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Civil Appeal No.94 of 1949.
107 834 Appeal from a judgment and decree of the High Court of Judi cature at Patna in Appeal from Appellate Decree No. 97 of 1946 (Mannohar Lall and Mukherji JJ.) dated 23rd Decem ber, 1947, confirming the judgment of the District Judge of Purulia in Appeal No. 159 of 1944.
S.P. Sinha (P. K. Bose, with him) for the appel lant.
N.C. Chatterjee and Panchanan Ghosh (Chandra Narayan Naik, with them) for the respondent. 1950.
December 1.
The Judgment of the Court was deliv ered by PATANJALI SASTRI J.
This appeal arises out of a suit brought by the respondent in the court of the Subordinate Judge, Dhanbad, for recovery of arrears of royalty and cess from the appellant and another alleged to be due under a compromise decree passed on the 6th March, 1923, in a previ ous suit between the predecessors in interest of the par ties.
The only plea which is material for the purpose of this appeal is that the compromise decree not having been registered was inadmissible in evidence.
The courts below held that the document did not require registration and gave effect to its terms in decreeing the suit.
The second defendant has preferred this appeal.
The facts are not now in dispute and may be briefly stated.
On 11th March, 1921, one Kumar Krishna Prasad Singh (hereinafter referred to as Kumar) granted a perma nent lease of the right to the underground coal in 5,800 bighas of land belonging to him to Shibsaran Singh and Sitaram Singh (hereinafter referred to as the Singhs) by a registered patta stipulating for a salami of Rs. 8,000 and royalty at the rate of 2a.
per ton of coal raised subject to a minimum of Rs. 8,000 and for certain other cesses and interest.
On 7th June, 1921, Kumar executed another perma nent patta leasing the right to the coal in 500 bighas out of the 5,800 bighas referred to above to one Prayngji Bal lavji Deoshi and his son Harakchand Deoshi (hereinafter referred to as the Deoshis).
By this document.
835 the Deoshis agreed inter alia to pay royalty at the rate of 2a. per ton on all classes of coal raised subject to a minimum of Rs. 750 a year.
The Singhs feeling themselves aggrieved by the latter transaction brought a title suit (No. 1291 of 1921) in the Court of the Subordinate Judge of Dhanbad for a declaration of their title and for possession of the 500 bighas leased to the Deoshis under the aforesaid patta of 7th June, 1921.
To that suit Kumar was made a party as defendant No. 3, the Deoshis being defendants 1 and 2.
The suit was however cornpromised on 6th March, 1923, by all the parties and a decree based on the compromise was also passed on the same day.
The interest of the Singhs was brought to sale in 193S in execution of a decree obtained against them and was purchased by the plaintiff who insti tuted the presnt suit on 3rd October, 1942, claiming the royalty and cesses payable under the compromise decree for the period from Pous 1345 to Asadh 1349 B.S. from defendants 1 and 2 as the representatives of the Deoshis who entered into the compromise of March, 1923.
In order to appreciate the contentions of the parties, it is necessary to set out the relevant terms of the compro mise decree which are as follows : "The plaintiffs (the Singhs) within two months from this date shall pay Rs. 8,000 as salami to defendant No. 3 (Kumar).
Otherwise all the terms of the compromise Will stand cancelled and the plaintiffs shall not be competent to claim any right to or possession over the.land covered by the patta dated 11th March, 1921.
The patta which defend ant No. 3 executed in favour of the plaintiffs in respect of 5,800 bighas of coal land in village Rahraband shall remain in force, and the plaintiffs will get a decree of declara tion of their right and title to the 500 bighas of coal land in dispute but defendants 1 and 2 (the Deoshis) shall hold possession as tenants.
Besides the terms mentioned below, defendants 1 and 2 shall remain bound by all the remaining terms under which they took settlement of the 500 bighas of coal land from defendant No. 3 under 836 patta and Kabuliyat, and both the defendants 1 and 2 shall possess the same under the plaintiffs from generation to generation and all the terms of the said patta and Kabuliyat shall remain effective and in force between them.
Both the defendants 1 and 2 shall remain bound to pay to the plain tiffs commission at the rate of 2a.
per ton on all sorts of coal instead of 2a.
a ton as stated before in the patta of 5,800 bighas of land settled with the plaintiffs.
The plaintiffs shall pay to defendant No. 3 in future the mini mum royalty of Rs. 6,000 instead of Rs. 8,000 as stipulated in the original patta of 11 th March 1921 and commission at the rate of la.
a ton in place of 2a.
a ton as stipulat ed in the patta of March 21 .
Unless the plaintiffs pay to the defendant No. 3 Rs. 8,000 within 2 months from this day they shall not be competent to take out execution of this decree, nor shall they be competent to take posses sion of the land in dispute.
The defendants 1 and 2 within one month from the date of payment of Rs. 8,000 as aforesaid to defendant No. 3 shall execute a new Kabuliyat in favour of the plaintiff in respect of the modified terms stated above, i.e., on the condition to pay commission at the rate of 2a.
per ton.
In the new patta which defendant No. 3 will execute in favour of the plaintiffs he shall embody the condition that the annual minimum royalty will be Rs. 6,000 instead of Rs. 8,000 and commission will be at the rate of la. 9p.
per ton in place of 2a.
per ton as mentioned in the aforesaid patta.
If the defendant No. 3 does not execute the parts on the aforesaid modified terms in favour 'of the plaintiffs within the time aforesaid and both the defendants 1 and 2 also do not execute a kabuliyat on the aforesaid modified terms, then this very rafanama shall be treated as the parts and kabuliyat, and the plaintiffs in accordance with the terms of the rafanama shall pay to defendant No. 3, Rs. 6,000 only as minimum royalty and commission at the rate of la.
per ton with respect to 5,800 bighas and shall continue to realise commission at the rate of 2a. 6p. per ton from defendants 1 and 2 who shall remain bound to pay the same.
" 837 The answer to the question whether this compromise decree requires registration depends on the legal effect of the changes in the status quo ante of the parties brought about by the document.
A careful analysis reveals the following alterations : (1) In the lease to the Singhs, the rate of royalty or commission was reduced from 2a.
per ton of coal raised to la.
per ton and the minimum royalty was reduced from Rs. 8,000 to Rs. 6,000 while the area of coal land in their khas possession was reduced by 500 bighas. (2) In the lease to the Deoshis the rate of royalty or commission was enhanced from 2a.
per ton to 2a.
per ton and tiffs was made payable to the Singhs.
The Singhs and the Deoshis were brought into a new legal relationship, the former accepting the latter as tenants holding the disputed 500 bighas under them in consideration of the latter agreeing to pay the enhanced royalty to the former. (4) The whole arrangement was made conditional on the Singhs paying Rs. 8,000 to Kumar within 2 months from the date of the compromise, it being expressly provided that the Singhs were not to be entitled to execute the decree or to take possession of the disputed area of 503 bighas which evidently had not till then passed into their possession.
Now, sub section (1) of section 17 of the , enumerates five categories of documents of which regis tration is made compulsory which include" (d) leases of immoveable property from year to year, or for any term exceeding one year, or reserving a yearly rent;".
Sub sec tion (2) however provided that "nothing in clauses (b) and (c) of sub section (1)applies to . (vi) any decree or order of court.
" It may be mentioned in passing that this clause was amended with affect from the 1st April, 1930, by the , so as to exclude from the scope of the exception compromise decrees comprising immovable property other than that which is the subject matter of the suit.
But 838 the amendment cannot affect the document here in question which came into existence in 1923.
Before the amendment, the clause was held to cover even compromise decrees comprising immovable property which was not the subject matter of the suit: [Vide Hemanta Kumari Debi vs Midnapur Zamindari Co. ( ')].
That decision applies to the present case and obviates the objection that because the compromise in question covered also the remaining 5,300 bighas which were not the subject matter of the title suit of 1921, it was outside the scope of the exception in sub section (2), clause (vi).
The only question, therefore, is whether the compromise decree is a "lease" [which expression includes "an agreement to lease" by the definition in section 2 (7)] within the meaning of el.
(d) of sub section (1).
It is obvious that if the compromise decree fails within clause (d) of sub section (1) it would not be protected under clause (vi) of sub section (2) which excepts only documents falling under the categories (b) and (c) of sub section (1).
The High Court was of opinion that, on a proper construction of the terms of the compromise, it did not fall under clause (d).
Mano har Lall J., who delivered the leading judgment, observed: "It was a tripartite agreement embodied in the decree of the court and was, therefore, exempt from registration.
It will be oh.served also that so far as the defendants were con cerned, their possession of the 500 bighas was not inter fered with and they still remained in possession as the lessees, but instead of paying the royalty to the plaintiffs it was agreed between all the parties that the defendants would pay the royalty in future to Shibsaran and Sitcram.
If the matter had stood there, the learned Advocate for the appellant could not have seriously contested the position, but he vehemently argued that when the agreement was not to pay the same amount of royalty or commission as previously agreed to but an altered amount of royalty and commission, the document should be held to fall within the mischief of section 17 (1)(d)of the (1) P.C. 839 .
The answer to this contention is, as I have stated just now, to be found in the Full Bench decision of this court :" [see Charu Chandra Mitra 's case ()].
It was there held that a mere alteration of the rent reserved does not make the transaction a new lease so as to bring it within clause (d)of subsection (1).
We are unable to share this view.
It oversimplifies the compromise transaction which, in our opinion, involves much more than a mere alteration of the royalties stipulated for in the previous pattas executed by Kumar.
Nor can we accept the suggestion of Mr. Chatterjee for the respondents theft the compromise operated as an assignment to the Singhs by Kumar of the latter 's reversion under the "lease granted to the Deoshis and all that the latter did was to acknowledge the Singhs as their landlords and attern to them.
On tiffs view it was said that the transaction would not fall under clause (d), although it would fall under clause (b) but then would be saved by the exception in clause (vi) of sub section (2).
The argument, however, overlooks that Kumar had leased the area of 5,800 bighas to the Singhs by his patta dated 11th March, 1921, and the compromise by providing that the Singhs should pay the reduced royalty of 1a.
per ton in respect of the whole area preserved Kumar 's reversion intact.
He could not therefore be deemed to have assigned any part of his inter est in 5,800 bighas as landlord to the Singhs who continue to hold the entire extent as tenants under him.
What the compromise really did was.
as stated already, to bring the Singhs and the Deoshis into a new legal relationship as underlessor and under lessee in respect of 500 bighas which were the subject matter of the title suit; in other words, its legal effect was to create a perpetual underlease be tween the Singhs and the Deoshis which would clearly fall under clause (d) but for the circumstance that it was to take effect only on condition float the Singhs paid Rs. 8,000 to Kumar within 2 months (1) 840 thereafter.
As pointed out by the Judicial Committee in Hemanta Kumar 's case (1) "An agreement for a lease, which a lease is by the statute declared to include, must, in their Lordships ' opinion, be a document which effects an actual demise and operates as a lease .
The phrase which in the context where it occurs and in the statute in which it is found, must in their opinion relate to some document which creates a present and immediate interest in the land.
" The compromise decree expressly provides that unless the sum of Rs. 8,000 was paid within the stipulated time the Singhs were not to execute the decree or to take possession of the disputed property.
Until the payment was made it was impossible to determine whether there would be any under lease or not.
Such a contingent agreement is not within clause (d) and although it is covered by clause (b). is excepted by clause (vi) of sub section ( '2).
We therefore agree with the conclusion of the High Court though on dif ferent grounds and dismiss the appeal with costs.
Appeal dismisseel.
|
An agreement for a lease, which a lease is by the Indian declared to include, must be a document which effects an actual demise and operates as a lease.
It must create present and immediate interest in land.
Where a litigation between two persons A and B who claimed to be tenants under C was settled by a compromise decree the effect of which was to create a perpetual underlease between A and B which was to take effect only on condition that A paid Rs. 8,000 to C within a fixed period: Held, that such a contingent agreement was not "a lease" within el.
(a) of section 17 (t) of the Indian , and even though it was covered by cl.
(b) of the said sec tion it was exempt from registration under el.
(vi) of subs.
(2) of section 17.
Hemanta Kumari Debi vs Midnapur Zamindari Co. (I P.C.) relied on.
|
Civil Appeal No.94 of 1949.
107 834 Appeal from a judgment and decree of the High Court of Judi cature at Patna in Appeal from Appellate Decree No. 97 of 1946 (Mannohar Lall and Mukherji JJ.) dated 23rd Decem ber, 1947, confirming the judgment of the District Judge of Purulia in Appeal No. 159 of 1944.
S.P. Sinha (P. K. Bose, with him) for the appel lant.
N.C. Chatterjee and Panchanan Ghosh (Chandra Narayan Naik, with them) for the respondent. 1950.
December 1.
The Judgment of the Court was deliv ered by PATANJALI SASTRI J.
This appeal arises out of a suit brought by the respondent in the court of the Subordinate Judge, Dhanbad, for recovery of arrears of royalty and cess from the appellant and another alleged to be due under a compromise decree passed on the 6th March, 1923, in a previ ous suit between the predecessors in interest of the par ties.
The only plea which is material for the purpose of this appeal is that the compromise decree not having been registered was inadmissible in evidence.
The courts below held that the document did not require registration and gave effect to its terms in decreeing the suit.
The second defendant has preferred this appeal.
The facts are not now in dispute and may be briefly stated.
On 11th March, 1921, one Kumar Krishna Prasad Singh (hereinafter referred to as Kumar) granted a perma nent lease of the right to the underground coal in 5,800 bighas of land belonging to him to Shibsaran Singh and Sitaram Singh (hereinafter referred to as the Singhs) by a registered patta stipulating for a salami of Rs. 8,000 and royalty at the rate of 2a.
per ton of coal raised subject to a minimum of Rs. 8,000 and for certain other cesses and interest.
On 7th June, 1921, Kumar executed another perma nent patta leasing the right to the coal in 500 bighas out of the 5,800 bighas referred to above to one Prayngji Bal lavji Deoshi and his son Harakchand Deoshi (hereinafter referred to as the Deoshis).
By this document.
835 the Deoshis agreed inter alia to pay royalty at the rate of 2a. per ton on all classes of coal raised subject to a minimum of Rs. 750 a year.
The Singhs feeling themselves aggrieved by the latter transaction brought a title suit (No. 1291 of 1921) in the Court of the Subordinate Judge of Dhanbad for a declaration of their title and for possession of the 500 bighas leased to the Deoshis under the aforesaid patta of 7th June, 1921.
To that suit Kumar was made a party as defendant No. 3, the Deoshis being defendants 1 and 2.
The suit was however cornpromised on 6th March, 1923, by all the parties and a decree based on the compromise was also passed on the same day.
The interest of the Singhs was brought to sale in 193S in execution of a decree obtained against them and was purchased by the plaintiff who insti tuted the presnt suit on 3rd October, 1942, claiming the royalty and cesses payable under the compromise decree for the period from Pous 1345 to Asadh 1349 B.S. from defendants 1 and 2 as the representatives of the Deoshis who entered into the compromise of March, 1923.
In order to appreciate the contentions of the parties, it is necessary to set out the relevant terms of the compro mise decree which are as follows : "The plaintiffs (the Singhs) within two months from this date shall pay Rs. 8,000 as salami to defendant No. 3 (Kumar).
Otherwise all the terms of the compromise Will stand cancelled and the plaintiffs shall not be competent to claim any right to or possession over the.land covered by the patta dated 11th March, 1921.
The patta which defend ant No. 3 executed in favour of the plaintiffs in respect of 5,800 bighas of coal land in village Rahraband shall remain in force, and the plaintiffs will get a decree of declara tion of their right and title to the 500 bighas of coal land in dispute but defendants 1 and 2 (the Deoshis) shall hold possession as tenants.
Besides the terms mentioned below, defendants 1 and 2 shall remain bound by all the remaining terms under which they took settlement of the 500 bighas of coal land from defendant No. 3 under 836 patta and Kabuliyat, and both the defendants 1 and 2 shall possess the same under the plaintiffs from generation to generation and all the terms of the said patta and Kabuliyat shall remain effective and in force between them.
Both the defendants 1 and 2 shall remain bound to pay to the plain tiffs commission at the rate of 2a.
per ton on all sorts of coal instead of 2a.
a ton as stated before in the patta of 5,800 bighas of land settled with the plaintiffs.
The plaintiffs shall pay to defendant No. 3 in future the mini mum royalty of Rs. 6,000 instead of Rs. 8,000 as stipulated in the original patta of 11 th March 1921 and commission at the rate of la.
a ton in place of 2a.
a ton as stipulat ed in the patta of March 21 .
Unless the plaintiffs pay to the defendant No. 3 Rs. 8,000 within 2 months from this day they shall not be competent to take out execution of this decree, nor shall they be competent to take posses sion of the land in dispute.
The defendants 1 and 2 within one month from the date of payment of Rs. 8,000 as aforesaid to defendant No. 3 shall execute a new Kabuliyat in favour of the plaintiff in respect of the modified terms stated above, i.e., on the condition to pay commission at the rate of 2a.
per ton.
In the new patta which defendant No. 3 will execute in favour of the plaintiffs he shall embody the condition that the annual minimum royalty will be Rs. 6,000 instead of Rs. 8,000 and commission will be at the rate of la. 9p.
per ton in place of 2a.
per ton as mentioned in the aforesaid patta.
If the defendant No. 3 does not execute the parts on the aforesaid modified terms in favour 'of the plaintiffs within the time aforesaid and both the defendants 1 and 2 also do not execute a kabuliyat on the aforesaid modified terms, then this very rafanama shall be treated as the parts and kabuliyat, and the plaintiffs in accordance with the terms of the rafanama shall pay to defendant No. 3, Rs. 6,000 only as minimum royalty and commission at the rate of la.
per ton with respect to 5,800 bighas and shall continue to realise commission at the rate of 2a. 6p. per ton from defendants 1 and 2 who shall remain bound to pay the same.
" 837 The answer to the question whether this compromise decree requires registration depends on the legal effect of the changes in the status quo ante of the parties brought about by the document.
A careful analysis reveals the following alterations : (1) In the lease to the Singhs, the rate of royalty or commission was reduced from 2a.
per ton of coal raised to la.
per ton and the minimum royalty was reduced from Rs. 8,000 to Rs. 6,000 while the area of coal land in their khas possession was reduced by 500 bighas. (2) In the lease to the Deoshis the rate of royalty or commission was enhanced from 2a.
per ton to 2a.
per ton and tiffs was made payable to the Singhs.
The Singhs and the Deoshis were brought into a new legal relationship, the former accepting the latter as tenants holding the disputed 500 bighas under them in consideration of the latter agreeing to pay the enhanced royalty to the former. (4) The whole arrangement was made conditional on the Singhs paying Rs. 8,000 to Kumar within 2 months from the date of the compromise, it being expressly provided that the Singhs were not to be entitled to execute the decree or to take possession of the disputed area of 503 bighas which evidently had not till then passed into their possession.
Now, sub section (1) of section 17 of the , enumerates five categories of documents of which regis tration is made compulsory which include" (d) leases of immoveable property from year to year, or for any term exceeding one year, or reserving a yearly rent;".
Sub sec tion (2) however provided that "nothing in clauses (b) and (c) of sub section (1)applies to . (vi) any decree or order of court.
" It may be mentioned in passing that this clause was amended with affect from the 1st April, 1930, by the , so as to exclude from the scope of the exception compromise decrees comprising immovable property other than that which is the subject matter of the suit.
But 838 the amendment cannot affect the document here in question which came into existence in 1923.
Before the amendment, the clause was held to cover even compromise decrees comprising immovable property which was not the subject matter of the suit: [Vide Hemanta Kumari Debi vs Midnapur Zamindari Co. ( ')].
That decision applies to the present case and obviates the objection that because the compromise in question covered also the remaining 5,300 bighas which were not the subject matter of the title suit of 1921, it was outside the scope of the exception in sub section (2), clause (vi).
The only question, therefore, is whether the compromise decree is a "lease" [which expression includes "an agreement to lease" by the definition in section 2 (7)] within the meaning of el.
(d) of sub section (1).
It is obvious that if the compromise decree fails within clause (d) of sub section (1) it would not be protected under clause (vi) of sub section (2) which excepts only documents falling under the categories (b) and (c) of sub section (1).
The High Court was of opinion that, on a proper construction of the terms of the compromise, it did not fall under clause (d).
Mano har Lall J., who delivered the leading judgment, observed: "It was a tripartite agreement embodied in the decree of the court and was, therefore, exempt from registration.
It will be oh.served also that so far as the defendants were con cerned, their possession of the 500 bighas was not inter fered with and they still remained in possession as the lessees, but instead of paying the royalty to the plaintiffs it was agreed between all the parties that the defendants would pay the royalty in future to Shibsaran and Sitcram.
If the matter had stood there, the learned Advocate for the appellant could not have seriously contested the position, but he vehemently argued that when the agreement was not to pay the same amount of royalty or commission as previously agreed to but an altered amount of royalty and commission, the document should be held to fall within the mischief of section 17 (1)(d)of the (1) P.C. 839 .
The answer to this contention is, as I have stated just now, to be found in the Full Bench decision of this court :" [see Charu Chandra Mitra 's case ()].
It was there held that a mere alteration of the rent reserved does not make the transaction a new lease so as to bring it within clause (d)of subsection (1).
We are unable to share this view.
It oversimplifies the compromise transaction which, in our opinion, involves much more than a mere alteration of the royalties stipulated for in the previous pattas executed by Kumar.
Nor can we accept the suggestion of Mr. Chatterjee for the respondents theft the compromise operated as an assignment to the Singhs by Kumar of the latter 's reversion under the "lease granted to the Deoshis and all that the latter did was to acknowledge the Singhs as their landlords and attern to them.
On tiffs view it was said that the transaction would not fall under clause (d), although it would fall under clause (b) but then would be saved by the exception in clause (vi) of sub section (2).
The argument, however, overlooks that Kumar had leased the area of 5,800 bighas to the Singhs by his patta dated 11th March, 1921, and the compromise by providing that the Singhs should pay the reduced royalty of 1a.
per ton in respect of the whole area preserved Kumar 's reversion intact.
He could not therefore be deemed to have assigned any part of his inter est in 5,800 bighas as landlord to the Singhs who continue to hold the entire extent as tenants under him.
What the compromise really did was.
as stated already, to bring the Singhs and the Deoshis into a new legal relationship as underlessor and under lessee in respect of 500 bighas which were the subject matter of the title suit; in other words, its legal effect was to create a perpetual underlease be tween the Singhs and the Deoshis which would clearly fall under clause (d) but for the circumstance that it was to take effect only on condition float the Singhs paid Rs. 8,000 to Kumar within 2 months (1) 840 thereafter.
As pointed out by the Judicial Committee in Hemanta Kumar 's case (1) "An agreement for a lease, which a lease is by the statute declared to include, must, in their Lordships ' opinion, be a document which effects an actual demise and operates as a lease .
The phrase which in the context where it occurs and in the statute in which it is found, must in their opinion relate to some document which creates a present and immediate interest in the land.
" The compromise decree expressly provides that unless the sum of Rs. 8,000 was paid within the stipulated time the Singhs were not to execute the decree or to take possession of the disputed property.
Until the payment was made it was impossible to determine whether there would be any under lease or not.
Such a contingent agreement is not within clause (d) and although it is covered by clause (b). is excepted by clause (vi) of sub section ( '2).
We therefore agree with the conclusion of the High Court though on dif ferent grounds and dismiss the appeal with costs.
Appeal dismisseel.
|
Civil Appeal No.94 of 1949.
107 834 Appeal from a judgment and decree of the High Court of Judi cature at Patna in Appeal from Appellate Decree No. 97 of 1946 (Mannohar Lall and Mukherji JJ.) dated 23rd Decem ber, 1947, confirming the judgment of the District Judge of Purulia in Appeal No. 159 of 1944.
S.P. Sinha (P. K. Bose, with him) for the appel lant.
N.C. Chatterjee and Panchanan Ghosh (Chandra Narayan Naik, with them) for the respondent. 1950.
December 1.
The Judgment of the Court was deliv ered by PATANJALI SASTRI J.
This appeal arises out of a suit brought by the respondent in the court of the Subordinate Judge, Dhanbad, for recovery of arrears of royalty and cess from the appellant and another alleged to be due under a compromise decree passed on the 6th March, 1923, in a previ ous suit between the predecessors in interest of the par ties.
The only plea which is material for the purpose of this appeal is that the compromise decree not having been registered was inadmissible in evidence.
The courts below held that the document did not require registration and gave effect to its terms in decreeing the suit.
The second defendant has preferred this appeal.
The facts are not now in dispute and may be briefly stated.
On 11th March, 1921, one Kumar Krishna Prasad Singh (hereinafter referred to as Kumar) granted a perma nent lease of the right to the underground coal in 5,800 bighas of land belonging to him to Shibsaran Singh and Sitaram Singh (hereinafter referred to as the Singhs) by a registered patta stipulating for a salami of Rs. 8,000 and royalty at the rate of 2a.
per ton of coal raised subject to a minimum of Rs. 8,000 and for certain other cesses and interest.
On 7th June, 1921, Kumar executed another perma nent patta leasing the right to the coal in 500 bighas out of the 5,800 bighas referred to above to one Prayngji Bal lavji Deoshi and his son Harakchand Deoshi (hereinafter referred to as the Deoshis).
By this document.
835 the Deoshis agreed inter alia to pay royalty at the rate of 2a. per ton on all classes of coal raised subject to a minimum of Rs. 750 a year.
The Singhs feeling themselves aggrieved by the latter transaction brought a title suit (No. 1291 of 1921) in the Court of the Subordinate Judge of Dhanbad for a declaration of their title and for possession of the 500 bighas leased to the Deoshis under the aforesaid patta of 7th June, 1921.
To that suit Kumar was made a party as defendant No. 3, the Deoshis being defendants 1 and 2.
The suit was however cornpromised on 6th March, 1923, by all the parties and a decree based on the compromise was also passed on the same day.
The interest of the Singhs was brought to sale in 193S in execution of a decree obtained against them and was purchased by the plaintiff who insti tuted the presnt suit on 3rd October, 1942, claiming the royalty and cesses payable under the compromise decree for the period from Pous 1345 to Asadh 1349 B.S. from defendants 1 and 2 as the representatives of the Deoshis who entered into the compromise of March, 1923.
In order to appreciate the contentions of the parties, it is necessary to set out the relevant terms of the compro mise decree which are as follows : "The plaintiffs (the Singhs) within two months from this date shall pay Rs. 8,000 as salami to defendant No. 3 (Kumar).
Otherwise all the terms of the compromise Will stand cancelled and the plaintiffs shall not be competent to claim any right to or possession over the.land covered by the patta dated 11th March, 1921.
The patta which defend ant No. 3 executed in favour of the plaintiffs in respect of 5,800 bighas of coal land in village Rahraband shall remain in force, and the plaintiffs will get a decree of declara tion of their right and title to the 500 bighas of coal land in dispute but defendants 1 and 2 (the Deoshis) shall hold possession as tenants.
Besides the terms mentioned below, defendants 1 and 2 shall remain bound by all the remaining terms under which they took settlement of the 500 bighas of coal land from defendant No. 3 under 836 patta and Kabuliyat, and both the defendants 1 and 2 shall possess the same under the plaintiffs from generation to generation and all the terms of the said patta and Kabuliyat shall remain effective and in force between them.
Both the defendants 1 and 2 shall remain bound to pay to the plain tiffs commission at the rate of 2a.
per ton on all sorts of coal instead of 2a.
a ton as stated before in the patta of 5,800 bighas of land settled with the plaintiffs.
The plaintiffs shall pay to defendant No. 3 in future the mini mum royalty of Rs. 6,000 instead of Rs. 8,000 as stipulated in the original patta of 11 th March 1921 and commission at the rate of la.
a ton in place of 2a.
a ton as stipulat ed in the patta of March 21 .
Unless the plaintiffs pay to the defendant No. 3 Rs. 8,000 within 2 months from this day they shall not be competent to take out execution of this decree, nor shall they be competent to take posses sion of the land in dispute.
The defendants 1 and 2 within one month from the date of payment of Rs. 8,000 as aforesaid to defendant No. 3 shall execute a new Kabuliyat in favour of the plaintiff in respect of the modified terms stated above, i.e., on the condition to pay commission at the rate of 2a.
per ton.
In the new patta which defendant No. 3 will execute in favour of the plaintiffs he shall embody the condition that the annual minimum royalty will be Rs. 6,000 instead of Rs. 8,000 and commission will be at the rate of la. 9p.
per ton in place of 2a.
per ton as mentioned in the aforesaid patta.
If the defendant No. 3 does not execute the parts on the aforesaid modified terms in favour 'of the plaintiffs within the time aforesaid and both the defendants 1 and 2 also do not execute a kabuliyat on the aforesaid modified terms, then this very rafanama shall be treated as the parts and kabuliyat, and the plaintiffs in accordance with the terms of the rafanama shall pay to defendant No. 3, Rs. 6,000 only as minimum royalty and commission at the rate of la.
per ton with respect to 5,800 bighas and shall continue to realise commission at the rate of 2a. 6p. per ton from defendants 1 and 2 who shall remain bound to pay the same.
" 837 The answer to the question whether this compromise decree requires registration depends on the legal effect of the changes in the status quo ante of the parties brought about by the document.
A careful analysis reveals the following alterations : (1) In the lease to the Singhs, the rate of royalty or commission was reduced from 2a.
per ton of coal raised to la.
per ton and the minimum royalty was reduced from Rs. 8,000 to Rs. 6,000 while the area of coal land in their khas possession was reduced by 500 bighas. (2) In the lease to the Deoshis the rate of royalty or commission was enhanced from 2a.
per ton to 2a.
per ton and tiffs was made payable to the Singhs.
The Singhs and the Deoshis were brought into a new legal relationship, the former accepting the latter as tenants holding the disputed 500 bighas under them in consideration of the latter agreeing to pay the enhanced royalty to the former. (4) The whole arrangement was made conditional on the Singhs paying Rs. 8,000 to Kumar within 2 months from the date of the compromise, it being expressly provided that the Singhs were not to be entitled to execute the decree or to take possession of the disputed area of 503 bighas which evidently had not till then passed into their possession.
Now, sub section (1) of section 17 of the , enumerates five categories of documents of which regis tration is made compulsory which include" (d) leases of immoveable property from year to year, or for any term exceeding one year, or reserving a yearly rent;".
Sub sec tion (2) however provided that "nothing in clauses (b) and (c) of sub section (1)applies to . (vi) any decree or order of court.
" It may be mentioned in passing that this clause was amended with affect from the 1st April, 1930, by the , so as to exclude from the scope of the exception compromise decrees comprising immovable property other than that which is the subject matter of the suit.
But 838 the amendment cannot affect the document here in question which came into existence in 1923.
Before the amendment, the clause was held to cover even compromise decrees comprising immovable property which was not the subject matter of the suit: [Vide Hemanta Kumari Debi vs Midnapur Zamindari Co. ( ')].
That decision applies to the present case and obviates the objection that because the compromise in question covered also the remaining 5,300 bighas which were not the subject matter of the title suit of 1921, it was outside the scope of the exception in sub section (2), clause (vi).
The only question, therefore, is whether the compromise decree is a "lease" [which expression includes "an agreement to lease" by the definition in section 2 (7)] within the meaning of el.
(d) of sub section (1).
It is obvious that if the compromise decree fails within clause (d) of sub section (1) it would not be protected under clause (vi) of sub section (2) which excepts only documents falling under the categories (b) and (c) of sub section (1).
The High Court was of opinion that, on a proper construction of the terms of the compromise, it did not fall under clause (d).
Mano har Lall J., who delivered the leading judgment, observed: "It was a tripartite agreement embodied in the decree of the court and was, therefore, exempt from registration.
It will be oh.served also that so far as the defendants were con cerned, their possession of the 500 bighas was not inter fered with and they still remained in possession as the lessees, but instead of paying the royalty to the plaintiffs it was agreed between all the parties that the defendants would pay the royalty in future to Shibsaran and Sitcram.
If the matter had stood there, the learned Advocate for the appellant could not have seriously contested the position, but he vehemently argued that when the agreement was not to pay the same amount of royalty or commission as previously agreed to but an altered amount of royalty and commission, the document should be held to fall within the mischief of section 17 (1)(d)of the (1) P.C. 839 .
The answer to this contention is, as I have stated just now, to be found in the Full Bench decision of this court :" [see Charu Chandra Mitra 's case ()].
It was there held that a mere alteration of the rent reserved does not make the transaction a new lease so as to bring it within clause (d)of subsection (1).
We are unable to share this view.
It oversimplifies the compromise transaction which, in our opinion, involves much more than a mere alteration of the royalties stipulated for in the previous pattas executed by Kumar.
Nor can we accept the suggestion of Mr. Chatterjee for the respondents theft the compromise operated as an assignment to the Singhs by Kumar of the latter 's reversion under the "lease granted to the Deoshis and all that the latter did was to acknowledge the Singhs as their landlords and attern to them.
On tiffs view it was said that the transaction would not fall under clause (d), although it would fall under clause (b) but then would be saved by the exception in clause (vi) of sub section (2).
The argument, however, overlooks that Kumar had leased the area of 5,800 bighas to the Singhs by his patta dated 11th March, 1921, and the compromise by providing that the Singhs should pay the reduced royalty of 1a.
per ton in respect of the whole area preserved Kumar 's reversion intact.
He could not therefore be deemed to have assigned any part of his inter est in 5,800 bighas as landlord to the Singhs who continue to hold the entire extent as tenants under him.
What the compromise really did was.
as stated already, to bring the Singhs and the Deoshis into a new legal relationship as underlessor and under lessee in respect of 500 bighas which were the subject matter of the title suit; in other words, its legal effect was to create a perpetual underlease be tween the Singhs and the Deoshis which would clearly fall under clause (d) but for the circumstance that it was to take effect only on condition float the Singhs paid Rs. 8,000 to Kumar within 2 months (1) 840 thereafter.
As pointed out by the Judicial Committee in Hemanta Kumar 's case (1) "An agreement for a lease, which a lease is by the statute declared to include, must, in their Lordships ' opinion, be a document which effects an actual demise and operates as a lease .
The phrase which in the context where it occurs and in the statute in which it is found, must in their opinion relate to some document which creates a present and immediate interest in the land.
" The compromise decree expressly provides that unless the sum of Rs. 8,000 was paid within the stipulated time the Singhs were not to execute the decree or to take possession of the disputed property.
Until the payment was made it was impossible to determine whether there would be any under lease or not.
Such a contingent agreement is not within clause (d) and although it is covered by clause (b). is excepted by clause (vi) of sub section ( '2).
We therefore agree with the conclusion of the High Court though on dif ferent grounds and dismiss the appeal with costs.
Appeal dismisseel.
|
An agreement for a lease, which a lease is by the Indian declared to include, must be a document which effects an actual demise and operates as a lease.
It must create present and immediate interest in land.
Where a litigation between two persons A and B who claimed to be tenants under C was settled by a compromise decree the effect of which was to create a perpetual underlease between A and B which was to take effect only on condition that A paid Rs. 8,000 to C within a fixed period: Held, that such a contingent agreement was not "a lease" within el.
(a) of section 17 (t) of the Indian , and even though it was covered by cl.
(b) of the said sec tion it was exempt from registration under el.
(vi) of subs.
(2) of section 17.
Hemanta Kumari Debi vs Midnapur Zamindari Co. (I P.C.) relied on.
|
An agreement for a lease, which a lease is by the Indian declared to include, must be a document which effects an actual demise and operates as a lease.
It must create present and immediate interest in land.
Where a litigation between two persons A and B who claimed to be tenants under C was settled by a compromise decree the effect of which was to create a perpetual underlease between A and B which was to take effect only on condition that A paid Rs. 8,000 to C within a fixed period: Held, that such a contingent agreement was not "a lease" within el.
(a) of section 17 (t) of the Indian , and even though it was covered by cl.
(b) of the said sec tion it was exempt from registration under el.
(vi) of subs.
(2) of section 17.
Hemanta Kumari Debi vs Midnapur Zamindari Co. (I P.C.) relied on.
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Special Leave Petition (Civil) No. 4221 of 1988.
From the Judgment and Order dated 3.12.1987 of the Delhi High Court in FAO (OS) No. 120 of 1987.
Mukul Rohtagi and Miss Bina Gupta for the petitioner.
Soli J. Sorabji, D.K. Sorab, P. Jain, Sushil Kr.
Jain and Sudhanshu Atreya for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an application for leave to appeal under Article 136 of the Constitution from the order of the Division Bench of the Delhi High Court affirming the order of the learned single Judge of that High Court.
It appears that on 19th March, 1983, there was an agreement for distribution of the film "Savere Wali Gadi" entered into between the parties, the petitioner as the distributor and the respondent as the producer.
The agreement contained an arbitration clause.
It is stated that a sum of Rs.3 lakhs was paid by the petitioner and acknowledged by the respondent earlier to the execution of the said agreement and therefore, the first instalment payable under the agreement to the respondent of Rs.3.40 lakhs was deemed to be adjusted.
Under the aforesaid distribution agreement by 30th August, 1983, the respondent was to hand over the prints of the film by this date which he never did.
In or about 1984 certain other moneys of about Rs.3 lakhs were further advanced to the respondent.
On 11th March, 1985 a further agreement was entered into between the parties whereby the respondent agreed to pay a total amount of Rs.6.50 lakhs to the petitioner and the petitioner to give up his distribution rights in the first agreement of 19th March, 1983.
The first agreement was accordingly irrevocably cancelled and superseded by this subsequent agreement.
On or about 2nd June, 1985 respondent wrote to the Motion Pictures Association, Delhi to de register the film in the name of the petitioner in view of the petitioner having given up the distribution rights by virtue of Annexure P/2 dated 11.3.85 where under the petitioner had agreed to receive Rs.6.50 lakhs and finished the deal within six months of 11.3.85.
It is the case of the petitioner.
530 however, that the sum of Rs.6.50 lakhs was never paid by the respondent to the petitioner.
On 3rd July, 1985 the Motion Picture Association wrote to the respondent acknowledging receipt of respondent 's letter dated 22nd June 1985 whereby he had asked for de registration of the film in view of Annexure P/2.
The Motion Picture Association stated that de registration would be allowed only when the respondent pays Rs.6.50 lakhs to the petitioner or deposits the amount with the Motion Picture Association.
It is stated that between July 1985 and September 1985, the petitioner wrote two letters to the Motion Picture Association stating that the respondent had committed a breach of the subsequent agreement dated 11th March, 1985 executed between the parties whereunder the respondent was to make payment of Rs.6.50 lakhs and it was clear that the respondent had no desire to make payment and the respondent wrongly wanted to deal with the film and sell the distribution rights to somebody else thereby enjoying benefit of the same and also to deprive the petitioner of the amount of Rs.6.50 lakhs.
Civil suit was filed in February, 1986 for recovery of Rs.6.50 lakhs with interest by the petitioner against the respondent.
The written statement was submitted.
An application was made under section 20 in June, 1986.
This application had been made later than the institution of the civil suit in the same High Court.
The learned single Judge directed that the arbitration agreement to be filed and reference was directed according to the agreement.
There was an order passed by the learned single Judge to that effect.
There was an appeal to the Division Bench of the High Court and the Division Bench confirmed the order of the learned single Judge.
Hence this petition.
It appears that there were two agreements one dated 11th March, 1985 and the other dated 19th March, 1983.
The learned Judge found that there could be little doubt that the intention of the parties when agreement dated 11th March, 1985 was entered into was that the earlier contract dated 19th March, 1983 should be superseded.
But it appears that the agreement fell through because when the agreement of 1985 was entered into, it was the intention of the parties to the earlier agreement would be superseded and a new arrangement was sought to be brought about whereby the rights of the petitioner herein under agreement dated 19th March, 1983 were to be yielded for a sum of Rs.6.50 lakhs.
This amount of Rs.6.50 lakhs was never paid by the respondent.
It was the case of the petitioner herein that thereby the agreement of 11th March, 1985 stood cancelled.
The petitioner who claimed rights under the earlier agreement dated 19th March, 1983 and sought the continuation of his registration of distributorship.
The learned single Judge found that it was at the instance of petitioner 531 herein that respondent No. 2 confirmed vide its letter dated 19th September, 1985 that as the petitioner, before the learned single Judge, had failed to pay Rs.6,50,000 the aforesaid picture stood registered in the name of the petitioner herein.
This registration could continue only by virtue of the earlier agreement dated March 19, 1983.
The learned single Judge further found that the agreement dated 11th March, 1985 had come to an end and the earlier agreement dated 19th March, 1983 had revived.
In this connection reference may be made to the observations of the Patna High Court in Babulal Marwari and others vs Tulsi Singh and others, A.I.R. 1940 Patna 121.
Whether in any particular case there was a complete novation of a contract in the sense that the new contract replaced or substituted the old contract, could depend upon the facts and circumstances of the case.
In that view of the matter, the single Judge of the High Court, in our opinion, rightly directed that the first agreement be filed.
The Division Bench of the High Court pointed out after referring to the letter dated 19/21st September, 1985 the Motion Pictures Association confirmed that in view of the failure of the producer to comply with his earlier letter regarding payment of Rs. 6.50 lakhs plus interest, the picture in question stood registered in the name of M/s. Raja Movies in the Motion Pictures Association.
This position was accepted by Suyog Films in the letter dated 5th November, 1985 and the subsequent letter by them.
The non performance of the terms of the contract dated 11th March, 1985 may not by itself revive the earlier contract of 19th March, 1983, but the petitioner in his letters dated 15th July, 1985 and 19th September, 1985 fell back on the original contract of 19th March, 1983.
This was accepted by M/s. Suyog Films and thus a binding contract came into existence.
In this case the Division Bench came to the conclusion on the construction of the letters and the conduct of the party that the contract dated 19th March, 1983 continued.
The contract dated 19th March, 1983 contained an arbitration clause.
There is no reason why that arbitration agreement should not be filed.
A civil suit had been filed but that by itself unlike under section 34 of the does not preclude filing of proper arbitration agreement between the parties.
There being no impediment in filing the arbitration agreement which indubitably was subsisting at the relevant time when the High Court directed that the arbitration agreement be filed, that discretion should not be interfered with.
Section 20 of the provides as follows: "20.
Application to file in Court arbitration agreement 532 (1) Where any persons have entered into an arbitration agreement before the institution of any suit with respect to the subject matter of the agreement or any part of it, and where a difference has arisen to which the agreement applies, they or any of them, instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement he filed in Court.
(2) The application shall be in writing and shall be numbered and registered as a suit between one or more of the parties interested or claiming to be interested as plaintiff or plaintiffs and the remainder is defendant or defendants, if the application has been presented by all the parties, or if otherwise, between the applicant as plaintiff and the other parties as defendants.
(3) on such application being made, the Court shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed.
(4) Where no sufficient cause is shown, the Court shall order the agreement to be filed, and shall make an order of reference to the arbitrator appointed by the parties, whether in the agreement or otherwise, or, where the parties cannot agree upon an arbitrator, to an arbitrator appointed by the Court.
(5) Thereafter the arbitration shall proceed in accordance with, and shall be governed by, the other provisions of this Act so far as they can be made applicable.
" It is significant to note that the sub section (1) gives an option to the parties by the use of expression 'may ' but the other sub section if the conditions are fulfilled, makes it obligatory for the Court to direct filing of an arbitration agreement.
Indubitably, in this case there was an arbitration clause in the agreement.
The parties have applied for reference.
The Division Bench has reiterated that the original agreement dated 19th March, 1983 which ceased to have effect and came to an end by the agreement dated 11th March, 1985, stood revived by virtue of the two letters dated 15th July, 1985 and 11th September, 533 1985 by the appellant.
The High Court has confirmed that the said two letters were acted upon by the Motion Pictures Association.
By letter dated 19/21 September, 1985 the Motion Pictures Association confirmed that in view of the failure of the producer to comply with his earlier letter regarding payment of Rs.6,50,000 plus interest, the picture "Savere Wali Gadi" stood registered in the name of M/s. Raja Movies in the Motion Pictures Association.
This position was accepted by Suyog Films in letter dated 5th November, 1985 and the subsequent letter by them.
It is clear that the petitioner in his letters dated 15th July, 1985 and 11th September, 1985 fell back on the original contract of 19th March, 1983.
This was accepted by the respondent.
Hence, there was at all relevant times a valid and binding contract between the parties.
That contract contained an arbitration clause.
There was nothing, in view of the reasons indicated above, to disentitle the parties to have their rights adjudicated in terms of an arbitration clause.
In the premises the High Court was right in the view it took.
This petition fails and is accordingly dismissed.
G.N. Petition dismissed.
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An agreement for distribution of the film "Savere Wali Gadi" was entered into on 19th March, 1983 between the petitioner as the distributor and the respondent as the producer.
The agreement contained an arbitration clause.
A sum of Rs.3.40 lakhs paid to the respondent and acknowledged by him earlier to the agreement was deemed to have been adjusted against the first instalment.
In or about 1984 about Rs. 3 lakhs were further advanced to the respondent.
As per the agreement the respondent was to hand over the prints of the film by 10th August, 1983, but it was not done.
On 11th March, 1985 a further agreement was entered into between the parties whereby the respondent agreed to pay a total sum of Rs.6.50 lakhs to the petitioner for giving up his distribution rights in the first agreement.
The first agreement was accordingly irrevocably cancelled and superseded by the subsequent agreement.
The respondent took up the matter with Motion Pictures Association to de register the film in the name of the petitioner.
The Motion Picture Association stated that de registration would be allowed only when the respondent pays Rs.6.50 lakhs to the petitioner or deposits the amount with the Association.
The petitioner 's claim before the Association was that the respondent committed breach of the subsequent agreement.
A civil suit was filed in the High Court for recovery of Rs.6.50 lakhs with interest, by the petitioner against the respondent.
Later, an application under section 20 of the was made.
The Single Judge held that the first agreement had revived and directed the 528 filing of the agreement.
On appeal, the Division Bench confirmed the order.
This special leave petition is against the order of the Division Bench of the High Court.
Dismissing the special leave petition, this Court, ^ HELD: 1.1 Whether in any particular case there was a complete novation of a contract in the sense that the new contract replaced or substituted the old contract, could depend upon the facts and circumstances of the case.
[531B C] 1.2 When the agreement of 1985 was entered into, it was the intention of the parties that the earlier agreement would be superseded and a new arrangement was sought to be brought about whereby the rights of the petitioner under the earlier agreement were to be yielded for a sum of Rs.6.50 lakhs.
This amount of Rs.6.50 lakhs was never paid by the respondent, and it was the case of the petitioner that the earlier agreement stood cancelled.
The petitioner who claimed rights under the earlier agreement, sought the continuation of his registration of distributorship.
This registration could continue only by virtue of the earlier agreement which had revived.
[530G HG; 531B] Babulal Marwari and others vs Tulsi Singh and others, A.I.R. 1940 Patna 121, refered to.
2.1 Sub section (1) of Section 20 of the gives an option to the parties by the use of the expression 'may ', but the other sub sections, if the conditions are fulfilled, make it obligatory for the Court to direct filing of an arbitration agreement.
[532G] 2.2 Indubitably, there was an arbitration clause in the agreement.
The parties have applied for reference.
The Division Bench has reiterated that the original agreement dated 19th March, 1983 which ceased to have effect and came to an end by the agreement dated 11th March, 1985 stood revived by virtue of the two letters dated 15th July, 1985 and 11th September, 1985 by the appellant.
It is clear that the petitioner in the above letters fell back on the original contract of 19th March, 1983.
This was accepted by the respondent.
Hence there was at all relevant times a valid and binding contract between the parties.
That contract contained an arbitration clause.
There was nothing to disentitle the parties to have their rights adjudicated in terms of an arbitration clause.
The civil suit filed does not by itself preclude filing of proper arbitration agreement between the parties.
There being no impediment 529 in filing the arbitration agreement which was subsisting at the relevant time when the High Court directed that the arbitration agreement be filed, that discretion should not be interfered with.
[532G H; 531F G]
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Special Leave Petition (Civil) No. 4221 of 1988.
From the Judgment and Order dated 3.12.1987 of the Delhi High Court in FAO (OS) No. 120 of 1987.
Mukul Rohtagi and Miss Bina Gupta for the petitioner.
Soli J. Sorabji, D.K. Sorab, P. Jain, Sushil Kr.
Jain and Sudhanshu Atreya for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an application for leave to appeal under Article 136 of the Constitution from the order of the Division Bench of the Delhi High Court affirming the order of the learned single Judge of that High Court.
It appears that on 19th March, 1983, there was an agreement for distribution of the film "Savere Wali Gadi" entered into between the parties, the petitioner as the distributor and the respondent as the producer.
The agreement contained an arbitration clause.
It is stated that a sum of Rs.3 lakhs was paid by the petitioner and acknowledged by the respondent earlier to the execution of the said agreement and therefore, the first instalment payable under the agreement to the respondent of Rs.3.40 lakhs was deemed to be adjusted.
Under the aforesaid distribution agreement by 30th August, 1983, the respondent was to hand over the prints of the film by this date which he never did.
In or about 1984 certain other moneys of about Rs.3 lakhs were further advanced to the respondent.
On 11th March, 1985 a further agreement was entered into between the parties whereby the respondent agreed to pay a total amount of Rs.6.50 lakhs to the petitioner and the petitioner to give up his distribution rights in the first agreement of 19th March, 1983.
The first agreement was accordingly irrevocably cancelled and superseded by this subsequent agreement.
On or about 2nd June, 1985 respondent wrote to the Motion Pictures Association, Delhi to de register the film in the name of the petitioner in view of the petitioner having given up the distribution rights by virtue of Annexure P/2 dated 11.3.85 where under the petitioner had agreed to receive Rs.6.50 lakhs and finished the deal within six months of 11.3.85.
It is the case of the petitioner.
530 however, that the sum of Rs.6.50 lakhs was never paid by the respondent to the petitioner.
On 3rd July, 1985 the Motion Picture Association wrote to the respondent acknowledging receipt of respondent 's letter dated 22nd June 1985 whereby he had asked for de registration of the film in view of Annexure P/2.
The Motion Picture Association stated that de registration would be allowed only when the respondent pays Rs.6.50 lakhs to the petitioner or deposits the amount with the Motion Picture Association.
It is stated that between July 1985 and September 1985, the petitioner wrote two letters to the Motion Picture Association stating that the respondent had committed a breach of the subsequent agreement dated 11th March, 1985 executed between the parties whereunder the respondent was to make payment of Rs.6.50 lakhs and it was clear that the respondent had no desire to make payment and the respondent wrongly wanted to deal with the film and sell the distribution rights to somebody else thereby enjoying benefit of the same and also to deprive the petitioner of the amount of Rs.6.50 lakhs.
Civil suit was filed in February, 1986 for recovery of Rs.6.50 lakhs with interest by the petitioner against the respondent.
The written statement was submitted.
An application was made under section 20 in June, 1986.
This application had been made later than the institution of the civil suit in the same High Court.
The learned single Judge directed that the arbitration agreement to be filed and reference was directed according to the agreement.
There was an order passed by the learned single Judge to that effect.
There was an appeal to the Division Bench of the High Court and the Division Bench confirmed the order of the learned single Judge.
Hence this petition.
It appears that there were two agreements one dated 11th March, 1985 and the other dated 19th March, 1983.
The learned Judge found that there could be little doubt that the intention of the parties when agreement dated 11th March, 1985 was entered into was that the earlier contract dated 19th March, 1983 should be superseded.
But it appears that the agreement fell through because when the agreement of 1985 was entered into, it was the intention of the parties to the earlier agreement would be superseded and a new arrangement was sought to be brought about whereby the rights of the petitioner herein under agreement dated 19th March, 1983 were to be yielded for a sum of Rs.6.50 lakhs.
This amount of Rs.6.50 lakhs was never paid by the respondent.
It was the case of the petitioner herein that thereby the agreement of 11th March, 1985 stood cancelled.
The petitioner who claimed rights under the earlier agreement dated 19th March, 1983 and sought the continuation of his registration of distributorship.
The learned single Judge found that it was at the instance of petitioner 531 herein that respondent No. 2 confirmed vide its letter dated 19th September, 1985 that as the petitioner, before the learned single Judge, had failed to pay Rs.6,50,000 the aforesaid picture stood registered in the name of the petitioner herein.
This registration could continue only by virtue of the earlier agreement dated March 19, 1983.
The learned single Judge further found that the agreement dated 11th March, 1985 had come to an end and the earlier agreement dated 19th March, 1983 had revived.
In this connection reference may be made to the observations of the Patna High Court in Babulal Marwari and others vs Tulsi Singh and others, A.I.R. 1940 Patna 121.
Whether in any particular case there was a complete novation of a contract in the sense that the new contract replaced or substituted the old contract, could depend upon the facts and circumstances of the case.
In that view of the matter, the single Judge of the High Court, in our opinion, rightly directed that the first agreement be filed.
The Division Bench of the High Court pointed out after referring to the letter dated 19/21st September, 1985 the Motion Pictures Association confirmed that in view of the failure of the producer to comply with his earlier letter regarding payment of Rs. 6.50 lakhs plus interest, the picture in question stood registered in the name of M/s. Raja Movies in the Motion Pictures Association.
This position was accepted by Suyog Films in the letter dated 5th November, 1985 and the subsequent letter by them.
The non performance of the terms of the contract dated 11th March, 1985 may not by itself revive the earlier contract of 19th March, 1983, but the petitioner in his letters dated 15th July, 1985 and 19th September, 1985 fell back on the original contract of 19th March, 1983.
This was accepted by M/s. Suyog Films and thus a binding contract came into existence.
In this case the Division Bench came to the conclusion on the construction of the letters and the conduct of the party that the contract dated 19th March, 1983 continued.
The contract dated 19th March, 1983 contained an arbitration clause.
There is no reason why that arbitration agreement should not be filed.
A civil suit had been filed but that by itself unlike under section 34 of the does not preclude filing of proper arbitration agreement between the parties.
There being no impediment in filing the arbitration agreement which indubitably was subsisting at the relevant time when the High Court directed that the arbitration agreement be filed, that discretion should not be interfered with.
Section 20 of the provides as follows: "20.
Application to file in Court arbitration agreement 532 (1) Where any persons have entered into an arbitration agreement before the institution of any suit with respect to the subject matter of the agreement or any part of it, and where a difference has arisen to which the agreement applies, they or any of them, instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement he filed in Court.
(2) The application shall be in writing and shall be numbered and registered as a suit between one or more of the parties interested or claiming to be interested as plaintiff or plaintiffs and the remainder is defendant or defendants, if the application has been presented by all the parties, or if otherwise, between the applicant as plaintiff and the other parties as defendants.
(3) on such application being made, the Court shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed.
(4) Where no sufficient cause is shown, the Court shall order the agreement to be filed, and shall make an order of reference to the arbitrator appointed by the parties, whether in the agreement or otherwise, or, where the parties cannot agree upon an arbitrator, to an arbitrator appointed by the Court.
(5) Thereafter the arbitration shall proceed in accordance with, and shall be governed by, the other provisions of this Act so far as they can be made applicable.
" It is significant to note that the sub section (1) gives an option to the parties by the use of expression 'may ' but the other sub section if the conditions are fulfilled, makes it obligatory for the Court to direct filing of an arbitration agreement.
Indubitably, in this case there was an arbitration clause in the agreement.
The parties have applied for reference.
The Division Bench has reiterated that the original agreement dated 19th March, 1983 which ceased to have effect and came to an end by the agreement dated 11th March, 1985, stood revived by virtue of the two letters dated 15th July, 1985 and 11th September, 533 1985 by the appellant.
The High Court has confirmed that the said two letters were acted upon by the Motion Pictures Association.
By letter dated 19/21 September, 1985 the Motion Pictures Association confirmed that in view of the failure of the producer to comply with his earlier letter regarding payment of Rs.6,50,000 plus interest, the picture "Savere Wali Gadi" stood registered in the name of M/s. Raja Movies in the Motion Pictures Association.
This position was accepted by Suyog Films in letter dated 5th November, 1985 and the subsequent letter by them.
It is clear that the petitioner in his letters dated 15th July, 1985 and 11th September, 1985 fell back on the original contract of 19th March, 1983.
This was accepted by the respondent.
Hence, there was at all relevant times a valid and binding contract between the parties.
That contract contained an arbitration clause.
There was nothing, in view of the reasons indicated above, to disentitle the parties to have their rights adjudicated in terms of an arbitration clause.
In the premises the High Court was right in the view it took.
This petition fails and is accordingly dismissed.
G.N. Petition dismissed.
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Special Leave Petition (Civil) No. 4221 of 1988.
From the Judgment and Order dated 3.12.1987 of the Delhi High Court in FAO (OS) No. 120 of 1987.
Mukul Rohtagi and Miss Bina Gupta for the petitioner.
Soli J. Sorabji, D.K. Sorab, P. Jain, Sushil Kr.
Jain and Sudhanshu Atreya for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an application for leave to appeal under Article 136 of the Constitution from the order of the Division Bench of the Delhi High Court affirming the order of the learned single Judge of that High Court.
It appears that on 19th March, 1983, there was an agreement for distribution of the film "Savere Wali Gadi" entered into between the parties, the petitioner as the distributor and the respondent as the producer.
The agreement contained an arbitration clause.
It is stated that a sum of Rs.3 lakhs was paid by the petitioner and acknowledged by the respondent earlier to the execution of the said agreement and therefore, the first instalment payable under the agreement to the respondent of Rs.3.40 lakhs was deemed to be adjusted.
Under the aforesaid distribution agreement by 30th August, 1983, the respondent was to hand over the prints of the film by this date which he never did.
In or about 1984 certain other moneys of about Rs.3 lakhs were further advanced to the respondent.
On 11th March, 1985 a further agreement was entered into between the parties whereby the respondent agreed to pay a total amount of Rs.6.50 lakhs to the petitioner and the petitioner to give up his distribution rights in the first agreement of 19th March, 1983.
The first agreement was accordingly irrevocably cancelled and superseded by this subsequent agreement.
On or about 2nd June, 1985 respondent wrote to the Motion Pictures Association, Delhi to de register the film in the name of the petitioner in view of the petitioner having given up the distribution rights by virtue of Annexure P/2 dated 11.3.85 where under the petitioner had agreed to receive Rs.6.50 lakhs and finished the deal within six months of 11.3.85.
It is the case of the petitioner.
530 however, that the sum of Rs.6.50 lakhs was never paid by the respondent to the petitioner.
On 3rd July, 1985 the Motion Picture Association wrote to the respondent acknowledging receipt of respondent 's letter dated 22nd June 1985 whereby he had asked for de registration of the film in view of Annexure P/2.
The Motion Picture Association stated that de registration would be allowed only when the respondent pays Rs.6.50 lakhs to the petitioner or deposits the amount with the Motion Picture Association.
It is stated that between July 1985 and September 1985, the petitioner wrote two letters to the Motion Picture Association stating that the respondent had committed a breach of the subsequent agreement dated 11th March, 1985 executed between the parties whereunder the respondent was to make payment of Rs.6.50 lakhs and it was clear that the respondent had no desire to make payment and the respondent wrongly wanted to deal with the film and sell the distribution rights to somebody else thereby enjoying benefit of the same and also to deprive the petitioner of the amount of Rs.6.50 lakhs.
Civil suit was filed in February, 1986 for recovery of Rs.6.50 lakhs with interest by the petitioner against the respondent.
The written statement was submitted.
An application was made under section 20 in June, 1986.
This application had been made later than the institution of the civil suit in the same High Court.
The learned single Judge directed that the arbitration agreement to be filed and reference was directed according to the agreement.
There was an order passed by the learned single Judge to that effect.
There was an appeal to the Division Bench of the High Court and the Division Bench confirmed the order of the learned single Judge.
Hence this petition.
It appears that there were two agreements one dated 11th March, 1985 and the other dated 19th March, 1983.
The learned Judge found that there could be little doubt that the intention of the parties when agreement dated 11th March, 1985 was entered into was that the earlier contract dated 19th March, 1983 should be superseded.
But it appears that the agreement fell through because when the agreement of 1985 was entered into, it was the intention of the parties to the earlier agreement would be superseded and a new arrangement was sought to be brought about whereby the rights of the petitioner herein under agreement dated 19th March, 1983 were to be yielded for a sum of Rs.6.50 lakhs.
This amount of Rs.6.50 lakhs was never paid by the respondent.
It was the case of the petitioner herein that thereby the agreement of 11th March, 1985 stood cancelled.
The petitioner who claimed rights under the earlier agreement dated 19th March, 1983 and sought the continuation of his registration of distributorship.
The learned single Judge found that it was at the instance of petitioner 531 herein that respondent No. 2 confirmed vide its letter dated 19th September, 1985 that as the petitioner, before the learned single Judge, had failed to pay Rs.6,50,000 the aforesaid picture stood registered in the name of the petitioner herein.
This registration could continue only by virtue of the earlier agreement dated March 19, 1983.
The learned single Judge further found that the agreement dated 11th March, 1985 had come to an end and the earlier agreement dated 19th March, 1983 had revived.
In this connection reference may be made to the observations of the Patna High Court in Babulal Marwari and others vs Tulsi Singh and others, A.I.R. 1940 Patna 121.
Whether in any particular case there was a complete novation of a contract in the sense that the new contract replaced or substituted the old contract, could depend upon the facts and circumstances of the case.
In that view of the matter, the single Judge of the High Court, in our opinion, rightly directed that the first agreement be filed.
The Division Bench of the High Court pointed out after referring to the letter dated 19/21st September, 1985 the Motion Pictures Association confirmed that in view of the failure of the producer to comply with his earlier letter regarding payment of Rs. 6.50 lakhs plus interest, the picture in question stood registered in the name of M/s. Raja Movies in the Motion Pictures Association.
This position was accepted by Suyog Films in the letter dated 5th November, 1985 and the subsequent letter by them.
The non performance of the terms of the contract dated 11th March, 1985 may not by itself revive the earlier contract of 19th March, 1983, but the petitioner in his letters dated 15th July, 1985 and 19th September, 1985 fell back on the original contract of 19th March, 1983.
This was accepted by M/s. Suyog Films and thus a binding contract came into existence.
In this case the Division Bench came to the conclusion on the construction of the letters and the conduct of the party that the contract dated 19th March, 1983 continued.
The contract dated 19th March, 1983 contained an arbitration clause.
There is no reason why that arbitration agreement should not be filed.
A civil suit had been filed but that by itself unlike under section 34 of the does not preclude filing of proper arbitration agreement between the parties.
There being no impediment in filing the arbitration agreement which indubitably was subsisting at the relevant time when the High Court directed that the arbitration agreement be filed, that discretion should not be interfered with.
Section 20 of the provides as follows: "20.
Application to file in Court arbitration agreement 532 (1) Where any persons have entered into an arbitration agreement before the institution of any suit with respect to the subject matter of the agreement or any part of it, and where a difference has arisen to which the agreement applies, they or any of them, instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement he filed in Court.
(2) The application shall be in writing and shall be numbered and registered as a suit between one or more of the parties interested or claiming to be interested as plaintiff or plaintiffs and the remainder is defendant or defendants, if the application has been presented by all the parties, or if otherwise, between the applicant as plaintiff and the other parties as defendants.
(3) on such application being made, the Court shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed.
(4) Where no sufficient cause is shown, the Court shall order the agreement to be filed, and shall make an order of reference to the arbitrator appointed by the parties, whether in the agreement or otherwise, or, where the parties cannot agree upon an arbitrator, to an arbitrator appointed by the Court.
(5) Thereafter the arbitration shall proceed in accordance with, and shall be governed by, the other provisions of this Act so far as they can be made applicable.
" It is significant to note that the sub section (1) gives an option to the parties by the use of expression 'may ' but the other sub section if the conditions are fulfilled, makes it obligatory for the Court to direct filing of an arbitration agreement.
Indubitably, in this case there was an arbitration clause in the agreement.
The parties have applied for reference.
The Division Bench has reiterated that the original agreement dated 19th March, 1983 which ceased to have effect and came to an end by the agreement dated 11th March, 1985, stood revived by virtue of the two letters dated 15th July, 1985 and 11th September, 533 1985 by the appellant.
The High Court has confirmed that the said two letters were acted upon by the Motion Pictures Association.
By letter dated 19/21 September, 1985 the Motion Pictures Association confirmed that in view of the failure of the producer to comply with his earlier letter regarding payment of Rs.6,50,000 plus interest, the picture "Savere Wali Gadi" stood registered in the name of M/s. Raja Movies in the Motion Pictures Association.
This position was accepted by Suyog Films in letter dated 5th November, 1985 and the subsequent letter by them.
It is clear that the petitioner in his letters dated 15th July, 1985 and 11th September, 1985 fell back on the original contract of 19th March, 1983.
This was accepted by the respondent.
Hence, there was at all relevant times a valid and binding contract between the parties.
That contract contained an arbitration clause.
There was nothing, in view of the reasons indicated above, to disentitle the parties to have their rights adjudicated in terms of an arbitration clause.
In the premises the High Court was right in the view it took.
This petition fails and is accordingly dismissed.
G.N. Petition dismissed.
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An agreement for distribution of the film "Savere Wali Gadi" was entered into on 19th March, 1983 between the petitioner as the distributor and the respondent as the producer.
The agreement contained an arbitration clause.
A sum of Rs.3.40 lakhs paid to the respondent and acknowledged by him earlier to the agreement was deemed to have been adjusted against the first instalment.
In or about 1984 about Rs. 3 lakhs were further advanced to the respondent.
As per the agreement the respondent was to hand over the prints of the film by 10th August, 1983, but it was not done.
On 11th March, 1985 a further agreement was entered into between the parties whereby the respondent agreed to pay a total sum of Rs.6.50 lakhs to the petitioner for giving up his distribution rights in the first agreement.
The first agreement was accordingly irrevocably cancelled and superseded by the subsequent agreement.
The respondent took up the matter with Motion Pictures Association to de register the film in the name of the petitioner.
The Motion Picture Association stated that de registration would be allowed only when the respondent pays Rs.6.50 lakhs to the petitioner or deposits the amount with the Association.
The petitioner 's claim before the Association was that the respondent committed breach of the subsequent agreement.
A civil suit was filed in the High Court for recovery of Rs.6.50 lakhs with interest, by the petitioner against the respondent.
Later, an application under section 20 of the was made.
The Single Judge held that the first agreement had revived and directed the 528 filing of the agreement.
On appeal, the Division Bench confirmed the order.
This special leave petition is against the order of the Division Bench of the High Court.
Dismissing the special leave petition, this Court, ^ HELD: 1.1 Whether in any particular case there was a complete novation of a contract in the sense that the new contract replaced or substituted the old contract, could depend upon the facts and circumstances of the case.
[531B C] 1.2 When the agreement of 1985 was entered into, it was the intention of the parties that the earlier agreement would be superseded and a new arrangement was sought to be brought about whereby the rights of the petitioner under the earlier agreement were to be yielded for a sum of Rs.6.50 lakhs.
This amount of Rs.6.50 lakhs was never paid by the respondent, and it was the case of the petitioner that the earlier agreement stood cancelled.
The petitioner who claimed rights under the earlier agreement, sought the continuation of his registration of distributorship.
This registration could continue only by virtue of the earlier agreement which had revived.
[530G HG; 531B] Babulal Marwari and others vs Tulsi Singh and others, A.I.R. 1940 Patna 121, refered to.
2.1 Sub section (1) of Section 20 of the gives an option to the parties by the use of the expression 'may ', but the other sub sections, if the conditions are fulfilled, make it obligatory for the Court to direct filing of an arbitration agreement.
[532G] 2.2 Indubitably, there was an arbitration clause in the agreement.
The parties have applied for reference.
The Division Bench has reiterated that the original agreement dated 19th March, 1983 which ceased to have effect and came to an end by the agreement dated 11th March, 1985 stood revived by virtue of the two letters dated 15th July, 1985 and 11th September, 1985 by the appellant.
It is clear that the petitioner in the above letters fell back on the original contract of 19th March, 1983.
This was accepted by the respondent.
Hence there was at all relevant times a valid and binding contract between the parties.
That contract contained an arbitration clause.
There was nothing to disentitle the parties to have their rights adjudicated in terms of an arbitration clause.
The civil suit filed does not by itself preclude filing of proper arbitration agreement between the parties.
There being no impediment 529 in filing the arbitration agreement which was subsisting at the relevant time when the High Court directed that the arbitration agreement be filed, that discretion should not be interfered with.
[532G H; 531F G]
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An agreement for distribution of the film "Savere Wali Gadi" was entered into on 19th March, 1983 between the petitioner as the distributor and the respondent as the producer.
The agreement contained an arbitration clause.
A sum of Rs.3.40 lakhs paid to the respondent and acknowledged by him earlier to the agreement was deemed to have been adjusted against the first instalment.
In or about 1984 about Rs. 3 lakhs were further advanced to the respondent.
As per the agreement the respondent was to hand over the prints of the film by 10th August, 1983, but it was not done.
On 11th March, 1985 a further agreement was entered into between the parties whereby the respondent agreed to pay a total sum of Rs.6.50 lakhs to the petitioner for giving up his distribution rights in the first agreement.
The first agreement was accordingly irrevocably cancelled and superseded by the subsequent agreement.
The respondent took up the matter with Motion Pictures Association to de register the film in the name of the petitioner.
The Motion Picture Association stated that de registration would be allowed only when the respondent pays Rs.6.50 lakhs to the petitioner or deposits the amount with the Association.
The petitioner 's claim before the Association was that the respondent committed breach of the subsequent agreement.
A civil suit was filed in the High Court for recovery of Rs.6.50 lakhs with interest, by the petitioner against the respondent.
Later, an application under section 20 of the was made.
The Single Judge held that the first agreement had revived and directed the 528 filing of the agreement.
On appeal, the Division Bench confirmed the order.
This special leave petition is against the order of the Division Bench of the High Court.
Dismissing the special leave petition, this Court, ^ HELD: 1.1 Whether in any particular case there was a complete novation of a contract in the sense that the new contract replaced or substituted the old contract, could depend upon the facts and circumstances of the case.
[531B C] 1.2 When the agreement of 1985 was entered into, it was the intention of the parties that the earlier agreement would be superseded and a new arrangement was sought to be brought about whereby the rights of the petitioner under the earlier agreement were to be yielded for a sum of Rs.6.50 lakhs.
This amount of Rs.6.50 lakhs was never paid by the respondent, and it was the case of the petitioner that the earlier agreement stood cancelled.
The petitioner who claimed rights under the earlier agreement, sought the continuation of his registration of distributorship.
This registration could continue only by virtue of the earlier agreement which had revived.
[530G HG; 531B] Babulal Marwari and others vs Tulsi Singh and others, A.I.R. 1940 Patna 121, refered to.
2.1 Sub section (1) of Section 20 of the gives an option to the parties by the use of the expression 'may ', but the other sub sections, if the conditions are fulfilled, make it obligatory for the Court to direct filing of an arbitration agreement.
[532G] 2.2 Indubitably, there was an arbitration clause in the agreement.
The parties have applied for reference.
The Division Bench has reiterated that the original agreement dated 19th March, 1983 which ceased to have effect and came to an end by the agreement dated 11th March, 1985 stood revived by virtue of the two letters dated 15th July, 1985 and 11th September, 1985 by the appellant.
It is clear that the petitioner in the above letters fell back on the original contract of 19th March, 1983.
This was accepted by the respondent.
Hence there was at all relevant times a valid and binding contract between the parties.
That contract contained an arbitration clause.
There was nothing to disentitle the parties to have their rights adjudicated in terms of an arbitration clause.
The civil suit filed does not by itself preclude filing of proper arbitration agreement between the parties.
There being no impediment 529 in filing the arbitration agreement which was subsisting at the relevant time when the High Court directed that the arbitration agreement be filed, that discretion should not be interfered with.
[532G H; 531F G]
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he refund of cess paid by them.
[304D] & CIVIL ORIGINAL JURISDICTION: Writ Petitions Nos.
2687, 5822 of 1983 etc.
(Under Article 32 of the Constitution of India).
Dr. Shankar Ghosh, T.S.K. Iyer, M.L. Lahoty, P.S. Jha, D.D. Gupta, S.K. Jain, D.P. Mukherjee, S.R. Srivastava, P.N. Tewari and Parijat Sinha for the petitioners.
Tapas Ray, Anil B. Dewan, T.C. Roy, G.S. Chatterjee, Dalip Sinha and H.K. Puri for the respondents.
The judgment of the Court was delivered by PATHAK, CJ.
By these writ petitions and transferred cases the petitioners challenge the validity of the levy of cess in respect of tea estates under the West Bengal Rural Employment and Production Act, 1976.
The West Bengal Rural Employment and Production Act, 1976, (shortly referred to as the "West Bengal Act") is intended to provide the additional resources for the promo tion of employment in rural areas and for implementing rural production programmes.
The additional resources are sought to be raised from two sources, a surcharge on land revenue under section 3 of the Act and a rural employment cess under section 4 of the Act.
We are concerned here with the levy of the rural employment cess.
297 Originally section 4 of the West Bengal Act provided as follows: "4.(1) On and from the commencement of this Act, all immovable properties on which road and public work cesses are assessed according to the provisions of the Cess Act, 1880, shall be liable to the payment of rural employment cess: Provided that no raiyat who is exempted from paying revenue in respect of his holding under clause (a) of subsection (1) of section 23B of the West Bengal Land Reforms Act, 1955, shall be liable to pay rural em ployment cess.
(2) The rural employment cess shall be levied annually (a) in respect of lands, at the rate of six paise on each rupee of development value thereof; (b) in respect of coal mines, at the rate of fifty paise on each tonne of coal on the annual dispatches therefrom; (c) in respect of mines other than coal mines and quarries, at the rate of six paise on each rupee of annual net profits thereof.
" The West Bengal Taxation Laws (Amendment) Act, 1982 amended the West Bengal Act and by section 7(b) thereof amend ments were made in section 4(2) of the West Bengal Act with effect from 1 April, 1981.
As a result, as from that date, section 4(2) in so far as it is material read as follows: 4(2).
The rural employment cess shall be levied annually (a) in respect of lands, other than a tea estate, at the rate of six paise on each rupee of development value thereof; (aa) in respect of a tea estate at such rate, not exceeding rupees six on each kilogram of tea on the dispatches from such tea estate of tea grown therein, as the State Government may, by notification in the Offi cial Gazette, fix in this behalf: 298 Provided that in calculating the dispatches of tea for the purpose of levy of rural employment cess, such dispatches for sale made at such tea auction centres as may be recognised by the State Government by notification in the Official Gazette shall be excluded.
Provided further that the State Government may fix different rates on des patches of different classes of tea.
Explanation For the purpose of this section, "tea" means the plant Camellia Sinen sis (L) O. Kuntze as well as all varieties of the product known commercially as tea made from the leaves of the plant Camellia Sinensis (L) O. Kuntze, including green tea and green tea leaves, processed or unprocessed;" Section 4 was also amended further by the insertion of sub section
(4) which provided: "(4) The State Government may, if it considers necessary so to do, by notification in the Official Gazette, exempt such categories of despatches or such percentage of despatches from the liability to pay the whole or any part of the rural employment cess, or reduce the rate of the rural employment cess payable thereon, under clause (aa) of sub section (2), on such terms and conditions as may be speci fied in the notification.
Provided that the State Government may, at any time, add to, amend, vary of rescind any such notification.
" Thereafter the West Bengal Taxation Laws (Amendment) Act, 1982 was enacted with effect from 1 October, 1982.
section 4(2) of the West Bengal Act was amended and under clause (aa) thereof the first proviso was omitted.
Pursuant to the amendments in the West Bengal Act in 1981 and 1982, various notifications were issued by the State Government, which for our purpose broadly cover these different periods: (a) First Period: 1 April, 1981 to 30 Septem ber, 1982 299 Rural employment cess was levied at the rate of Rs.5 per Kg.
on all despatches of tea, but in respect of despatches to two tea auction centres within West Bengal the rate of duty was nil, and in respect of tea sold in West Bengal through registered dealers otherwise than through the two tea auction centres the rate of tax was Rs.2.50 per Kg.
(b) Second Period: 1 October, 1982 to 28 March, 1984 Rural employment cess was levied at the rate of Rs. 1.50 per Kg.
on all despatches of tea except that for despatches to the said two tea auction centres the rate of levy was 30 paise per Kg.
(c) Third Period: 29 March, 1984 onwards Rural employment cess was levied at the rate of Rs.3 per Kg.
on all despatches of tea except that for despatches to the said two tea auction centres in West Bengal the rate of tax was only 30 paise per Kg.
Learned counsel for the petitioners contend that the levy of the cess under section 4(1) read with section 4(2)(aa) of the West Bengal Act as amended in 1981 and 1982 is ultra vires inasmuch as the statutory provisions violate Article 14 and Article 301 of the Constitution and also lie outside the legislative competence of the State Government.
It seems to us that these cases can be disposed of on the short ground based on Article 301 of the Constitution and want of legis lative competence.
There can be no dispute that the rural employment cess is a tax.
cannot also be disputed that if the levy of a tax on goods has the direct and immediate effect of impeding the movement of goods throughout the territory of India, there is a violation of Article 301 of the Constitution.
If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301.
In Atiabari Tea Co., Ltd. vs The State of Assam and Others, ; , Gajendragadkar, J (as he then was) speaking for the majority in that case held that tax laws would effect trade and commerce and could be violative of the freedom guaranteed by Article 30 1, provided they di rectly or immediately affect the freedom of trade and com merce and not indirectly or in a remote manner.
This princi ple was affirmed by this Court in The Automobile Transport (Rajasthan) 300 Ltd. vs The State of Rajasthan and Others, [1963] 1 S.C.R. 491 and again in Firm A.T.B. Mehtab Majid and Company vs State of Madras and Another, [1963] Suppl.
2 S.C.R. 435.
But the declaration in Article 301 that trade, commerce and intercourse throughout the territory of India shall be free is subject to Article 304(b) which provides: "304.
Restrictions on trade, commerce and intercourse among States.
Notwithstanding anything in Article 301 or Article 303, the Legislature of a State may by law ( a ) .
. . (b) impose such reasonable restrictions on the freedom of trade, commerce or inter course with or within that State as may be required in the public interest.
Provided that no Bill or amendment for the purposes of clause (b) shall be intro duced or moved in the Legislature of a State without the previous sanction of the Presi dent.
" Therefore, there is no violation of Article 30 1 if the case falls under Article 304(b) and its proviso.
In Kalyani Stores vs The State of Orissa and Others, [1966] 1 S.C.R. 865 this Court held that a restriction on the freedom of trade and commerce which is guaranteed by Article 301 cannot be justified unless the procedure provided in Article 304 is followed.
That was also the view taken in State of Mysore vs H. Sanjeeviah; , and Andhra Sugars Ltd. & Anr.
vs State of Andhra Pradesh & Ors.
, [1968] 1 S.C.R. 705.
In other words, if the Legislature of a State enacts a law which imposes such reasonable restrictions on the free dom of trade, commerce or intercourse with or within that State as may be required in the public interest and further that the Bill or amendment for the purposes of clause (b) has been introduced or moved in the Legislature of a State with the previous sanction of the President, such enactment will not offend the Article 301.
The question then is whether the impugned levy impedes the free flow of trade and commerce throughout the territory of India, and if it does, whether it fails within the excep tion carved out in Article 304(b).
If the levy imposes a cess in respect of tea estates, it may well De said that even though the free flow of tea is impeded in its movement throughout the territory of India it is in consequence of an indirect or 301 remote effect of the levy and that it cannot be said that Article 301 is contravened.
The contention of the petition ers is, however, that it is ostensibly only in respect of tea estates but in fact it is a levy on despatches of tea.
If that contention is sound, there can be no doubt that it constitutes a violation of Article 301 unless the legisla tion is brought within the scope of Article 304(b).
To determine whether the levy is in respect of tea estates or is a levy on despatches of tea, the substance of the legis lation must be ascertained from the relevant provisions of the statute.
It cannot be disputed that the subject of the levy, the nature of which defines the quality of the levy, must not be confused with the measure of liability, that is to say, the quantum of the tax.
There is a plenitude of case law supporting that principle, among the cases being Union of India and Others vs Bombay Tyre International Ltd. and Others, ; But what is the position here? The statute speaks of a levy "in respect of a tea estate", and it says that the levy will not exceed Rs.6 on each Kilogram of tea on the des patches from such tea estate of tea grown therein.
The statute also provides that in calculating the despatches of tea for the purpose of levy of rural employment cess, the despatches for sale made at such tea auction centres as may be recognised by the State Government shall be excluded.
And there is a proviso which empowers the State Government to fix different rates on despatches of different classes of tea.
There is also section 4(4) which empowers the State Govern ment to exempt such categories of despatches or such per centage of despatches from the liability to pay the whole or any part of the rural employment cess, or to reduce the rate of the rural employment cess payable thereon under clause (aa) of sub section
(2) on such terms and conditions as it may specify by notification.
As from 1 October, 1982 the posi tion remained the same except that the first proviso to section 4(2)(aa) excluding the despatches for sale made at recog nised tea auction centres was deleted.
The remaining provi sions continued as before.
Now, for determining the true nature of the legislation, whether it is a legislation in respect of tea estates.
and therefore of land, or in respect of despatches of tea, we must, as we have said, take all the relevant provisions of the legislation into account and ascertain the essential substance of it.
It seems to us that although the impugned provisions speak of a levy of cess in respect of tea estates, what is really contemplated is a levy on despatches of tea instead.
The entire structure of the levy points to that conclusion.
If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea des patched from the tea estate there must be a nexus between the two indicating a 302 relationship between the levy on the tea estate and the criteria for determining the measure of liability.
If there is no nexus at all it can conceivably be inferred that the levy iS not what it purports to be.
The statutory provisions for measuring the liability on account of the levy throws light on the general character of the tax as observed by the Privy Council in Re: A Reference under the Government of Ireland Act, 1920 and Section 3 of the Finance Act (Northern Ireland), 1934, In R.R. Engineering Co. vs Zila Parishad, Bareilly & Anr., ; , this Court observed that the standard on which the tax is levied was a relevant consideration for determining the nature of the tax, although it could not be regarded as conclusive in the matter.
Again in The Hingir Rampur Coal Co. Ltd. and Others.
vs The State of Orissa and Others, ; , this Court observed that the method of determining the rate of levy would be relevant in consider ing the character of the levy.
All these cases were referred to in Bombay Tyre International Ltd. (supra) where in the discussion on the point at page 367 this Court said: "Any standard which maintains a nexus with the essential character of the levy can be regard ed as a valid basis for assessing the measure of the levy.
" It is apparent that the standards laid down for measur ing the liability under the levy must bear a relationship to the nature of the levy.
In the case before us, however, we find that the nexus with the tea estate is lost altogether in the provisions for exemption or reduction of the levy and that throughout the nexus is confined to despatches of tea rather than related to the tea estate.
There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates.
We may presume that a tea estate produces different classes of tea and not one class of tea only.
While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions.
Variations considered appropriate for the purpose of deter mining the measure must correspond to variations in the subject of the levy.
If the measure of levy is to vary with the despatches of different classes of tea there must be something in the class of tea concerned which points to a reason located in the particular tea estate or classes of tea estates which are made the subject of the levy.
So also if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate or classes of tea estates.
In other words, there must be a reason why one class of tea is treated 303 differently from another class of tea when deciding upon the rate to be applied to different classes of tea and that reason must be found in the nature of the tea estate con cerned.
Ultimately the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy.
When the provisions before us are examined in their totali ty, we find no such relationship or nexus between the tea estate and the varied treatment accorded in respect of despatches of different kinds of tea.
It seems to us that having regard to all the relevant provisions of the statute, including section 4(2)(aa) and section 4(4), in substance the impugned levy is a levy in respect of despatches of tea and not in respect of tea estates.
Treating it as a levy on despatches of tea it is evident that the levy must be regarded as constituting a direct and immediate restriction on the flow of trade and commerce in tea throughout the territory of India, and the levy can avoid the injunction declared in Article 301 only if it satisfies the provisions of Article 304(b) and the proviso thereto.
For bringing the legislation within the saving provisions of Article 304(b) it is necessary that the Bill or amendment should have been introduced or moved in the Legislature of the State with the previous sanction of the President.
It is not disputed that the amendments to the West Bengal Act made in 198 1 and 1982 did not satisfy that requirement.
Indeed, it appears that the West Bengal Govern ment had sent an earlier Bill to the President with the object of levying a tax on the income from tea but the Presidential assent was not granted.
It appears further that the Finance Minister of WeSt Bengal made a statement in the West Bengal Legislature on 27 February, 1981 stating that he would introduce the rural employment cess on despatches of tea.
He referred to a Bill for amending the West Bengal Marketing (Regulation) Act, 1972 having been sent to the President and the President not having signified his consent to the amendment.
In our opinion, the impugned provisions brought into the West Bengal Act by the amendments in 1981 and 1982 so far as they purport to relate to tea estates are unconstitutional and void and cannot be given effect to.
Another aspect of the matter may be considered, and that relates to legislative competence.
If the impugned legisla tion were to be regarded as a levy in respect of tea es tates, it would be referable to Entry 49 in List II of the Seventh Schedule of the Constitution which speaks of "taxes on lands and buildings".
But if the legislation is in sub stance legislation in respect of despatches of tea, legisla tive authority must be 304 found for it with reference to some other Entry.
We have not been shown any Entry in List II or in List III of the Sev enth Schedule which would be pertinent.
It may be noted that Parliament had made a declaration in section 2 of the that it was expedient in the public interest that the Union should take under its control the tea industry.
Under the , Parliament has assumed control of the tea industry including the tea trade and control of tea prices.
Under section 25 of the Act a cess on tea produced in India has also been imposed.
It appears to us that the impugned legis lation is also void for want of legislative competence as it pertains to a covered field.
We do not consider it necessary to express our opinion on the other points raised between the parties in this case.
In the result, the writ petitions filed in this Court and the petitions in the Transferred Cases are allowed, the impugned amendments effected in the West Bengal Rural Em ployment and Production Act, 1976 by the amending Acts of 1981 and 1982 so far as they purport to relate to tea es tates are declared void and the petitioners are held enti tled to the refund of cess paid by them under the impugned statutory provisions.
The petitioners are entitled to their costs.
P.S.S. Petitions allowed.
|
Section 4(1) of the West Bengal Rural Employment.
and Production Act, 1976 provided for levy of rural employment cess on immovable properties.
Clause (aa) of section 4(2) as amended by section 7(b) of the West Bengal Taxation Laws (Amend ment) Act, 1981 provided for levy of rural employment cess in respect of tea estates on the despatches of tea grown therein.
The first proviso thereto provided for exclusion of despatches of tea for sale made at recognised centres.
The second proviso thereto empowered the State Government 10 fix different rates of cess on despatches of different classes of tea.
Sub section (4) of the amended section 4 provided for exemption of certain categories of despatches from the liability to pay the whole or part of the cess or to reduce the rate of the cess payable thereon.
The first proviso to section 4(2)(aa) was.
however, omitted by the West Bengal Taxa tion Laws (Amendment) Act, 1982.
Article 304(b) of the Constitution permits the legislature of a State to impose reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State provided the Bill or amendment for that purpose is introduced with the previous sanction of the President.
It was contended for the petitioners that the levy of the cess under section 4(1) read with section 4(2)(aa) of the Act, as amended in 1981 and 1982.
was violative of the freedom guaranteed by Article 301 of the Constitu 294 tion and also lay outside the legislative competence of the State Government.
Allowing the writ petitions.
HELD: 1.1 If the levy of a tax on goods has direct and immediate effect of impeding the movement of goods through out the territory of India, there is a violation of Article 301 of the Constitution.
If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301.
There is also no violation of Article 301 if the case fails under Article 304(b) and its proviso.
[299F, 300D E] 1.2 Therefore, if the legislature of a State enacts a law which imposes such reasonable restrictions on the free dom of trade, commerce or intercourse with or within that State as may be required in the public interest and further that the Bill or amendment for the purposes of clause (b) has been introduced or moved in the Legislature of a State with the previous sanction of the President, such enactment will not offend Article 301.
The rural employment cess in the instant case was a tax.
[300F, 299F] Ariabari Tea Co., Ltd. vs The State of Assam & Ors. ; ; The Automobile Transport (Rajasthan) Ltd. vs The State of Rajasthan & Ors., [1963] 1 S.C.R. 491; Firm A.T.B. Mehtab Majid and Company vs State of Madras & Anr., [1963] Suppl.
2 S.C.R. 435; Kalyani Stores vs TIre State of Orissa & Ors., ; ; State of Mysore vs Ii.
Sanjeeviah, ; and Andhra Sugars Ltd. & Anr.
vs State of Andhra Pradesh & Ors.
, ; , referred to.
2.1 To determine whether the levy was in respect of tea estates, and, therefore, of land thus making an indirect impact or was a levy on despatches of tea thereby directly impeding movement of goods, the substance of the legislation must be ascertained from the relevant provisions of the statute.
[301B] 2.2 The subject of the levy, the nature of which de fines the quality of the levy, however, must not be confused with the measure of liability, that is to say, the quantum of the tax.
Furthermore, the standards laid down for measur ing the liability under the levy must bear a relationship to the nature of levy.
[301B C, 302D E] 295 Union of India & Ors.
vs Bombay Tyre International Ltd. 2.3 If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea despatched from the tea estate there must be a nexus between the two indicating a relationship between the levy on the tea estate and the criteria for determining the measure of liability.
If there is no nexus at all it can conceivably be inferred that the levy is not what it purports to be.
[301H, 302A] 2.4 In the instant case, the nexus with the tea estate is lost altogether in the provisions for exemption or reduc tion of the levy and throughout the nexus is confined to despatches of tea rather than related to the tea estate.
There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates.
[302E F] 2.5 While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions.
Variations considered appropriate for the purpose of determining the measure must correspond to variations in the subject of the levy.
If the measure of levy is to vary with the despatches of different classes of tea, there must be something in the class of tea concerned which points to a reason located in the particular tea estate or classes of tea estates which are made the subject of the levy.
So also, if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate concerned.
Ultimately, the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy.
[302F, 303A] 2.6 In the instant case the relevant statutory provi sions, including section 4(2)(aa) and section 4(4), indicate no such relationship or nexus between the tea estate and the varied treatment accorded in respect of the despatch of different kinds of tea.
The levy of rural employment cess was, there fore, a levy in respect of despatches of tea and not in respect of tea estates.
It must, thus, be regarded as con stituting a direct and immediate restriction on the flow of trade and commerce in tea throughout the territory of India.
[303B C] 2.7 Such a levy could avoid the injunction declared in Article 301 296 only if it satisfied the provisions of Article 304(b) and the proviso thereto.
The amendments made to the West Bengal Act in 1981 and 1982 had not been moved in the Legislature of the State with the previous sanction of the President.
The provisions brought into the Act by the said amendments were, therefore, unconstitutional and void and could not be given effect to.
[303C D, F, G] 3.
Under the Parliament had assumed con trol of the tea industry including the tea trade and control of tea prices.
Under section 25 of that Act a cess on tea pro duced in India had also been imposed.
The State legislation imposing a cess on despatches of tea was, therefore, also void for want of legislative competence as it pertained to a covered field.
[304B]
|
he refund of cess paid by them.
[304D] & CIVIL ORIGINAL JURISDICTION: Writ Petitions Nos.
2687, 5822 of 1983 etc.
(Under Article 32 of the Constitution of India).
Dr. Shankar Ghosh, T.S.K. Iyer, M.L. Lahoty, P.S. Jha, D.D. Gupta, S.K. Jain, D.P. Mukherjee, S.R. Srivastava, P.N. Tewari and Parijat Sinha for the petitioners.
Tapas Ray, Anil B. Dewan, T.C. Roy, G.S. Chatterjee, Dalip Sinha and H.K. Puri for the respondents.
The judgment of the Court was delivered by PATHAK, CJ.
By these writ petitions and transferred cases the petitioners challenge the validity of the levy of cess in respect of tea estates under the West Bengal Rural Employment and Production Act, 1976.
The West Bengal Rural Employment and Production Act, 1976, (shortly referred to as the "West Bengal Act") is intended to provide the additional resources for the promo tion of employment in rural areas and for implementing rural production programmes.
The additional resources are sought to be raised from two sources, a surcharge on land revenue under section 3 of the Act and a rural employment cess under section 4 of the Act.
We are concerned here with the levy of the rural employment cess.
297 Originally section 4 of the West Bengal Act provided as follows: "4.(1) On and from the commencement of this Act, all immovable properties on which road and public work cesses are assessed according to the provisions of the Cess Act, 1880, shall be liable to the payment of rural employment cess: Provided that no raiyat who is exempted from paying revenue in respect of his holding under clause (a) of subsection (1) of section 23B of the West Bengal Land Reforms Act, 1955, shall be liable to pay rural em ployment cess.
(2) The rural employment cess shall be levied annually (a) in respect of lands, at the rate of six paise on each rupee of development value thereof; (b) in respect of coal mines, at the rate of fifty paise on each tonne of coal on the annual dispatches therefrom; (c) in respect of mines other than coal mines and quarries, at the rate of six paise on each rupee of annual net profits thereof.
" The West Bengal Taxation Laws (Amendment) Act, 1982 amended the West Bengal Act and by section 7(b) thereof amend ments were made in section 4(2) of the West Bengal Act with effect from 1 April, 1981.
As a result, as from that date, section 4(2) in so far as it is material read as follows: 4(2).
The rural employment cess shall be levied annually (a) in respect of lands, other than a tea estate, at the rate of six paise on each rupee of development value thereof; (aa) in respect of a tea estate at such rate, not exceeding rupees six on each kilogram of tea on the dispatches from such tea estate of tea grown therein, as the State Government may, by notification in the Offi cial Gazette, fix in this behalf: 298 Provided that in calculating the dispatches of tea for the purpose of levy of rural employment cess, such dispatches for sale made at such tea auction centres as may be recognised by the State Government by notification in the Official Gazette shall be excluded.
Provided further that the State Government may fix different rates on des patches of different classes of tea.
Explanation For the purpose of this section, "tea" means the plant Camellia Sinen sis (L) O. Kuntze as well as all varieties of the product known commercially as tea made from the leaves of the plant Camellia Sinensis (L) O. Kuntze, including green tea and green tea leaves, processed or unprocessed;" Section 4 was also amended further by the insertion of sub section
(4) which provided: "(4) The State Government may, if it considers necessary so to do, by notification in the Official Gazette, exempt such categories of despatches or such percentage of despatches from the liability to pay the whole or any part of the rural employment cess, or reduce the rate of the rural employment cess payable thereon, under clause (aa) of sub section (2), on such terms and conditions as may be speci fied in the notification.
Provided that the State Government may, at any time, add to, amend, vary of rescind any such notification.
" Thereafter the West Bengal Taxation Laws (Amendment) Act, 1982 was enacted with effect from 1 October, 1982.
section 4(2) of the West Bengal Act was amended and under clause (aa) thereof the first proviso was omitted.
Pursuant to the amendments in the West Bengal Act in 1981 and 1982, various notifications were issued by the State Government, which for our purpose broadly cover these different periods: (a) First Period: 1 April, 1981 to 30 Septem ber, 1982 299 Rural employment cess was levied at the rate of Rs.5 per Kg.
on all despatches of tea, but in respect of despatches to two tea auction centres within West Bengal the rate of duty was nil, and in respect of tea sold in West Bengal through registered dealers otherwise than through the two tea auction centres the rate of tax was Rs.2.50 per Kg.
(b) Second Period: 1 October, 1982 to 28 March, 1984 Rural employment cess was levied at the rate of Rs. 1.50 per Kg.
on all despatches of tea except that for despatches to the said two tea auction centres the rate of levy was 30 paise per Kg.
(c) Third Period: 29 March, 1984 onwards Rural employment cess was levied at the rate of Rs.3 per Kg.
on all despatches of tea except that for despatches to the said two tea auction centres in West Bengal the rate of tax was only 30 paise per Kg.
Learned counsel for the petitioners contend that the levy of the cess under section 4(1) read with section 4(2)(aa) of the West Bengal Act as amended in 1981 and 1982 is ultra vires inasmuch as the statutory provisions violate Article 14 and Article 301 of the Constitution and also lie outside the legislative competence of the State Government.
It seems to us that these cases can be disposed of on the short ground based on Article 301 of the Constitution and want of legis lative competence.
There can be no dispute that the rural employment cess is a tax.
cannot also be disputed that if the levy of a tax on goods has the direct and immediate effect of impeding the movement of goods throughout the territory of India, there is a violation of Article 301 of the Constitution.
If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301.
In Atiabari Tea Co., Ltd. vs The State of Assam and Others, ; , Gajendragadkar, J (as he then was) speaking for the majority in that case held that tax laws would effect trade and commerce and could be violative of the freedom guaranteed by Article 30 1, provided they di rectly or immediately affect the freedom of trade and com merce and not indirectly or in a remote manner.
This princi ple was affirmed by this Court in The Automobile Transport (Rajasthan) 300 Ltd. vs The State of Rajasthan and Others, [1963] 1 S.C.R. 491 and again in Firm A.T.B. Mehtab Majid and Company vs State of Madras and Another, [1963] Suppl.
2 S.C.R. 435.
But the declaration in Article 301 that trade, commerce and intercourse throughout the territory of India shall be free is subject to Article 304(b) which provides: "304.
Restrictions on trade, commerce and intercourse among States.
Notwithstanding anything in Article 301 or Article 303, the Legislature of a State may by law ( a ) .
. . (b) impose such reasonable restrictions on the freedom of trade, commerce or inter course with or within that State as may be required in the public interest.
Provided that no Bill or amendment for the purposes of clause (b) shall be intro duced or moved in the Legislature of a State without the previous sanction of the Presi dent.
" Therefore, there is no violation of Article 30 1 if the case falls under Article 304(b) and its proviso.
In Kalyani Stores vs The State of Orissa and Others, [1966] 1 S.C.R. 865 this Court held that a restriction on the freedom of trade and commerce which is guaranteed by Article 301 cannot be justified unless the procedure provided in Article 304 is followed.
That was also the view taken in State of Mysore vs H. Sanjeeviah; , and Andhra Sugars Ltd. & Anr.
vs State of Andhra Pradesh & Ors.
, [1968] 1 S.C.R. 705.
In other words, if the Legislature of a State enacts a law which imposes such reasonable restrictions on the free dom of trade, commerce or intercourse with or within that State as may be required in the public interest and further that the Bill or amendment for the purposes of clause (b) has been introduced or moved in the Legislature of a State with the previous sanction of the President, such enactment will not offend the Article 301.
The question then is whether the impugned levy impedes the free flow of trade and commerce throughout the territory of India, and if it does, whether it fails within the excep tion carved out in Article 304(b).
If the levy imposes a cess in respect of tea estates, it may well De said that even though the free flow of tea is impeded in its movement throughout the territory of India it is in consequence of an indirect or 301 remote effect of the levy and that it cannot be said that Article 301 is contravened.
The contention of the petition ers is, however, that it is ostensibly only in respect of tea estates but in fact it is a levy on despatches of tea.
If that contention is sound, there can be no doubt that it constitutes a violation of Article 301 unless the legisla tion is brought within the scope of Article 304(b).
To determine whether the levy is in respect of tea estates or is a levy on despatches of tea, the substance of the legis lation must be ascertained from the relevant provisions of the statute.
It cannot be disputed that the subject of the levy, the nature of which defines the quality of the levy, must not be confused with the measure of liability, that is to say, the quantum of the tax.
There is a plenitude of case law supporting that principle, among the cases being Union of India and Others vs Bombay Tyre International Ltd. and Others, ; But what is the position here? The statute speaks of a levy "in respect of a tea estate", and it says that the levy will not exceed Rs.6 on each Kilogram of tea on the des patches from such tea estate of tea grown therein.
The statute also provides that in calculating the despatches of tea for the purpose of levy of rural employment cess, the despatches for sale made at such tea auction centres as may be recognised by the State Government shall be excluded.
And there is a proviso which empowers the State Government to fix different rates on despatches of different classes of tea.
There is also section 4(4) which empowers the State Govern ment to exempt such categories of despatches or such per centage of despatches from the liability to pay the whole or any part of the rural employment cess, or to reduce the rate of the rural employment cess payable thereon under clause (aa) of sub section
(2) on such terms and conditions as it may specify by notification.
As from 1 October, 1982 the posi tion remained the same except that the first proviso to section 4(2)(aa) excluding the despatches for sale made at recog nised tea auction centres was deleted.
The remaining provi sions continued as before.
Now, for determining the true nature of the legislation, whether it is a legislation in respect of tea estates.
and therefore of land, or in respect of despatches of tea, we must, as we have said, take all the relevant provisions of the legislation into account and ascertain the essential substance of it.
It seems to us that although the impugned provisions speak of a levy of cess in respect of tea estates, what is really contemplated is a levy on despatches of tea instead.
The entire structure of the levy points to that conclusion.
If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea des patched from the tea estate there must be a nexus between the two indicating a 302 relationship between the levy on the tea estate and the criteria for determining the measure of liability.
If there is no nexus at all it can conceivably be inferred that the levy iS not what it purports to be.
The statutory provisions for measuring the liability on account of the levy throws light on the general character of the tax as observed by the Privy Council in Re: A Reference under the Government of Ireland Act, 1920 and Section 3 of the Finance Act (Northern Ireland), 1934, In R.R. Engineering Co. vs Zila Parishad, Bareilly & Anr., ; , this Court observed that the standard on which the tax is levied was a relevant consideration for determining the nature of the tax, although it could not be regarded as conclusive in the matter.
Again in The Hingir Rampur Coal Co. Ltd. and Others.
vs The State of Orissa and Others, ; , this Court observed that the method of determining the rate of levy would be relevant in consider ing the character of the levy.
All these cases were referred to in Bombay Tyre International Ltd. (supra) where in the discussion on the point at page 367 this Court said: "Any standard which maintains a nexus with the essential character of the levy can be regard ed as a valid basis for assessing the measure of the levy.
" It is apparent that the standards laid down for measur ing the liability under the levy must bear a relationship to the nature of the levy.
In the case before us, however, we find that the nexus with the tea estate is lost altogether in the provisions for exemption or reduction of the levy and that throughout the nexus is confined to despatches of tea rather than related to the tea estate.
There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates.
We may presume that a tea estate produces different classes of tea and not one class of tea only.
While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions.
Variations considered appropriate for the purpose of deter mining the measure must correspond to variations in the subject of the levy.
If the measure of levy is to vary with the despatches of different classes of tea there must be something in the class of tea concerned which points to a reason located in the particular tea estate or classes of tea estates which are made the subject of the levy.
So also if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate or classes of tea estates.
In other words, there must be a reason why one class of tea is treated 303 differently from another class of tea when deciding upon the rate to be applied to different classes of tea and that reason must be found in the nature of the tea estate con cerned.
Ultimately the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy.
When the provisions before us are examined in their totali ty, we find no such relationship or nexus between the tea estate and the varied treatment accorded in respect of despatches of different kinds of tea.
It seems to us that having regard to all the relevant provisions of the statute, including section 4(2)(aa) and section 4(4), in substance the impugned levy is a levy in respect of despatches of tea and not in respect of tea estates.
Treating it as a levy on despatches of tea it is evident that the levy must be regarded as constituting a direct and immediate restriction on the flow of trade and commerce in tea throughout the territory of India, and the levy can avoid the injunction declared in Article 301 only if it satisfies the provisions of Article 304(b) and the proviso thereto.
For bringing the legislation within the saving provisions of Article 304(b) it is necessary that the Bill or amendment should have been introduced or moved in the Legislature of the State with the previous sanction of the President.
It is not disputed that the amendments to the West Bengal Act made in 198 1 and 1982 did not satisfy that requirement.
Indeed, it appears that the West Bengal Govern ment had sent an earlier Bill to the President with the object of levying a tax on the income from tea but the Presidential assent was not granted.
It appears further that the Finance Minister of WeSt Bengal made a statement in the West Bengal Legislature on 27 February, 1981 stating that he would introduce the rural employment cess on despatches of tea.
He referred to a Bill for amending the West Bengal Marketing (Regulation) Act, 1972 having been sent to the President and the President not having signified his consent to the amendment.
In our opinion, the impugned provisions brought into the West Bengal Act by the amendments in 1981 and 1982 so far as they purport to relate to tea estates are unconstitutional and void and cannot be given effect to.
Another aspect of the matter may be considered, and that relates to legislative competence.
If the impugned legisla tion were to be regarded as a levy in respect of tea es tates, it would be referable to Entry 49 in List II of the Seventh Schedule of the Constitution which speaks of "taxes on lands and buildings".
But if the legislation is in sub stance legislation in respect of despatches of tea, legisla tive authority must be 304 found for it with reference to some other Entry.
We have not been shown any Entry in List II or in List III of the Sev enth Schedule which would be pertinent.
It may be noted that Parliament had made a declaration in section 2 of the that it was expedient in the public interest that the Union should take under its control the tea industry.
Under the , Parliament has assumed control of the tea industry including the tea trade and control of tea prices.
Under section 25 of the Act a cess on tea produced in India has also been imposed.
It appears to us that the impugned legis lation is also void for want of legislative competence as it pertains to a covered field.
We do not consider it necessary to express our opinion on the other points raised between the parties in this case.
In the result, the writ petitions filed in this Court and the petitions in the Transferred Cases are allowed, the impugned amendments effected in the West Bengal Rural Em ployment and Production Act, 1976 by the amending Acts of 1981 and 1982 so far as they purport to relate to tea es tates are declared void and the petitioners are held enti tled to the refund of cess paid by them under the impugned statutory provisions.
The petitioners are entitled to their costs.
P.S.S. Petitions allowed.
|
[304D] & CIVIL ORIGINAL JURISDICTION: Writ Petitions Nos. (Under Article 32 of the Constitution of India). Dr. Shankar Ghosh, T.S.K. Iyer, M.L. Lahoty, P.S. Jha, D.D. Gupta, S.K. Jain, D.P. Mukherjee, S.R. Srivastava, P.N. Tewari and Parijat Sinha for the petitioners. Tapas Ray, Anil B. Dewan, T.C. Roy, G.S. Chatterjee, Dalip Sinha and H.K. Puri for the respondents. The judgment of the Court was delivered by PATHAK, CJ. By these writ petitions and transferred cases the petitioners challenge the validity of the levy of cess in respect of tea estates under the West Bengal Rural Employment and Production Act, 1976. The West Bengal Rural Employment and Production Act, 1976, (shortly referred to as the "West Bengal Act") is intended to provide the additional resources for the promo tion of employment in rural areas and for implementing rural production programmes. The additional resources are sought to be raised from two sources, a surcharge on land revenue under section 3 of the Act and a rural employment cess under section 4 of the Act. We are concerned here with the levy of the rural employment cess. 297 Originally section 4 of the West Bengal Act provided as follows: "4.(1) On and from the commencement of this Act, all immovable properties on which road and public work cesses are assessed according to the provisions of the Cess Act, 1880, shall be liable to the payment of rural employment cess: Provided that no raiyat who is exempted from paying revenue in respect of his holding under clause (a) of subsection (1) of section 23B of the West Bengal Land Reforms Act, 1955, shall be liable to pay rural em ployment cess. (2) The rural employment cess shall be levied annually (a) in respect of lands, at the rate of six paise on each rupee of development value thereof; (b) in respect of coal mines, at the rate of fifty paise on each tonne of coal on the annual dispatches therefrom; (c) in respect of mines other than coal mines and quarries, at the rate of six paise on each rupee of annual net profits thereof. " The West Bengal Taxation Laws (Amendment) Act, 1982 amended the West Bengal Act and by section 7(b) thereof amend ments were made in section 4(2) of the West Bengal Act with effect from 1 April, 1981. As a result, as from that date, section 4(2) in so far as it is material read as follows: 4(2). Provided further that the State Government may fix different rates on des patches of different classes of tea. Provided that the State Government may, at any time, add to, amend, vary of rescind any such notification. " Thereafter the West Bengal Taxation Laws (Amendment) Act, 1982 was enacted with effect from 1 October, 1982. section 4(2) of the West Bengal Act was amended and under clause (aa) thereof the first proviso was omitted. Pursuant to the amendments in the West Bengal Act in 1981 and 1982, various notifications were issued by the State Government, which for our purpose broadly cover these different periods: (a) First Period: 1 April, 1981 to 30 Septem ber, 1982 299 Rural employment cess was levied at the rate of Rs.5 per Kg. on all despatches of tea, but in respect of despatches to two tea auction centres within West Bengal the rate of duty was nil, and in respect of tea sold in West Bengal through registered dealers otherwise than through the two tea auction centres the rate of tax was Rs.2.50 per Kg. (b) Second Period: 1 October, 1982 to 28 March, 1984 Rural employment cess was levied at the rate of Rs. on all despatches of tea except that for despatches to the said two tea auction centres the rate of levy was 30 paise per Kg. on all despatches of tea except that for despatches to the said two tea auction centres in West Bengal the rate of tax was only 30 paise per Kg. Learned counsel for the petitioners contend that the levy of the cess under section 4(1) read with section 4(2)(aa) of the West Bengal Act as amended in 1981 and 1982 is ultra vires inasmuch as the statutory provisions violate Article 14 and Article 301 of the Constitution and also lie outside the legislative competence of the State Government. It seems to us that these cases can be disposed of on the short ground based on Article 301 of the Constitution and want of legis lative competence. There can be no dispute that the rural employment cess is a tax. cannot also be disputed that if the levy of a tax on goods has the direct and immediate effect of impeding the movement of goods throughout the territory of India, there is a violation of Article 301 of the Constitution. If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301. But the declaration in Article 301 that trade, commerce and intercourse throughout the territory of India shall be free is subject to Article 304(b) which provides: "304. Restrictions on trade, commerce and intercourse among States. Notwithstanding anything in Article 301 or Article 303, the Legislature of a State may by law ( a ) . b) impose such reasonable restrictions on the freedom of trade, commerce or inter course with or within that State as may be required in the public interest. Provided that no Bill or amendment for the purposes of clause (b) shall be intro duced or moved in the Legislature of a State without the previous sanction of the Presi dent. " Therefore, there is no violation of Article 30 1 if the case falls under Article 304(b) and its proviso. In Kalyani Stores vs The State of Orissa and Others, [1966] 1 S.C.R. 865 this Court held that a restriction on the freedom of trade and commerce which is guaranteed by Article 301 cannot be justified unless the procedure provided in Article 304 is followed. That was also the view taken in State of Mysore vs H. Sanjeeviah; , and Andhra Sugars Ltd. & Anr. In other words, if the Legislature of a State enacts a law which imposes such reasonable restrictions on the free dom of trade, commerce or intercourse with or within that State as may be required in the public interest and further that the Bill or amendment for the purposes of clause (b) has been introduced or moved in the Legislature of a State with the previous sanction of the President, such enactment will not offend the Article 301. If the levy imposes a cess in respect of tea estates, it may well De said that even though the free flow of tea is impeded in its movement throughout the territory of India it is in consequence of an indirect or 301 remote effect of the levy and that it cannot be said that Article 301 is contravened. The contention of the petition ers is, however, that it is ostensibly only in respect of tea estates but in fact it is a levy on despatches of tea. If that contention is sound, there can be no doubt that it constitutes a violation of Article 301 unless the legisla tion is brought within the scope of Article 304(b). It cannot be disputed that the subject of the levy, the nature of which defines the quality of the levy, must not be confused with the measure of liability, that is to say, the quantum of the tax. There is a plenitude of case law supporting that principle, among the cases being Union of India and Others vs Bombay Tyre International Ltd. and Others, ; But what is the position here? The statute speaks of a levy "in respect of a tea estate", and it says that the levy will not exceed Rs.6 on each Kilogram of tea on the des patches from such tea estate of tea grown therein. The statute also provides that in calculating the despatches of tea for the purpose of levy of rural employment cess, the despatches for sale made at such tea auction centres as may be recognised by the State Government shall be excluded. And there is a proviso which empowers the State Government to fix different rates on despatches of different classes of tea. There is also section 4(4) which empowers the State Govern ment to exempt such categories of despatches or such per centage of despatches from the liability to pay the whole or any part of the rural employment cess, or to reduce the rate of the rural employment cess payable thereon under clause (aa) of sub section
(2) on such terms and conditions as it may specify by notification. As from 1 October, 1982 the posi tion remained the same except that the first proviso to section 4(2)(aa) excluding the despatches for sale made at recog nised tea auction centres was deleted. The remaining provi sions continued as before. Now, for determining the true nature of the legislation, whether it is a legislation in respect of tea estates. and therefore of land, or in respect of despatches of tea, we must, as we have said, take all the relevant provisions of the legislation into account and ascertain the essential substance of it. It seems to us that although the impugned provisions speak of a levy of cess in respect of tea estates, what is really contemplated is a levy on despatches of tea instead. The entire structure of the levy points to that conclusion. If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea des patched from the tea estate there must be a nexus between the two indicating a 302 relationship between the levy on the tea estate and the criteria for determining the measure of liability. If there is no nexus at all it can conceivably be inferred that the levy iS not what it purports to be. The statutory provisions for measuring the liability on account of the levy throws light on the general character of the tax as observed by the Privy Council in Re: A Reference under the Government of Ireland Act, 1920 and Section 3 of the Finance Act (Northern Ireland), 1934, In R.R. Engineering Co. vs Zila Parishad, Bareilly & Anr., ; , this Court observed that the standard on which the tax is levied was a relevant consideration for determining the nature of the tax, although it could not be regarded as conclusive in the matter. Again in The Hingir Rampur Coal Co. Ltd. and Others. vs The State of Orissa and Others, ; , this Court observed that the method of determining the rate of levy would be relevant in consider ing the character of the levy. All these cases were referred to in Bombay Tyre International Ltd. (supra) where in the discussion on the point at page 367 this Court said: "Any standard which maintains a nexus with the essential character of the levy can be regard ed as a valid basis for assessing the measure of the levy. " It is apparent that the standards laid down for measur ing the liability under the levy must bear a relationship to the nature of the levy. In the case before us, however, we find that the nexus with the tea estate is lost altogether in the provisions for exemption or reduction of the levy and that throughout the nexus is confined to despatches of tea rather than related to the tea estate. There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates. We may presume that a tea estate produces different classes of tea and not one class of tea only. While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions. Variations considered appropriate for the purpose of deter mining the measure must correspond to variations in the subject of the levy. If the measure of levy is to vary with the despatches of different classes of tea there must be something in the class of tea concerned which points to a reason located in the particular tea estate or classes of tea estates which are made the subject of the levy. So also if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate or classes of tea estates. In other words, there must be a reason why one class of tea is treated 303 differently from another class of tea when deciding upon the rate to be applied to different classes of tea and that reason must be found in the nature of the tea estate con cerned. Ultimately the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy. It seems to us that having regard to all the relevant provisions of the statute, including section 4(2)(aa) and section 4(4), in substance the impugned levy is a levy in respect of despatches of tea and not in respect of tea estates. For bringing the legislation within the saving provisions of Article 304(b) it is necessary that the Bill or amendment should have been introduced or moved in the Legislature of the State with the previous sanction of the President. It is not disputed that the amendments to the West Bengal Act made in 198 1 and 1982 did not satisfy that requirement. Indeed, it appears that the West Bengal Govern ment had sent an earlier Bill to the President with the object of levying a tax on the income from tea but the Presidential assent was not granted. It appears further that the Finance Minister of WeSt Bengal made a statement in the West Bengal Legislature on 27 February, 1981 stating that he would introduce the rural employment cess on despatches of tea. He referred to a Bill for amending the West Bengal Marketing (Regulation) Act, 1972 having been sent to the President and the President not having signified his consent to the amendment. In our opinion, the impugned provisions brought into the West Bengal Act by the amendments in 1981 and 1982 so far as they purport to relate to tea estates are unconstitutional and void and cannot be given effect to. Another aspect of the matter may be considered, and that relates to legislative competence. If the impugned legisla tion were to be regarded as a levy in respect of tea es tates, it would be referable to Entry 49 in List II of the Seventh Schedule of the Constitution which speaks of "taxes on lands and buildings". But if the legislation is in sub stance legislation in respect of despatches of tea, legisla tive authority must be 304 found for it with reference to some other Entry. We have not been shown any Entry in List II or in List III of the Sev enth Schedule which would be pertinent. It may be noted that Parliament had made a declaration in section 2 of the that it was expedient in the public interest that the Union should take under its control the tea industry. Under the , Parliament has assumed control of the tea industry including the tea trade and control of tea prices. Under section 25 of the Act a cess on tea produced in India has also been imposed. It appears to us that the impugned legis lation is also void for want of legislative competence as it pertains to a covered field. We do not consider it necessary to express our opinion on the other points raised between the parties in this case. In the result, the writ petitions filed in this Court and the petitions in the Transferred Cases are allowed, the impugned amendments effected in the West Bengal Rural Em ployment and Production Act, 1976 by the amending Acts of 1981 and 1982 so far as they purport to relate to tea es tates are declared void and the petitioners are held enti tled to the refund of cess paid by them under the impugned statutory provisions. The petitioners are entitled to their costs.
|
Section 4(1) of the West Bengal Rural Employment.
and Production Act, 1976 provided for levy of rural employment cess on immovable properties.
Clause (aa) of section 4(2) as amended by section 7(b) of the West Bengal Taxation Laws (Amend ment) Act, 1981 provided for levy of rural employment cess in respect of tea estates on the despatches of tea grown therein.
The first proviso thereto provided for exclusion of despatches of tea for sale made at recognised centres.
The second proviso thereto empowered the State Government 10 fix different rates of cess on despatches of different classes of tea.
Sub section (4) of the amended section 4 provided for exemption of certain categories of despatches from the liability to pay the whole or part of the cess or to reduce the rate of the cess payable thereon.
The first proviso to section 4(2)(aa) was.
however, omitted by the West Bengal Taxa tion Laws (Amendment) Act, 1982.
Article 304(b) of the Constitution permits the legislature of a State to impose reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State provided the Bill or amendment for that purpose is introduced with the previous sanction of the President.
It was contended for the petitioners that the levy of the cess under section 4(1) read with section 4(2)(aa) of the Act, as amended in 1981 and 1982.
was violative of the freedom guaranteed by Article 301 of the Constitu 294 tion and also lay outside the legislative competence of the State Government.
Allowing the writ petitions.
HELD: 1.1 If the levy of a tax on goods has direct and immediate effect of impeding the movement of goods through out the territory of India, there is a violation of Article 301 of the Constitution.
If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301.
There is also no violation of Article 301 if the case fails under Article 304(b) and its proviso.
[299F, 300D E] 1.2 Therefore, if the legislature of a State enacts a law which imposes such reasonable restrictions on the free dom of trade, commerce or intercourse with or within that State as may be required in the public interest and further that the Bill or amendment for the purposes of clause (b) has been introduced or moved in the Legislature of a State with the previous sanction of the President, such enactment will not offend Article 301.
The rural employment cess in the instant case was a tax.
[300F, 299F] Ariabari Tea Co., Ltd. vs The State of Assam & Ors. ; ; The Automobile Transport (Rajasthan) Ltd. vs The State of Rajasthan & Ors., [1963] 1 S.C.R. 491; Firm A.T.B. Mehtab Majid and Company vs State of Madras & Anr., [1963] Suppl.
2 S.C.R. 435; Kalyani Stores vs TIre State of Orissa & Ors., ; ; State of Mysore vs Ii.
Sanjeeviah, ; and Andhra Sugars Ltd. & Anr.
vs State of Andhra Pradesh & Ors.
, ; , referred to.
2.1 To determine whether the levy was in respect of tea estates, and, therefore, of land thus making an indirect impact or was a levy on despatches of tea thereby directly impeding movement of goods, the substance of the legislation must be ascertained from the relevant provisions of the statute.
[301B] 2.2 The subject of the levy, the nature of which de fines the quality of the levy, however, must not be confused with the measure of liability, that is to say, the quantum of the tax.
Furthermore, the standards laid down for measur ing the liability under the levy must bear a relationship to the nature of levy.
[301B C, 302D E] 295 Union of India & Ors.
vs Bombay Tyre International Ltd. 2.3 If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea despatched from the tea estate there must be a nexus between the two indicating a relationship between the levy on the tea estate and the criteria for determining the measure of liability.
If there is no nexus at all it can conceivably be inferred that the levy is not what it purports to be.
[301H, 302A] 2.4 In the instant case, the nexus with the tea estate is lost altogether in the provisions for exemption or reduc tion of the levy and throughout the nexus is confined to despatches of tea rather than related to the tea estate.
There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates.
[302E F] 2.5 While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions.
Variations considered appropriate for the purpose of determining the measure must correspond to variations in the subject of the levy.
If the measure of levy is to vary with the despatches of different classes of tea, there must be something in the class of tea concerned which points to a reason located in the particular tea estate or classes of tea estates which are made the subject of the levy.
So also, if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate concerned.
Ultimately, the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy.
[302F, 303A] 2.6 In the instant case the relevant statutory provi sions, including section 4(2)(aa) and section 4(4), indicate no such relationship or nexus between the tea estate and the varied treatment accorded in respect of the despatch of different kinds of tea.
The levy of rural employment cess was, there fore, a levy in respect of despatches of tea and not in respect of tea estates.
It must, thus, be regarded as con stituting a direct and immediate restriction on the flow of trade and commerce in tea throughout the territory of India.
[303B C] 2.7 Such a levy could avoid the injunction declared in Article 301 296 only if it satisfied the provisions of Article 304(b) and the proviso thereto.
The amendments made to the West Bengal Act in 1981 and 1982 had not been moved in the Legislature of the State with the previous sanction of the President.
The provisions brought into the Act by the said amendments were, therefore, unconstitutional and void and could not be given effect to.
[303C D, F, G] 3.
Under the Parliament had assumed con trol of the tea industry including the tea trade and control of tea prices.
Under section 25 of that Act a cess on tea pro duced in India had also been imposed.
The State legislation imposing a cess on despatches of tea was, therefore, also void for want of legislative competence as it pertained to a covered field.
[304B]
|
Section 4(1) of the West Bengal Rural Employment. and Production Act, 1976 provided for levy of rural employment cess on immovable properties. Clause (aa) of section 4(2) as amended by section 7(b) of the West Bengal Taxation Laws (Amend ment) Act, 1981 provided for levy of rural employment cess in respect of tea estates on the despatches of tea grown therein. The first proviso thereto provided for exclusion of despatches of tea for sale made at recognised centres. The second proviso thereto empowered the State Government 10 fix different rates of cess on despatches of different classes of tea. The first proviso to section 4(2)(aa) was. was violative of the freedom guaranteed by Article 301 of the Constitu 294 tion and also lay outside the legislative competence of the State Government. HELD: 1.1 If the levy of a tax on goods has direct and immediate effect of impeding the movement of goods through out the territory of India, there is a violation of Article 301 of the Constitution. If, however, the impact of the levy is indirect or remote, no valid complaint can be made in relation to Article 301. The rural employment cess in the instant case was a tax. 2 S.C.R. 435; Kalyani Stores vs TIre State of Orissa & Ors., ; ; 2.1 To determine whether the levy was in respect of tea estates, and, therefore, of land thus making an indirect impact or was a levy on despatches of tea thereby directly impeding movement of goods, the substance of the legislation must be ascertained from the relevant provisions of the statute. [301B] 2.2 The subject of the levy, the nature of which de fines the quality of the levy, however, must not be confused with the measure of liability, that is to say, the quantum of the tax. [301B C, 302D E] 295 Union of India & Ors. If there is no nexus at all it can conceivably be inferred that the levy is not what it purports to be. [301H, 302A] 2.4 In the instant case, the nexus with the tea estate is lost altogether in the provisions for exemption or reduc tion of the levy and throughout the nexus is confined to despatches of tea rather than related to the tea estate. There is nothing to suggest that a particular tea estate produces only one class of tea, and when reference is made to a certain class of tea the reference identifies a certain class of tea estates. [302E F] 2.5 While there must always be a nexus between the subject of the levy and the measure of the levy that nexus extends into different dimensions. Variations considered appropriate for the purpose of determining the measure must correspond to variations in the subject of the levy. So also, if the measure varies with the centre of sale of tea, the variation must relate to a reason to be found in the nature of the tea estate concerned. Ultimately, the benefit of exemption or reduced levy must be related to the need for exempting the tea estate from that levy or relieving it from part of the normal levy. [302F, 303A] 2.6 In the instant case the relevant statutory provi sions, including section 4(2)(aa) and section 4(4), indicate no such relationship or nexus between the tea estate and the varied treatment accorded in respect of the despatch of different kinds of tea. The levy of rural employment cess was, there fore, a levy in respect of despatches of tea and not in respect of tea estates. The provisions brought into the Act by the said amendments were, therefore, unconstitutional and void and could not be given effect to. Under the Parliament had assumed con trol of the tea industry including the tea trade and control of tea prices.
| 0.799233
| 0.901363
| 0.400612
| 0.694669
|
ON: Criminal Appeal No. 165 of 1957.
Appeal by special leave from the judgment and order dated the 4th August, 1955, of the Patna High Court in Criminal Appeal No. 699 of 1953 with Criminal Revision No. 205 of 1954, arising out of the judgment and order dated the 12th December, 1953, 769 of the Court of the Assistant Sessions Judge, Second Court Chapra in Trial No. 70 of 1953.
G. C. Mathur., for the appellants.
section P. Varma, for the respondent.
October 28.
The following judgment of the Court was delivered by SINHA J.
The only question for determination in this appeal is whether the High Court in its revisional jurisdiction, has the power to enhance the sentence, as it has done in the instant case, beyond the limit of the maximum sentence that could have been imposed by the trial court, on the accused persons.
The appellants, along with others, were placed on their trial before the Assistant Sessions Judge of Chapra in the district of Saran, for the offence of dacoity under section 395, Indian Penal Code.
They, along with two others, were convicted under section 395, Indian Penal Code, and sentenced to rigorous imprisonment for 5 years, by the Assistant Sessions Judge, by his Judgment and order dated December 12, 1953.
The other accused were acquitted.
The convicted persons preferred an appeal to the High Court at Patna.
The High Court, in its revisional jurisdiction, while admitting the appeal, called upon the appellants to show cause why, in the event of their convictions being maintained, their sentence should not be enhanced.
The appeal and the rule for enhancement of sentence were heard together by a Division Bench of that Court.
The High Court, by its judgment and order dated August 4, 1955, allowed the appeal of two of the appellants and acquitted them but maintained the conviction as against the remaining six appellants.
On the question of sentence, the High Court observed that the " offence of dacoity has increased tremendously.
It is a very heinous offence as innocent persons, while sleeping in their houses, are attacked and their belongings are taken by force.
" The High Court, therefore, was of the opinion that a sentence of five years ' rigorous imprisonment was "extremely inadequate".
It, therefore, enhanced the sentence to 10 years ' rigorous imprisonment in each 770 and obtained special leave to appeal limited to the question of sentence only, the question being whether the High Court had the jurisdiction to enhance the sentence beyond the limits of the power of the trial court itself The occurrence of dacoity which is the subjectmatter of the charge against the appellants, along with others, took place on the night between July 1 and 2, 1952, in the house of Ranjit Bahadur, a minor.
After midnight, 16 or 17 dacoits, fully armed with various deadly weapons, broke open the main entrance door of the house with an axe.
After going into the house, they broke open boxes and tampered with the iron safe, and removed articles worth twenty thousand rupees.
The inmates of the house were over powered.
Some of them, slipping out of the house, raised a big fire which is the customary form of alarm raised against the invading crowd of dacoits.
On that alarm, a number of people of the village turned up but had not the courage to face the dacoits for fear of being shot.
They contented themselves with using brickbats against the dacoits who made good their escape with their booty.
It would, thus, appear that it was a serious occurrence involving the lives and fortunes of the inmates of the house, and naturally, the High Court took a very serious view of the offence.
In this Court, the learned counsel for the appellants, who appeared amicus curiae, contended, in the first place, that the High Court had exceeded its powers in enhancing the sentence from 5 to 10 years inasmuch as the trial court itself could not have inflicted a sentence of imprisonment for more that 7 years.
Alternatively, he contended that the High Court had not kept in view the dictum of this Court in the case of Bed Raj vs The State of Uttar Pradesh (1), while enhancing the sentence against the appellants before it.
And lastly, it was contended that in any view of the matter, in the circumstances of this case, the sentence of 10 years rigorous imprisonment is too severe.
In our opinion, there is no substance in any one of these contentions.
(1) ; 771 The main point on which the special leave was granted is the question of the competence of the High: Court to impose a higher sentence than that which could have been imposed by the learned Assistant Sessions Judge under section 31(3) of the Code of Criminal Procedure.
The learned trial judge could not have imposed a term of imprisonment exceeding 7 years.
The argument is that the High Court could enhance the sentence from 5 to 7 years and no more.
This argument is sought to be enforced by the consideration that it must be presumed that the learned Assistant Sessions Judge had been entrusted with the trial of the accused persons with the full knowledge that, on conviction, the accused persons could be punished with a term of imprisonment not exceeding 7 years.
In its revisional jurisdiction, the High Court could exercise its powers only to correct any mistakes made by the learned trial judge.
The High Court could, therefore, at the most, say that the trial judge should have inflicted the highest punishment, it had been empowered by the Code, to impose.
The High Court could not, at the revisional stage, it was further argued, insist upon a higher punishment being awarded by the trial court than 7 years ' rigorous imprisonment.
The power of the High Court to enhance a sentence, is contained in sub section
(1) of section 439 of the Code, which clothes the High Court with the powers of a Court of Appeal under the Code, as also the power to enhance the sentence.
Sub section
(1) itself, does not contain any words of limitation on the power to enhance the sentence.
Hence, the High Court could impose any sentence up to the maximum limit prescribed by the Indian Penal Code, for a particular offence.
In this case, therefore, the High Court could impose the maximum sentence of imprisonment for life under section 395, Indian Penal Code.
Is there anything in the Code of Criminal Procedure, which limits that power ? The fact that the trial of the case was entrusted to a court with a limited jurisdiction in the matter of sentence, could not be used to impose a limit on the power of a High Court to impose a proper and 98 772 adequate sentence.
That the Legislature did not intend to impose a limit on the power of the High Court to inflict an adequate sentence in a trial held by a Court of Session, is made clear by the provisions of sub section
(3) of section 439, Criminal Procedure Code, which is in these terms: " (3) Where the sentence dealt with under this section has been passed by a Magistrate acting otherwise than under section 34, the Court shall not inflict a greater punishment for the offence, which, in the opinion of such Court, the accused has committed, than might have been inflicted for such offence by a Presidency Magistrate or a Magistrate of the first class.
" Section 32 of the Code lays down the sentence which magistrates may, ordinarily, impose, which is a term of imprisonment not exceeding two years, in the case of Presidency Magistrates and Magistrates of the first class (omitting all reference to fine).
But in certain specified areas, section 30 empowers the Government to invest a District Magistrate or a Magistrate, first class, with the power to try, as a magistrate, all offences not punishable with death.
A magistrate so empowered under section 30, may pass a sentence of imprisonment for a term of 7 years or less.
Thus, the powers of an Assistant Sessions Judge, under section 31(3) and of a magistrate specially empowered under section 30 to impose a sentence of imprisonment, are the same, the terms of section 31 (3) and section 34 being almost identical.
From the terms of section 439(3), it is clear that the only limitation on the power of a High Court to impose punishment is in respect of cases tried by magistrates other than those specially empowered under section 30, and thus, vested with higher powers of punishment under section 34.
Sub section (3) aforesaid, does not impose any limits on the powers of the High Court in cases dealt with by a magistrate specially empowered under section 30.
Hence, in such a case, the High Court has the power to impose a sentence higher than that which could have been imposed by such a magistrate.
That sub section has no reference to a trial held by a Court of Session.
If the High Court can enhance the sentence beyond 773 the maximum sentence which could be awarded by a magistrate specially empowered under section 30, and acting under section 34, there is no reason to hold that the High Court 's power in respect of enhancing the sentence in a trial held by an Assistant Sessions Judge, should be limited in the way suggested on behalf of the appellants.
Sub section (3) of section 439, thus, makes it clear that there is no limitation on the power of the High Court to enhance a sentence to the maximum prescribed by the Indian Penal Code, except in cases tried by magistrates other than those especially empowered under section 30, Criminal Procedure Code.
The learned counsel for the appellants very properly informed us that there are some reported decisions of some of the High Courts which have gone against his contention, and that there is no decision which has taken a view; in support of his contention.
In our opinion, there is no provision in the Code of Criminal Procedure, which limits the power of the High Court in the way suggested on behalf of the appellants, and there are no reasons which militate against the decision of the High Courts taking that view.
The case relied upon on behalf of the appellants in support of their second contention (Bed Raj vs The State of Uttar Pradesh (1)), also seems to point to the same conclusion as will appear from the following observations at p. 584: " Now, though no limitation has been, placed on the High Court 's power to enhance it is nevertheless a judicial act and, like all judicial acts involving an exercise of discretion, must be exercised along wellknown judicial lines.
" On the second contention, there is no doubt that the question of sentence is a matter of discretion which has to be exercised in a judicial way, that is to say, the sentence imposed by the trial court should not be lightly interfered with and should not be enhanced.
unless the appellate court comes to the conclusion, on a consideration of the entire circumstances disclosed in the evidence, that the sentence imposed is inadequate.
In the instant case, the High Court has (1) ; 774 pointed out that the incidence of the offence of dacoity has gone up to such an extent that in proved cases of serious dacoity, like the one in hand, deterrent punishment is called for.
The High Court was, therefore, justified in imposing the sentence of 10 years ' rigorous imprisonment.
In view of the circumstances disclosed in the case, as indicated above, it cannot be asserted that the sentence as enhanced by the High Court is excessive.
The appeal is, accordingly, dismissed.
Appeal dismissed.
|
The appellants were tried before an Assistant Sessions judge for the offence of dacoity under section 395 Indian Penal Code.
Under 3.
31(3) Code of Criminal Procedure, (as it then stood) the Assistant Sessions judge could award a maximum sentence of seven years rigorous imprisonment.
He convicted the appellants and sentenced them to five years rigorous imprisonment each.
The appellants appealed to the High Court, and the High Court, in its revisional jurisdiction, issued a notice to the appellants for enhancement of sentence.
The High Court dismissed the appeal and enhanced the sentence to ten years rigorous imprisonment.
Held, that the High Court had, in its revisional jurisdiction under section 439 Code of Criminal Procedure, the power to enhance the sentence beyond the limit of the maximum sentence that could have been imposed by the trial Court.
Bed Raj vs The State of Uttar Pradesh, ; , referred to.
|
ON: Criminal Appeal No. 165 of 1957.
Appeal by special leave from the judgment and order dated the 4th August, 1955, of the Patna High Court in Criminal Appeal No. 699 of 1953 with Criminal Revision No. 205 of 1954, arising out of the judgment and order dated the 12th December, 1953, 769 of the Court of the Assistant Sessions Judge, Second Court Chapra in Trial No. 70 of 1953.
G. C. Mathur., for the appellants.
section P. Varma, for the respondent.
October 28.
The following judgment of the Court was delivered by SINHA J.
The only question for determination in this appeal is whether the High Court in its revisional jurisdiction, has the power to enhance the sentence, as it has done in the instant case, beyond the limit of the maximum sentence that could have been imposed by the trial court, on the accused persons.
The appellants, along with others, were placed on their trial before the Assistant Sessions Judge of Chapra in the district of Saran, for the offence of dacoity under section 395, Indian Penal Code.
They, along with two others, were convicted under section 395, Indian Penal Code, and sentenced to rigorous imprisonment for 5 years, by the Assistant Sessions Judge, by his Judgment and order dated December 12, 1953.
The other accused were acquitted.
The convicted persons preferred an appeal to the High Court at Patna.
The High Court, in its revisional jurisdiction, while admitting the appeal, called upon the appellants to show cause why, in the event of their convictions being maintained, their sentence should not be enhanced.
The appeal and the rule for enhancement of sentence were heard together by a Division Bench of that Court.
The High Court, by its judgment and order dated August 4, 1955, allowed the appeal of two of the appellants and acquitted them but maintained the conviction as against the remaining six appellants.
On the question of sentence, the High Court observed that the " offence of dacoity has increased tremendously.
It is a very heinous offence as innocent persons, while sleeping in their houses, are attacked and their belongings are taken by force.
" The High Court, therefore, was of the opinion that a sentence of five years ' rigorous imprisonment was "extremely inadequate".
It, therefore, enhanced the sentence to 10 years ' rigorous imprisonment in each 770 and obtained special leave to appeal limited to the question of sentence only, the question being whether the High Court had the jurisdiction to enhance the sentence beyond the limits of the power of the trial court itself The occurrence of dacoity which is the subjectmatter of the charge against the appellants, along with others, took place on the night between July 1 and 2, 1952, in the house of Ranjit Bahadur, a minor.
After midnight, 16 or 17 dacoits, fully armed with various deadly weapons, broke open the main entrance door of the house with an axe.
After going into the house, they broke open boxes and tampered with the iron safe, and removed articles worth twenty thousand rupees.
The inmates of the house were over powered.
Some of them, slipping out of the house, raised a big fire which is the customary form of alarm raised against the invading crowd of dacoits.
On that alarm, a number of people of the village turned up but had not the courage to face the dacoits for fear of being shot.
They contented themselves with using brickbats against the dacoits who made good their escape with their booty.
It would, thus, appear that it was a serious occurrence involving the lives and fortunes of the inmates of the house, and naturally, the High Court took a very serious view of the offence.
In this Court, the learned counsel for the appellants, who appeared amicus curiae, contended, in the first place, that the High Court had exceeded its powers in enhancing the sentence from 5 to 10 years inasmuch as the trial court itself could not have inflicted a sentence of imprisonment for more that 7 years.
Alternatively, he contended that the High Court had not kept in view the dictum of this Court in the case of Bed Raj vs The State of Uttar Pradesh (1), while enhancing the sentence against the appellants before it.
And lastly, it was contended that in any view of the matter, in the circumstances of this case, the sentence of 10 years rigorous imprisonment is too severe.
In our opinion, there is no substance in any one of these contentions.
(1) ; 771 The main point on which the special leave was granted is the question of the competence of the High: Court to impose a higher sentence than that which could have been imposed by the learned Assistant Sessions Judge under section 31(3) of the Code of Criminal Procedure.
The learned trial judge could not have imposed a term of imprisonment exceeding 7 years.
The argument is that the High Court could enhance the sentence from 5 to 7 years and no more.
This argument is sought to be enforced by the consideration that it must be presumed that the learned Assistant Sessions Judge had been entrusted with the trial of the accused persons with the full knowledge that, on conviction, the accused persons could be punished with a term of imprisonment not exceeding 7 years.
In its revisional jurisdiction, the High Court could exercise its powers only to correct any mistakes made by the learned trial judge.
The High Court could, therefore, at the most, say that the trial judge should have inflicted the highest punishment, it had been empowered by the Code, to impose.
The High Court could not, at the revisional stage, it was further argued, insist upon a higher punishment being awarded by the trial court than 7 years ' rigorous imprisonment.
The power of the High Court to enhance a sentence, is contained in sub section
(1) of section 439 of the Code, which clothes the High Court with the powers of a Court of Appeal under the Code, as also the power to enhance the sentence.
Sub section
(1) itself, does not contain any words of limitation on the power to enhance the sentence.
Hence, the High Court could impose any sentence up to the maximum limit prescribed by the Indian Penal Code, for a particular offence.
In this case, therefore, the High Court could impose the maximum sentence of imprisonment for life under section 395, Indian Penal Code.
Is there anything in the Code of Criminal Procedure, which limits that power ? The fact that the trial of the case was entrusted to a court with a limited jurisdiction in the matter of sentence, could not be used to impose a limit on the power of a High Court to impose a proper and 98 772 adequate sentence.
That the Legislature did not intend to impose a limit on the power of the High Court to inflict an adequate sentence in a trial held by a Court of Session, is made clear by the provisions of sub section
(3) of section 439, Criminal Procedure Code, which is in these terms: " (3) Where the sentence dealt with under this section has been passed by a Magistrate acting otherwise than under section 34, the Court shall not inflict a greater punishment for the offence, which, in the opinion of such Court, the accused has committed, than might have been inflicted for such offence by a Presidency Magistrate or a Magistrate of the first class.
" Section 32 of the Code lays down the sentence which magistrates may, ordinarily, impose, which is a term of imprisonment not exceeding two years, in the case of Presidency Magistrates and Magistrates of the first class (omitting all reference to fine).
But in certain specified areas, section 30 empowers the Government to invest a District Magistrate or a Magistrate, first class, with the power to try, as a magistrate, all offences not punishable with death.
A magistrate so empowered under section 30, may pass a sentence of imprisonment for a term of 7 years or less.
Thus, the powers of an Assistant Sessions Judge, under section 31(3) and of a magistrate specially empowered under section 30 to impose a sentence of imprisonment, are the same, the terms of section 31 (3) and section 34 being almost identical.
From the terms of section 439(3), it is clear that the only limitation on the power of a High Court to impose punishment is in respect of cases tried by magistrates other than those specially empowered under section 30, and thus, vested with higher powers of punishment under section 34.
Sub section (3) aforesaid, does not impose any limits on the powers of the High Court in cases dealt with by a magistrate specially empowered under section 30.
Hence, in such a case, the High Court has the power to impose a sentence higher than that which could have been imposed by such a magistrate.
That sub section has no reference to a trial held by a Court of Session.
If the High Court can enhance the sentence beyond 773 the maximum sentence which could be awarded by a magistrate specially empowered under section 30, and acting under section 34, there is no reason to hold that the High Court 's power in respect of enhancing the sentence in a trial held by an Assistant Sessions Judge, should be limited in the way suggested on behalf of the appellants.
Sub section (3) of section 439, thus, makes it clear that there is no limitation on the power of the High Court to enhance a sentence to the maximum prescribed by the Indian Penal Code, except in cases tried by magistrates other than those especially empowered under section 30, Criminal Procedure Code.
The learned counsel for the appellants very properly informed us that there are some reported decisions of some of the High Courts which have gone against his contention, and that there is no decision which has taken a view; in support of his contention.
In our opinion, there is no provision in the Code of Criminal Procedure, which limits the power of the High Court in the way suggested on behalf of the appellants, and there are no reasons which militate against the decision of the High Courts taking that view.
The case relied upon on behalf of the appellants in support of their second contention (Bed Raj vs The State of Uttar Pradesh (1)), also seems to point to the same conclusion as will appear from the following observations at p. 584: " Now, though no limitation has been, placed on the High Court 's power to enhance it is nevertheless a judicial act and, like all judicial acts involving an exercise of discretion, must be exercised along wellknown judicial lines.
" On the second contention, there is no doubt that the question of sentence is a matter of discretion which has to be exercised in a judicial way, that is to say, the sentence imposed by the trial court should not be lightly interfered with and should not be enhanced.
unless the appellate court comes to the conclusion, on a consideration of the entire circumstances disclosed in the evidence, that the sentence imposed is inadequate.
In the instant case, the High Court has (1) ; 774 pointed out that the incidence of the offence of dacoity has gone up to such an extent that in proved cases of serious dacoity, like the one in hand, deterrent punishment is called for.
The High Court was, therefore, justified in imposing the sentence of 10 years ' rigorous imprisonment.
In view of the circumstances disclosed in the case, as indicated above, it cannot be asserted that the sentence as enhanced by the High Court is excessive.
The appeal is, accordingly, dismissed.
Appeal dismissed.
|
ON: Criminal Appeal No. 165 of 1957.
Appeal by special leave from the judgment and order dated the 4th August, 1955, of the Patna High Court in Criminal Appeal No. 699 of 1953 with Criminal Revision No. 205 of 1954, arising out of the judgment and order dated the 12th December, 1953, 769 of the Court of the Assistant Sessions Judge, Second Court Chapra in Trial No. 70 of 1953.
G. C. Mathur., for the appellants.
section P. Varma, for the respondent.
October 28.
The following judgment of the Court was delivered by SINHA J.
The only question for determination in this appeal is whether the High Court in its revisional jurisdiction, has the power to enhance the sentence, as it has done in the instant case, beyond the limit of the maximum sentence that could have been imposed by the trial court, on the accused persons.
The appellants, along with others, were placed on their trial before the Assistant Sessions Judge of Chapra in the district of Saran, for the offence of dacoity under section 395, Indian Penal Code.
They, along with two others, were convicted under section 395, Indian Penal Code, and sentenced to rigorous imprisonment for 5 years, by the Assistant Sessions Judge, by his Judgment and order dated December 12, 1953.
The other accused were acquitted.
The convicted persons preferred an appeal to the High Court at Patna.
The High Court, in its revisional jurisdiction, while admitting the appeal, called upon the appellants to show cause why, in the event of their convictions being maintained, their sentence should not be enhanced.
The appeal and the rule for enhancement of sentence were heard together by a Division Bench of that Court.
The High Court, by its judgment and order dated August 4, 1955, allowed the appeal of two of the appellants and acquitted them but maintained the conviction as against the remaining six appellants.
On the question of sentence, the High Court observed that the " offence of dacoity has increased tremendously.
It is a very heinous offence as innocent persons, while sleeping in their houses, are attacked and their belongings are taken by force.
" The High Court, therefore, was of the opinion that a sentence of five years ' rigorous imprisonment was "extremely inadequate".
It, therefore, enhanced the sentence to 10 years ' rigorous imprisonment in each 770 and obtained special leave to appeal limited to the question of sentence only, the question being whether the High Court had the jurisdiction to enhance the sentence beyond the limits of the power of the trial court itself The occurrence of dacoity which is the subjectmatter of the charge against the appellants, along with others, took place on the night between July 1 and 2, 1952, in the house of Ranjit Bahadur, a minor.
After midnight, 16 or 17 dacoits, fully armed with various deadly weapons, broke open the main entrance door of the house with an axe.
After going into the house, they broke open boxes and tampered with the iron safe, and removed articles worth twenty thousand rupees.
The inmates of the house were over powered.
Some of them, slipping out of the house, raised a big fire which is the customary form of alarm raised against the invading crowd of dacoits.
On that alarm, a number of people of the village turned up but had not the courage to face the dacoits for fear of being shot.
They contented themselves with using brickbats against the dacoits who made good their escape with their booty.
It would, thus, appear that it was a serious occurrence involving the lives and fortunes of the inmates of the house, and naturally, the High Court took a very serious view of the offence.
In this Court, the learned counsel for the appellants, who appeared amicus curiae, contended, in the first place, that the High Court had exceeded its powers in enhancing the sentence from 5 to 10 years inasmuch as the trial court itself could not have inflicted a sentence of imprisonment for more that 7 years.
Alternatively, he contended that the High Court had not kept in view the dictum of this Court in the case of Bed Raj vs The State of Uttar Pradesh (1), while enhancing the sentence against the appellants before it.
And lastly, it was contended that in any view of the matter, in the circumstances of this case, the sentence of 10 years rigorous imprisonment is too severe.
In our opinion, there is no substance in any one of these contentions.
(1) ; 771 The main point on which the special leave was granted is the question of the competence of the High: Court to impose a higher sentence than that which could have been imposed by the learned Assistant Sessions Judge under section 31(3) of the Code of Criminal Procedure.
The learned trial judge could not have imposed a term of imprisonment exceeding 7 years.
The argument is that the High Court could enhance the sentence from 5 to 7 years and no more.
This argument is sought to be enforced by the consideration that it must be presumed that the learned Assistant Sessions Judge had been entrusted with the trial of the accused persons with the full knowledge that, on conviction, the accused persons could be punished with a term of imprisonment not exceeding 7 years.
In its revisional jurisdiction, the High Court could exercise its powers only to correct any mistakes made by the learned trial judge.
The High Court could, therefore, at the most, say that the trial judge should have inflicted the highest punishment, it had been empowered by the Code, to impose.
The High Court could not, at the revisional stage, it was further argued, insist upon a higher punishment being awarded by the trial court than 7 years ' rigorous imprisonment.
The power of the High Court to enhance a sentence, is contained in sub section
(1) of section 439 of the Code, which clothes the High Court with the powers of a Court of Appeal under the Code, as also the power to enhance the sentence.
Sub section
(1) itself, does not contain any words of limitation on the power to enhance the sentence.
Hence, the High Court could impose any sentence up to the maximum limit prescribed by the Indian Penal Code, for a particular offence.
In this case, therefore, the High Court could impose the maximum sentence of imprisonment for life under section 395, Indian Penal Code.
Is there anything in the Code of Criminal Procedure, which limits that power ? The fact that the trial of the case was entrusted to a court with a limited jurisdiction in the matter of sentence, could not be used to impose a limit on the power of a High Court to impose a proper and 98 772 adequate sentence.
That the Legislature did not intend to impose a limit on the power of the High Court to inflict an adequate sentence in a trial held by a Court of Session, is made clear by the provisions of sub section
(3) of section 439, Criminal Procedure Code, which is in these terms: " (3) Where the sentence dealt with under this section has been passed by a Magistrate acting otherwise than under section 34, the Court shall not inflict a greater punishment for the offence, which, in the opinion of such Court, the accused has committed, than might have been inflicted for such offence by a Presidency Magistrate or a Magistrate of the first class.
" Section 32 of the Code lays down the sentence which magistrates may, ordinarily, impose, which is a term of imprisonment not exceeding two years, in the case of Presidency Magistrates and Magistrates of the first class (omitting all reference to fine).
But in certain specified areas, section 30 empowers the Government to invest a District Magistrate or a Magistrate, first class, with the power to try, as a magistrate, all offences not punishable with death.
A magistrate so empowered under section 30, may pass a sentence of imprisonment for a term of 7 years or less.
Thus, the powers of an Assistant Sessions Judge, under section 31(3) and of a magistrate specially empowered under section 30 to impose a sentence of imprisonment, are the same, the terms of section 31 (3) and section 34 being almost identical.
From the terms of section 439(3), it is clear that the only limitation on the power of a High Court to impose punishment is in respect of cases tried by magistrates other than those specially empowered under section 30, and thus, vested with higher powers of punishment under section 34.
Sub section (3) aforesaid, does not impose any limits on the powers of the High Court in cases dealt with by a magistrate specially empowered under section 30.
Hence, in such a case, the High Court has the power to impose a sentence higher than that which could have been imposed by such a magistrate.
That sub section has no reference to a trial held by a Court of Session.
If the High Court can enhance the sentence beyond 773 the maximum sentence which could be awarded by a magistrate specially empowered under section 30, and acting under section 34, there is no reason to hold that the High Court 's power in respect of enhancing the sentence in a trial held by an Assistant Sessions Judge, should be limited in the way suggested on behalf of the appellants.
Sub section (3) of section 439, thus, makes it clear that there is no limitation on the power of the High Court to enhance a sentence to the maximum prescribed by the Indian Penal Code, except in cases tried by magistrates other than those especially empowered under section 30, Criminal Procedure Code.
The learned counsel for the appellants very properly informed us that there are some reported decisions of some of the High Courts which have gone against his contention, and that there is no decision which has taken a view; in support of his contention.
In our opinion, there is no provision in the Code of Criminal Procedure, which limits the power of the High Court in the way suggested on behalf of the appellants, and there are no reasons which militate against the decision of the High Courts taking that view.
The case relied upon on behalf of the appellants in support of their second contention (Bed Raj vs The State of Uttar Pradesh (1)), also seems to point to the same conclusion as will appear from the following observations at p. 584: " Now, though no limitation has been, placed on the High Court 's power to enhance it is nevertheless a judicial act and, like all judicial acts involving an exercise of discretion, must be exercised along wellknown judicial lines.
" On the second contention, there is no doubt that the question of sentence is a matter of discretion which has to be exercised in a judicial way, that is to say, the sentence imposed by the trial court should not be lightly interfered with and should not be enhanced.
unless the appellate court comes to the conclusion, on a consideration of the entire circumstances disclosed in the evidence, that the sentence imposed is inadequate.
In the instant case, the High Court has (1) ; 774 pointed out that the incidence of the offence of dacoity has gone up to such an extent that in proved cases of serious dacoity, like the one in hand, deterrent punishment is called for.
The High Court was, therefore, justified in imposing the sentence of 10 years ' rigorous imprisonment.
In view of the circumstances disclosed in the case, as indicated above, it cannot be asserted that the sentence as enhanced by the High Court is excessive.
The appeal is, accordingly, dismissed.
Appeal dismissed.
|
The appellants were tried before an Assistant Sessions judge for the offence of dacoity under section 395 Indian Penal Code.
Under 3.
31(3) Code of Criminal Procedure, (as it then stood) the Assistant Sessions judge could award a maximum sentence of seven years rigorous imprisonment.
He convicted the appellants and sentenced them to five years rigorous imprisonment each.
The appellants appealed to the High Court, and the High Court, in its revisional jurisdiction, issued a notice to the appellants for enhancement of sentence.
The High Court dismissed the appeal and enhanced the sentence to ten years rigorous imprisonment.
Held, that the High Court had, in its revisional jurisdiction under section 439 Code of Criminal Procedure, the power to enhance the sentence beyond the limit of the maximum sentence that could have been imposed by the trial Court.
Bed Raj vs The State of Uttar Pradesh, ; , referred to.
|
The appellants were tried before an Assistant Sessions judge for the offence of dacoity under section 395 Indian Penal Code.
Under 3.
31(3) Code of Criminal Procedure, (as it then stood) the Assistant Sessions judge could award a maximum sentence of seven years rigorous imprisonment.
He convicted the appellants and sentenced them to five years rigorous imprisonment each.
The appellants appealed to the High Court, and the High Court, in its revisional jurisdiction, issued a notice to the appellants for enhancement of sentence.
The High Court dismissed the appeal and enhanced the sentence to ten years rigorous imprisonment.
Held, that the High Court had, in its revisional jurisdiction under section 439 Code of Criminal Procedure, the power to enhance the sentence beyond the limit of the maximum sentence that could have been imposed by the trial Court.
Bed Raj vs The State of Uttar Pradesh, ; , referred to.
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ivil Appeal No. 103 of 1975.
From the Judgment and Order dated 19.4.1974 of the Patna High Court in Taxation Case No. 21 of 1970.
S.K. Dhingra and K.B. Rohtagi for the Appellants.
D .N. Goburdhan and D. Goburdhan for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal is by special leave.
Challenge herein is to the decision of the Patna High Court rendered on a reference under Section 33(1) of the Bihar Sales Tax Act, 1959.
The following question was referred to the High Court for its opinion, by the Commercial Taxes Tribunal of Bihar: 1049 "Whether in the facts and circumstances of the case, the direction of the Tribunal to ascer tain the price of the containers (gunny bags) of wheat products sold for an all inclusive price under the provisions of the Roller Mills Wheat Products (Price Control) Order, 1964, for taxing the same at a higher rate of 4 1/2 % is legally valid? For the year 1964 65, the assessee, a registered dealer, under the Bihar Sales Tax Act returned a gross turnover of Rs.53,39,981 which was accepted by the assessing officer.
He determined the taxable turnover at Rs.52,79,962 representing sale of wheat products taxable at 2 per cent.
He found that the dealer had sold gunny bags in which wheat products had been packed and determined its turnover at Rs. 1,37,150 and assessed the same at 4 1/2 %.
The First Appellate Authority on assessee 's appeal held: "The learned Assessing Officer was not justi fied in adding back the price of container in the gross turnover.
What he should have done is to tax a portion of the taxable turnover at a different rate or in other words out of the turnover taxable under the Bihar Sales Tax Act, the price of bags calculated @ Rs.
O.70 paise per hundred kilogram should have been deducted and taxed @ 1/2%.
The remaining was to be taxed @2% The dealer filed a Revision before the Tribunal and contended that the demand of sales tax payable at different rates on the calculated turnover of gunny bags was not at all warranted as no price had been charged for the contain ers.
The Tribunal found: "(1) The dealer transferred the property in the gunny bags, the packing material, to the purchasers f:or price.
(2) The price of the gunny bags was included in the consolidated rates of price charged by the dealer.
(3) There was an implied agreement for the sale of gunny bags between the dealer and the different purchasers to whom the wheat products were supplied.
(4) The transfer of gunny bags was impliedly covered by the contract of sale with regard to the wheat products.
1050 On these findings the Tribunal held: "We hold that the learned lower courts were justified in levying tax at a different rate on the turnover on account of sale of gunny bags in which the wheat products were sold.
" It further found: "The learned Deputy Commissioner has given a direction for determination of the turnover on account of sale of gunny bags.
On being asked the applicant accepted that the accounts maintained by him would reveal the exact number of gunny bags used in the trans action of sale under consideration as also the price of the same.
Hence we direct in modifi cation of the orders passed by the learned Deputy Commissioner in this behalf that the learned Assessing Officer should ascertain from the accounts, the turnover on account of sale of gunny bags as container of wheat products during the period under consideration and assess tax thereon at the prescribed rate of 4 1/2 %.
The balance turnover shall be assessed at 2%" Reliance was placed on the provisions of clause (3) of the Roller Mills Wheat Products (Price Control) Order, 1964.
That clause provides: "3.
Maximum ex mill prices of wheat products.
"No owner or other person in charge of a roller mill shall sell, or offer for sale, ex mill any of the wheat products specified in column 1 of the Schedule II to this Order ( a ) . . . . . . . . . (b) In the State of Maharashtra (excluding Greater Bombay) and in any other State (not being a State specified sub clause (a), to which this Order applies, at a price exceeding the price specified against the clause 3 thereof.
Explanation : The prices referred to in this clause are: (i) Exclusive of: 1051 ( a ) . . . . . . . . . ( b ) . . . . . . . . . (ii) for net weight (inclusive of the cost of the bag), but where wheat products are sold in cloth bags in quantities of 40 kgs.
net, 20 kgs.
net and 10 kgs.
net, a sum of 70 np.
37 np.
and 19 np.
respectively, towards the cost of the cloth bag may be charged in addition to the said prices.
" In our view, the Tribunal rightly came to the conclusion that there was implied agreement of sale of the gunny bags.
Admittedly gunny bags are a different commodity and sale thereof is assessable to tax at 4 1/2 %.
It is not disputed that appellant bought gunny bags for packing wheat products for the purpose of sale.
The Control Order contemplates a net weight which means that the weight of the bag is includ ed in the price to be charged by the dealer.
Under the explanation when packing is done in cloth bags, a higher rate is admissible.
The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted.
This Court in Commissioner of Taxes vs Prabhat Marketing Company Ltd., 19 STC 84 has held: "In Hyderabad Deccan Cigarette Factor) ' vs The State of Andhra Pradesh, (17 STC 624) it was held by this Court that in a case of this description what the Sales tax Authorities had to do was to ask and answer the question whether the parties, having regard to the circumstances of the case, intended to sell or buy the packing materials or whether the subject matter of the contracts of sale was only an exempted article (here exigible to tax at redical rate), and packing materials did not form part of the bargain at all, but were used by the sellers as a convenient and cheap vehicle of transport.
" In that decision it was further pointed out that the ques tion as to whether there was an agreement to sell packing material was a pure question of fact depending upon the circumstances found in each case.
The Tribunal and the High Court have recorded a clear finding that there was an im plied contract for sale of the gunny bags along with the products contained therein.
1052 In this Court, the assessee filed an affidavit and produced a communication purporting to be of the Regional Director (Food), Eastern Region, Government of India, dated July 23, 1957.
This not being the part of the record and the affidavit having been filed at a belated stage has got to be rejected.
There is no scope to dispute the assessability of sales tax on the turnover of gunny bags.
This appeal fails and is dismissed.
Parties are directed to bear their own costs.
A.P.J. Appeal dismissed.
|
For the year 1964 65, the assessee, a registered dealer, under the Bihar Sales Tax Act, 1959 returned a gross turn over of Rs.53,39,981 which was accepted by the Assessing Officer.
He determined the taxable turnover at Rs.52,79,962 representing the sale of wheat products taxable at 2%.
He found that the dealer has sold gunny bags in which wheat products had been packed and determined its turnover at Rs.1,37,150 and assessed the same at 4 1/2%.
The First Appellate Authority on assessee 's appeal held that the Assessing Officer was not justified in adding back the price of container in the gross turnover.
What he should have done is to tax a portion of the taxable turnover at a different rate or out of the turnover taxable, the price of bags calculated at the rate of 70 paise per 100 kilogram should have been deducted and taxed at the rate of 4 1/2%.
The remaining was to be taxed at the rate of 2%.
In the revision before the Tribunal the assessee con tended that the demand of sales tax payable at different rates on the calculated turnover of gunny bags was not at all warranted as no price had been charged for the contain ers.
The Tribunal held that the lower Courts were justified in levying tax at a different rate on the turnover on ac count of sale of gunny bags in which the wheat products were sold and directed that the Assessing Officer should ascer tain from the accounts, the turnover on account of sale of gunny bags as container of wheat products during the period under consideration and assess tax thereon at the prescribed rate of 4 1/2%.
The balance turnover shall be assessed at 2%.
In the reference the High Court affirmed this view.
Dismissing the appeal, 1048 HELD: 1.
The Control Order contemplates a net weight which means that the weight of the bag is included in the price to be charged by the dealer.
Under the explanation when packing is done in clothbags, a higher rate is admissi ble.
The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted.
[1051C D] Commissioner of Taxes vs Prabhat Marketing Company Ltd., 19 STC 84, referred to. 2.
The Tribunal rightly came to the conclusion that there was implied agreement of sale of the gunny bags.
Admittedly, gunny bags are a different commodity and sale thereof is assessable to tax at 4V1%.
It is not disputed that appellant bought gunny bags for packing wheat products for the purpose of sale.
[1051C] 3.
The question as to whether there was an agreement to sell packing material is a pure question of fact depending upon the circumstances found in each case.
[1051G H] 4.
The Tribunal and the High Court in the instant case, have recorded a clear finding that there was an implied contract for sale of the gunny bags with the products con tained therein.
[1051H]
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ivil Appeal No. 103 of 1975.
From the Judgment and Order dated 19.4.1974 of the Patna High Court in Taxation Case No. 21 of 1970.
S.K. Dhingra and K.B. Rohtagi for the Appellants.
D .N. Goburdhan and D. Goburdhan for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal is by special leave.
Challenge herein is to the decision of the Patna High Court rendered on a reference under Section 33(1) of the Bihar Sales Tax Act, 1959.
The following question was referred to the High Court for its opinion, by the Commercial Taxes Tribunal of Bihar: 1049 "Whether in the facts and circumstances of the case, the direction of the Tribunal to ascer tain the price of the containers (gunny bags) of wheat products sold for an all inclusive price under the provisions of the Roller Mills Wheat Products (Price Control) Order, 1964, for taxing the same at a higher rate of 4 1/2 % is legally valid? For the year 1964 65, the assessee, a registered dealer, under the Bihar Sales Tax Act returned a gross turnover of Rs.53,39,981 which was accepted by the assessing officer.
He determined the taxable turnover at Rs.52,79,962 representing sale of wheat products taxable at 2 per cent.
He found that the dealer had sold gunny bags in which wheat products had been packed and determined its turnover at Rs. 1,37,150 and assessed the same at 4 1/2 %.
The First Appellate Authority on assessee 's appeal held: "The learned Assessing Officer was not justi fied in adding back the price of container in the gross turnover.
What he should have done is to tax a portion of the taxable turnover at a different rate or in other words out of the turnover taxable under the Bihar Sales Tax Act, the price of bags calculated @ Rs.
O.70 paise per hundred kilogram should have been deducted and taxed @ 1/2%.
The remaining was to be taxed @2% The dealer filed a Revision before the Tribunal and contended that the demand of sales tax payable at different rates on the calculated turnover of gunny bags was not at all warranted as no price had been charged for the contain ers.
The Tribunal found: "(1) The dealer transferred the property in the gunny bags, the packing material, to the purchasers f:or price.
(2) The price of the gunny bags was included in the consolidated rates of price charged by the dealer.
(3) There was an implied agreement for the sale of gunny bags between the dealer and the different purchasers to whom the wheat products were supplied.
(4) The transfer of gunny bags was impliedly covered by the contract of sale with regard to the wheat products.
1050 On these findings the Tribunal held: "We hold that the learned lower courts were justified in levying tax at a different rate on the turnover on account of sale of gunny bags in which the wheat products were sold.
" It further found: "The learned Deputy Commissioner has given a direction for determination of the turnover on account of sale of gunny bags.
On being asked the applicant accepted that the accounts maintained by him would reveal the exact number of gunny bags used in the trans action of sale under consideration as also the price of the same.
Hence we direct in modifi cation of the orders passed by the learned Deputy Commissioner in this behalf that the learned Assessing Officer should ascertain from the accounts, the turnover on account of sale of gunny bags as container of wheat products during the period under consideration and assess tax thereon at the prescribed rate of 4 1/2 %.
The balance turnover shall be assessed at 2%" Reliance was placed on the provisions of clause (3) of the Roller Mills Wheat Products (Price Control) Order, 1964.
That clause provides: "3.
Maximum ex mill prices of wheat products.
"No owner or other person in charge of a roller mill shall sell, or offer for sale, ex mill any of the wheat products specified in column 1 of the Schedule II to this Order ( a ) . . . . . . . . . (b) In the State of Maharashtra (excluding Greater Bombay) and in any other State (not being a State specified sub clause (a), to which this Order applies, at a price exceeding the price specified against the clause 3 thereof.
Explanation : The prices referred to in this clause are: (i) Exclusive of: 1051 ( a ) . . . . . . . . . ( b ) . . . . . . . . . (ii) for net weight (inclusive of the cost of the bag), but where wheat products are sold in cloth bags in quantities of 40 kgs.
net, 20 kgs.
net and 10 kgs.
net, a sum of 70 np.
37 np.
and 19 np.
respectively, towards the cost of the cloth bag may be charged in addition to the said prices.
" In our view, the Tribunal rightly came to the conclusion that there was implied agreement of sale of the gunny bags.
Admittedly gunny bags are a different commodity and sale thereof is assessable to tax at 4 1/2 %.
It is not disputed that appellant bought gunny bags for packing wheat products for the purpose of sale.
The Control Order contemplates a net weight which means that the weight of the bag is includ ed in the price to be charged by the dealer.
Under the explanation when packing is done in cloth bags, a higher rate is admissible.
The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted.
This Court in Commissioner of Taxes vs Prabhat Marketing Company Ltd., 19 STC 84 has held: "In Hyderabad Deccan Cigarette Factor) ' vs The State of Andhra Pradesh, (17 STC 624) it was held by this Court that in a case of this description what the Sales tax Authorities had to do was to ask and answer the question whether the parties, having regard to the circumstances of the case, intended to sell or buy the packing materials or whether the subject matter of the contracts of sale was only an exempted article (here exigible to tax at redical rate), and packing materials did not form part of the bargain at all, but were used by the sellers as a convenient and cheap vehicle of transport.
" In that decision it was further pointed out that the ques tion as to whether there was an agreement to sell packing material was a pure question of fact depending upon the circumstances found in each case.
The Tribunal and the High Court have recorded a clear finding that there was an im plied contract for sale of the gunny bags along with the products contained therein.
1052 In this Court, the assessee filed an affidavit and produced a communication purporting to be of the Regional Director (Food), Eastern Region, Government of India, dated July 23, 1957.
This not being the part of the record and the affidavit having been filed at a belated stage has got to be rejected.
There is no scope to dispute the assessability of sales tax on the turnover of gunny bags.
This appeal fails and is dismissed.
Parties are directed to bear their own costs.
A.P.J. Appeal dismissed.
|
ivil Appeal No. 103 of 1975.
From the Judgment and Order dated 19.4.1974 of the Patna High Court in Taxation Case No. 21 of 1970.
S.K. Dhingra and K.B. Rohtagi for the Appellants.
D .N. Goburdhan and D. Goburdhan for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal is by special leave.
Challenge herein is to the decision of the Patna High Court rendered on a reference under Section 33(1) of the Bihar Sales Tax Act, 1959.
The following question was referred to the High Court for its opinion, by the Commercial Taxes Tribunal of Bihar: 1049 "Whether in the facts and circumstances of the case, the direction of the Tribunal to ascer tain the price of the containers (gunny bags) of wheat products sold for an all inclusive price under the provisions of the Roller Mills Wheat Products (Price Control) Order, 1964, for taxing the same at a higher rate of 4 1/2 % is legally valid? For the year 1964 65, the assessee, a registered dealer, under the Bihar Sales Tax Act returned a gross turnover of Rs.53,39,981 which was accepted by the assessing officer.
He determined the taxable turnover at Rs.52,79,962 representing sale of wheat products taxable at 2 per cent.
He found that the dealer had sold gunny bags in which wheat products had been packed and determined its turnover at Rs. 1,37,150 and assessed the same at 4 1/2 %.
The First Appellate Authority on assessee 's appeal held: "The learned Assessing Officer was not justi fied in adding back the price of container in the gross turnover.
What he should have done is to tax a portion of the taxable turnover at a different rate or in other words out of the turnover taxable under the Bihar Sales Tax Act, the price of bags calculated @ Rs.
O.70 paise per hundred kilogram should have been deducted and taxed @ 1/2%.
The remaining was to be taxed @2% The dealer filed a Revision before the Tribunal and contended that the demand of sales tax payable at different rates on the calculated turnover of gunny bags was not at all warranted as no price had been charged for the contain ers.
The Tribunal found: "(1) The dealer transferred the property in the gunny bags, the packing material, to the purchasers f:or price.
(2) The price of the gunny bags was included in the consolidated rates of price charged by the dealer.
(3) There was an implied agreement for the sale of gunny bags between the dealer and the different purchasers to whom the wheat products were supplied.
(4) The transfer of gunny bags was impliedly covered by the contract of sale with regard to the wheat products.
1050 On these findings the Tribunal held: "We hold that the learned lower courts were justified in levying tax at a different rate on the turnover on account of sale of gunny bags in which the wheat products were sold.
" It further found: "The learned Deputy Commissioner has given a direction for determination of the turnover on account of sale of gunny bags.
On being asked the applicant accepted that the accounts maintained by him would reveal the exact number of gunny bags used in the trans action of sale under consideration as also the price of the same.
Hence we direct in modifi cation of the orders passed by the learned Deputy Commissioner in this behalf that the learned Assessing Officer should ascertain from the accounts, the turnover on account of sale of gunny bags as container of wheat products during the period under consideration and assess tax thereon at the prescribed rate of 4 1/2 %.
The balance turnover shall be assessed at 2%" Reliance was placed on the provisions of clause (3) of the Roller Mills Wheat Products (Price Control) Order, 1964.
That clause provides: "3.
Maximum ex mill prices of wheat products.
"No owner or other person in charge of a roller mill shall sell, or offer for sale, ex mill any of the wheat products specified in column 1 of the Schedule II to this Order ( a ) . . . . . . . . . (b) In the State of Maharashtra (excluding Greater Bombay) and in any other State (not being a State specified sub clause (a), to which this Order applies, at a price exceeding the price specified against the clause 3 thereof.
Explanation : The prices referred to in this clause are: (i) Exclusive of: 1051 ( a ) . . . . . . . . . ( b ) . . . . . . . . . (ii) for net weight (inclusive of the cost of the bag), but where wheat products are sold in cloth bags in quantities of 40 kgs.
net, 20 kgs.
net and 10 kgs.
net, a sum of 70 np.
37 np.
and 19 np.
respectively, towards the cost of the cloth bag may be charged in addition to the said prices.
" In our view, the Tribunal rightly came to the conclusion that there was implied agreement of sale of the gunny bags.
Admittedly gunny bags are a different commodity and sale thereof is assessable to tax at 4 1/2 %.
It is not disputed that appellant bought gunny bags for packing wheat products for the purpose of sale.
The Control Order contemplates a net weight which means that the weight of the bag is includ ed in the price to be charged by the dealer.
Under the explanation when packing is done in cloth bags, a higher rate is admissible.
The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted.
This Court in Commissioner of Taxes vs Prabhat Marketing Company Ltd., 19 STC 84 has held: "In Hyderabad Deccan Cigarette Factor) ' vs The State of Andhra Pradesh, (17 STC 624) it was held by this Court that in a case of this description what the Sales tax Authorities had to do was to ask and answer the question whether the parties, having regard to the circumstances of the case, intended to sell or buy the packing materials or whether the subject matter of the contracts of sale was only an exempted article (here exigible to tax at redical rate), and packing materials did not form part of the bargain at all, but were used by the sellers as a convenient and cheap vehicle of transport.
" In that decision it was further pointed out that the ques tion as to whether there was an agreement to sell packing material was a pure question of fact depending upon the circumstances found in each case.
The Tribunal and the High Court have recorded a clear finding that there was an im plied contract for sale of the gunny bags along with the products contained therein.
1052 In this Court, the assessee filed an affidavit and produced a communication purporting to be of the Regional Director (Food), Eastern Region, Government of India, dated July 23, 1957.
This not being the part of the record and the affidavit having been filed at a belated stage has got to be rejected.
There is no scope to dispute the assessability of sales tax on the turnover of gunny bags.
This appeal fails and is dismissed.
Parties are directed to bear their own costs.
A.P.J. Appeal dismissed.
|
For the year 1964 65, the assessee, a registered dealer, under the Bihar Sales Tax Act, 1959 returned a gross turn over of Rs.53,39,981 which was accepted by the Assessing Officer.
He determined the taxable turnover at Rs.52,79,962 representing the sale of wheat products taxable at 2%.
He found that the dealer has sold gunny bags in which wheat products had been packed and determined its turnover at Rs.1,37,150 and assessed the same at 4 1/2%.
The First Appellate Authority on assessee 's appeal held that the Assessing Officer was not justified in adding back the price of container in the gross turnover.
What he should have done is to tax a portion of the taxable turnover at a different rate or out of the turnover taxable, the price of bags calculated at the rate of 70 paise per 100 kilogram should have been deducted and taxed at the rate of 4 1/2%.
The remaining was to be taxed at the rate of 2%.
In the revision before the Tribunal the assessee con tended that the demand of sales tax payable at different rates on the calculated turnover of gunny bags was not at all warranted as no price had been charged for the contain ers.
The Tribunal held that the lower Courts were justified in levying tax at a different rate on the turnover on ac count of sale of gunny bags in which the wheat products were sold and directed that the Assessing Officer should ascer tain from the accounts, the turnover on account of sale of gunny bags as container of wheat products during the period under consideration and assess tax thereon at the prescribed rate of 4 1/2%.
The balance turnover shall be assessed at 2%.
In the reference the High Court affirmed this view.
Dismissing the appeal, 1048 HELD: 1.
The Control Order contemplates a net weight which means that the weight of the bag is included in the price to be charged by the dealer.
Under the explanation when packing is done in clothbags, a higher rate is admissi ble.
The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted.
[1051C D] Commissioner of Taxes vs Prabhat Marketing Company Ltd., 19 STC 84, referred to. 2.
The Tribunal rightly came to the conclusion that there was implied agreement of sale of the gunny bags.
Admittedly, gunny bags are a different commodity and sale thereof is assessable to tax at 4V1%.
It is not disputed that appellant bought gunny bags for packing wheat products for the purpose of sale.
[1051C] 3.
The question as to whether there was an agreement to sell packing material is a pure question of fact depending upon the circumstances found in each case.
[1051G H] 4.
The Tribunal and the High Court in the instant case, have recorded a clear finding that there was an implied contract for sale of the gunny bags with the products con tained therein.
[1051H]
|
For the year 1964 65, the assessee, a registered dealer, under the Bihar Sales Tax Act, 1959 returned a gross turn over of Rs.53,39,981 which was accepted by the Assessing Officer.
He determined the taxable turnover at Rs.52,79,962 representing the sale of wheat products taxable at 2%.
He found that the dealer has sold gunny bags in which wheat products had been packed and determined its turnover at Rs.1,37,150 and assessed the same at 4 1/2%.
The First Appellate Authority on assessee 's appeal held that the Assessing Officer was not justified in adding back the price of container in the gross turnover.
What he should have done is to tax a portion of the taxable turnover at a different rate or out of the turnover taxable, the price of bags calculated at the rate of 70 paise per 100 kilogram should have been deducted and taxed at the rate of 4 1/2%.
The remaining was to be taxed at the rate of 2%.
In the revision before the Tribunal the assessee con tended that the demand of sales tax payable at different rates on the calculated turnover of gunny bags was not at all warranted as no price had been charged for the contain ers.
The Tribunal held that the lower Courts were justified in levying tax at a different rate on the turnover on ac count of sale of gunny bags in which the wheat products were sold and directed that the Assessing Officer should ascer tain from the accounts, the turnover on account of sale of gunny bags as container of wheat products during the period under consideration and assess tax thereon at the prescribed rate of 4 1/2%.
The balance turnover shall be assessed at 2%.
In the reference the High Court affirmed this view.
Dismissing the appeal, 1048 HELD: 1.
The Control Order contemplates a net weight which means that the weight of the bag is included in the price to be charged by the dealer.
Under the explanation when packing is done in clothbags, a higher rate is admissi ble.
The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted.
[1051C D] Commissioner of Taxes vs Prabhat Marketing Company Ltd., 19 STC 84, referred to. 2.
The Tribunal rightly came to the conclusion that there was implied agreement of sale of the gunny bags.
Admittedly, gunny bags are a different commodity and sale thereof is assessable to tax at 4V1%.
It is not disputed that appellant bought gunny bags for packing wheat products for the purpose of sale.
[1051C] 3.
The question as to whether there was an agreement to sell packing material is a pure question of fact depending upon the circumstances found in each case.
[1051G H] 4.
The Tribunal and the High Court in the instant case, have recorded a clear finding that there was an implied contract for sale of the gunny bags with the products con tained therein.
[1051H]
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Petition Nos.
1483, 1494 and 1544 of 1986 etc.
Under Article 32 of the Constitution of India.
Dr: Y.S. Chitale, Satish Chandra, P.K. Banerjee, S.N. Kacker, K.C. Agarawal, S.S. Rathore, L.K. Garg, M.K.D. Namboodiary, P.M. Amin, Ashok Grover, Bulchandani, M.N. Shroff, P.H. Parekh and Sohail Dutt for the Petitioners.
K. Parasaran, Attorney Genera1, G. Ramaswamy Additional Solicitor General, G. Subramaniam, A.S. Rao, Ms. Relan and P.P. Parmeshwaran for the Respondents.
R.S. Nariman, (Indo Afghan Chamber of Commerce).
Kapil Sibal, (M/s Raj Prakash Chemicals) and Rajiv Dutta for the Interveners.
The Judgment of the Court Was delivered by SABYASACHI MUKHARJI, J.
Writ Petition No. 1483 Of 1986 is directed.
against 'the Show Cause Notices dated 21st August, 1986, 11th September, 1986 and 26th September, 1986 issued to the petitioners Messrs.D. Navinchandra & Company, a partnership firm and Dilip Kumar Dalpatlal Mehta, a part ner 'of the said firm.
In order to 'appreCiate this chal lenge;, it is necessary to refer to certain facts.
This petition raises the question of the rights of the petition ers and 993 other diamond exporters who were entitled to export house certificates and additional licences under import policy of 1978 79 and who were granted the same pursuant to the judg ment and 'order of this Court dated 18th April,1985.
As we shall explain later, there is no conflict With this decision of a Bench which consisted of a bench of three judges and the subsequent decisions of this Court which We.
Shall presently refer.
It is necessary also that in order to make out.
a case, the petitioners have sought to emphasise on the point that the decision dated 18th April, 1985 was a deci sion of three learned Judges, in Order to spin out a case of some sort of conflict with this decision and certain subse quent decisions of this Court consisting of benches of two ' learned judges.
It appears that the import policy issued by the Government of India for the year 1978 79 by paragraph 176 provided for, additional licences.
On 29th April, 1979, the first petitioner, a diamond exporters, was refused Export House Certificate.
The said.
petitioner filed a writ petition before the High Court of Bombay.
being Misc.
peti tion No. 1293/1979.
By his order and judgment, Pendse , J. made the rule absolute holding that canalised items were not banned items, and there was no reason why the first peti tioner should not be compel " led to approach the canalising agency for import of the same.
On 7th April, 1983, the Delhi High Court delivered a judgment in Civil writ Petition No. 1501 of 1981 (which for the sake of convenience, the party has chosen to describe as Rajnikant Bros. & Ors.
case allow ing the diamond exporters the same and holding that merely Canalising an item could not be regarded as import of that item being absolutely banned.
Against` these judgments special leave petitions were filed in this Court, Appeal was also filed on 27th March.
1984 by the Import Control Authorities and Union of India against the judgment dated 11th November, 1983 mentioned hereinbefore passed by Pendse, J. and the said appeal as dismissed on that date.
Against the ' same, the, Export Control authorities and Union of India filed special leave petition No. 7190 Of 1984 in this Court.
Similar special leave petitions were filed in this Court against similar judgments of the Bombay High Court.
On 18th April, 1985, by a common judgment, the special leave.
petitions were disposed of.
As much has been made out 'of this judgment and order, it is necessary to refer to the same.
The matter was disposed of by the order in Civil Appeal No, 1423 of 1984 ' by a bench consisting Fazal Ali, J., Varadarajan, J. and one of us (Sabyasachi Mukharji, J.).
It was held by the said order that there was no requirement of diversification of exports as a condition for the grant of Export 994 House Certificate in the Import Policy for 1978 79.
There fore, while confirming the High Court 's judgment, quashing the order impugned in the writ petitions in the High Court, this Court directed the appellants namely Union of India and Import Control authorities to issue necessary Export House Certificates for the year 1978 79.
It was further directed that Export House Certificates should be granted within three months from that date.
The order stated that 'save and except items which are specifically banned under the preva lent import policy at the time of import, the respondents shall be entitled to import all other items whether cana lised or otherwise in accordance with the relevant rules '.
The appeals were disposed of accordingly with no order as to costs.
Pursuant to the aforesaid order, on 29th July, 1985, import licence was issued, it is claimed, to the first petitioner.
of the c.i.f. value of Rs.71,15,900.
Pursuant to the said import licence, the first petitioner imported several consignments of items failing either under Appendix 3 (List of Limited Permissible Items), Appendix 2B (List of Restricted Items) or Appendix 5 (Canalised Items).
According to the petitioner, in the matter of clearance of such con signments different standards were applied by the Custom authorities.
On 18th October, 1985, in special leave petition No. 11843 of 1985 In the case of Raj Prakash Chemicals Ltd. vs Union of India this Court directed that Acrylic Ester Mono mors would not be permitted to be cleared until further orders unless they had already been cleared.
Similarly, on 31st January, 1986, interim order was passed in the case of M/s Indo Afghan Chambers of Commerce vs Union of India (Writ Petition No. 199 of 1986) directing that Dry Fruits in respect of which Custom clearance had been obtained till 30th January, 1986 would be allowed to be cleared and no clearance of Dry fruits from 31st January, 1986 onwards would be made by the Custom authorities until further or ders.
On 5th March, 1986, judgment was delivered in the case of Raj Prakash Chemicals Ltd. and Another vs Union of India and Others, by a bench consisting of three learned Judges Tulzapurkar, J. and two of us (R.S. Pathak, J. as the Chief Justice then was, and Sabyasachi Mukharji, J.).
This Court held that additional licence holders were entitled to import items permissible to Export Houses under Import Policy 1978 79 excluding those items which fell in Appendix 3 (List of Banned Items) of the Import Policy 1985 88.
This Court observed that diamond exporters who were granted Addi 995 tional Licences had formed a bona fide belief that they could import all the items accessible to them under Open General Licence under the Import Policy of 1978 79 except those placed in Appendix 2 Part A of the Banned List under the Import Policy 1985 88.
This belief was formed on the basis of consistent orders of the High Courts and consistent manner in which Import Control authorities construed those orders.
In view of such a belief, it was further held by this Court, in the interest of broad principles of justice, equity and fair play and to avoid undeserved hardship, without going to the legal technicalities that those diamond exporters who were granted Additional Licences under the Import Policy 1978 79 and had opened and established irrevo cable letters of credit before 18th October, 1985 i.e. the date on which the interim order was passed by this Court in Raj Prakash 's case as mentioned hereinbefore, should be permitted, notwithstanding the construction placed by this Court on the order dated 18th April, 1985 of this Court, to clear the goods imported, or to be imported by them pursuant to such irrevocable letters of credit.
In other words, all imports effected pursuant to such letters of credit should be deemed to have been legally and properly made, and should entail no adverse consequences whatsoever.
This Court fur ther reiterated that the Court must be presumed to have given effect to law That presumption can be rebutted only upon evidence showing a clear intention to the contrary, either expressly or by necessary implication.
This Court noted that the order dated 18th April, 1985 which we have set out hereinbefore used the expression "specifically banned" and the controversy before this Court in Raj Pra kash 's case was on the meaning of the expression 'specifi cally banned ' and the controversy between the parties cen tered round the meaning of the words 'specifically banned '.
It was mentioned that Appendix 3 is the list of items which could not be imported by an Export House on additional licence, it was a ban with reference to the category of importers.
Appendix 4 is the list of items which could not be imported by anyone whosoever.
This Court, therefore, was of the view that when regard is had to the Import Policy 1984 85, reference must necessarily be made to the corre sponding Appendix 3, formerly described as the List of Banned Items and now described as the List of Limited Per missible Items, and Appendix 2 Part A which is now the list of Banned Items replacing Appendix 4 (List of Absolutely Banned Items).
In other words, said the Court, the Addition al Licences to be issued to diamond exporters entitled them to import items permissible to Export Houses under such licence under the Import Policy 1978 79 excluding those items which fell within Appendices 3 and 4 of the Import Policy 1978 79 and also excluding items which fell in Appen dix 3 and Appendix 2 Part A of the Import This Court was of the view that this is the meaning which must be given to the terms of the order dated 18th April, 1985.
This Court noted that when this Court made the previous order on 18th April, 1985 when the Import Policy of 1985 88 was in force.
there were only two items which were absolutely banned.
and these were animal tallow and animal cannot.
That was also Substantially the position under the Import Policy 1984 85.
This Court was of the view that in the Import Policies of 1984 85 and 1985 88 the items open to import under Open General Licence were then set forth, when Raj Prakash 's judgment was delivered i.e. in Appendix 6.
A perusal of Part I1 of List 8 in Appendix 6 indicated that it enumerated in fairly long detail the items allowed to be imported by the Export Houses holding Additional Licences for sale of those items to eligible Actual Users (Industrial) subject to Actual User conditions.
That was the entitlement of the holder of an Additional Licence under paragraph 265(4) of the Import Policy 1985 88.
It is necessary to set out in detail the aforesaid judgment and also to refer to the order of 18th April.
1985 to emphasise that whether non canalised items could be imported directly.
and not through canalised agency, was not in issue in either of these two cases.
nor decided or adju dicated upon.
In the judgment in Raj Prakash 's case (supra), it was held that Additional Licence holders were entitled to import items permissible to Export Houses under the Import Policy 1978 79 excluding those items which fell in Appendix 3 (list of banned items) of the Import Policy 1985 88.
On 17th March, 1986, letter was written by the Joint Chief Controller of Imports to Messrs. B. Vijay Kumar and Co. stating that against Additional Licences issued in terms of this Court 's Order dated 18th April, 1985, import of items permissible against Additional Licences in terms of Policy for 1978 79 would be allowed even if such items were in the list of canalised items in Policy for 1978 79.
On 3rd April, 1986, there was a meeting with Member of C.B.E.C. and Principal Collector where the minutes recorded that items which were under O.G.L. during 1978 79 and subse quently canalised in Policy for 1985 88 would be allowed to be imported.
On 23rd April, 1986, a circular was issued from the Under Secretary to the Government of India to port authorities stating that canalised items 997 were not covered within the purview of this Court 's decision in Raj Prakash 's case and Additional Licence holders would be allowed to import canalised item.
By a letter on 14/15th May, 1986 from Principal Collector to Chairman, Western Region, Federation of Indian Export Organisation, the matter had been clarified and clearance of canalised items against Additional Licences was unconditionally allowed.
This Court again dealt with the question in the case of M/s Indo Afghan Chambers of Commerce and Another etc.
vs Union of India and Other etc., [1986] 3 SCC 352.
In that decision two of us (R.S. Pathak, J. as the learned Chief Justice then was and Sabyasachi Mukharji, J.) were parties.
It was held that under the import policy of 1978 79 dry fruits (exclud ing cashewnuts) could be imported by all persons under the Open General Licence.
There was no need to obtain any Addi tional Licence for importing items in the year 1978 79 and therefore, the wrongful denial of Additional Licences to diamond exporters in the year 1978 79, could not justify any restitution subsequently in regard to the import of dry fruits (other than cashewnuts).
It was further observed that under the Import Policy 1985 88, dry fruits (excluding cashewnuts and dates) were no longer open to import under the Open General Licence.
The sanction for importing them must be found under some other provision of the Import Policy.
The diamond exporters, it was held, ' could not be regarded as dealers engaged in the trade of stocking and selling dry fruits (excluding cashewnuts and dates).
They were, therefore, not entitled to the advantage of paragraph 181 (3) of the Import Policy 1985 88.
Dry fruits, it was further held, must be regarded as consumer goods of agricul tural origin.
The words "agricultural origin" in Item 121 of Appendix 2 Part B are used in the broadest sense.
The words 'consumer goods ' in item 121 referred to dry fruits imported for supply to Actual Users (Industrial).
It was further held that dry fruits do not appear in Appendix 3 Part A and 5 nor can be imported under the Open General Licence under the Import Policy 1985 88, Inasmuch as they fail within Item 121 of Appendix 2 part B they are excluded from the scope of Item 1 of Appendix 6, and cannot be imported as raw materi als and consumables for sale to Actual Users (Industrial).
Appendix 2 Part B (List of Restricted Items) was also suc cessor of Appendix 4 (List of Absolutely Banned Items) under the Import Policy 1978 79.
This Court reiterated, and it was important to emphasise, that On the reasoning which found favour with this Court in Raj Prakash 's case, it must be held that diamond exporters holding Additional Licences were not entitled to import goods enumerated in Appendix 2 Part B of the Import Policy 1985 88.
As held in that case, holders of Additional Licences were 998 entitled to import only those goods which were included in Appendix 6 Part 2 List 8 of the Import Policy 1985 88.
Dry fruits were not included in that list and therefore they could not be imported under Additional Licences.
It is stated that on 20th May, 1986, there was an order of adjudication in respect of one consignment of the first petitioner in this case i.e. Messrs. D. Navinchandra & Co. of items falling in Appendix 2B (List of Restricted Items) ( 10 Bills of Entry) imposing fine aggregating to Rs.45,000.
Then on 21st August, 1986, a show cause notice was issued to the first petitioner in this petition in respect of consign ment falling in Appendix 5 (Canalised Items) of the Policy for 1985 88.
Reply was duly given on 9th September, 1986 and a show cause notice was issued on 11th September, 1986 to the first petitioner in respect of one consignment falling in Appendix 2B (List of Restricted Items) of Policy for 1985 88.
In the meantime, this Court had occasion to examine some passage of this decision.
This question was examined and it is necessary to refer to the said two subsequent decisions of this Court.
The first one is the decision in Union of India vs Godrej Soaps Pvt. Ltd. and Another, ; and the second one is the decision in M/s Star Diamond Co. India vs Union of India and Others, ; It is neces sary first to refer to Godrej Soaps ' case.
It was held that a diamond exporter could import the items he was entitled to import under the Import Policy 1978 79 provided they were importable also under the Import Policy ruling at the time of import.
These are items which are open to import by an Export House holding an Additional Licence for sale to eligible Actual Users (Industrial).
These are items which could be directly imported, for example, the items enumerat ed in Part 2 of List 8 of Appendix VI of the Import Policy 1985 88.
These are items which are not 'canalised '. 'Cana lised ' items are those items which are ordinarily open to import only through a public sector agency.
There is, howev er, nothing to prevent an Import Policy from providing in the future that an Export House holding an Additional Li cence can directly import certain canalised items also.
In that event, an Export House holding an Additional Licence would be entitled to import items "whether canalised or otherwise", meaning thereby items open ordinarily to direct import (non canalised items) as well as items directly importable although on the canalised list.
It is in that sense that the Court had intended to define the entitlement of a diamond exporter by using the words "whether canalised or otherwise" in its order dated 18th April, 1985.
999 In that case this Court found that in respect of Palm Kernel Fatty Acid which was a canalised item listed as Item 9(v) in Appendix V Part B of the Import Policy 1985 88, there is no provision in that policy which permitted the import of such item by an Export House holding an Additional Licence.
Therefore, both on grounds of equity and construc tion the claim of the diamond exporters, or, as in that case, a purchaser from the diamond exporter, was held to be not maintainable.
As importation of canalised items, this Court reiterated, directly by holders of additional licences was banned, it should not be construed to have been permit ted by virtue of the order of this Court and the items sought to be imported do not come within List 8 of Part 2 of Appendix 6 of the Import Policy of 1985 88 against addition al licences.
It was found that the goods were purchased by the respondents in that case after they were aware of the position of law as enunciated in Raj Prakash 's case as well as Indo Afghan Chambers of Commerce 's case.
No question of any restitution of rights, therefore, arose.
Goods in ques tion being specially banned goods, these could not be im ported under Item I of Appendix 6 (Import of items under Open General Licence) of Import Policy, 1985 88, more so the import being not by the Actual User (Industrial) but by somebody else from whom the respondent purchased the goods.
This position was reiterated in the case of M/s Star Diamond Co. India vs Union of India and others (supra).
This Court further reiterated that a decision of this Court is binding on all.
To complete the narration of events, reply was given by the first petitioner to the show cause notice dated 11th September, 1986 on 18th September, 1986.
On 26th September, 1986, another show cause notice was issued to the Petitioner in respect of another consignment falling in Appendix 2B (List of Restricted Items) of Policy for 1985 88.
Personal hearing was given to the first peti tioner thereafter.
The petitioner moved this Court under Article 32 of the Constitution, for quashing the show cause notices dated 21st August, 1986, 11th September, 1986 and 26th September, 1986 and the order of adjudication dated 20th May, 1986 and for consequential relief.
We are, however, unable to find any merit in this appli cation either in law or in equity.
1000 One of the points on which an argument was sought to be built up was that the Bench of two judges of this Court in the subsequent decisions had cut down the effect of the decision of this Court dated 18th April, 1985 in the case of Union of India vs Rajnikant Bros.
It has been stated that in subsequent decisions referred to hereinbefore, this Court had deviated and indeed differed from the view expressed in that case.
It was urged that in Rajnikant Bros. case a bench of three judges categorically stated that the respondents would be entitled "to import all other items whether cana lised or otherwise" except those which were specifically banned under the prevalent import policy at the time of import, with the relevant rules.
In our opinion, the subse quent decisions referred to hereinbefore do not take any different or contrary view.
Indeed it gives effect to the letter and spirit of the said decision.
It has to be borne in mind, that the basic background under which the Rajni kant 's decision was rendered, the Export Houses had been refused Export House Certificates because it was insisted that they should have diversified their export and that was a condition for the grant or entitlement of an export house certificate.
It was found and it is common ground now that that was wrong.
Therefore, the wrong was undone.
Those who had been denied Export House Certificates on that wrong ground were put back to the position as far as it could be if that wrong had not been done.
To do so, the Custom au thorities and Govt.
authorities were directed to issue necessary Export House certificates for the year 1978 79 though the order was passed in April, 1985.
This was a measure of restitution, but tile Court, while doing so, ensured that nothing illegal was done.
It is a presumption of law that the courts act lawfully and will not ask any authority to do anything which is illegal.
Therefore, the court directed that except those which were specifically banned under the prevalent import policy at the time of import, the respondents shall be entitled to import all other items whether canalised or not canalised in accordance with the relevant rules.
Analysing the said order, it is apparent, (1) that the importation that was permissible was of goods which were not specifically banned, (2) such ban ning must be under the prevalent import policy at the time of import, and (3) whether items which were canalised or un canalised would be imported in accordance _with the relevant rules.
These conditions had to be fulfilled.
The court never did and could not have said that canalised items could be imported in any manner not permitted nor it could have given a go bye to canalisation policy.
It must be emphasised that in the case of Raj Prakash (supra), this position has been explained by saying that only such items could 1001 be imported by diamond exporters under the Additional Li cences granted to them as could have been imported under the Import Policy of 1978 79.
the period during which the dia mond exporters had applied for Export House Certificates and had been wrongly refused and were also importable under the import policy prevailing at the time of import which in the present case would be during the import policy of 1985 88.
These were the items which had not been 'specifically banned ' under the prevalent import policy.
The items had to pass to two tests.
firstly, they should have been importable under the import policy 1978 79 and secondly they should also have been importable under the import policy 1985 88 in terms of the Order dated 18th April.
1985 and if one may add.
in such terms in accordance with the import rules ' whether canalised or not canalised.
It must be emphasised that in this case also.
the CoUrt had no occasion to consid er the significance of the words 'whether canalised or otherwise ' mentioned in the Order dated 18th April.
1985 because that point did not arise in the case before it.
What did the court then intend by these words used by the court? We have seen that diamond exporters could import the items which they were entitled to import under the Import Policy 1978 79 provided they were importable also under the import policy ruling at the time of import.
These are items which were open to import by Export Houses holding Additional Licences for sale to the Actual Users (Industrial).
These are items which were directly imported, for example, items in Part 2 List 8 of Appendix 6 of Import Policy 1985 88.
These are items which are not canalised.
Canalised items are those items which are ordinarily open to import only through a public sector agency.
Although generally these are import able through public sector agencies, it is permissible for any import policy to provide an exception to the rule and to declare that an importer might import a canalised item directly.
It is in that sense and that sense only that the Court could have intended to define the entitlement of diamond exporters.
They would be entitled to import items which were canalised or not if the import policy prevailing at the time of import permitted them to import items falling under such category.
This was also viewed in that light in the case of Indo Afghan Chambers of Commerce (supra).
It must be emphasised that in the Order dated 18th April, 1985, this Court did not do away with canalisation.
That was not the issue before this Court.
The expression 'whether canalised or not canalised ' was to include both.
This Court did not say that canalised items could be import ed directly by the importers ignoring the canalisation process.
We are of the opinion that this Court did not say that canalisation 1002 could be ignored.
That was not the issue.
High public poli cy, it must be emphasised, is involved in the scheme of canalisation.
This purpose of canalisation was examined by this Court in Daruka & Co. vs Union of India & Ors., ; where the Constitution Bench of this Court ob served that the policies of imports or exports were fash ioned not only with reference to internal or international trade, but also on monetary policy, the development of agriculture and industries and even on the political poli cies of the country and rival theories and views may be held on such policies.
If the Government decided an economic policy that import or export should be by a selected channel or through selected agencies the court would proceed on the assumption that the decision was in the interest of the general public unless the contrary was shown.
Therefore it could not be collaterally altered in the manner suggested.
The policy of canalisation which is a matter of policy of the Government was not given a go bye by the observations referred to in the Order of 18th April, 1985.
Indeed it is possible to read the Order in a manner consistent with canalisation scheme in the way we have indicated.
If that is so, then it should be so read.
When this Court observed that the fact whether items were sought to be imported by diamond merchants were canalised, would not be an impediment to the import directly by them, the Court meant to say that this could be imported directly by them through the canalisation organisation.
The need for canalisation stands on public policy and that need cannot be lightly or inferencially given a go bye.
It should not be presumed that collaterally the court had done away with the system of canalisation based, on sound public policy.
We have found nothing in the different authorities on this subject, which militate against the above views.
Therefore, the action taken by the Custom authorities in issuing adjudication notice and pro ceeding in the manner they did, we are of the opinion that they have not acted illegally or without jurisdiction.
This must proceed in accordance with law as laid down by this Court which, in our opinion, is clear enough.
The fact that in subsequent decision, the petitioner is not a party is not relevant.
Generally legal positions laid down by the court would be binding on all concerned even though Some of them have not been made parties nor were served nor any notice of such proceedings given.
As held in Star Diamond 's case (supra), the meaning of the expression "whether canalised or otherwise" used by this Court in Rajnikant Bros ' case as explained in Godrej Soaps Pvt. Ltd. case and reiterated and followed in the present case is applicable to the present petitioner.
1003 We see no substance in the submission made in the peti tion and reiterated before us in this Court for a reconsid eration of this question by a larger Bench.
In the aforesaid view of the matter, we are unable to sustain the grounds urged in support of this petition.
We are, therefore, of the opinion that proceedings must go in accordance with law.
The government 's understanding of the matter at one point of time is irrelevant.
There are several applications for impleadment.
These are allowed, and they are impleaded.
Their statements are taken on record.
Before parting with this case, certain factors must be noted.
The diamond exporters and dry fruit exporters have their full round in this Court.
Speaking entirely for my self, my conscience protests to me that when thousands remediless wrongs await in the queue for this Court 's inter vention and solution for justice, the petitions at the behest of diamond exporters and dry fruit exporters where large sums are involved should be admitted and disposed of by this Court at such a quick speed.
Neither justice nor equity nor good conscience deserves these applications to be filed or entertained.
There is no equity of restitution against the law declared categorically and repeatedly by this Court and no principle of estoppel involved in these applications.
The Writ petition is dismissed and in the facts and circumstances of this case, we direct that the petitioner must pay cost of this application.
It has been prayed that clear cut date must be fixed where contracts had been entered into and in which letters of credit prior to 15th April, 1986 have been entered into, there should be no prosecution.
It has been further prayed that where however contracts have been entered into but no letters of credit have been opened, such parties should not be penalised in the facts and circumstances of the case.
No direction is necessary by this Court on this aspect.
The authorities concerned will decide the same in taking into consideration all the facts and circumstances and taking into consideration the case of the petitioners and the alleged claim of bona fide on their part.
A submission was made on the principle of promissory estoppel and reliance was placed on the several observations of several cases including the case in Union of India and Others etc.
vs Godfrey Philips India Ltd. etc.
; , It is true that the doctrine of 1004 promissory estoppel is applicable against the Government in the exercise of its government, public or executive func tions and the doctrine of executive necessity or freedom of future executive action cannot be invoked to defeat the applicability of the doctrine of promissory estoppel.
But in this case no such case of promissory estoppel has been made out.
The intervention applications filed in this connection are allowed and the submissions contrary to what we had stated hereinbefore are rejected.
As the points involved in Writ Petition No. 1494 of 1986 are same, this is also dismissed with costs.
Interim orders, if any, are vacated forthwith.
The proceedings will proceed as expeditiously as possible in accordance with law.
For the same reasons, Writ Petition No. 1544 of 1986 is also dis missed with costs with the same observations.
H.L.C. Petition dis missed.
|
By a common order dated April 18, 1985 in C.A. No. 1423 of 1984, etc., Union of India vs Rajnikant Bros. the Court had directed issue of Export House Certificates and Addi tional Licences to the petitioners and other diamond export ers under the Import Policy 1978 79 stating: "Save and except items which are specifically banned under the preva lent Import Policy at the time of import, the respondents shall be entitled to import all other items whether cana lised or otherwise in accordance with the relevant rules".
The petitioners, who were issued Additional Licences pursu ant to this order, imported several consignments of items falling under Appendices 2B, 3 and 5 of Import Policy, 1985 88, and, while clearing them, the Customs Authorities imposed a fine of Rs.45,000 in respect of certain items failing in Appendix 2B and issued show cause notices in respect of certain other items failing in Appendices 2B and 5.
The petitioners challenge was directed not only against these orders, but extended to certain subsequent decisions of the Court which, according to them, had cut down the effect of the Court 's earlier order dated April 18, 1985 in Union of India vs Rajnikant Bros. Dismissing the petitions, HELD: The decisions rendered subsequent to the decision dated April 18, 1985 in Union of India vs Rajnikant Bros. do not take any different or contrary view.
Indeed, they give effect to the letter and spirit of that decision.
The basic background in which the decision in Union of India vs Rajni kant Bros. was rendered was that Export Houses had been refused Export House Certificates on the ground that they had not diversified their exports.
It was found that was wrong.
The wrong was undone by directing issue of Export House Certificates for 990 the year 1978 79 though the order was passed in April, 1985.
That was a measure of restitution, but the Court, while doing so, ensured that nothing illegal was done.
It is a presumption of law that the courts act lawfully and will not ask any authority to do anything which is illegal.
It was directed that except those items which were specifically banned under the prevalent import policy at the time of import, the respondents therein were entitled to import all other items whether canalised or not canalised in accordance with the relevant rules.
Analysing the said order, it is apparent: (1) that the importation that was permissible was of goods which were not specifically banned, (2) that such banning must be under the prevalent import policy at the time of import.
and (3) whether items which were canalised or uncanalised would be imported in accordance with the relevant rules.
These conditions had to be fulfilled.
The court never did and could not have said that canalised items could be imported in any manner not permitted nor it could have given a go bye to the canalisation policy.
[1000C H] (ii).
In Raj Prakash Chemicals vs Union of India,, it was explained that only such items could be imported by diamond exporters under the Additional Licences granted to them as could have been imported under the Import Policy 1978 79 and were also importable under the Import Policy prevailing at the time of import.
These were the items which had not been 'specifically banned ' under the prevalent Import Policy.
The items had to pass through two tests, firstly, they should have been importable under the Import Policy 1978 79 and, secondly, they should also have been importable under the Import Policy, 1985 88 in terms of the Order dated 18th April, 1985 and if one may add, in such terms 'in accordance with the import rules ' whether cana lised or not canalised.
The Court had no occasion to consid er in that case the significance of the words 'whether canalised or otherwise ' mentioned in the Order dated 18th April, 1985 in Union of India vs Rajnikant Bros., because that point did not arise there.
[1000H; 1001A D] (iii) What did the court then intend by the words 'whet her canalised or otherwise ' used in the order dated 18th April, 1985 in Union of India vs Rajnikant Bros? The diamond exporters could import the items which they were entitled to import under the Import Policy 1978 79 provided they were importable also under the Import Policy ruling at the time of import.
These are items which were open to import by Export Houses holding Additional Licences for Sale to the Actual Users (Industrial).
These are items which were di rectly imported, for example, items in Part II List 8 of Appendix 6 of Import Policy 1985 88.
These are items which are not canalised.
Canalised items are those 991 items which are ordinarily open to import only through a public sector agency.
Although generally these are import able through public sector agencies, it is permissible for any Import Policy to provide an exception to the rule and to declare that an importer might import a canalised item directly.
It is in that sense and that sense only that the Court could have intended to define the entitlement of diamond exporters.
They would be entitled to import items which were canalised or not if the Import Policy prevailing at the time of import permitted them to import items failing under such category.
[1001D G] (iv) In the Order dated 18th April, 1985 in Union of India vs Rajnikant Bros., this Court did not do away with canalisation.
That was not the issue before this Court.
This expression 'whether canalised or not canalised ' was to include both.
This Court did not say that canalised items could be imported directly by the importers ignoring the canalisation process.
High public policy, it must be empha sised, is involved in the scheme of canalisation.
This purpose of canalisation was examined by.this Court in Daruka of this Court observed that the policies of imports or exports were fashioned not only with reference to internal or international trade, but also on monetary policy, the development of agriculture and industries and even on the political policies of the country and rival theories and views may be held on such policies.
If the Government decid ed an economic policy that import or export should be by a selected channel or through selected agencies, the court would proceed on the assumption that the decision was in the interest of the general public unless the contrary was shown.
Therefore, it could not be collaterally altered in the manner suggested.
The policy of canalisation which is a matter of policy of the Government was not given a go bye by the observations referred to in the Order of 18th April, 1985.
Indeed, it is possible to read the Order in a manner consistent with canalisation scheme in the way we have indicated.
If that is so, then it should be so read.
When this Court observed that the fact whether items were sought to be imported by diamond merchants were canalised, would not be an impediment to the import directly by them, the Court meant to say that this could be imported directly by them through the canalisation organisation.
The need for canalisation stands on public policy and that need cannot be lightly or inferentially given a go bye.
It should not be presumed that collaterally the court had done away with the system of canalisation based on sound public policy.
We have found nothing in the different authorities on this subject, which militate against the above views.
Therefore, the action taken by the Customs Authorities in issuing adjudica tion notice and proceeding in 992 the manner they did we are of the opinion that they have not acted illegally or without jurisdiction.
This must proceed in accordance with law as laid down by this Court which, in.
our opinion is clear enough.
The fact that in subsequent decision, the petitioner is not a party is not relevant.
Generally legal positions laid down by the court would be binding on all concerned even though some of them have not been made parties nor were served nor any notice of such proceedings given.
[1001H; 1002A G] Union of India vs Rajnikant Bros., C.A. No. 1423 of 1984 decided on April 18, 1985; Raj Prakash Chemicals Ltd. & Anr.
vs Union of India & Ors.
, ; M/s. Indo Afghan Chambers of Commerce &Anr., etc.
vs Union of India & Ors., etc., [1986] 3 S.C.C. 352; Union of India vs Godrej Soaps Pvt. Ltd. &Anr., ; ; and M/s. Star Diamond Co. India vs Union of India & Ors., [1986] 4 S.C.C. 246, discussed, explained and reiterated.
Daruka & Co. vs Union of India & Ors., ; , referred to.
|
Petition Nos.
1483, 1494 and 1544 of 1986 etc.
Under Article 32 of the Constitution of India.
Dr: Y.S. Chitale, Satish Chandra, P.K. Banerjee, S.N. Kacker, K.C. Agarawal, S.S. Rathore, L.K. Garg, M.K.D. Namboodiary, P.M. Amin, Ashok Grover, Bulchandani, M.N. Shroff, P.H. Parekh and Sohail Dutt for the Petitioners.
K. Parasaran, Attorney Genera1, G. Ramaswamy Additional Solicitor General, G. Subramaniam, A.S. Rao, Ms. Relan and P.P. Parmeshwaran for the Respondents.
R.S. Nariman, (Indo Afghan Chamber of Commerce).
Kapil Sibal, (M/s Raj Prakash Chemicals) and Rajiv Dutta for the Interveners.
The Judgment of the Court Was delivered by SABYASACHI MUKHARJI, J.
Writ Petition No. 1483 Of 1986 is directed.
against 'the Show Cause Notices dated 21st August, 1986, 11th September, 1986 and 26th September, 1986 issued to the petitioners Messrs.D. Navinchandra & Company, a partnership firm and Dilip Kumar Dalpatlal Mehta, a part ner 'of the said firm.
In order to 'appreCiate this chal lenge;, it is necessary to refer to certain facts.
This petition raises the question of the rights of the petition ers and 993 other diamond exporters who were entitled to export house certificates and additional licences under import policy of 1978 79 and who were granted the same pursuant to the judg ment and 'order of this Court dated 18th April,1985.
As we shall explain later, there is no conflict With this decision of a Bench which consisted of a bench of three judges and the subsequent decisions of this Court which We.
Shall presently refer.
It is necessary also that in order to make out.
a case, the petitioners have sought to emphasise on the point that the decision dated 18th April, 1985 was a deci sion of three learned Judges, in Order to spin out a case of some sort of conflict with this decision and certain subse quent decisions of this Court consisting of benches of two ' learned judges.
It appears that the import policy issued by the Government of India for the year 1978 79 by paragraph 176 provided for, additional licences.
On 29th April, 1979, the first petitioner, a diamond exporters, was refused Export House Certificate.
The said.
petitioner filed a writ petition before the High Court of Bombay.
being Misc.
peti tion No. 1293/1979.
By his order and judgment, Pendse , J. made the rule absolute holding that canalised items were not banned items, and there was no reason why the first peti tioner should not be compel " led to approach the canalising agency for import of the same.
On 7th April, 1983, the Delhi High Court delivered a judgment in Civil writ Petition No. 1501 of 1981 (which for the sake of convenience, the party has chosen to describe as Rajnikant Bros. & Ors.
case allow ing the diamond exporters the same and holding that merely Canalising an item could not be regarded as import of that item being absolutely banned.
Against` these judgments special leave petitions were filed in this Court, Appeal was also filed on 27th March.
1984 by the Import Control Authorities and Union of India against the judgment dated 11th November, 1983 mentioned hereinbefore passed by Pendse, J. and the said appeal as dismissed on that date.
Against the ' same, the, Export Control authorities and Union of India filed special leave petition No. 7190 Of 1984 in this Court.
Similar special leave petitions were filed in this Court against similar judgments of the Bombay High Court.
On 18th April, 1985, by a common judgment, the special leave.
petitions were disposed of.
As much has been made out 'of this judgment and order, it is necessary to refer to the same.
The matter was disposed of by the order in Civil Appeal No, 1423 of 1984 ' by a bench consisting Fazal Ali, J., Varadarajan, J. and one of us (Sabyasachi Mukharji, J.).
It was held by the said order that there was no requirement of diversification of exports as a condition for the grant of Export 994 House Certificate in the Import Policy for 1978 79.
There fore, while confirming the High Court 's judgment, quashing the order impugned in the writ petitions in the High Court, this Court directed the appellants namely Union of India and Import Control authorities to issue necessary Export House Certificates for the year 1978 79.
It was further directed that Export House Certificates should be granted within three months from that date.
The order stated that 'save and except items which are specifically banned under the preva lent import policy at the time of import, the respondents shall be entitled to import all other items whether cana lised or otherwise in accordance with the relevant rules '.
The appeals were disposed of accordingly with no order as to costs.
Pursuant to the aforesaid order, on 29th July, 1985, import licence was issued, it is claimed, to the first petitioner.
of the c.i.f. value of Rs.71,15,900.
Pursuant to the said import licence, the first petitioner imported several consignments of items failing either under Appendix 3 (List of Limited Permissible Items), Appendix 2B (List of Restricted Items) or Appendix 5 (Canalised Items).
According to the petitioner, in the matter of clearance of such con signments different standards were applied by the Custom authorities.
On 18th October, 1985, in special leave petition No. 11843 of 1985 In the case of Raj Prakash Chemicals Ltd. vs Union of India this Court directed that Acrylic Ester Mono mors would not be permitted to be cleared until further orders unless they had already been cleared.
Similarly, on 31st January, 1986, interim order was passed in the case of M/s Indo Afghan Chambers of Commerce vs Union of India (Writ Petition No. 199 of 1986) directing that Dry Fruits in respect of which Custom clearance had been obtained till 30th January, 1986 would be allowed to be cleared and no clearance of Dry fruits from 31st January, 1986 onwards would be made by the Custom authorities until further or ders.
On 5th March, 1986, judgment was delivered in the case of Raj Prakash Chemicals Ltd. and Another vs Union of India and Others, by a bench consisting of three learned Judges Tulzapurkar, J. and two of us (R.S. Pathak, J. as the Chief Justice then was, and Sabyasachi Mukharji, J.).
This Court held that additional licence holders were entitled to import items permissible to Export Houses under Import Policy 1978 79 excluding those items which fell in Appendix 3 (List of Banned Items) of the Import Policy 1985 88.
This Court observed that diamond exporters who were granted Addi 995 tional Licences had formed a bona fide belief that they could import all the items accessible to them under Open General Licence under the Import Policy of 1978 79 except those placed in Appendix 2 Part A of the Banned List under the Import Policy 1985 88.
This belief was formed on the basis of consistent orders of the High Courts and consistent manner in which Import Control authorities construed those orders.
In view of such a belief, it was further held by this Court, in the interest of broad principles of justice, equity and fair play and to avoid undeserved hardship, without going to the legal technicalities that those diamond exporters who were granted Additional Licences under the Import Policy 1978 79 and had opened and established irrevo cable letters of credit before 18th October, 1985 i.e. the date on which the interim order was passed by this Court in Raj Prakash 's case as mentioned hereinbefore, should be permitted, notwithstanding the construction placed by this Court on the order dated 18th April, 1985 of this Court, to clear the goods imported, or to be imported by them pursuant to such irrevocable letters of credit.
In other words, all imports effected pursuant to such letters of credit should be deemed to have been legally and properly made, and should entail no adverse consequences whatsoever.
This Court fur ther reiterated that the Court must be presumed to have given effect to law That presumption can be rebutted only upon evidence showing a clear intention to the contrary, either expressly or by necessary implication.
This Court noted that the order dated 18th April, 1985 which we have set out hereinbefore used the expression "specifically banned" and the controversy before this Court in Raj Pra kash 's case was on the meaning of the expression 'specifi cally banned ' and the controversy between the parties cen tered round the meaning of the words 'specifically banned '.
It was mentioned that Appendix 3 is the list of items which could not be imported by an Export House on additional licence, it was a ban with reference to the category of importers.
Appendix 4 is the list of items which could not be imported by anyone whosoever.
This Court, therefore, was of the view that when regard is had to the Import Policy 1984 85, reference must necessarily be made to the corre sponding Appendix 3, formerly described as the List of Banned Items and now described as the List of Limited Per missible Items, and Appendix 2 Part A which is now the list of Banned Items replacing Appendix 4 (List of Absolutely Banned Items).
In other words, said the Court, the Addition al Licences to be issued to diamond exporters entitled them to import items permissible to Export Houses under such licence under the Import Policy 1978 79 excluding those items which fell within Appendices 3 and 4 of the Import Policy 1978 79 and also excluding items which fell in Appen dix 3 and Appendix 2 Part A of the Import This Court was of the view that this is the meaning which must be given to the terms of the order dated 18th April, 1985.
This Court noted that when this Court made the previous order on 18th April, 1985 when the Import Policy of 1985 88 was in force.
there were only two items which were absolutely banned.
and these were animal tallow and animal cannot.
That was also Substantially the position under the Import Policy 1984 85.
This Court was of the view that in the Import Policies of 1984 85 and 1985 88 the items open to import under Open General Licence were then set forth, when Raj Prakash 's judgment was delivered i.e. in Appendix 6.
A perusal of Part I1 of List 8 in Appendix 6 indicated that it enumerated in fairly long detail the items allowed to be imported by the Export Houses holding Additional Licences for sale of those items to eligible Actual Users (Industrial) subject to Actual User conditions.
That was the entitlement of the holder of an Additional Licence under paragraph 265(4) of the Import Policy 1985 88.
It is necessary to set out in detail the aforesaid judgment and also to refer to the order of 18th April.
1985 to emphasise that whether non canalised items could be imported directly.
and not through canalised agency, was not in issue in either of these two cases.
nor decided or adju dicated upon.
In the judgment in Raj Prakash 's case (supra), it was held that Additional Licence holders were entitled to import items permissible to Export Houses under the Import Policy 1978 79 excluding those items which fell in Appendix 3 (list of banned items) of the Import Policy 1985 88.
On 17th March, 1986, letter was written by the Joint Chief Controller of Imports to Messrs. B. Vijay Kumar and Co. stating that against Additional Licences issued in terms of this Court 's Order dated 18th April, 1985, import of items permissible against Additional Licences in terms of Policy for 1978 79 would be allowed even if such items were in the list of canalised items in Policy for 1978 79.
On 3rd April, 1986, there was a meeting with Member of C.B.E.C. and Principal Collector where the minutes recorded that items which were under O.G.L. during 1978 79 and subse quently canalised in Policy for 1985 88 would be allowed to be imported.
On 23rd April, 1986, a circular was issued from the Under Secretary to the Government of India to port authorities stating that canalised items 997 were not covered within the purview of this Court 's decision in Raj Prakash 's case and Additional Licence holders would be allowed to import canalised item.
By a letter on 14/15th May, 1986 from Principal Collector to Chairman, Western Region, Federation of Indian Export Organisation, the matter had been clarified and clearance of canalised items against Additional Licences was unconditionally allowed.
This Court again dealt with the question in the case of M/s Indo Afghan Chambers of Commerce and Another etc.
vs Union of India and Other etc., [1986] 3 SCC 352.
In that decision two of us (R.S. Pathak, J. as the learned Chief Justice then was and Sabyasachi Mukharji, J.) were parties.
It was held that under the import policy of 1978 79 dry fruits (exclud ing cashewnuts) could be imported by all persons under the Open General Licence.
There was no need to obtain any Addi tional Licence for importing items in the year 1978 79 and therefore, the wrongful denial of Additional Licences to diamond exporters in the year 1978 79, could not justify any restitution subsequently in regard to the import of dry fruits (other than cashewnuts).
It was further observed that under the Import Policy 1985 88, dry fruits (excluding cashewnuts and dates) were no longer open to import under the Open General Licence.
The sanction for importing them must be found under some other provision of the Import Policy.
The diamond exporters, it was held, ' could not be regarded as dealers engaged in the trade of stocking and selling dry fruits (excluding cashewnuts and dates).
They were, therefore, not entitled to the advantage of paragraph 181 (3) of the Import Policy 1985 88.
Dry fruits, it was further held, must be regarded as consumer goods of agricul tural origin.
The words "agricultural origin" in Item 121 of Appendix 2 Part B are used in the broadest sense.
The words 'consumer goods ' in item 121 referred to dry fruits imported for supply to Actual Users (Industrial).
It was further held that dry fruits do not appear in Appendix 3 Part A and 5 nor can be imported under the Open General Licence under the Import Policy 1985 88, Inasmuch as they fail within Item 121 of Appendix 2 part B they are excluded from the scope of Item 1 of Appendix 6, and cannot be imported as raw materi als and consumables for sale to Actual Users (Industrial).
Appendix 2 Part B (List of Restricted Items) was also suc cessor of Appendix 4 (List of Absolutely Banned Items) under the Import Policy 1978 79.
This Court reiterated, and it was important to emphasise, that On the reasoning which found favour with this Court in Raj Prakash 's case, it must be held that diamond exporters holding Additional Licences were not entitled to import goods enumerated in Appendix 2 Part B of the Import Policy 1985 88.
As held in that case, holders of Additional Licences were 998 entitled to import only those goods which were included in Appendix 6 Part 2 List 8 of the Import Policy 1985 88.
Dry fruits were not included in that list and therefore they could not be imported under Additional Licences.
It is stated that on 20th May, 1986, there was an order of adjudication in respect of one consignment of the first petitioner in this case i.e. Messrs. D. Navinchandra & Co. of items falling in Appendix 2B (List of Restricted Items) ( 10 Bills of Entry) imposing fine aggregating to Rs.45,000.
Then on 21st August, 1986, a show cause notice was issued to the first petitioner in this petition in respect of consign ment falling in Appendix 5 (Canalised Items) of the Policy for 1985 88.
Reply was duly given on 9th September, 1986 and a show cause notice was issued on 11th September, 1986 to the first petitioner in respect of one consignment falling in Appendix 2B (List of Restricted Items) of Policy for 1985 88.
In the meantime, this Court had occasion to examine some passage of this decision.
This question was examined and it is necessary to refer to the said two subsequent decisions of this Court.
The first one is the decision in Union of India vs Godrej Soaps Pvt. Ltd. and Another, ; and the second one is the decision in M/s Star Diamond Co. India vs Union of India and Others, ; It is neces sary first to refer to Godrej Soaps ' case.
It was held that a diamond exporter could import the items he was entitled to import under the Import Policy 1978 79 provided they were importable also under the Import Policy ruling at the time of import.
These are items which are open to import by an Export House holding an Additional Licence for sale to eligible Actual Users (Industrial).
These are items which could be directly imported, for example, the items enumerat ed in Part 2 of List 8 of Appendix VI of the Import Policy 1985 88.
These are items which are not 'canalised '. 'Cana lised ' items are those items which are ordinarily open to import only through a public sector agency.
There is, howev er, nothing to prevent an Import Policy from providing in the future that an Export House holding an Additional Li cence can directly import certain canalised items also.
In that event, an Export House holding an Additional Licence would be entitled to import items "whether canalised or otherwise", meaning thereby items open ordinarily to direct import (non canalised items) as well as items directly importable although on the canalised list.
It is in that sense that the Court had intended to define the entitlement of a diamond exporter by using the words "whether canalised or otherwise" in its order dated 18th April, 1985.
999 In that case this Court found that in respect of Palm Kernel Fatty Acid which was a canalised item listed as Item 9(v) in Appendix V Part B of the Import Policy 1985 88, there is no provision in that policy which permitted the import of such item by an Export House holding an Additional Licence.
Therefore, both on grounds of equity and construc tion the claim of the diamond exporters, or, as in that case, a purchaser from the diamond exporter, was held to be not maintainable.
As importation of canalised items, this Court reiterated, directly by holders of additional licences was banned, it should not be construed to have been permit ted by virtue of the order of this Court and the items sought to be imported do not come within List 8 of Part 2 of Appendix 6 of the Import Policy of 1985 88 against addition al licences.
It was found that the goods were purchased by the respondents in that case after they were aware of the position of law as enunciated in Raj Prakash 's case as well as Indo Afghan Chambers of Commerce 's case.
No question of any restitution of rights, therefore, arose.
Goods in ques tion being specially banned goods, these could not be im ported under Item I of Appendix 6 (Import of items under Open General Licence) of Import Policy, 1985 88, more so the import being not by the Actual User (Industrial) but by somebody else from whom the respondent purchased the goods.
This position was reiterated in the case of M/s Star Diamond Co. India vs Union of India and others (supra).
This Court further reiterated that a decision of this Court is binding on all.
To complete the narration of events, reply was given by the first petitioner to the show cause notice dated 11th September, 1986 on 18th September, 1986.
On 26th September, 1986, another show cause notice was issued to the Petitioner in respect of another consignment falling in Appendix 2B (List of Restricted Items) of Policy for 1985 88.
Personal hearing was given to the first peti tioner thereafter.
The petitioner moved this Court under Article 32 of the Constitution, for quashing the show cause notices dated 21st August, 1986, 11th September, 1986 and 26th September, 1986 and the order of adjudication dated 20th May, 1986 and for consequential relief.
We are, however, unable to find any merit in this appli cation either in law or in equity.
1000 One of the points on which an argument was sought to be built up was that the Bench of two judges of this Court in the subsequent decisions had cut down the effect of the decision of this Court dated 18th April, 1985 in the case of Union of India vs Rajnikant Bros.
It has been stated that in subsequent decisions referred to hereinbefore, this Court had deviated and indeed differed from the view expressed in that case.
It was urged that in Rajnikant Bros. case a bench of three judges categorically stated that the respondents would be entitled "to import all other items whether cana lised or otherwise" except those which were specifically banned under the prevalent import policy at the time of import, with the relevant rules.
In our opinion, the subse quent decisions referred to hereinbefore do not take any different or contrary view.
Indeed it gives effect to the letter and spirit of the said decision.
It has to be borne in mind, that the basic background under which the Rajni kant 's decision was rendered, the Export Houses had been refused Export House Certificates because it was insisted that they should have diversified their export and that was a condition for the grant or entitlement of an export house certificate.
It was found and it is common ground now that that was wrong.
Therefore, the wrong was undone.
Those who had been denied Export House Certificates on that wrong ground were put back to the position as far as it could be if that wrong had not been done.
To do so, the Custom au thorities and Govt.
authorities were directed to issue necessary Export House certificates for the year 1978 79 though the order was passed in April, 1985.
This was a measure of restitution, but tile Court, while doing so, ensured that nothing illegal was done.
It is a presumption of law that the courts act lawfully and will not ask any authority to do anything which is illegal.
Therefore, the court directed that except those which were specifically banned under the prevalent import policy at the time of import, the respondents shall be entitled to import all other items whether canalised or not canalised in accordance with the relevant rules.
Analysing the said order, it is apparent, (1) that the importation that was permissible was of goods which were not specifically banned, (2) such ban ning must be under the prevalent import policy at the time of import, and (3) whether items which were canalised or un canalised would be imported in accordance _with the relevant rules.
These conditions had to be fulfilled.
The court never did and could not have said that canalised items could be imported in any manner not permitted nor it could have given a go bye to canalisation policy.
It must be emphasised that in the case of Raj Prakash (supra), this position has been explained by saying that only such items could 1001 be imported by diamond exporters under the Additional Li cences granted to them as could have been imported under the Import Policy of 1978 79.
the period during which the dia mond exporters had applied for Export House Certificates and had been wrongly refused and were also importable under the import policy prevailing at the time of import which in the present case would be during the import policy of 1985 88.
These were the items which had not been 'specifically banned ' under the prevalent import policy.
The items had to pass to two tests.
firstly, they should have been importable under the import policy 1978 79 and secondly they should also have been importable under the import policy 1985 88 in terms of the Order dated 18th April.
1985 and if one may add.
in such terms in accordance with the import rules ' whether canalised or not canalised.
It must be emphasised that in this case also.
the CoUrt had no occasion to consid er the significance of the words 'whether canalised or otherwise ' mentioned in the Order dated 18th April.
1985 because that point did not arise in the case before it.
What did the court then intend by these words used by the court? We have seen that diamond exporters could import the items which they were entitled to import under the Import Policy 1978 79 provided they were importable also under the import policy ruling at the time of import.
These are items which were open to import by Export Houses holding Additional Licences for sale to the Actual Users (Industrial).
These are items which were directly imported, for example, items in Part 2 List 8 of Appendix 6 of Import Policy 1985 88.
These are items which are not canalised.
Canalised items are those items which are ordinarily open to import only through a public sector agency.
Although generally these are import able through public sector agencies, it is permissible for any import policy to provide an exception to the rule and to declare that an importer might import a canalised item directly.
It is in that sense and that sense only that the Court could have intended to define the entitlement of diamond exporters.
They would be entitled to import items which were canalised or not if the import policy prevailing at the time of import permitted them to import items falling under such category.
This was also viewed in that light in the case of Indo Afghan Chambers of Commerce (supra).
It must be emphasised that in the Order dated 18th April, 1985, this Court did not do away with canalisation.
That was not the issue before this Court.
The expression 'whether canalised or not canalised ' was to include both.
This Court did not say that canalised items could be import ed directly by the importers ignoring the canalisation process.
We are of the opinion that this Court did not say that canalisation 1002 could be ignored.
That was not the issue.
High public poli cy, it must be emphasised, is involved in the scheme of canalisation.
This purpose of canalisation was examined by this Court in Daruka & Co. vs Union of India & Ors., ; where the Constitution Bench of this Court ob served that the policies of imports or exports were fash ioned not only with reference to internal or international trade, but also on monetary policy, the development of agriculture and industries and even on the political poli cies of the country and rival theories and views may be held on such policies.
If the Government decided an economic policy that import or export should be by a selected channel or through selected agencies the court would proceed on the assumption that the decision was in the interest of the general public unless the contrary was shown.
Therefore it could not be collaterally altered in the manner suggested.
The policy of canalisation which is a matter of policy of the Government was not given a go bye by the observations referred to in the Order of 18th April, 1985.
Indeed it is possible to read the Order in a manner consistent with canalisation scheme in the way we have indicated.
If that is so, then it should be so read.
When this Court observed that the fact whether items were sought to be imported by diamond merchants were canalised, would not be an impediment to the import directly by them, the Court meant to say that this could be imported directly by them through the canalisation organisation.
The need for canalisation stands on public policy and that need cannot be lightly or inferencially given a go bye.
It should not be presumed that collaterally the court had done away with the system of canalisation based, on sound public policy.
We have found nothing in the different authorities on this subject, which militate against the above views.
Therefore, the action taken by the Custom authorities in issuing adjudication notice and pro ceeding in the manner they did, we are of the opinion that they have not acted illegally or without jurisdiction.
This must proceed in accordance with law as laid down by this Court which, in our opinion, is clear enough.
The fact that in subsequent decision, the petitioner is not a party is not relevant.
Generally legal positions laid down by the court would be binding on all concerned even though Some of them have not been made parties nor were served nor any notice of such proceedings given.
As held in Star Diamond 's case (supra), the meaning of the expression "whether canalised or otherwise" used by this Court in Rajnikant Bros ' case as explained in Godrej Soaps Pvt. Ltd. case and reiterated and followed in the present case is applicable to the present petitioner.
1003 We see no substance in the submission made in the peti tion and reiterated before us in this Court for a reconsid eration of this question by a larger Bench.
In the aforesaid view of the matter, we are unable to sustain the grounds urged in support of this petition.
We are, therefore, of the opinion that proceedings must go in accordance with law.
The government 's understanding of the matter at one point of time is irrelevant.
There are several applications for impleadment.
These are allowed, and they are impleaded.
Their statements are taken on record.
Before parting with this case, certain factors must be noted.
The diamond exporters and dry fruit exporters have their full round in this Court.
Speaking entirely for my self, my conscience protests to me that when thousands remediless wrongs await in the queue for this Court 's inter vention and solution for justice, the petitions at the behest of diamond exporters and dry fruit exporters where large sums are involved should be admitted and disposed of by this Court at such a quick speed.
Neither justice nor equity nor good conscience deserves these applications to be filed or entertained.
There is no equity of restitution against the law declared categorically and repeatedly by this Court and no principle of estoppel involved in these applications.
The Writ petition is dismissed and in the facts and circumstances of this case, we direct that the petitioner must pay cost of this application.
It has been prayed that clear cut date must be fixed where contracts had been entered into and in which letters of credit prior to 15th April, 1986 have been entered into, there should be no prosecution.
It has been further prayed that where however contracts have been entered into but no letters of credit have been opened, such parties should not be penalised in the facts and circumstances of the case.
No direction is necessary by this Court on this aspect.
The authorities concerned will decide the same in taking into consideration all the facts and circumstances and taking into consideration the case of the petitioners and the alleged claim of bona fide on their part.
A submission was made on the principle of promissory estoppel and reliance was placed on the several observations of several cases including the case in Union of India and Others etc.
vs Godfrey Philips India Ltd. etc.
; , It is true that the doctrine of 1004 promissory estoppel is applicable against the Government in the exercise of its government, public or executive func tions and the doctrine of executive necessity or freedom of future executive action cannot be invoked to defeat the applicability of the doctrine of promissory estoppel.
But in this case no such case of promissory estoppel has been made out.
The intervention applications filed in this connection are allowed and the submissions contrary to what we had stated hereinbefore are rejected.
As the points involved in Writ Petition No. 1494 of 1986 are same, this is also dismissed with costs.
Interim orders, if any, are vacated forthwith.
The proceedings will proceed as expeditiously as possible in accordance with law.
For the same reasons, Writ Petition No. 1544 of 1986 is also dis missed with costs with the same observations.
H.L.C. Petition dis missed.
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Under Article 32 of the Constitution of India. Dr: Y.S. Chitale, Satish Chandra, P.K. Banerjee, S.N. Kacker, K.C. Agarawal, S.S. Rathore, L.K. Garg, M.K.D. Namboodiary, P.M. Amin, Ashok Grover, Bulchandani, M.N. Shroff, P.H. Parekh and Sohail Dutt for the Petitioners. K. Parasaran, Attorney Genera1, G. Ramaswamy Additional Solicitor General, G. Subramaniam, A.S. Rao, Ms. Relan and P.P. Parmeshwaran for the Respondents. R.S. Nariman, (Indo Afghan Chamber of Commerce). In order to 'appreCiate this chal lenge;, it is necessary to refer to certain facts. It is necessary also that in order to make out. It appears that the import policy issued by the Government of India for the year 1978 79 by paragraph 176 provided for, additional licences. On 29th April, 1979, the first petitioner, a diamond exporters, was refused Export House Certificate. petitioner filed a writ petition before the High Court of Bombay. On 7th April, 1983, the Delhi High Court delivered a judgment in Civil writ Petition No. 1501 of 1981 (which for the sake of convenience, the party has chosen to describe as Rajnikant Bros. & Ors. case allow ing the diamond exporters the same and holding that merely Canalising an item could not be regarded as import of that item being absolutely banned. Against` these judgments special leave petitions were filed in this Court, Appeal was also filed on 27th March. Similar special leave petitions were filed in this Court against similar judgments of the Bombay High Court. On 18th April, 1985, by a common judgment, the special leave. As much has been made out 'of this judgment and order, it is necessary to refer to the same. It was held by the said order that there was no requirement of diversification of exports as a condition for the grant of Export 994 House Certificate in the Import Policy for 1978 79. It was further directed that Export House Certificates should be granted within three months from that date. The appeals were disposed of accordingly with no order as to costs. Pursuant to the aforesaid order, on 29th July, 1985, import licence was issued, it is claimed, to the first petitioner. According to the petitioner, in the matter of clearance of such con signments different standards were applied by the Custom authorities. On 18th October, 1985, in special leave petition No. On 5th March, 1986, judgment was delivered in the case of Raj Prakash Chemicals Ltd. and Another vs Union of India and Others, by a bench consisting of three learned Judges Tulzapurkar, J. and two of us (R.S. Pathak, J. as the Chief Justice then was, and Sabyasachi Mukharji, J.). This Court held that additional licence holders were entitled to import items permissible to Export Houses under Import Policy 1978 79 excluding those items which fell in Appendix 3 (List of Banned Items) of the Import Policy 1985 88. This Court observed that diamond exporters who were granted Addi 995 tional Licences had formed a bona fide belief that they could import all the items accessible to them under Open General Licence under the Import Policy of 1978 79 except those placed in Appendix 2 Part A of the Banned List under the Import Policy 1985 88. This belief was formed on the basis of consistent orders of the High Courts and consistent manner in which Import Control authorities construed those orders. Appendix 4 is the list of items which could not be imported by anyone whosoever. This Court, therefore, was of the view that when regard is had to the Import Policy 1984 85, reference must necessarily be made to the corre sponding Appendix 3, formerly described as the List of Banned Items and now described as the List of Limited Per missible Items, and Appendix 2 Part A which is now the list of Banned Items replacing Appendix 4 (List of Absolutely Banned Items). there were only two items which were absolutely banned. and these were animal tallow and animal cannot. That was also Substantially the position under the Import Policy 1984 85. 1985 to emphasise that whether non canalised items could be imported directly. and not through canalised agency, was not in issue in either of these two cases. On 17th March, 1986, letter was written by the Joint Chief Controller of Imports to Messrs. B. Vijay Kumar and Co. stating that against Additional Licences issued in terms of this Court 's Order dated 18th April, 1985, import of items permissible against Additional Licences in terms of Policy for 1978 79 would be allowed even if such items were in the list of canalised items in Policy for 1978 79. It was further observed that under the Import Policy 1985 88, dry fruits (excluding cashewnuts and dates) were no longer open to import under the Open General Licence. The diamond exporters, it was held, ' could not be regarded as dealers engaged in the trade of stocking and selling dry fruits (excluding cashewnuts and dates). The words "agricultural origin" in Item 121 of Appendix 2 Part B are used in the broadest sense. The words 'consumer goods ' in item 121 referred to dry fruits imported for supply to Actual Users (Industrial). Dry fruits were not included in that list and therefore they could not be imported under Additional Licences. It is stated that on 20th May, 1986, there was an order of adjudication in respect of one consignment of the first petitioner in this case i.e. Messrs. D. Navinchandra & Co. of items falling in Appendix 2B (List of Restricted Items) ( 10 Bills of Entry) imposing fine aggregating to Rs.45,000. Reply was duly given on 9th September, 1986 and a show cause notice was issued on 11th September, 1986 to the first petitioner in respect of one consignment falling in Appendix 2B (List of Restricted Items) of Policy for 1985 88. In the meantime, this Court had occasion to examine some passage of this decision. This question was examined and it is necessary to refer to the said two subsequent decisions of this Court. It was held that a diamond exporter could import the items he was entitled to import under the Import Policy 1978 79 provided they were importable also under the Import Policy ruling at the time of import. These are items which are open to import by an Export House holding an Additional Licence for sale to eligible Actual Users (Industrial). These are items which are not 'canalised '. ' There is, howev er, nothing to prevent an Import Policy from providing in the future that an Export House holding an Additional Li cence can directly import certain canalised items also. It is in that sense that the Court had intended to define the entitlement of a diamond exporter by using the words "whether canalised or otherwise" in its order dated 18th April, 1985. Therefore, both on grounds of equity and construc tion the claim of the diamond exporters, or, as in that case, a purchaser from the diamond exporter, was held to be not maintainable. No question of any restitution of rights, therefore, arose. Goods in ques tion being specially banned goods, these could not be im ported under Item I of Appendix 6 (Import of items under Open General Licence) of Import Policy, 1985 88, more so the import being not by the Actual User (Industrial) but by somebody else from whom the respondent purchased the goods. This position was reiterated in the case of M/s Star Diamond Co. India vs Union of India and others (supra). This Court further reiterated that a decision of this Court is binding on all. Personal hearing was given to the first peti tioner thereafter. We are, however, unable to find any merit in this appli cation either in law or in equity. 1000 One of the points on which an argument was sought to be built up was that the Bench of two judges of this Court in the subsequent decisions had cut down the effect of the decision of this Court dated 18th April, 1985 in the case of Union of India vs Rajnikant Bros.
It has been stated that in subsequent decisions referred to hereinbefore, this Court had deviated and indeed differed from the view expressed in that case. In our opinion, the subse quent decisions referred to hereinbefore do not take any different or contrary view. Indeed it gives effect to the letter and spirit of the said decision. It was found and it is common ground now that that was wrong. Those who had been denied Export House Certificates on that wrong ground were put back to the position as far as it could be if that wrong had not been done. To do so, the Custom au thorities and Govt. authorities were directed to issue necessary Export House certificates for the year 1978 79 though the order was passed in April, 1985. This was a measure of restitution, but tile Court, while doing so, ensured that nothing illegal was done. It is a presumption of law that the courts act lawfully and will not ask any authority to do anything which is illegal. Therefore, the court directed that except those which were specifically banned under the prevalent import policy at the time of import, the respondents shall be entitled to import all other items whether canalised or not canalised in accordance with the relevant rules. It must be emphasised that in the case of Raj Prakash (supra), this position has been explained by saying that only such items could 1001 be imported by diamond exporters under the Additional Li cences granted to them as could have been imported under the Import Policy of 1978 79. the period during which the dia mond exporters had applied for Export House Certificates and had been wrongly refused and were also importable under the import policy prevailing at the time of import which in the present case would be during the import policy of 1985 88. These were the items which had not been 'specifically banned ' under the prevalent import policy. It must be emphasised that in this case also. 1985 because that point did not arise in the case before it. What did the court then intend by these words used by the court? These are items which were directly imported, for example, items in Part 2 List 8 of Appendix 6 of Import Policy 1985 88. Canalised items are those items which are ordinarily open to import only through a public sector agency. It must be emphasised that in the Order dated 18th April, 1985, this Court did not do away with canalisation. That was not the issue before this Court. The expression 'whether canalised or not canalised ' was to include both. This Court did not say that canalised items could be import ed directly by the importers ignoring the canalisation process. We are of the opinion that this Court did not say that canalisation 1002 could be ignored. High public poli cy, it must be emphasised, is involved in the scheme of canalisation. This purpose of canalisation was examined by this Court in Daruka & Co. vs Union of India & Ors., ; where the Constitution Bench of this Court ob served that the policies of imports or exports were fash ioned not only with reference to internal or international trade, but also on monetary policy, the development of agriculture and industries and even on the political poli cies of the country and rival theories and views may be held on such policies. Therefore it could not be collaterally altered in the manner suggested. If that is so, then it should be so read. The need for canalisation stands on public policy and that need cannot be lightly or inferencially given a go bye. It should not be presumed that collaterally the court had done away with the system of canalisation based, on sound public policy. Therefore, the action taken by the Custom authorities in issuing adjudication notice and pro ceeding in the manner they did, we are of the opinion that they have not acted illegally or without jurisdiction. The fact that in subsequent decision, the petitioner is not a party is not relevant. Generally legal positions laid down by the court would be binding on all concerned even though Some of them have not been made parties nor were served nor any notice of such proceedings given. As held in Star Diamond 's case (supra), the meaning of the expression "whether canalised or otherwise" used by this Court in Rajnikant Bros ' case as explained in Godrej Soaps Pvt. Ltd. case and reiterated and followed in the present case is applicable to the present petitioner. 1003 We see no substance in the submission made in the peti tion and reiterated before us in this Court for a reconsid eration of this question by a larger Bench. In the aforesaid view of the matter, we are unable to sustain the grounds urged in support of this petition. We are, therefore, of the opinion that proceedings must go in accordance with law. The government 's understanding of the matter at one point of time is irrelevant. There are several applications for impleadment. These are allowed, and they are impleaded. Before parting with this case, certain factors must be noted. The diamond exporters and dry fruit exporters have their full round in this Court. Neither justice nor equity nor good conscience deserves these applications to be filed or entertained. It has been prayed that clear cut date must be fixed where contracts had been entered into and in which letters of credit prior to 15th April, 1986 have been entered into, there should be no prosecution. No direction is necessary by this Court on this aspect. But in this case no such case of promissory estoppel has been made out. The intervention applications filed in this connection are allowed and the submissions contrary to what we had stated hereinbefore are rejected. As the points involved in Writ Petition No. 1494 of 1986 are same, this is also dismissed with costs. Interim orders, if any, are vacated forthwith. The proceedings will proceed as expeditiously as possible in accordance with law. 1544 of 1986 is also dis missed with costs with the same observations.
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By a common order dated April 18, 1985 in C.A. No. 1423 of 1984, etc., Union of India vs Rajnikant Bros. the Court had directed issue of Export House Certificates and Addi tional Licences to the petitioners and other diamond export ers under the Import Policy 1978 79 stating: "Save and except items which are specifically banned under the preva lent Import Policy at the time of import, the respondents shall be entitled to import all other items whether cana lised or otherwise in accordance with the relevant rules".
The petitioners, who were issued Additional Licences pursu ant to this order, imported several consignments of items falling under Appendices 2B, 3 and 5 of Import Policy, 1985 88, and, while clearing them, the Customs Authorities imposed a fine of Rs.45,000 in respect of certain items failing in Appendix 2B and issued show cause notices in respect of certain other items failing in Appendices 2B and 5.
The petitioners challenge was directed not only against these orders, but extended to certain subsequent decisions of the Court which, according to them, had cut down the effect of the Court 's earlier order dated April 18, 1985 in Union of India vs Rajnikant Bros. Dismissing the petitions, HELD: The decisions rendered subsequent to the decision dated April 18, 1985 in Union of India vs Rajnikant Bros. do not take any different or contrary view.
Indeed, they give effect to the letter and spirit of that decision.
The basic background in which the decision in Union of India vs Rajni kant Bros. was rendered was that Export Houses had been refused Export House Certificates on the ground that they had not diversified their exports.
It was found that was wrong.
The wrong was undone by directing issue of Export House Certificates for 990 the year 1978 79 though the order was passed in April, 1985.
That was a measure of restitution, but the Court, while doing so, ensured that nothing illegal was done.
It is a presumption of law that the courts act lawfully and will not ask any authority to do anything which is illegal.
It was directed that except those items which were specifically banned under the prevalent import policy at the time of import, the respondents therein were entitled to import all other items whether canalised or not canalised in accordance with the relevant rules.
Analysing the said order, it is apparent: (1) that the importation that was permissible was of goods which were not specifically banned, (2) that such banning must be under the prevalent import policy at the time of import.
and (3) whether items which were canalised or uncanalised would be imported in accordance with the relevant rules.
These conditions had to be fulfilled.
The court never did and could not have said that canalised items could be imported in any manner not permitted nor it could have given a go bye to the canalisation policy.
[1000C H] (ii).
In Raj Prakash Chemicals vs Union of India,, it was explained that only such items could be imported by diamond exporters under the Additional Licences granted to them as could have been imported under the Import Policy 1978 79 and were also importable under the Import Policy prevailing at the time of import.
These were the items which had not been 'specifically banned ' under the prevalent Import Policy.
The items had to pass through two tests, firstly, they should have been importable under the Import Policy 1978 79 and, secondly, they should also have been importable under the Import Policy, 1985 88 in terms of the Order dated 18th April, 1985 and if one may add, in such terms 'in accordance with the import rules ' whether cana lised or not canalised.
The Court had no occasion to consid er in that case the significance of the words 'whether canalised or otherwise ' mentioned in the Order dated 18th April, 1985 in Union of India vs Rajnikant Bros., because that point did not arise there.
[1000H; 1001A D] (iii) What did the court then intend by the words 'whet her canalised or otherwise ' used in the order dated 18th April, 1985 in Union of India vs Rajnikant Bros? The diamond exporters could import the items which they were entitled to import under the Import Policy 1978 79 provided they were importable also under the Import Policy ruling at the time of import.
These are items which were open to import by Export Houses holding Additional Licences for Sale to the Actual Users (Industrial).
These are items which were di rectly imported, for example, items in Part II List 8 of Appendix 6 of Import Policy 1985 88.
These are items which are not canalised.
Canalised items are those 991 items which are ordinarily open to import only through a public sector agency.
Although generally these are import able through public sector agencies, it is permissible for any Import Policy to provide an exception to the rule and to declare that an importer might import a canalised item directly.
It is in that sense and that sense only that the Court could have intended to define the entitlement of diamond exporters.
They would be entitled to import items which were canalised or not if the Import Policy prevailing at the time of import permitted them to import items failing under such category.
[1001D G] (iv) In the Order dated 18th April, 1985 in Union of India vs Rajnikant Bros., this Court did not do away with canalisation.
That was not the issue before this Court.
This expression 'whether canalised or not canalised ' was to include both.
This Court did not say that canalised items could be imported directly by the importers ignoring the canalisation process.
High public policy, it must be empha sised, is involved in the scheme of canalisation.
This purpose of canalisation was examined by.this Court in Daruka of this Court observed that the policies of imports or exports were fashioned not only with reference to internal or international trade, but also on monetary policy, the development of agriculture and industries and even on the political policies of the country and rival theories and views may be held on such policies.
If the Government decid ed an economic policy that import or export should be by a selected channel or through selected agencies, the court would proceed on the assumption that the decision was in the interest of the general public unless the contrary was shown.
Therefore, it could not be collaterally altered in the manner suggested.
The policy of canalisation which is a matter of policy of the Government was not given a go bye by the observations referred to in the Order of 18th April, 1985.
Indeed, it is possible to read the Order in a manner consistent with canalisation scheme in the way we have indicated.
If that is so, then it should be so read.
When this Court observed that the fact whether items were sought to be imported by diamond merchants were canalised, would not be an impediment to the import directly by them, the Court meant to say that this could be imported directly by them through the canalisation organisation.
The need for canalisation stands on public policy and that need cannot be lightly or inferentially given a go bye.
It should not be presumed that collaterally the court had done away with the system of canalisation based on sound public policy.
We have found nothing in the different authorities on this subject, which militate against the above views.
Therefore, the action taken by the Customs Authorities in issuing adjudica tion notice and proceeding in 992 the manner they did we are of the opinion that they have not acted illegally or without jurisdiction.
This must proceed in accordance with law as laid down by this Court which, in.
our opinion is clear enough.
The fact that in subsequent decision, the petitioner is not a party is not relevant.
Generally legal positions laid down by the court would be binding on all concerned even though some of them have not been made parties nor were served nor any notice of such proceedings given.
[1001H; 1002A G] Union of India vs Rajnikant Bros., C.A. No. 1423 of 1984 decided on April 18, 1985; Raj Prakash Chemicals Ltd. & Anr.
vs Union of India & Ors.
, ; M/s. Indo Afghan Chambers of Commerce &Anr., etc.
vs Union of India & Ors., etc., [1986] 3 S.C.C. 352; Union of India vs Godrej Soaps Pvt. Ltd. &Anr., ; ; and M/s. Star Diamond Co. India vs Union of India & Ors., [1986] 4 S.C.C. 246, discussed, explained and reiterated.
Daruka & Co. vs Union of India & Ors., ; , referred to.
|
By a common order dated April 18, 1985 in C.A. No. Indeed, they give effect to the letter and spirit of that decision. The wrong was undone by directing issue of Export House Certificates for 990 the year 1978 79 though the order was passed in April, 1985. It was directed that except those items which were specifically banned under the prevalent import policy at the time of import, the respondents therein were entitled to import all other items whether canalised or not canalised in accordance with the relevant rules. Analysing the said order, it is apparent: (1) that the importation that was permissible was of goods which were not specifically banned, (2) that such banning must be under the prevalent import policy at the time of import. and (3) whether items which were canalised or uncanalised would be imported in accordance with the relevant rules. In Raj Prakash Chemicals vs Union of India,, it was explained that only such items could be imported by diamond exporters under the Additional Licences granted to them as could have been imported under the Import Policy 1978 79 and were also importable under the Import Policy prevailing at the time of import. These were the items which had not been 'specifically banned ' under the prevalent Import Policy. The Court had no occasion to consid er in that case the significance of the words 'whether canalised or otherwise ' mentioned in the Order dated 18th April, 1985 in Union of India vs Rajnikant Bros., because that point did not arise there. Canalised items are those 991 items which are ordinarily open to import only through a public sector agency. That was not the issue before this Court. This expression 'whether canalised or not canalised ' was to include both. This Court did not say that canalised items could be imported directly by the importers ignoring the canalisation process. High public policy, it must be empha sised, is involved in the scheme of canalisation. This purpose of canalisation was examined by.this Court in Daruka of this Court observed that the policies of imports or exports were fashioned not only with reference to internal or international trade, but also on monetary policy, the development of agriculture and industries and even on the political policies of the country and rival theories and views may be held on such policies. Therefore, it could not be collaterally altered in the manner suggested. If that is so, then it should be so read. The need for canalisation stands on public policy and that need cannot be lightly or inferentially given a go bye. We have found nothing in the different authorities on this subject, which militate against the above views. The fact that in subsequent decision, the petitioner is not a party is not relevant. Generally legal positions laid down by the court would be binding on all concerned even though some of them have not been made parties nor were served nor any notice of such proceedings given. , ; M/s. Indo Afghan Chambers of Commerce &Anr., 1986] 3 S.C.C. 352; Union of India vs Godrej Soaps Pvt. and M/s. Star Diamond Co. India vs Union of India & Ors., [ 1986] 4 S.C.C. 246, discussed, explained and reiterated.
| 0.267608
| 0.608163
| 0.174163
| 0.543086
|
ivil Appeal No. 2027 of 1974.
From the Judgment and Order dated 8.10.1973 of the Gujarat High Court in Gift Tax Reference No. 3 of 1971.
Wazir Singh, K.C. Dua and Ms. A. Subhashini for the Appellants.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal is by certificate under a Deed of Partnership dated 12.11.1958, a Firm by name M/s Chhotalal Vedilal came into existence with three partners, Chhotalal Mohanlal 1044 (the assessee).
Gunvantilal Chhotalal and Pravinchandra Vedilal.
These three partners had 7 annas, 4 annas and 5 annas share respectively in the firm.
This position contin ued until on 9.11.
1961 relevant to assessment year 1963 64 with which this appeal is concerned, a change took place in the constitution of the firm.
Under the new deed, Pravin chandra Vedilal retired; no change took place in respect of Gunvantilal Chhotalal; one Ramniklal Chhotalal became a partner with 4 annas share.
The share of the assessee Chhotalal Mohanlal was reduced to 4 annas; for the remaining 4 annas two minor sons of Chhotalal being Kiritkumar and Deepak Kumar were admitted to the benefits only of the firm Kiritkumar having 12 percent and Deepak Kumar having 13 per cent.
No alteration was, however, made regarding the share capital standing in the name of the assessee.
The Gift Tax Officer came to the conclusion that the assessee had deprived himself of 19 per cent share in the profits and had gifted away 19 per cent share in the good will of the firm in favour of his two minor sons.
He valued the goodwill and treated 19 per cent thereof as taxable gift.
The Appellate Assistant Commissioner before whom the assessee appealed adopted a different stand.
According to him, the gift was not of a share of the goodwill but in respect of the right to receive future profits.
He valued that right and since the amount Was higher than what the Income tax Officer had estimated, following the requirements of law he enhanced the quantum.
In further appeal by the assessee the Tribunal held that in the circumstances of the case there could be no gift of goodwill.
As appears from the statement of the case, the Revenue did not seek to support the order of the Incometax Officer but pleaded for sustain ing the order of the Appellate Assistant Commissioner.
The Tribunal further found that the right to receive future profits could not be subject matter of a gift as the trans fer did not relate to existing property.
According to it, the situation did not give rise to any gift which could be made liable to tax under the Act.
The following question relevant for the purpose of the appeal was referred to the High Court for its opinion at the instance of the Revenue: "Whether on the facts and in the circumstances of the case, the benefit of partnership given to minors Kirit Kumar Chhotalal and Deepak Kumar Chhotalal was a gift under the Gift Tax Act, 1958?" The High Court answered the question against the Revenue and up 1045 held the view of the Tribunal.
This appeal has, therefore, been carried by the Revenue.
In spite of service of notice of appeal the respondent has not appeared.
Counsel appearing in support of the appeal has contended that the order of the Gift Tax Officer was right and the Appellate Assistant Commissioner, the Tribunal and the High Court had gone wrong in holding that the ar rangement under the deed of 9.11.1961 did not give rise to a taxable event under the Act, so far as the assessee was concerned.
"Gift" is defined in section 2(xii) of the Act: " 'Gift ' means the transfer by one person to another of any existing movable or immovable property made voluntarily and without consid eration in money or money 's worth, and in cludes the transfer of any property deemed to be a gift under section 4.
" In support of the appeal, learned counsel further relies upon decisions of different High Courts to which we shall presently refer.
Before doing so it would be appropriate to indicate that in Khushal Khemgar Shah & Ors.
vs Khorsheed Banu Dadiba Boatwalla & Anr., ; this Court has held that goodwill of a firm is an asset, In Commission er of Gift Tax vs Nani Gopal Mondal, after referring to a number of authorities of this Court and different High Courts a Division Bench of the Calcutta High Court concluded thus: "From the cases cited above, it appears that goodwill of a partnership business is a property of the firm in which a partner is entitled to a share.
Although the above cases are under the Estate Duty Act, yet the princi ple laid down in the said cases regarding the nature of goodwill of a firm and the right of a partner in respect thereof is applicable to the instant case.
In this connection, it may be mentioned that according to section 14 of the Indian Partnership Act, property of a firm includes goodwill of the business.
Further, according to section 29(2), if a partner transfers his interest and the transferring partner ceases to be a partner, the transferee is entitled as against the remaining partners to receive the share of the assets of the firm to which the transferring partner is entitled to.
It further appears that under proviso to section 53 of the Indian Partnership Act, 1046 in case of dissolution, a partner or his representative may buy the goodwill of the firm and under section 55(1) of the Act, in settling the accounts of a firm after dissolu tion, the goodwill shall, subject to contract between the parties, be included in the assets and it may be sold either separately or along with other properties of the firm .
Upon transfer, the share or interest in the property of the firm of the transferring partner including the goodwill becomes the share or interest of the transferee.
In the instant case, Nani Gopal Mondal by the deed of gift transferred his share or interest in the firm which included his share of goodwill also.
Hence, for the purpose of payment of gift tax, the value of one third share of the assessee in the goodwill shall also be taken in account." In M.K. Kuppuraj vs Commissioner of Gift Tax, the Madras High Court was called upon to deal with a case of this type where minors were admitted to the benefits of partnership firm and the assessee 's interest in the firm suffered the detriment by relinquishment of a portion of his interest.
The High Court found that relinquishment of 8 per cent profit was in favour of the minors who were admitted without any consideration.
It held that the transaction constituted a gift by the assessee in favour of the minors.
The ratio in Sirehmal Nawalkha vs Commissioner of Income Tax, as also in Commissioner of Gift Tax, Bombay vs Premji Trikamji Jobanputra, ' 17 support the stand of the Revenue that the transaction constitutes a 'gift '.
Once goodwill is taken to be property and with the admission of the two minors to the benefits of partnership in respect of a fixed share, the right to the money value of the goodwill stands transferred, the transaction does con stitute a gift under the Act.
Since there has been no dis pute about valuation of the goodwill as made by the Gift Tax Officer, with the conclusion that there has been a gift in respect of a part of the goodwill, the answer to the ques tion referred has to be in the affirmative, that is, it constitutes a gift under the Act.
The appeal is allowed and the conclusion of the High Court is reversed.
Since the respondent has not appeared, there will be no order for costs.
A.P.J. Appeal allowed.
|
Under a deed of partnership dated 12.11.1958, a firm by the name M/s. Chhotalal Vedilal came into existence with Chhotalal Mohanlal (the assessee), Gunvantilal Chhotalal and Pravinchandra Vedilal, as partners, each having 7 annas, 4 annas and 5 annas share respectively in the firm.
This position continued until on 9.11.1961 when a change took place in the constitution of the firm.
Under the new deed, Pravinchandra Vedilal retired.
One Ramniklal Chhotalal became a partner with 4 annas share.
The share of the asses see, Chhotalal Mohanlal was reduced.
For the remaining 4 annas, two minor sons of the assessee were admitted to the benefits only of the firm.
In the assessment year 1963 64, the Gift Tax Officer concluded that the assessee had deprived himself of 19% share In the profits and had gifted away 19% share in the goodwill of the firm in favour of his two minor sons.
He valued the .goodwill and treated 19% thereof as taxable gift.
In the appeal before the Appellate Assistant Commission er the assessee took the stand that the gift was not of a share of the goodwill but in respect of the right to receive future profits.
He valued that right and since the amount was higher than what the Income Tax Officer has estimated, he enhanced the quantum.
In further appeal by the assessee the Tribunal held that in the circumstances of the case there could be no gift of goodwill and found that the right to receive future profits could not be subject matter of a gift as the transfer did not relate to existing property and the situation did not give rise to any gift which could be made liable to tax under the Act.
In the Reference the High Court upheld the view of the Tribunal.
1043 In the appeal to this Court on behalf of the Revenue, it was contended that the order of the Gift Tax Officer was right and the Appellate Assistant Commissioner, the Tribunal and the High Court had gone wrong in holding that the ar rangement under the deed of 9.11.1961 did not give rise to a taxable event under the Act.
Allowing the appeal, HELD: 1.
Goodwill of a firm is an asset.
[1045E] Khushal Khemgar Shah & Ors.
vs Khorshed Banu Dadiba Boatwalla & Anr., ; , followed.
Once goodwill is taken to be property and with the admission of the two minors to the benefits of partnership in respect of a fixed share, the right to the money value of the goodwill stands transferred, the transaction does con stitute a gift under the Gift Tax Act, 1958.
[1046F] 3.
Since there has been no dispute about valuation of the goodwill as made by the Gift Tax Officer, with the conclusion that there has been a gift in respect of a part of the goodwill the transfer of the benefit of the partner ship constitutes a gift under the Act.
[1046F G] Commissioner of Gift Tax vs Nani Gopal Mondal, ; M.K. Kuppuraj vs Commissioner of Gift Tax, ; Sirehmal Nawalkha vs Commissioner of Income Tax, and Commissioner of Gift Tax, Bombay vs Premji Trikamji Jobanputra, , approved.
|
ivil Appeal No. 2027 of 1974.
From the Judgment and Order dated 8.10.1973 of the Gujarat High Court in Gift Tax Reference No. 3 of 1971.
Wazir Singh, K.C. Dua and Ms. A. Subhashini for the Appellants.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal is by certificate under a Deed of Partnership dated 12.11.1958, a Firm by name M/s Chhotalal Vedilal came into existence with three partners, Chhotalal Mohanlal 1044 (the assessee).
Gunvantilal Chhotalal and Pravinchandra Vedilal.
These three partners had 7 annas, 4 annas and 5 annas share respectively in the firm.
This position contin ued until on 9.11.
1961 relevant to assessment year 1963 64 with which this appeal is concerned, a change took place in the constitution of the firm.
Under the new deed, Pravin chandra Vedilal retired; no change took place in respect of Gunvantilal Chhotalal; one Ramniklal Chhotalal became a partner with 4 annas share.
The share of the assessee Chhotalal Mohanlal was reduced to 4 annas; for the remaining 4 annas two minor sons of Chhotalal being Kiritkumar and Deepak Kumar were admitted to the benefits only of the firm Kiritkumar having 12 percent and Deepak Kumar having 13 per cent.
No alteration was, however, made regarding the share capital standing in the name of the assessee.
The Gift Tax Officer came to the conclusion that the assessee had deprived himself of 19 per cent share in the profits and had gifted away 19 per cent share in the good will of the firm in favour of his two minor sons.
He valued the goodwill and treated 19 per cent thereof as taxable gift.
The Appellate Assistant Commissioner before whom the assessee appealed adopted a different stand.
According to him, the gift was not of a share of the goodwill but in respect of the right to receive future profits.
He valued that right and since the amount Was higher than what the Income tax Officer had estimated, following the requirements of law he enhanced the quantum.
In further appeal by the assessee the Tribunal held that in the circumstances of the case there could be no gift of goodwill.
As appears from the statement of the case, the Revenue did not seek to support the order of the Incometax Officer but pleaded for sustain ing the order of the Appellate Assistant Commissioner.
The Tribunal further found that the right to receive future profits could not be subject matter of a gift as the trans fer did not relate to existing property.
According to it, the situation did not give rise to any gift which could be made liable to tax under the Act.
The following question relevant for the purpose of the appeal was referred to the High Court for its opinion at the instance of the Revenue: "Whether on the facts and in the circumstances of the case, the benefit of partnership given to minors Kirit Kumar Chhotalal and Deepak Kumar Chhotalal was a gift under the Gift Tax Act, 1958?" The High Court answered the question against the Revenue and up 1045 held the view of the Tribunal.
This appeal has, therefore, been carried by the Revenue.
In spite of service of notice of appeal the respondent has not appeared.
Counsel appearing in support of the appeal has contended that the order of the Gift Tax Officer was right and the Appellate Assistant Commissioner, the Tribunal and the High Court had gone wrong in holding that the ar rangement under the deed of 9.11.1961 did not give rise to a taxable event under the Act, so far as the assessee was concerned.
"Gift" is defined in section 2(xii) of the Act: " 'Gift ' means the transfer by one person to another of any existing movable or immovable property made voluntarily and without consid eration in money or money 's worth, and in cludes the transfer of any property deemed to be a gift under section 4.
" In support of the appeal, learned counsel further relies upon decisions of different High Courts to which we shall presently refer.
Before doing so it would be appropriate to indicate that in Khushal Khemgar Shah & Ors.
vs Khorsheed Banu Dadiba Boatwalla & Anr., ; this Court has held that goodwill of a firm is an asset, In Commission er of Gift Tax vs Nani Gopal Mondal, after referring to a number of authorities of this Court and different High Courts a Division Bench of the Calcutta High Court concluded thus: "From the cases cited above, it appears that goodwill of a partnership business is a property of the firm in which a partner is entitled to a share.
Although the above cases are under the Estate Duty Act, yet the princi ple laid down in the said cases regarding the nature of goodwill of a firm and the right of a partner in respect thereof is applicable to the instant case.
In this connection, it may be mentioned that according to section 14 of the Indian Partnership Act, property of a firm includes goodwill of the business.
Further, according to section 29(2), if a partner transfers his interest and the transferring partner ceases to be a partner, the transferee is entitled as against the remaining partners to receive the share of the assets of the firm to which the transferring partner is entitled to.
It further appears that under proviso to section 53 of the Indian Partnership Act, 1046 in case of dissolution, a partner or his representative may buy the goodwill of the firm and under section 55(1) of the Act, in settling the accounts of a firm after dissolu tion, the goodwill shall, subject to contract between the parties, be included in the assets and it may be sold either separately or along with other properties of the firm .
Upon transfer, the share or interest in the property of the firm of the transferring partner including the goodwill becomes the share or interest of the transferee.
In the instant case, Nani Gopal Mondal by the deed of gift transferred his share or interest in the firm which included his share of goodwill also.
Hence, for the purpose of payment of gift tax, the value of one third share of the assessee in the goodwill shall also be taken in account." In M.K. Kuppuraj vs Commissioner of Gift Tax, the Madras High Court was called upon to deal with a case of this type where minors were admitted to the benefits of partnership firm and the assessee 's interest in the firm suffered the detriment by relinquishment of a portion of his interest.
The High Court found that relinquishment of 8 per cent profit was in favour of the minors who were admitted without any consideration.
It held that the transaction constituted a gift by the assessee in favour of the minors.
The ratio in Sirehmal Nawalkha vs Commissioner of Income Tax, as also in Commissioner of Gift Tax, Bombay vs Premji Trikamji Jobanputra, ' 17 support the stand of the Revenue that the transaction constitutes a 'gift '.
Once goodwill is taken to be property and with the admission of the two minors to the benefits of partnership in respect of a fixed share, the right to the money value of the goodwill stands transferred, the transaction does con stitute a gift under the Act.
Since there has been no dis pute about valuation of the goodwill as made by the Gift Tax Officer, with the conclusion that there has been a gift in respect of a part of the goodwill, the answer to the ques tion referred has to be in the affirmative, that is, it constitutes a gift under the Act.
The appeal is allowed and the conclusion of the High Court is reversed.
Since the respondent has not appeared, there will be no order for costs.
A.P.J. Appeal allowed.
|
ivil Appeal No. 2027 of 1974.
From the Judgment and Order dated 8.10.1973 of the Gujarat High Court in Gift Tax Reference No. 3 of 1971.
Wazir Singh, K.C. Dua and Ms. A. Subhashini for the Appellants.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal is by certificate under a Deed of Partnership dated 12.11.1958, a Firm by name M/s Chhotalal Vedilal came into existence with three partners, Chhotalal Mohanlal 1044 (the assessee).
Gunvantilal Chhotalal and Pravinchandra Vedilal.
These three partners had 7 annas, 4 annas and 5 annas share respectively in the firm.
This position contin ued until on 9.11.
1961 relevant to assessment year 1963 64 with which this appeal is concerned, a change took place in the constitution of the firm.
Under the new deed, Pravin chandra Vedilal retired; no change took place in respect of Gunvantilal Chhotalal; one Ramniklal Chhotalal became a partner with 4 annas share.
The share of the assessee Chhotalal Mohanlal was reduced to 4 annas; for the remaining 4 annas two minor sons of Chhotalal being Kiritkumar and Deepak Kumar were admitted to the benefits only of the firm Kiritkumar having 12 percent and Deepak Kumar having 13 per cent.
No alteration was, however, made regarding the share capital standing in the name of the assessee.
The Gift Tax Officer came to the conclusion that the assessee had deprived himself of 19 per cent share in the profits and had gifted away 19 per cent share in the good will of the firm in favour of his two minor sons.
He valued the goodwill and treated 19 per cent thereof as taxable gift.
The Appellate Assistant Commissioner before whom the assessee appealed adopted a different stand.
According to him, the gift was not of a share of the goodwill but in respect of the right to receive future profits.
He valued that right and since the amount Was higher than what the Income tax Officer had estimated, following the requirements of law he enhanced the quantum.
In further appeal by the assessee the Tribunal held that in the circumstances of the case there could be no gift of goodwill.
As appears from the statement of the case, the Revenue did not seek to support the order of the Incometax Officer but pleaded for sustain ing the order of the Appellate Assistant Commissioner.
The Tribunal further found that the right to receive future profits could not be subject matter of a gift as the trans fer did not relate to existing property.
According to it, the situation did not give rise to any gift which could be made liable to tax under the Act.
The following question relevant for the purpose of the appeal was referred to the High Court for its opinion at the instance of the Revenue: "Whether on the facts and in the circumstances of the case, the benefit of partnership given to minors Kirit Kumar Chhotalal and Deepak Kumar Chhotalal was a gift under the Gift Tax Act, 1958?" The High Court answered the question against the Revenue and up 1045 held the view of the Tribunal.
This appeal has, therefore, been carried by the Revenue.
In spite of service of notice of appeal the respondent has not appeared.
Counsel appearing in support of the appeal has contended that the order of the Gift Tax Officer was right and the Appellate Assistant Commissioner, the Tribunal and the High Court had gone wrong in holding that the ar rangement under the deed of 9.11.1961 did not give rise to a taxable event under the Act, so far as the assessee was concerned.
"Gift" is defined in section 2(xii) of the Act: " 'Gift ' means the transfer by one person to another of any existing movable or immovable property made voluntarily and without consid eration in money or money 's worth, and in cludes the transfer of any property deemed to be a gift under section 4.
" In support of the appeal, learned counsel further relies upon decisions of different High Courts to which we shall presently refer.
Before doing so it would be appropriate to indicate that in Khushal Khemgar Shah & Ors.
vs Khorsheed Banu Dadiba Boatwalla & Anr., ; this Court has held that goodwill of a firm is an asset, In Commission er of Gift Tax vs Nani Gopal Mondal, after referring to a number of authorities of this Court and different High Courts a Division Bench of the Calcutta High Court concluded thus: "From the cases cited above, it appears that goodwill of a partnership business is a property of the firm in which a partner is entitled to a share.
Although the above cases are under the Estate Duty Act, yet the princi ple laid down in the said cases regarding the nature of goodwill of a firm and the right of a partner in respect thereof is applicable to the instant case.
In this connection, it may be mentioned that according to section 14 of the Indian Partnership Act, property of a firm includes goodwill of the business.
Further, according to section 29(2), if a partner transfers his interest and the transferring partner ceases to be a partner, the transferee is entitled as against the remaining partners to receive the share of the assets of the firm to which the transferring partner is entitled to.
It further appears that under proviso to section 53 of the Indian Partnership Act, 1046 in case of dissolution, a partner or his representative may buy the goodwill of the firm and under section 55(1) of the Act, in settling the accounts of a firm after dissolu tion, the goodwill shall, subject to contract between the parties, be included in the assets and it may be sold either separately or along with other properties of the firm .
Upon transfer, the share or interest in the property of the firm of the transferring partner including the goodwill becomes the share or interest of the transferee.
In the instant case, Nani Gopal Mondal by the deed of gift transferred his share or interest in the firm which included his share of goodwill also.
Hence, for the purpose of payment of gift tax, the value of one third share of the assessee in the goodwill shall also be taken in account." In M.K. Kuppuraj vs Commissioner of Gift Tax, the Madras High Court was called upon to deal with a case of this type where minors were admitted to the benefits of partnership firm and the assessee 's interest in the firm suffered the detriment by relinquishment of a portion of his interest.
The High Court found that relinquishment of 8 per cent profit was in favour of the minors who were admitted without any consideration.
It held that the transaction constituted a gift by the assessee in favour of the minors.
The ratio in Sirehmal Nawalkha vs Commissioner of Income Tax, as also in Commissioner of Gift Tax, Bombay vs Premji Trikamji Jobanputra, ' 17 support the stand of the Revenue that the transaction constitutes a 'gift '.
Once goodwill is taken to be property and with the admission of the two minors to the benefits of partnership in respect of a fixed share, the right to the money value of the goodwill stands transferred, the transaction does con stitute a gift under the Act.
Since there has been no dis pute about valuation of the goodwill as made by the Gift Tax Officer, with the conclusion that there has been a gift in respect of a part of the goodwill, the answer to the ques tion referred has to be in the affirmative, that is, it constitutes a gift under the Act.
The appeal is allowed and the conclusion of the High Court is reversed.
Since the respondent has not appeared, there will be no order for costs.
A.P.J. Appeal allowed.
|
Under a deed of partnership dated 12.11.1958, a firm by the name M/s. Chhotalal Vedilal came into existence with Chhotalal Mohanlal (the assessee), Gunvantilal Chhotalal and Pravinchandra Vedilal, as partners, each having 7 annas, 4 annas and 5 annas share respectively in the firm.
This position continued until on 9.11.1961 when a change took place in the constitution of the firm.
Under the new deed, Pravinchandra Vedilal retired.
One Ramniklal Chhotalal became a partner with 4 annas share.
The share of the asses see, Chhotalal Mohanlal was reduced.
For the remaining 4 annas, two minor sons of the assessee were admitted to the benefits only of the firm.
In the assessment year 1963 64, the Gift Tax Officer concluded that the assessee had deprived himself of 19% share In the profits and had gifted away 19% share in the goodwill of the firm in favour of his two minor sons.
He valued the .goodwill and treated 19% thereof as taxable gift.
In the appeal before the Appellate Assistant Commission er the assessee took the stand that the gift was not of a share of the goodwill but in respect of the right to receive future profits.
He valued that right and since the amount was higher than what the Income Tax Officer has estimated, he enhanced the quantum.
In further appeal by the assessee the Tribunal held that in the circumstances of the case there could be no gift of goodwill and found that the right to receive future profits could not be subject matter of a gift as the transfer did not relate to existing property and the situation did not give rise to any gift which could be made liable to tax under the Act.
In the Reference the High Court upheld the view of the Tribunal.
1043 In the appeal to this Court on behalf of the Revenue, it was contended that the order of the Gift Tax Officer was right and the Appellate Assistant Commissioner, the Tribunal and the High Court had gone wrong in holding that the ar rangement under the deed of 9.11.1961 did not give rise to a taxable event under the Act.
Allowing the appeal, HELD: 1.
Goodwill of a firm is an asset.
[1045E] Khushal Khemgar Shah & Ors.
vs Khorshed Banu Dadiba Boatwalla & Anr., ; , followed.
Once goodwill is taken to be property and with the admission of the two minors to the benefits of partnership in respect of a fixed share, the right to the money value of the goodwill stands transferred, the transaction does con stitute a gift under the Gift Tax Act, 1958.
[1046F] 3.
Since there has been no dispute about valuation of the goodwill as made by the Gift Tax Officer, with the conclusion that there has been a gift in respect of a part of the goodwill the transfer of the benefit of the partner ship constitutes a gift under the Act.
[1046F G] Commissioner of Gift Tax vs Nani Gopal Mondal, ; M.K. Kuppuraj vs Commissioner of Gift Tax, ; Sirehmal Nawalkha vs Commissioner of Income Tax, and Commissioner of Gift Tax, Bombay vs Premji Trikamji Jobanputra, , approved.
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Under a deed of partnership dated 12.11.1958, a firm by the name M/s. Chhotalal Vedilal came into existence with Chhotalal Mohanlal (the assessee), Gunvantilal Chhotalal and Pravinchandra Vedilal, as partners, each having 7 annas, 4 annas and 5 annas share respectively in the firm.
This position continued until on 9.11.1961 when a change took place in the constitution of the firm.
Under the new deed, Pravinchandra Vedilal retired.
One Ramniklal Chhotalal became a partner with 4 annas share.
The share of the asses see, Chhotalal Mohanlal was reduced.
For the remaining 4 annas, two minor sons of the assessee were admitted to the benefits only of the firm.
In the assessment year 1963 64, the Gift Tax Officer concluded that the assessee had deprived himself of 19% share In the profits and had gifted away 19% share in the goodwill of the firm in favour of his two minor sons.
He valued the .goodwill and treated 19% thereof as taxable gift.
In the appeal before the Appellate Assistant Commission er the assessee took the stand that the gift was not of a share of the goodwill but in respect of the right to receive future profits.
He valued that right and since the amount was higher than what the Income Tax Officer has estimated, he enhanced the quantum.
In further appeal by the assessee the Tribunal held that in the circumstances of the case there could be no gift of goodwill and found that the right to receive future profits could not be subject matter of a gift as the transfer did not relate to existing property and the situation did not give rise to any gift which could be made liable to tax under the Act.
In the Reference the High Court upheld the view of the Tribunal.
1043 In the appeal to this Court on behalf of the Revenue, it was contended that the order of the Gift Tax Officer was right and the Appellate Assistant Commissioner, the Tribunal and the High Court had gone wrong in holding that the ar rangement under the deed of 9.11.1961 did not give rise to a taxable event under the Act.
Allowing the appeal, HELD: 1.
Goodwill of a firm is an asset.
[1045E] Khushal Khemgar Shah & Ors.
vs Khorshed Banu Dadiba Boatwalla & Anr., ; , followed.
Once goodwill is taken to be property and with the admission of the two minors to the benefits of partnership in respect of a fixed share, the right to the money value of the goodwill stands transferred, the transaction does con stitute a gift under the Gift Tax Act, 1958.
[1046F] 3.
Since there has been no dispute about valuation of the goodwill as made by the Gift Tax Officer, with the conclusion that there has been a gift in respect of a part of the goodwill the transfer of the benefit of the partner ship constitutes a gift under the Act.
[1046F G] Commissioner of Gift Tax vs Nani Gopal Mondal, ; M.K. Kuppuraj vs Commissioner of Gift Tax, ; Sirehmal Nawalkha vs Commissioner of Income Tax, and Commissioner of Gift Tax, Bombay vs Premji Trikamji Jobanputra, , approved.
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ON: Civil Appeal No. 1777 of 1973.
From the Judgment and Decree dated 25.6.1973 of the Karnataka High Court in Regular First Appeal No. 56 of 1968.
K.N. Bhatt, V.K. Verma and Ms Madhu Moolchandani for the Appellants.
S.S. Javali and B .R.
Agarwala for the Respondents.
The Judgment of the Court was delivered by 1142 KHALID, J.
This is an appeal by certificate.
against the Judgment dated 25th June, 1972, passed by a Division Bench of the Karnataka High Court.
The 1st defendant Bank is the appellant.
Original Suit No. 72 of 1962 was filed in the Court of Civil Judge.
Mangalore, by the Canara Sales Corporation, Ltd. through its Managing Director, V.S. Kudva.
He died during the pendency of the suit and the suit was continued by the succeeding Managing Director of the Corporation.
The suit was against two defendants: the appellant Bank was the first defendant and the second defendant was one Y.V, Bhat who was the Chief Accounts Officer of the plaintiff, till 1961.
He died during the pendency of the appeal before the High Court and his legal representatives were brought on record.
When the suit was filed, the appellant Bank was called the Canara Bank Ltd.
After the nationalisation of banks it became the Canara Bank which is the appellant before us.
The suit was instituted for recovery of a sum of Rs.3,26,047.92.
with the following allegations: The plain tiff is a private Limited Company with its head office at Mangalore.
It had a current account with the appellant Bank in its Mangalore Bunder branch.
The Managing Director of the company and the General Manager of a sister concern of the company had been authorised to operate the said current account of the plaintiff with the Bank.
The second defendant was attending to the maintenance of accounts of the plain tiff and was also in charge and custody of the cheque books issued by the Bank to the plaintiff.
In March, 1961, the second defendant was absent from duty for some time.
During that period one A. Shenoy, who was the Assistant of the second defendant was directed to bring the accounts upto date.
During this process, he noticed certain irregularities in the account and brought this to the notice of the plain tiff.
On verification, it was found that cheques purporting to bear the signature of Shri V.S. Kudva were encashed though they did not bear his signature.
In other words the signatures were forged.
On 25 3 196 1, a complaint was made by the plaintiff with the Superintendent of Police.
The plaintiff appointed a firm of Chartered Accountants to conduct special audit of the company 's accounts, for the years 1957:58 to 1960 61.
This special audit disclosed that the second defendant had withdrawn, in all, a sum of Rs.3,26,047.92 under 42 cheques.
The suit was filed for recovery of the amount on the plea that the amounts as per the forged cheques were not utilized for the purpose of the plaintiff, that they were not authorised ones, that there was no acquiescence or ratification open or tacit on the part of the plaintiff, that the plaintiff was unaware of the 1143 fraud till the new accountant discovered it.
The appellant Bank resisted the suit on the following grounds in their written statement: (i) That the cheques were not forged ones.
(ii) Even if they were forged ones the plaintiff was not entitled to recover the amount on account of its own negli gence.
(iii) There was settlement of accounts between the parties from time to time and as such the plaintiff was not entitled to reopen the same and claim the sums paid under the cheques in question.
(iv) The suit was barred by limitation.
The second defendant pleaded that the cheques were not forged ones and the amounts recovered by the cheques were utilized for the purpose of the plaintiff.
The Trial Court negatived the contentions of the first defendant Bank and passed a decree for the sum claimed, with interest at 6% from the date of the suit till recovery of the amount.
In appeal before the Division Bench, the judg ment of the Trial Court was confirmed.
The High Court certified that the case involved substan tial questions of law of general public importance and granted certificate to file the appeal.
It is thus that this appeal has come before us.
Venkataramiah, J. as he then was, who spoke for the Bench, has in his detailed Judgment considered all the aspects of the case both on facts and on law and agreed with the Trial Court that the suit had to be decreed, repelling the contentions raised by the first defendant.
The courts have concurrently found that the cheques were forged and that the second defendant was responsible for it.
We do not propose to consider the question of facts in this Judgment.
The learned counsel for the appellant, Shri Bhat argued the case at length and took us through various authorities, bearing on the question, most of which fell for considera tion at the hands of the High Court also.
In the instant case.
42 cheques with forged signature were presented on various dates between the year 1957 and 1961.
During the said period the appellant Bank used to send to the plaintiff respondent 1144 pass sheets containing the debit and credit entries in the current account of the plaintiff with the Bank every month and at the end of every half year ending 30th June and 31st December, a letter used to be sent asking the respondent to confirm that the balance in his account with the Bank was as mentioned in the letter.
Till March.
1961 the correctness of the entries in the pass sheets and half yearly statements was not questioned by the plaintiff.
The accounts of the plaintiff company were being audited as required by the Companies Act by Chartered Accountants.
The Bank contended that if there was mis appropriation of an amount of nearly Rs.3 lacs by forged cheques by the second defendant this would have been detected by the Chartered Accountants and would have come to the notice of the plaintiff company.
The several entries in the books of account maintained by the plaintiff company show that all the amounts covered by the cheques in dispute had been credited in the books.
The Managing Director of the plaintiff company himself admitted that he had received the periodical statements and that he did not at any time intimate the Bank about the incorrect ness either in the pass sheets or in the letters.
The inac tion on the part of the plaintiff company and its Managing Director in not informing the Bank of the irregularities in the account and deliberately withholding such information from the Bank, according to the Bank.
constituted negli gence.
disentitling the plaintiff from claiming any amount from the Bank in respect of forged cheques.
Alternatively it was contended that the principle of estoppel operated against the plaintiff from claiming the amount, on the ground of adoption or acquiescence.
The case of the appellant can be summarised as follows: After reasonable opportunities are given to the customer to examine the Bank statements.
its debit entries should be deemed to be final and will not be open for reconstruction to the detriment of the bank.
Of course.
what is a reasona ble opportunity will depend on the facts of each case.
In law, there can always be a settled or stated account between the banker and the customer.
The question to be decided here is whether acceptance by the customer without protest of a balance struck in the pass book or statement of account constitutes a settled account.
It is submitted that this aspect of the Banking law has not yet been authorita tively decided by this Court and invited us to pronounce upon it.
On the question of estoppel it was contended that a repre senta 1145 tion may be made either by statement or by conduct: and conduct included negligence, silence, acquiescence or en couragement.
If a customer of a bank, by his negligence to give timely information of forged cheques, allows amount to be drawn on such cheques.
the debit will stand for the whole amount and the customer will be estopped from claiming the amount.
If timely information was given, the Bank could have acted to ward off the mischief.
It was further contended that inaction for a long period would amount to such negligence, as would persuade a Court to impute to the customer, with knowledge or at any rate constructive knowledge, to decline him, relief in an action for recovery of amounts, which would be to the detriment of an innocent party, namely the Bank.
For this purpose.
dictionary meanings of the word 'know ledge was brought to our notice.
"Knowledge may include not only actual knowledge, i.e. actual awareness of the facts relevant.
but constructive knowledge.
i.e. knowledge at tributed by law to the party in the circumstances, whether he actually had the knowledge or not, and knowledge may be attributed to a person who has sought to avoid finding out, or has shut his eyes to obvious means of knowledge.
e.g. the man who is offered valuables cheaply in circumstances which suggest that they may well have been stolen.
but who refrains from enquiry".
Black 's Law Dictionary Fifth Edn. defines.
"Constructive knowledge" as "If one by exercise of reasonable care would have known a fact.
he is deemed to have had costructive knowledge of such fact, e.g., matters of public record".
"Notice" means "bringing it to a person 's knowledge".
Then he referred us to the Transfer of Property Act.
Trusts Act, Law of Agency.
etc. to contend that a person is said to have noticed of a fact when but for wilful absten tion from an enquiry.
he would have known it and that in equity a man who ought to have known a fact should be treat ed as if he actually does know it.
He then developed his submission as follows: It is accepted to be a duty of customer who knows that his cheques are being forged, to inform the bank.
If he fails to give such an information, he is estopped from claiming that the cheques were forged.
In law.
there should be no differ 1146 ence in the consequence between a person having constructive knowledge and a person having actual knowledge.
Thus a person having constructive knowledge of a matter.
cannot be allowed to take advantage of his own negli gence.
According to him the terms of contract between a banker and its customer can never be complete unless there is an implied condition that the customer was under a duty to examine the statement to account, particularly when the bank issues a notice that if no errors are pointed out within a specified time.
the bank will proceed to believe that there are no errors.
Such a notice imposes on a customer a duty to react and failure to react would amount to negligence, leading to estoppel.
The company 's Balance Sheet for four years clearly show that the auditors have examined the books and vouchers.
It is in evidence (spoken to by PW 8) that the balance sheets were adopted by the general bodies for four successive years.
This shows that the statements of account.
given by the Bank was accepted as such.
There is a duty on the part of the Company 's directors to present a correct Balance Sheet.
Negligence to verify the obvious things.
like examining the counterfoil of cheques amounts not only to estoppel but to adoption and ratifica tion.
for, no one can take shelter under one 's own failure to examine the obvious.
Further, the annual reports are to be treated as public documents and public are likely to rely upon its representation and defendant bank is, at any rate, a member of the public.
We have set out above, the contentions of the appellant, in detail, so as to bring into focus, the questions of law to be decided in the appeal.
Now we propose to consider the submissions made by the appellant to test their validity qua the Banking Law, ap plicable to India.
It is true that there is no direct au thority of this Court on this Branch of the Law.
It is.
therefore, necessary to briefly outline the confines of this Branch of law.
The relationship between the customer of a bank and the bank is that of a creditor and debtor.
When a cheque which presented for encashment contains a forged signature the bank has no authority to make payment against such a cheque.
The bank would be acting 1147 against law in debiting the customer with the amounts cov ered by such cheques.
When a customer demands payment for the amount covered by such cheques.
the bank would be liable to pay the amount to the customer.
The bank can succeed in denying payment only when it establishes that the customer is disentitled to make a claim either on account of adop tion.
estoppel or ratification.
The principle of law regard ing this aspect is as follows: When a cheque duly signed by a customer is presented before a bank with whom he has an account there is a mandate on the bank to pay the amount covered by.
the cheque.
However.
if the signature on the cheque is not genuine.
there is no mandate on the bank to pay.
The bank, when it makes payment on such a cheque, cannot resist the claim of the customer with the defence of negligence on his part such as leaving the cheque book carelessly so that third parties would easily get hold of it.
This is because a document in cheque form, on which the customer 's name as drawer is forged, is a mere nullity.
The bank can succeed only when it establishes adoption or estoppel.
The relationship between a bank and its customers indi rectly arose before this Court in Bihta Co operative Devel opment Cane Marketing Union Ltd. & Anr.
vs The Bank of Bihar & Ors., ; In that case a suit was filed by a Society registered under the Bihar and Orissa Co operative Societies Act, 1935, and its Secretary.
This Society had an account with the first defendant Bank.
The and 7th defend ants were respectively its Joint Secretary and Treasurer.
A sum of Rs.11,000 was withdrawn from the account by means of a cheque, not from the cheque book of the Society, but from a loose cheque leaf surrendered by an ex constitutent of the bank.
It bore the signature of the 7th defendant but the forged signature of the 6th defendant.
The suit against the bank, its manager and other employees was decreed by the Trial Court and confirmed by the High Court on the question relevant for our purpose but dismissed on the ground juris diction.
The question before us in this appeal was consid ered by this Court with reference to a Judgment of the House of Lords in London Joint Stock Bank Ltd. vs Macmillan, It was argued before this Court that the decree against the bank could not be sustained since even though there was negligence on the part of the bank and its employees, the plaintiffs ' Society was not altogether free from blame or negligence in that but for the part played by at least one 1148 of its employees in the matter of encashment of the cheque for Rs.11,000 the fraud could not have been perpetrated.
It was also argued that if both the parties were negligent or blameworthy.
the plaintiffs claim ought not to succeed.
It was, in this connection that Macmillan 's case fell for reference.
Being a landmark case, we would set out the facts of that case in brief: The plaintiffs, Macmillan etc.
brought a suit against the London Stock Bank for a declaration that the bank was not entitled to debit the plaintiffs with a cheque for pound 120.
The plaintiffs had in their employment a confidential clerk who made out cheques and got the signature of part ners.
On a certain day.
the clerk made out a cheque for pound 2 and asked one of the partners to sign it, which the partner did.
The next day the clerk did not turn up.
The partners became suspicious and went to the bank.
when they discovered that the cheque for pound.
2 was distorted by using the space on either side of the figure '2 ' by the clerk by insertion of additional figures 1 & 0 and thus he pocketed pound.
The question before the House of Lords was whether the plaintiffs had been so negligent with regard to the cheque that their action against the bank should fail.
The Trial Judge found that the plaintiffs were not guilty of negligence in the mode of signing the cheque and decreed the suit.
The Court of Appeal upheld this decision.
The House of Lords reversed the judgment.
We may usefully quote the following passages from the Judgment.
Lord Finlay observed: "As the customer and the banker are under a contractual relation in this matter.
it ap pears obvious that in drawing a cheque the customer is bound to take usual and reasonable precautions to prevent forgery.
Crime, is indeed, a very serious matter, but every one knows that crime is not uncommon.
If the cheque is drawn in such a way as to facilitate or almost invite an increase in the amount by forgery if the cheque should get into the hands of a dishonest person, forgery is not a remote but a very natural consequence of negligence of this description.
" The learned Lord Chancellor further observed: Of course the negligence must be in the trans action itself, that is, in the manner in which the cheque is drawn.
It would be no defence to the banker, if the forgery had been that of a clerk of a customer, that the latter had taken the clerk into his service without sufficient inquiry as to his 1149 character.
Attempts have often been made to extend the principle of Young vs Grote, ; beyond the case of negligence in the immediate transaction, but they have always failed.
According to the learned Lord Chancellor, leaving blank spaces on either side of the figure '2 ' in the cheque amounted to a clear breach of duty which the customer owed to the banker.
The learned Lord Chancellor said: "If the customer chooses to dispense with ordinary precautions because he has complete faith in his clerk 's honesty, he cannot claim to throw upon the banker the loss which re sults.
No one can be certain of preventing forgery, but it is a very simple thing in drawing a cheque to take reasonable and ordi nary precautions against forgery.
If owing to the neglect of such precautions it is put into the power of any 'dishonest person to increase the amount by forgery, the customer must bear the loss as between himself and the banker.
" The principles so settled by the House of Lords was pressed into service before this Court in the above case.
This Court held that the principle settled by the House of Lords could not help the bank.
The accepted principle that if the signatures on the cheque is genuine, there is a mandate by the customer to the bank to pay was reiterated.
It was also held that if an unauthorised person got hold of such a cheque and encashed it, the bank might have had a good defence hut, however, if the signatures on the cheque or at least one of the signatures are or is not genuine , ' there is no mandate on the bank to pay and the question of any negligence on the part of the customer, such as leaving the cheque book carelessly so that a third party could easily get hold of it would afford no defence to the bank.
This Court distinguished Macmillan 's case, observing that if any of the signatures was forged the question of negligence of the customer in between the signature and the presenta tion of the cheque never arose.
The suit was, however, dismissed on another point and that of jurisdiction.
That takes us to the question as to whether there is a duty on the part of the customer to examine the pass book and inner part of cheques and to communicate to the banker within a reasonable time of the debits which he does not admit.
1150 The kindered question connected with this is whether a customer is estopped from disputing the debits shown in the pass book when the pass book is returned without any comment and whether such a conduct would constitute a "stated and settled account." To answer this it is necessary to examine the question whether the customer owes a duty to the bank to inform it about the correctness or mis statements in the entries in the pass book within a reasonable time and wheth er failure to do so would amount to such negligence as to non suit him in a suit for recovery of the amount paid on a forged cheque.
When does negligence constitute estoppel ? For negligence to constitute an estoppel it is necessary to imply the existence of some duty which the patty against whom estoppel is alleged owes to the other party.
There is a duty of sorts on the part of the customer to inform the bank of the irregularities when he comes to know of it.
But by mere negligence One cannot presume that there has been a breach of duty by the customer to the bank.
The customer should not by his conduct facilitate payment .of money on forged cheques.
In the absence of such circumstances, mere negligence will not prevent a customer from successfully suing the bank for recovery of the amount.
A case of acquiescence also cannot be flourished against the plaintiff.
In order to sustain a plea of acquiescence, it is necessary to prove that the party against whom the said plea is raised, had remained silent about the matter regarding which the plea of acquiescence is raised, even after knowing the truth of the matter.
As indicated above, the plaintiff did not, during the relevant period, when these 42 cheques were encashed, know anything about the sinister design of the second defendant.
If the bank had proved to the satisfaction of the Court that the plaintiff had with full knowledge acknowledged the correctness of the accounts for the relevant period, a case of acquiescence against the plaintiff would be available to the bank.
That is not the case here.
In this judgment under appeal, the High Court has elabo rately considered the law obtaining in the United States of America on this aspect.
We need not exercise ourselves with the American Law since the American Law is different from the law that we follow.
On the questions involved in this appeal, it is the .law that obtains in England which had been followed by this Court and High Courts in the country.
The authorities in England have more or less consistently held that there is no duty on the part of the customer to intimate the banker about any error that may be seen in the pass book and that he will be entitled to claim any amount paid on a forged cheque though there may be some negligence or in action on his part in not being careful to 1151 discover the errors in the pass book or other documents.
In the instant ease, there is no evidence to show that anyone other than the second defendant knew that the forged cheques had been encashed.
After the matter was discovered, immedi ate action was taken.
Therefore, in the absence of any evidence of the plaintiff 's involvement, the plaintiff cannot be nonsuited on the ground of negligence or in ac tion.
Venkatramiah, J when he rendered the Judgment, under appeal, laid down the law correctly, with the aid of author ities then available and on his own reasons.
Now we are in a more advantageous position.
We have an authority, more or less identical on facts, rendered by the Privy Council in the decision in Tai Hing Cotton Ltd. vs Liu Chong Bank, [1985] 2 All England Reports 947.
The facts of this case are similar to the case on hand; if anything, more to the disadvantage to the bank in terms of money involved than the instant case.
The appellant before the Privy Council was a company, a textile manufac turer carrying on business in Hong Kong.
The company was a customer of the three respondent banks and maintained with each of them a current account.
The banks were authorised to pay cheques on behalf of the company if signed by its Manag ing Director or two authorised signatories.
The banks agreed to send the appellant periodic statements which were deemed to be confirmed unless the customer notified the bank of any error therein by a specified time.
Between 1972 and 1978 the accounts clerk employed by the company forged the signature of the Managing Director on 300 cheques purported to be drawn by the company for a total sum of $HK.5.5 million.
The banks paid the cheques on presentation by the clerk and debited the company 's current account accordingly.
The clerk was able to manipulate the accounts without any obstruction or discovery because he was in almost sole control of the receipts and payments made through the accounts.
As in this case, the fraud was uncovered in May, 1978, when a newly appointed accountant commenced reconciling the bank state ments with the company 's books.
This was an exercise which had not been followed previously.
The new accountant found at once that something was seriously wrong.
He reported the matter to the Managing Director.
The errant accountant was interrogated and he admitted the frauds.
The company took action against the banks, the accountant and his wife.
The Trial Judge basing his decision on the fundamental premise that a forged cheque is no mandate to pay held that unless the bank established affirmatively that they were entitled to debit the customers current account with the amounts of the forged cheques, the customer was entitled to the relief 1152 of the loss arising from the bank 's payment on the forged cheques.
A case was put forward before the Trial Judge that the Company was vicariously liable for the fraud played by its accountant.
This was negatived and was not pursued.
The Trial Judge also rejected the submission of the banks that their terms of business which was contractual called the banking contract, should be construed as ousting the common law rule.
The defence included one of estoppel raised by each of the banks.
The plea of estoppel was put forward in two ways; first, that the company was estopped by its negli gence in the management of its bank accounts from asserting that the accounts had been wrongly debited, and second, that the company was estopped by a representation to be implied from the course of conduct that the periodic bank statements were correct.
The Trial Judge rejected the plea of estoppel by negligence but held: " . .
In the case of each bank the company by failing to .
challenge the debits shown on the bank statements, had represented to each bank that the debits had been correctly made.
He held that Tokyo and Chekiang had acted in reliance on the representations so made by their willingness to continue operating their respective accounts and to expose themselves to the risk of paying out on forged cheques.
He did not find the same prejudice had been suffered by Liu Chong Hing as it only became exposed to the fraud in November 1977, the first representation to it not being made until the company 's failure.
to query the December 1977 statement of account.
The Judge found that the chance of recovery from Leung had not been substantially diminished during the period (December 1977 to May 1978) during which it could be said that the estoppel was operative.
" On this finding the Judge gave the company Judgment against one bank, but dismissed its claims against the other two banks.
The company appealed and the defeated banks cross appealed.
The Court of appeal differed from the Trial Judge on the general question.
The Court of appeal evolved a theory that the banker/customer relationship is such as to give rise to a general duty of care in the operation of its banking account and on this basis held that the company was in breach of the duty which they held, it owed to the banks and must bear the loss.
According to the Court of appeal this duty arose in tort as well as in contract.
There was difference of opinion among the Judges as to whether the in action on the part of the customer in not objecting 1153 to the statement sent by the bank within the time specified would constitute conclusive evidence of the correctness of the debits recorded therein or whether the banking contracts could be construed as including a term requiring the monthly statements to be treated after a period of time as conclu sive evidence of the state of the account.
But all of them were agreed that estoppel operated against the company by its own negligence from challenging the correctness of the banks statements.
The banks thus succeeded in the Court of appeal.
The defeated company moved the Judicial Committee of the Privy Council by filing appeals.
This was how the matter reached the Privy Council.
The Privy Council had to decide the case in the light of the law settled by the House of Lords in the Macmillan 's case and in Greenwood vs Martins Bank Ltd.; = 1932 All England Reports 3 18.
The Privy Council posed two questions before it, first, whether English law recognises any duty of care owed by the customer to his bank in the operation of a current account beyond, first, a duty to refrain from drawing a cheque in such a manner as may facil itate fraud or forgery and, second, a duty to inform the bank of any forgery of cheque purportedly drawn on the account as soon as he, the customer, becomes aware of it.
The respondent banks while recognising the existence of both the duties indicated above contended that the law had evolved in England after 19 18 and 1933 in recognising an altogether wider duty of care.
This duty, according to them, required the customer to take reasonable precautions in the management of his business with the bank to prevent forged cheques being presented to it for payment.
Additionally, it was contended.
that even if this wider duty did not exist.
at any rate the customer owed a duty to take such steps to check the periodic bank statements sent to him as a reasona ble person in his pOsition would take to enable him to notify the bank of any debit items in the account which he had not authorised, When it is accepted that the bank sent periodic statements to the customer, the bank contended that the duty and responsibility to look into such statements and to notify to the bank were necessary incidents of the con tractual relationship between the customer and the bank.
The source of this obligation according to the banks is to be found both in the contract law as an implied term of the banking contract and in the tort law as a civil obligation arising from the relationship of banker and customer.
Then the Privy Council proceeded to consider the weightier sub 1154 missions advanced by the bank (1) a wider duty on the part of the customer to act with diligence which must be implied into the contract and alternatively that such a duty arises in tort from the relationship between banker and customer.
The Privy Council parted company with the observation by the Court of Appeal here and repelled the plea that it was necessary to imply into a contract between a banker and the customer a wider duty and that it was not a necessary inci dent of banker customer relationship that the customer should owe his banker a wider duty of care.
This duty is in the form of an undertaking by the customer to exercise reasonable care in executing his written orders so as not to mis lead the bank or to facilitate forgery.
The Privy Coun cil accepted that an obligation should be read into the contract as the nature of this contract implicity requires.
In other words 'the term sought to be implied must be one without which the whole 'transaction would become futile and inefficacious. ' After referring to some earlier decisions, the Privy Council rejected the implied term 'submission ' and set out the limits of the care of the customer and the functions of the banks in the following words: " .
One can fully understand the com ment of Cons JA that the banks must today look for protection.
So be it.
They can increase the severity of their terms of business and they can use their influence as they have in the past, to seek to persuade the legislature that they should be granted by statute 'fur ther protection.
But it does not follow that because they may need protection as their business expands the necessary incidents of their relationship with their customer must also change.
The business of banking is the business not of the customer but of the bank.
They offer a service, which is to honour their customer 's cheques when drawn on an account in credit or within an agreed overdraft limit.
If they pay out on cheques which are not his, they are acting outside their mandate and cannot plead his authority in justification of their debit to his account.
This is a risk of the service which it is their business to offer.
The limits set to the risk in the Macmillan and Greenwood cases can be seen to be plainly necessary incidents of the relationshi p. Offered such a service, a customer must obviously take care in the way he draws his cheque, and must obviously warn his bank as soon as he knows that a forger is operating the account . . " The limits of the duty and the confines of contractual obligation cannot be expressed better.
1155 On the question of tort also the bank could not satisfy the Privy Council as is seen from the following observation: "Their Lordships do not believe that there is anything to the advantage of the law 's development in searching for a liability in tort where the parties are in a contractual relationship.
This is particularly so in a commercial rela tionship.
Though it is possible as a matter of legal seman tics to conduct an analysis of the rights and duties inher ent in some contractual relationships including that of a banker and customer either as a matter of contract law when the question will be what.
if any.
terms are to be implied or as a matter of tort law when the task will be to identify a duty arising from the proximity and character of the relationship between the parties.
their Lordships believe it to be correct in principle and necessary for the avoidance of confusion in the law to adhere to the contractual analy sis on principle because it is a relationship in which the parties have.
subject to a few exceptions, the right to determine their obligations to each other.
and for the avoidance of confusion because different consequences do follow according to whether liability arises from contract or tort, e.g. in the limitation of action . " Their Lordships of the Privy Council sumed up the Law, as followers: 'Their Lordships do not, therefore, embark on an investiga tion whether in the relationship of banker and customer it is possible to identify tort as well as contract as a source of the obligations owed by the one to the other.
Their Lordships do not, however, accept that the parties ' mutual obligations in tort can be any greater than those to be found expressly or by necessary implication in their con tract.
If, therefore, as their Lordships have concluded, no duty wider than that recognised in Macmillan and Greenwood can be implied into the banking contract in the absence of express terms to that effect, the respondent banks cannot rely on the law of tort to provide them with greater protec tion than that for which they have contracted.
Having rejected the plea of implied terms, indirectly con structive 1156 notice and estoppel by negligence, it was held that the company was not under any breach of duty owed by it to the banks and as such mere silence, omission or failure to act is not a sufficient ground to establish a case in favour of the bank to non suit its customer.
We adopt the reasoning indicated above with great re spect.
Unless the bank is able to satisfy the Court of either an express condition in the contract with its custom er or an unequivocal ratification it will not be possible to save the bank from its liability.
The banks do business for their benefit.
Customers also get some benefit.
If banks are to insist upon extreme care by the customers in minutely looking into the pass book and the statements sent by them, no bank perhaps can do profitable business.
It is common knowledge that the entries in the pass books and the state ments of account sent by the bank are either not readable, decipherable or legible.
There is always an element of trust between the bank and its customer.
The bank 's business depends upon this trust.
Whenever a cheque purporting to be by a customer is presented before a bank it carries a man date to the bank to pay.
If a cheque is forged there is no such mandate.
The bank can escape liability only if it can establish knowledge to the customer of the forgery in the cheques.
In action for continuously long period cannot by itself afford a satisfactory ground for the bank to escape the liability.
The plaintiff in this case swung into action immediately on the discovery of the fraud committed by its accountant as in the case before the Privy Council.
We may, in passing.
refer to a decision of this court on the question of negligence under circumstances not strictly akin to the case on hand reported in the New Marine Coal Co. (Bengal) Pvt. Ltd. vs Union of India, ; There the suit was for recovery of certain amount represent ing the price of coal supplied to the respondent.
Inter alia the respondent pleaded in defence of the suit that the respondent had issued and sent bills to cover the amount and the intimation cards in accordance with the usual practice in the ordinary course of dealings.
The respondents it was alleged paid the amount by cheque to a person authorised by the appellant and on presentation of proper receipts.
It was pleaded that the appellant 's claim having been satisfied he had no cause of action.
It was established in the course of the trial that the appellant had not in fact authorised any person to issue the receipts but a certain person not con nected with the appellant firm without the consent or knowl edge of the appellant got hold of the intimation cards and bills addressed to the appellant.
forged the documents and fraudulently received the cheque from the respondent and 1157 appropriated the amount for himself.
We may usefully read the following passage relating to negligence in the context of a plea based on estoppel: ". .
Apart from, this aspect of the matter, there is another serious objection which has been taken by Mr. Setalved against the view which prevailed with Mukharji J. He argues that when a plea of estoppel on the ground of negligence is raised, negligence to which reference is made in support of such a plea is not the negligence as is understood in popu lar language or in common sense; it has a technical denota tion.
In support of a plea of estoppel on the ground of negligence.
it must be shown that the party against whom the plea is raised owed a duty to the party who raises the plea.
Just as estoppel can be pleaded on the ground of misrepre sentation or act or omission.
so can estoppel be pleaded on the ground of negligence; but before such a plea can suc ceed, negligence must be established in this technical sense.
As Halsbury has observed: 'before anyone can be estopped by a representation inferred from negligent con duct.
there must be a duty to use due care towards the party misled, or towards the general public of which he is one. ' There is another requirement which has to be proved before a plea of estoppel on the ground of negligence can be upheld and that requirement is that 'the negligence on which it is based should not be indirectly or remotely connected with the misleading effect assigned to it, but must be the proxi mate or real cause of that result. ' Negligence.
according to Halsbury, which can sustain a plea of estoppel must be in the transaction itself and it should be so connected with the result to which it led that it is impossible to treat the two separately.
This aspect of the matter has not been duly examined by Mukharji.
J. when he made his finding against the appellant.
" This is how this Court understood how a plea of estoppel based on negligence can be successfully put forward.
We have seen that there is no duty for a customer to inform the bank of fraud committed on him.
of which he was unaware.
Nor can in action for a reasonably long time in not discovering fraud or irregularity be made a defence to defeat a customer in an action for loss.
Thus the contentions put for 1158 ward by the bank cannot be accepted to defeat the plaintiff.
The various submissions made by the counsel for the bank based on constructive notice in the general law and on other branches of law cannot be extended to relationship between a bank and its customers.
On a careful analysis of the questions of law, we hold that the judgment of the High Court and that of the Trial Judge have to be upheld.
We do so.
We accordingly dismiss the appeal with costs of the 1st respondent.
N.P.V. Appeal dis missed.
|
The respondent company had a current account with the lant bank in its Mangalore Builder Branch.
The Manag ing Director of the company and the General Manager of a sister concern of the company had been authorised to operate the said current account.
The second defendant was attending to the maintenance of accounts of the respondent company and was also in charge and had the custody of the cheque book issued by the Bank to the respondent company.
During the process of bringing the accounts upto date certain irregu larities were noticed in the account and on verification it was found that cheques purporting to bear the signature of the Managing Director were encashed, though they did not bear 'his signature.
A complaint was lodged by the respond ent Company with the police and a special audit of the company 's accounts for the years 1957 58 to 1960 61 by a firm of Chartered Accountants disclosed that the second defendant had withdrawn a sum of Rs.3,26.047.92 under 42 cheques.
A suit was filed for the recovery of the said amount on the plea that the amounts as per the forged cheques were not utilised for the purpose of the respondent company.
that they were not authorised ones.
that there was no acquiescence or ratification open or tacit on the part of the respondent company and that the respondent was unaware of the fraud till the new accountant discovered it.
The appellant bank resisted the suit on the grounds (1) that the cheques were not forged ones; (2) that even if they were forged ones.
the company was not entitled to recover the amount on account of its own 1139 negligence; (3) that there was settlement of accounts be tween the parties from time to time and as such.
the company was not entitled to reopen the same and claim the sums paid under the cheques; and (4) that the suit was barred by limitation.
The second defendant pleaded that the cheques were utilised for the purpose of the company.
The trial Court negatived the contentions of the bank and passed a decree for the sum claimed with interest at 6%.
In appeal the Division Bench confirmed the judgment of the trial court but as the case involved substantial ques tions of law of general public importance it granted a certificate to file the appeal.
In the appeal before this Court it was contended on behalf of the appellant that: (1) after reasonable opportu nities are given to the customer to examine the bank state ments, its debit entries should be deemed to be final and will not be open for reconstruction to the detriment of the bank; (2) a representation may be made either by statement or by conduct, and conduct included negligence, silence, acquiescence or encouragement, and if a customer of a bank, by his negligence, to give timely information of forged cheques, allows amount to be drawn on such cheques.
the debit will stand for the whole amount and the consumer will be estopped from claiming the amount; and (3) in action for a long period would amount to such negligence as would persuade a court to impute to the customer with knowledge or at any rate constructive knowledge,_to decline him relief in an action for recovery of amounts which would be to the detriment of an innocent party, namely, the bank.
Dismissing the appeal.
HELD: 1.
When a cheque duly signed by a customer is presented before a bank with whom he has an account there is a mandate on the bank to pay the amount covered by the cheque.
However.
if the signature on the cheque is not genuine.
there is no mandate on the bank to pay.
The bank.
when it makes payment on such a cheque, cannot resist the claim of the customer with the defence of negligence on his part such as leaving the cheque book carelessly so that third parties would easily get hold of it.
This is because a document in cheque form.
on which the customer 's name as drawer is forged.
is a mere nullity.
[1147B D] 2.
The relationship between the customer of a bank and the bank is that of a creditor and debtor.
When a cheque presented for encashment contains a forged signature the bank has no authority to make payment against such a cheque.
The bank would be acting against law 1140 in debiting the customer with the amounts covered by such cheques.
When a customer demands payment for the amount covered by such cheques, the bank would be liable to pay the payment to the customer.
The bank can succeed in denying payment only when it establishes that the customer is disen titled to make a claim either on account of adoption, estop pel or ratification.
[1146G H; 1147A B] For negligence to constitute an estoppel.
it is neces sary to imply the existence of some duty which the party against whom estoppel is alleged owes to the other party.
There is a duty of sorts on the part of the customer to inform the bank of the irregularities when he comes to know of it.
But by mere negligence.
one cannot presume that there has been a breach of duty by the customer to the bank.
The customer should not by his conduct facilitate payment of money on forged cheques.
In the absence of such circum stances.
mere negligence will not prevent a customer from successfully suing the bank for recovery of the amount.
[1150B D] 4.
In order to sustain a plea of acquiescence, it is necessary to prove that the party against whom the said plea is raised.
had remained silent about the matter regarding which the plea of acquiescence is raised.
even after knowing the truth of the matter.
[1150D E] 5.
There is no duty for a customer to inform the bank of a fraud committed on him, of which he was unaware.
Nor can in action for a reasonably long time in not discovering fraud or irregularity be made a defence to defeat a customer in an action for loss.
[1157G H] 6.
There is no duty on the part of the customer to intimate the banker about any error that may be seen in the pass book and he will be entitled to claim any amount paid on a forged cheque though there may be some negligence or in action on his part in not being careful to discover the errors in the pass book or other documents.
Banks do business for their benefit.
Customers also get some benefit.
If banks are to insist upon extreme care by the customers in minutely looking into the pass book and the statements sent by them, no bank perhaps can do profita ble business.
It is common knowledge that the entries in the pass books and the statements of account sent by the bank are either not readable.
decipherable or legible.
There is always an element of trust between the bank and its custom er.
The bank 's business depends upon this trust.
[1156B D] 1141 8.
Whenever a cheque purporting to be by a customer is presented before a bank it carries a mandate to the bank to pay.
If a cheque is forged there is no such mandate.
The bank can escape liability only if it can establish knowledge to the customer of the forgery in the cheques.
In action for continuously long period cannot by itself afford a satisfac tory ground for the bank to escape the liability.
[1156D E] 9.
In the present case.
during the relevant period when 42 cheques were encashed, the company did not know anything about the sinister design of the second defendant.
Since the bank had not proved to the satisfaction of the court that the company had with full knowledge acknowledged the cor rectness of the accounts for the relevant period the case of acquiescence cannot be flourished against the company.
There is no evidence to show that any one other than the second defendant knew that the forged cheques had been encashed.
After the matter was discovered immediate action was taken.
Therefore, in the absence of any evidence of the respondent company 's involvement.
it cannot be non suited on the ground of negligence or in action.
Unless the bank is able to satisfy the court of either an express condition in the contract with its customer or an unequivocal ratifica tion it will not be possible to save the bank from its liability.
[1150E F; 1151A B; 1156B] Bihta Co operative Development Cane Marketing Union Ltd. Joint Stock Bank Ltd. vs Macmillan, ; Tai Hing Cotton Ltd. vs Liu Chong Bank, [1985] 2 All England Reports 947; Greenwood vs Martins Bank Ltd., = [1932] All England Reports 318; and New Marine Coal Co. (Bengal) Pvt. Ltd. vs Union of India, ; , referred to.
|
ON: Civil Appeal No. 1777 of 1973.
From the Judgment and Decree dated 25.6.1973 of the Karnataka High Court in Regular First Appeal No. 56 of 1968.
K.N. Bhatt, V.K. Verma and Ms Madhu Moolchandani for the Appellants.
S.S. Javali and B .R.
Agarwala for the Respondents.
The Judgment of the Court was delivered by 1142 KHALID, J.
This is an appeal by certificate.
against the Judgment dated 25th June, 1972, passed by a Division Bench of the Karnataka High Court.
The 1st defendant Bank is the appellant.
Original Suit No. 72 of 1962 was filed in the Court of Civil Judge.
Mangalore, by the Canara Sales Corporation, Ltd. through its Managing Director, V.S. Kudva.
He died during the pendency of the suit and the suit was continued by the succeeding Managing Director of the Corporation.
The suit was against two defendants: the appellant Bank was the first defendant and the second defendant was one Y.V, Bhat who was the Chief Accounts Officer of the plaintiff, till 1961.
He died during the pendency of the appeal before the High Court and his legal representatives were brought on record.
When the suit was filed, the appellant Bank was called the Canara Bank Ltd.
After the nationalisation of banks it became the Canara Bank which is the appellant before us.
The suit was instituted for recovery of a sum of Rs.3,26,047.92.
with the following allegations: The plain tiff is a private Limited Company with its head office at Mangalore.
It had a current account with the appellant Bank in its Mangalore Bunder branch.
The Managing Director of the company and the General Manager of a sister concern of the company had been authorised to operate the said current account of the plaintiff with the Bank.
The second defendant was attending to the maintenance of accounts of the plain tiff and was also in charge and custody of the cheque books issued by the Bank to the plaintiff.
In March, 1961, the second defendant was absent from duty for some time.
During that period one A. Shenoy, who was the Assistant of the second defendant was directed to bring the accounts upto date.
During this process, he noticed certain irregularities in the account and brought this to the notice of the plain tiff.
On verification, it was found that cheques purporting to bear the signature of Shri V.S. Kudva were encashed though they did not bear his signature.
In other words the signatures were forged.
On 25 3 196 1, a complaint was made by the plaintiff with the Superintendent of Police.
The plaintiff appointed a firm of Chartered Accountants to conduct special audit of the company 's accounts, for the years 1957:58 to 1960 61.
This special audit disclosed that the second defendant had withdrawn, in all, a sum of Rs.3,26,047.92 under 42 cheques.
The suit was filed for recovery of the amount on the plea that the amounts as per the forged cheques were not utilized for the purpose of the plaintiff, that they were not authorised ones, that there was no acquiescence or ratification open or tacit on the part of the plaintiff, that the plaintiff was unaware of the 1143 fraud till the new accountant discovered it.
The appellant Bank resisted the suit on the following grounds in their written statement: (i) That the cheques were not forged ones.
(ii) Even if they were forged ones the plaintiff was not entitled to recover the amount on account of its own negli gence.
(iii) There was settlement of accounts between the parties from time to time and as such the plaintiff was not entitled to reopen the same and claim the sums paid under the cheques in question.
(iv) The suit was barred by limitation.
The second defendant pleaded that the cheques were not forged ones and the amounts recovered by the cheques were utilized for the purpose of the plaintiff.
The Trial Court negatived the contentions of the first defendant Bank and passed a decree for the sum claimed, with interest at 6% from the date of the suit till recovery of the amount.
In appeal before the Division Bench, the judg ment of the Trial Court was confirmed.
The High Court certified that the case involved substan tial questions of law of general public importance and granted certificate to file the appeal.
It is thus that this appeal has come before us.
Venkataramiah, J. as he then was, who spoke for the Bench, has in his detailed Judgment considered all the aspects of the case both on facts and on law and agreed with the Trial Court that the suit had to be decreed, repelling the contentions raised by the first defendant.
The courts have concurrently found that the cheques were forged and that the second defendant was responsible for it.
We do not propose to consider the question of facts in this Judgment.
The learned counsel for the appellant, Shri Bhat argued the case at length and took us through various authorities, bearing on the question, most of which fell for considera tion at the hands of the High Court also.
In the instant case.
42 cheques with forged signature were presented on various dates between the year 1957 and 1961.
During the said period the appellant Bank used to send to the plaintiff respondent 1144 pass sheets containing the debit and credit entries in the current account of the plaintiff with the Bank every month and at the end of every half year ending 30th June and 31st December, a letter used to be sent asking the respondent to confirm that the balance in his account with the Bank was as mentioned in the letter.
Till March.
1961 the correctness of the entries in the pass sheets and half yearly statements was not questioned by the plaintiff.
The accounts of the plaintiff company were being audited as required by the Companies Act by Chartered Accountants.
The Bank contended that if there was mis appropriation of an amount of nearly Rs.3 lacs by forged cheques by the second defendant this would have been detected by the Chartered Accountants and would have come to the notice of the plaintiff company.
The several entries in the books of account maintained by the plaintiff company show that all the amounts covered by the cheques in dispute had been credited in the books.
The Managing Director of the plaintiff company himself admitted that he had received the periodical statements and that he did not at any time intimate the Bank about the incorrect ness either in the pass sheets or in the letters.
The inac tion on the part of the plaintiff company and its Managing Director in not informing the Bank of the irregularities in the account and deliberately withholding such information from the Bank, according to the Bank.
constituted negli gence.
disentitling the plaintiff from claiming any amount from the Bank in respect of forged cheques.
Alternatively it was contended that the principle of estoppel operated against the plaintiff from claiming the amount, on the ground of adoption or acquiescence.
The case of the appellant can be summarised as follows: After reasonable opportunities are given to the customer to examine the Bank statements.
its debit entries should be deemed to be final and will not be open for reconstruction to the detriment of the bank.
Of course.
what is a reasona ble opportunity will depend on the facts of each case.
In law, there can always be a settled or stated account between the banker and the customer.
The question to be decided here is whether acceptance by the customer without protest of a balance struck in the pass book or statement of account constitutes a settled account.
It is submitted that this aspect of the Banking law has not yet been authorita tively decided by this Court and invited us to pronounce upon it.
On the question of estoppel it was contended that a repre senta 1145 tion may be made either by statement or by conduct: and conduct included negligence, silence, acquiescence or en couragement.
If a customer of a bank, by his negligence to give timely information of forged cheques, allows amount to be drawn on such cheques.
the debit will stand for the whole amount and the customer will be estopped from claiming the amount.
If timely information was given, the Bank could have acted to ward off the mischief.
It was further contended that inaction for a long period would amount to such negligence, as would persuade a Court to impute to the customer, with knowledge or at any rate constructive knowledge, to decline him, relief in an action for recovery of amounts, which would be to the detriment of an innocent party, namely the Bank.
For this purpose.
dictionary meanings of the word 'know ledge was brought to our notice.
"Knowledge may include not only actual knowledge, i.e. actual awareness of the facts relevant.
but constructive knowledge.
i.e. knowledge at tributed by law to the party in the circumstances, whether he actually had the knowledge or not, and knowledge may be attributed to a person who has sought to avoid finding out, or has shut his eyes to obvious means of knowledge.
e.g. the man who is offered valuables cheaply in circumstances which suggest that they may well have been stolen.
but who refrains from enquiry".
Black 's Law Dictionary Fifth Edn. defines.
"Constructive knowledge" as "If one by exercise of reasonable care would have known a fact.
he is deemed to have had costructive knowledge of such fact, e.g., matters of public record".
"Notice" means "bringing it to a person 's knowledge".
Then he referred us to the Transfer of Property Act.
Trusts Act, Law of Agency.
etc. to contend that a person is said to have noticed of a fact when but for wilful absten tion from an enquiry.
he would have known it and that in equity a man who ought to have known a fact should be treat ed as if he actually does know it.
He then developed his submission as follows: It is accepted to be a duty of customer who knows that his cheques are being forged, to inform the bank.
If he fails to give such an information, he is estopped from claiming that the cheques were forged.
In law.
there should be no differ 1146 ence in the consequence between a person having constructive knowledge and a person having actual knowledge.
Thus a person having constructive knowledge of a matter.
cannot be allowed to take advantage of his own negli gence.
According to him the terms of contract between a banker and its customer can never be complete unless there is an implied condition that the customer was under a duty to examine the statement to account, particularly when the bank issues a notice that if no errors are pointed out within a specified time.
the bank will proceed to believe that there are no errors.
Such a notice imposes on a customer a duty to react and failure to react would amount to negligence, leading to estoppel.
The company 's Balance Sheet for four years clearly show that the auditors have examined the books and vouchers.
It is in evidence (spoken to by PW 8) that the balance sheets were adopted by the general bodies for four successive years.
This shows that the statements of account.
given by the Bank was accepted as such.
There is a duty on the part of the Company 's directors to present a correct Balance Sheet.
Negligence to verify the obvious things.
like examining the counterfoil of cheques amounts not only to estoppel but to adoption and ratifica tion.
for, no one can take shelter under one 's own failure to examine the obvious.
Further, the annual reports are to be treated as public documents and public are likely to rely upon its representation and defendant bank is, at any rate, a member of the public.
We have set out above, the contentions of the appellant, in detail, so as to bring into focus, the questions of law to be decided in the appeal.
Now we propose to consider the submissions made by the appellant to test their validity qua the Banking Law, ap plicable to India.
It is true that there is no direct au thority of this Court on this Branch of the Law.
It is.
therefore, necessary to briefly outline the confines of this Branch of law.
The relationship between the customer of a bank and the bank is that of a creditor and debtor.
When a cheque which presented for encashment contains a forged signature the bank has no authority to make payment against such a cheque.
The bank would be acting 1147 against law in debiting the customer with the amounts cov ered by such cheques.
When a customer demands payment for the amount covered by such cheques.
the bank would be liable to pay the amount to the customer.
The bank can succeed in denying payment only when it establishes that the customer is disentitled to make a claim either on account of adop tion.
estoppel or ratification.
The principle of law regard ing this aspect is as follows: When a cheque duly signed by a customer is presented before a bank with whom he has an account there is a mandate on the bank to pay the amount covered by.
the cheque.
However.
if the signature on the cheque is not genuine.
there is no mandate on the bank to pay.
The bank, when it makes payment on such a cheque, cannot resist the claim of the customer with the defence of negligence on his part such as leaving the cheque book carelessly so that third parties would easily get hold of it.
This is because a document in cheque form, on which the customer 's name as drawer is forged, is a mere nullity.
The bank can succeed only when it establishes adoption or estoppel.
The relationship between a bank and its customers indi rectly arose before this Court in Bihta Co operative Devel opment Cane Marketing Union Ltd. & Anr.
vs The Bank of Bihar & Ors., ; In that case a suit was filed by a Society registered under the Bihar and Orissa Co operative Societies Act, 1935, and its Secretary.
This Society had an account with the first defendant Bank.
The and 7th defend ants were respectively its Joint Secretary and Treasurer.
A sum of Rs.11,000 was withdrawn from the account by means of a cheque, not from the cheque book of the Society, but from a loose cheque leaf surrendered by an ex constitutent of the bank.
It bore the signature of the 7th defendant but the forged signature of the 6th defendant.
The suit against the bank, its manager and other employees was decreed by the Trial Court and confirmed by the High Court on the question relevant for our purpose but dismissed on the ground juris diction.
The question before us in this appeal was consid ered by this Court with reference to a Judgment of the House of Lords in London Joint Stock Bank Ltd. vs Macmillan, It was argued before this Court that the decree against the bank could not be sustained since even though there was negligence on the part of the bank and its employees, the plaintiffs ' Society was not altogether free from blame or negligence in that but for the part played by at least one 1148 of its employees in the matter of encashment of the cheque for Rs.11,000 the fraud could not have been perpetrated.
It was also argued that if both the parties were negligent or blameworthy.
the plaintiffs claim ought not to succeed.
It was, in this connection that Macmillan 's case fell for reference.
Being a landmark case, we would set out the facts of that case in brief: The plaintiffs, Macmillan etc.
brought a suit against the London Stock Bank for a declaration that the bank was not entitled to debit the plaintiffs with a cheque for pound 120.
The plaintiffs had in their employment a confidential clerk who made out cheques and got the signature of part ners.
On a certain day.
the clerk made out a cheque for pound 2 and asked one of the partners to sign it, which the partner did.
The next day the clerk did not turn up.
The partners became suspicious and went to the bank.
when they discovered that the cheque for pound.
2 was distorted by using the space on either side of the figure '2 ' by the clerk by insertion of additional figures 1 & 0 and thus he pocketed pound.
The question before the House of Lords was whether the plaintiffs had been so negligent with regard to the cheque that their action against the bank should fail.
The Trial Judge found that the plaintiffs were not guilty of negligence in the mode of signing the cheque and decreed the suit.
The Court of Appeal upheld this decision.
The House of Lords reversed the judgment.
We may usefully quote the following passages from the Judgment.
Lord Finlay observed: "As the customer and the banker are under a contractual relation in this matter.
it ap pears obvious that in drawing a cheque the customer is bound to take usual and reasonable precautions to prevent forgery.
Crime, is indeed, a very serious matter, but every one knows that crime is not uncommon.
If the cheque is drawn in such a way as to facilitate or almost invite an increase in the amount by forgery if the cheque should get into the hands of a dishonest person, forgery is not a remote but a very natural consequence of negligence of this description.
" The learned Lord Chancellor further observed: Of course the negligence must be in the trans action itself, that is, in the manner in which the cheque is drawn.
It would be no defence to the banker, if the forgery had been that of a clerk of a customer, that the latter had taken the clerk into his service without sufficient inquiry as to his 1149 character.
Attempts have often been made to extend the principle of Young vs Grote, ; beyond the case of negligence in the immediate transaction, but they have always failed.
According to the learned Lord Chancellor, leaving blank spaces on either side of the figure '2 ' in the cheque amounted to a clear breach of duty which the customer owed to the banker.
The learned Lord Chancellor said: "If the customer chooses to dispense with ordinary precautions because he has complete faith in his clerk 's honesty, he cannot claim to throw upon the banker the loss which re sults.
No one can be certain of preventing forgery, but it is a very simple thing in drawing a cheque to take reasonable and ordi nary precautions against forgery.
If owing to the neglect of such precautions it is put into the power of any 'dishonest person to increase the amount by forgery, the customer must bear the loss as between himself and the banker.
" The principles so settled by the House of Lords was pressed into service before this Court in the above case.
This Court held that the principle settled by the House of Lords could not help the bank.
The accepted principle that if the signatures on the cheque is genuine, there is a mandate by the customer to the bank to pay was reiterated.
It was also held that if an unauthorised person got hold of such a cheque and encashed it, the bank might have had a good defence hut, however, if the signatures on the cheque or at least one of the signatures are or is not genuine , ' there is no mandate on the bank to pay and the question of any negligence on the part of the customer, such as leaving the cheque book carelessly so that a third party could easily get hold of it would afford no defence to the bank.
This Court distinguished Macmillan 's case, observing that if any of the signatures was forged the question of negligence of the customer in between the signature and the presenta tion of the cheque never arose.
The suit was, however, dismissed on another point and that of jurisdiction.
That takes us to the question as to whether there is a duty on the part of the customer to examine the pass book and inner part of cheques and to communicate to the banker within a reasonable time of the debits which he does not admit.
1150 The kindered question connected with this is whether a customer is estopped from disputing the debits shown in the pass book when the pass book is returned without any comment and whether such a conduct would constitute a "stated and settled account." To answer this it is necessary to examine the question whether the customer owes a duty to the bank to inform it about the correctness or mis statements in the entries in the pass book within a reasonable time and wheth er failure to do so would amount to such negligence as to non suit him in a suit for recovery of the amount paid on a forged cheque.
When does negligence constitute estoppel ? For negligence to constitute an estoppel it is necessary to imply the existence of some duty which the patty against whom estoppel is alleged owes to the other party.
There is a duty of sorts on the part of the customer to inform the bank of the irregularities when he comes to know of it.
But by mere negligence One cannot presume that there has been a breach of duty by the customer to the bank.
The customer should not by his conduct facilitate payment .of money on forged cheques.
In the absence of such circumstances, mere negligence will not prevent a customer from successfully suing the bank for recovery of the amount.
A case of acquiescence also cannot be flourished against the plaintiff.
In order to sustain a plea of acquiescence, it is necessary to prove that the party against whom the said plea is raised, had remained silent about the matter regarding which the plea of acquiescence is raised, even after knowing the truth of the matter.
As indicated above, the plaintiff did not, during the relevant period, when these 42 cheques were encashed, know anything about the sinister design of the second defendant.
If the bank had proved to the satisfaction of the Court that the plaintiff had with full knowledge acknowledged the correctness of the accounts for the relevant period, a case of acquiescence against the plaintiff would be available to the bank.
That is not the case here.
In this judgment under appeal, the High Court has elabo rately considered the law obtaining in the United States of America on this aspect.
We need not exercise ourselves with the American Law since the American Law is different from the law that we follow.
On the questions involved in this appeal, it is the .law that obtains in England which had been followed by this Court and High Courts in the country.
The authorities in England have more or less consistently held that there is no duty on the part of the customer to intimate the banker about any error that may be seen in the pass book and that he will be entitled to claim any amount paid on a forged cheque though there may be some negligence or in action on his part in not being careful to 1151 discover the errors in the pass book or other documents.
In the instant ease, there is no evidence to show that anyone other than the second defendant knew that the forged cheques had been encashed.
After the matter was discovered, immedi ate action was taken.
Therefore, in the absence of any evidence of the plaintiff 's involvement, the plaintiff cannot be nonsuited on the ground of negligence or in ac tion.
Venkatramiah, J when he rendered the Judgment, under appeal, laid down the law correctly, with the aid of author ities then available and on his own reasons.
Now we are in a more advantageous position.
We have an authority, more or less identical on facts, rendered by the Privy Council in the decision in Tai Hing Cotton Ltd. vs Liu Chong Bank, [1985] 2 All England Reports 947.
The facts of this case are similar to the case on hand; if anything, more to the disadvantage to the bank in terms of money involved than the instant case.
The appellant before the Privy Council was a company, a textile manufac turer carrying on business in Hong Kong.
The company was a customer of the three respondent banks and maintained with each of them a current account.
The banks were authorised to pay cheques on behalf of the company if signed by its Manag ing Director or two authorised signatories.
The banks agreed to send the appellant periodic statements which were deemed to be confirmed unless the customer notified the bank of any error therein by a specified time.
Between 1972 and 1978 the accounts clerk employed by the company forged the signature of the Managing Director on 300 cheques purported to be drawn by the company for a total sum of $HK.5.5 million.
The banks paid the cheques on presentation by the clerk and debited the company 's current account accordingly.
The clerk was able to manipulate the accounts without any obstruction or discovery because he was in almost sole control of the receipts and payments made through the accounts.
As in this case, the fraud was uncovered in May, 1978, when a newly appointed accountant commenced reconciling the bank state ments with the company 's books.
This was an exercise which had not been followed previously.
The new accountant found at once that something was seriously wrong.
He reported the matter to the Managing Director.
The errant accountant was interrogated and he admitted the frauds.
The company took action against the banks, the accountant and his wife.
The Trial Judge basing his decision on the fundamental premise that a forged cheque is no mandate to pay held that unless the bank established affirmatively that they were entitled to debit the customers current account with the amounts of the forged cheques, the customer was entitled to the relief 1152 of the loss arising from the bank 's payment on the forged cheques.
A case was put forward before the Trial Judge that the Company was vicariously liable for the fraud played by its accountant.
This was negatived and was not pursued.
The Trial Judge also rejected the submission of the banks that their terms of business which was contractual called the banking contract, should be construed as ousting the common law rule.
The defence included one of estoppel raised by each of the banks.
The plea of estoppel was put forward in two ways; first, that the company was estopped by its negli gence in the management of its bank accounts from asserting that the accounts had been wrongly debited, and second, that the company was estopped by a representation to be implied from the course of conduct that the periodic bank statements were correct.
The Trial Judge rejected the plea of estoppel by negligence but held: " . .
In the case of each bank the company by failing to .
challenge the debits shown on the bank statements, had represented to each bank that the debits had been correctly made.
He held that Tokyo and Chekiang had acted in reliance on the representations so made by their willingness to continue operating their respective accounts and to expose themselves to the risk of paying out on forged cheques.
He did not find the same prejudice had been suffered by Liu Chong Hing as it only became exposed to the fraud in November 1977, the first representation to it not being made until the company 's failure.
to query the December 1977 statement of account.
The Judge found that the chance of recovery from Leung had not been substantially diminished during the period (December 1977 to May 1978) during which it could be said that the estoppel was operative.
" On this finding the Judge gave the company Judgment against one bank, but dismissed its claims against the other two banks.
The company appealed and the defeated banks cross appealed.
The Court of appeal differed from the Trial Judge on the general question.
The Court of appeal evolved a theory that the banker/customer relationship is such as to give rise to a general duty of care in the operation of its banking account and on this basis held that the company was in breach of the duty which they held, it owed to the banks and must bear the loss.
According to the Court of appeal this duty arose in tort as well as in contract.
There was difference of opinion among the Judges as to whether the in action on the part of the customer in not objecting 1153 to the statement sent by the bank within the time specified would constitute conclusive evidence of the correctness of the debits recorded therein or whether the banking contracts could be construed as including a term requiring the monthly statements to be treated after a period of time as conclu sive evidence of the state of the account.
But all of them were agreed that estoppel operated against the company by its own negligence from challenging the correctness of the banks statements.
The banks thus succeeded in the Court of appeal.
The defeated company moved the Judicial Committee of the Privy Council by filing appeals.
This was how the matter reached the Privy Council.
The Privy Council had to decide the case in the light of the law settled by the House of Lords in the Macmillan 's case and in Greenwood vs Martins Bank Ltd.; = 1932 All England Reports 3 18.
The Privy Council posed two questions before it, first, whether English law recognises any duty of care owed by the customer to his bank in the operation of a current account beyond, first, a duty to refrain from drawing a cheque in such a manner as may facil itate fraud or forgery and, second, a duty to inform the bank of any forgery of cheque purportedly drawn on the account as soon as he, the customer, becomes aware of it.
The respondent banks while recognising the existence of both the duties indicated above contended that the law had evolved in England after 19 18 and 1933 in recognising an altogether wider duty of care.
This duty, according to them, required the customer to take reasonable precautions in the management of his business with the bank to prevent forged cheques being presented to it for payment.
Additionally, it was contended.
that even if this wider duty did not exist.
at any rate the customer owed a duty to take such steps to check the periodic bank statements sent to him as a reasona ble person in his pOsition would take to enable him to notify the bank of any debit items in the account which he had not authorised, When it is accepted that the bank sent periodic statements to the customer, the bank contended that the duty and responsibility to look into such statements and to notify to the bank were necessary incidents of the con tractual relationship between the customer and the bank.
The source of this obligation according to the banks is to be found both in the contract law as an implied term of the banking contract and in the tort law as a civil obligation arising from the relationship of banker and customer.
Then the Privy Council proceeded to consider the weightier sub 1154 missions advanced by the bank (1) a wider duty on the part of the customer to act with diligence which must be implied into the contract and alternatively that such a duty arises in tort from the relationship between banker and customer.
The Privy Council parted company with the observation by the Court of Appeal here and repelled the plea that it was necessary to imply into a contract between a banker and the customer a wider duty and that it was not a necessary inci dent of banker customer relationship that the customer should owe his banker a wider duty of care.
This duty is in the form of an undertaking by the customer to exercise reasonable care in executing his written orders so as not to mis lead the bank or to facilitate forgery.
The Privy Coun cil accepted that an obligation should be read into the contract as the nature of this contract implicity requires.
In other words 'the term sought to be implied must be one without which the whole 'transaction would become futile and inefficacious. ' After referring to some earlier decisions, the Privy Council rejected the implied term 'submission ' and set out the limits of the care of the customer and the functions of the banks in the following words: " .
One can fully understand the com ment of Cons JA that the banks must today look for protection.
So be it.
They can increase the severity of their terms of business and they can use their influence as they have in the past, to seek to persuade the legislature that they should be granted by statute 'fur ther protection.
But it does not follow that because they may need protection as their business expands the necessary incidents of their relationship with their customer must also change.
The business of banking is the business not of the customer but of the bank.
They offer a service, which is to honour their customer 's cheques when drawn on an account in credit or within an agreed overdraft limit.
If they pay out on cheques which are not his, they are acting outside their mandate and cannot plead his authority in justification of their debit to his account.
This is a risk of the service which it is their business to offer.
The limits set to the risk in the Macmillan and Greenwood cases can be seen to be plainly necessary incidents of the relationshi p. Offered such a service, a customer must obviously take care in the way he draws his cheque, and must obviously warn his bank as soon as he knows that a forger is operating the account . . " The limits of the duty and the confines of contractual obligation cannot be expressed better.
1155 On the question of tort also the bank could not satisfy the Privy Council as is seen from the following observation: "Their Lordships do not believe that there is anything to the advantage of the law 's development in searching for a liability in tort where the parties are in a contractual relationship.
This is particularly so in a commercial rela tionship.
Though it is possible as a matter of legal seman tics to conduct an analysis of the rights and duties inher ent in some contractual relationships including that of a banker and customer either as a matter of contract law when the question will be what.
if any.
terms are to be implied or as a matter of tort law when the task will be to identify a duty arising from the proximity and character of the relationship between the parties.
their Lordships believe it to be correct in principle and necessary for the avoidance of confusion in the law to adhere to the contractual analy sis on principle because it is a relationship in which the parties have.
subject to a few exceptions, the right to determine their obligations to each other.
and for the avoidance of confusion because different consequences do follow according to whether liability arises from contract or tort, e.g. in the limitation of action . " Their Lordships of the Privy Council sumed up the Law, as followers: 'Their Lordships do not, therefore, embark on an investiga tion whether in the relationship of banker and customer it is possible to identify tort as well as contract as a source of the obligations owed by the one to the other.
Their Lordships do not, however, accept that the parties ' mutual obligations in tort can be any greater than those to be found expressly or by necessary implication in their con tract.
If, therefore, as their Lordships have concluded, no duty wider than that recognised in Macmillan and Greenwood can be implied into the banking contract in the absence of express terms to that effect, the respondent banks cannot rely on the law of tort to provide them with greater protec tion than that for which they have contracted.
Having rejected the plea of implied terms, indirectly con structive 1156 notice and estoppel by negligence, it was held that the company was not under any breach of duty owed by it to the banks and as such mere silence, omission or failure to act is not a sufficient ground to establish a case in favour of the bank to non suit its customer.
We adopt the reasoning indicated above with great re spect.
Unless the bank is able to satisfy the Court of either an express condition in the contract with its custom er or an unequivocal ratification it will not be possible to save the bank from its liability.
The banks do business for their benefit.
Customers also get some benefit.
If banks are to insist upon extreme care by the customers in minutely looking into the pass book and the statements sent by them, no bank perhaps can do profitable business.
It is common knowledge that the entries in the pass books and the state ments of account sent by the bank are either not readable, decipherable or legible.
There is always an element of trust between the bank and its customer.
The bank 's business depends upon this trust.
Whenever a cheque purporting to be by a customer is presented before a bank it carries a man date to the bank to pay.
If a cheque is forged there is no such mandate.
The bank can escape liability only if it can establish knowledge to the customer of the forgery in the cheques.
In action for continuously long period cannot by itself afford a satisfactory ground for the bank to escape the liability.
The plaintiff in this case swung into action immediately on the discovery of the fraud committed by its accountant as in the case before the Privy Council.
We may, in passing.
refer to a decision of this court on the question of negligence under circumstances not strictly akin to the case on hand reported in the New Marine Coal Co. (Bengal) Pvt. Ltd. vs Union of India, ; There the suit was for recovery of certain amount represent ing the price of coal supplied to the respondent.
Inter alia the respondent pleaded in defence of the suit that the respondent had issued and sent bills to cover the amount and the intimation cards in accordance with the usual practice in the ordinary course of dealings.
The respondents it was alleged paid the amount by cheque to a person authorised by the appellant and on presentation of proper receipts.
It was pleaded that the appellant 's claim having been satisfied he had no cause of action.
It was established in the course of the trial that the appellant had not in fact authorised any person to issue the receipts but a certain person not con nected with the appellant firm without the consent or knowl edge of the appellant got hold of the intimation cards and bills addressed to the appellant.
forged the documents and fraudulently received the cheque from the respondent and 1157 appropriated the amount for himself.
We may usefully read the following passage relating to negligence in the context of a plea based on estoppel: ". .
Apart from, this aspect of the matter, there is another serious objection which has been taken by Mr. Setalved against the view which prevailed with Mukharji J. He argues that when a plea of estoppel on the ground of negligence is raised, negligence to which reference is made in support of such a plea is not the negligence as is understood in popu lar language or in common sense; it has a technical denota tion.
In support of a plea of estoppel on the ground of negligence.
it must be shown that the party against whom the plea is raised owed a duty to the party who raises the plea.
Just as estoppel can be pleaded on the ground of misrepre sentation or act or omission.
so can estoppel be pleaded on the ground of negligence; but before such a plea can suc ceed, negligence must be established in this technical sense.
As Halsbury has observed: 'before anyone can be estopped by a representation inferred from negligent con duct.
there must be a duty to use due care towards the party misled, or towards the general public of which he is one. ' There is another requirement which has to be proved before a plea of estoppel on the ground of negligence can be upheld and that requirement is that 'the negligence on which it is based should not be indirectly or remotely connected with the misleading effect assigned to it, but must be the proxi mate or real cause of that result. ' Negligence.
according to Halsbury, which can sustain a plea of estoppel must be in the transaction itself and it should be so connected with the result to which it led that it is impossible to treat the two separately.
This aspect of the matter has not been duly examined by Mukharji.
J. when he made his finding against the appellant.
" This is how this Court understood how a plea of estoppel based on negligence can be successfully put forward.
We have seen that there is no duty for a customer to inform the bank of fraud committed on him.
of which he was unaware.
Nor can in action for a reasonably long time in not discovering fraud or irregularity be made a defence to defeat a customer in an action for loss.
Thus the contentions put for 1158 ward by the bank cannot be accepted to defeat the plaintiff.
The various submissions made by the counsel for the bank based on constructive notice in the general law and on other branches of law cannot be extended to relationship between a bank and its customers.
On a careful analysis of the questions of law, we hold that the judgment of the High Court and that of the Trial Judge have to be upheld.
We do so.
We accordingly dismiss the appeal with costs of the 1st respondent.
N.P.V. Appeal dis missed.
|
From the Judgment and Decree dated 25.6.1973 of the Karnataka High Court in Regular First Appeal No. S.S. Javali and B .R.
Agarwala for the Respondents. 72 of 1962 was filed in the Court of Civil Judge. Mangalore, by the Canara Sales Corporation, Ltd. through its Managing Director, V.S. Kudva. He died during the pendency of the appeal before the High Court and his legal representatives were brought on record. with the following allegations: The plain tiff is a private Limited Company with its head office at Mangalore. In March, 1961, the second defendant was absent from duty for some time. During that period one A. Shenoy, who was the Assistant of the second defendant was directed to bring the accounts upto date. In other words the signatures were forged. (iii) There was settlement of accounts between the parties from time to time and as such the plaintiff was not entitled to reopen the same and claim the sums paid under the cheques in question. In appeal before the Division Bench, the judg ment of the Trial Court was confirmed. The High Court certified that the case involved substan tial questions of law of general public importance and granted certificate to file the appeal. It is thus that this appeal has come before us. The courts have concurrently found that the cheques were forged and that the second defendant was responsible for it. We do not propose to consider the question of facts in this Judgment. The learned counsel for the appellant, Shri Bhat argued the case at length and took us through various authorities, bearing on the question, most of which fell for considera tion at the hands of the High Court also. 1961 the correctness of the entries in the pass sheets and half yearly statements was not questioned by the plaintiff. The accounts of the plaintiff company were being audited as required by the Companies Act by Chartered Accountants. The several entries in the books of account maintained by the plaintiff company show that all the amounts covered by the cheques in dispute had been credited in the books. The Managing Director of the plaintiff company himself admitted that he had received the periodical statements and that he did not at any time intimate the Bank about the incorrect ness either in the pass sheets or in the letters. The question to be decided here is whether acceptance by the customer without protest of a balance struck in the pass book or statement of account constitutes a settled account. the debit will stand for the whole amount and the customer will be estopped from claiming the amount. If timely information was given, the Bank could have acted to ward off the mischief. It was further contended that inaction for a long period would amount to such negligence, as would persuade a Court to impute to the customer, with knowledge or at any rate constructive knowledge, to decline him, relief in an action for recovery of amounts, which would be to the detriment of an innocent party, namely the Bank. dictionary meanings of the word 'know ledge was brought to our notice. "Knowledge may include not only actual knowledge, i.e. actual awareness of the facts relevant. i.e. knowledge at tributed by law to the party in the circumstances, whether he actually had the knowledge or not, and knowledge may be attributed to a person who has sought to avoid finding out, or has shut his eyes to obvious means of knowledge. e.g. the man who is offered valuables cheaply in circumstances which suggest that they may well have been stolen. "Constructive knowledge" as "If one by exercise of reasonable care would have known a fact. he is deemed to have had costructive knowledge of such fact, e.g., matters of public record". "Notice" means "bringing it to a person 's knowledge". to contend that a person is said to have noticed of a fact when but for wilful absten tion from an enquiry. he would have known it and that in equity a man who ought to have known a fact should be treat ed as if he actually does know it. He then developed his submission as follows: It is accepted to be a duty of customer who knows that his cheques are being forged, to inform the bank. there should be no differ 1146 ence in the consequence between a person having constructive knowledge and a person having actual knowledge. Thus a person having constructive knowledge of a matter. cannot be allowed to take advantage of his own negli gence. According to him the terms of contract between a banker and its customer can never be complete unless there is an implied condition that the customer was under a duty to examine the statement to account, particularly when the bank issues a notice that if no errors are pointed out within a specified time. the bank will proceed to believe that there are no errors. Such a notice imposes on a customer a duty to react and failure to react would amount to negligence, leading to estoppel. This shows that the statements of account. There is a duty on the part of the Company 's directors to present a correct Balance Sheet. like examining the counterfoil of cheques amounts not only to estoppel but to adoption and ratifica tion. for, no one can take shelter under one 's own failure to examine the obvious. therefore, necessary to briefly outline the confines of this Branch of law. The relationship between the customer of a bank and the bank is that of a creditor and debtor. When a customer demands payment for the amount covered by such cheques. if the signature on the cheque is not genuine. This is because a document in cheque form, on which the customer 's name as drawer is forged, is a mere nullity. The relationship between a bank and its customers indi rectly arose before this Court in Bihta Co operative Devel opment Cane Marketing Union Ltd. & Anr. This Society had an account with the first defendant Bank. The and 7th defend ants were respectively its Joint Secretary and Treasurer. It bore the signature of the 7th defendant but the forged signature of the 6th defendant. It was also argued that if both the parties were negligent or blameworthy. the plaintiffs claim ought not to succeed. It was, in this connection that Macmillan 's case fell for reference. The partners became suspicious and went to the bank. when they discovered that the cheque for pound. 2 was distorted by using the space on either side of the figure '2 ' by the clerk by insertion of additional figures 1 & 0 and thus he pocketed pound. The question before the House of Lords was whether the plaintiffs had been so negligent with regard to the cheque that their action against the bank should fail. The Trial Judge found that the plaintiffs were not guilty of negligence in the mode of signing the cheque and decreed the suit. The Court of Appeal upheld this decision. The House of Lords reversed the judgment. We may usefully quote the following passages from the Judgment. Crime, is indeed, a very serious matter, but every one knows that crime is not uncommon. It would be no defence to the banker, if the forgery had been that of a clerk of a customer, that the latter had taken the clerk into his service without sufficient inquiry as to his 1149 character. This Court held that the principle settled by the House of Lords could not help the bank. It was also held that if an unauthorised person got hold of such a cheque and encashed it, the bank might have had a good defence hut, however, if the signatures on the cheque or at least one of the signatures are or is not genuine , ' there is no mandate on the bank to pay and the question of any negligence on the part of the customer, such as leaving the cheque book carelessly so that a third party could easily get hold of it would afford no defence to the bank. The suit was, however, dismissed on another point and that of jurisdiction. That takes us to the question as to whether there is a duty on the part of the customer to examine the pass book and inner part of cheques and to communicate to the banker within a reasonable time of the debits which he does not admit. 1150 The kindered question connected with this is whether a customer is estopped from disputing the debits shown in the pass book when the pass book is returned without any comment and whether such a conduct would constitute a "stated and settled account." When does negligence constitute estoppel ? In the absence of such circumstances, mere negligence will not prevent a customer from successfully suing the bank for recovery of the amount. As indicated above, the plaintiff did not, during the relevant period, when these 42 cheques were encashed, know anything about the sinister design of the second defendant. If the bank had proved to the satisfaction of the Court that the plaintiff had with full knowledge acknowledged the correctness of the accounts for the relevant period, a case of acquiescence against the plaintiff would be available to the bank. In this judgment under appeal, the High Court has elabo rately considered the law obtaining in the United States of America on this aspect. We need not exercise ourselves with the American Law since the American Law is different from the law that we follow. In the instant ease, there is no evidence to show that anyone other than the second defendant knew that the forged cheques had been encashed. After the matter was discovered, immedi ate action was taken. Now we are in a more advantageous position. The facts of this case are similar to the case on hand; if anything, more to the disadvantage to the bank in terms of money involved than the instant case. The appellant before the Privy Council was a company, a textile manufac turer carrying on business in Hong Kong. Between 1972 and 1978 the accounts clerk employed by the company forged the signature of the Managing Director on 300 cheques purported to be drawn by the company for a total sum of $HK.5.5 million. The clerk was able to manipulate the accounts without any obstruction or discovery because he was in almost sole control of the receipts and payments made through the accounts. This was an exercise which had not been followed previously. The new accountant found at once that something was seriously wrong. He reported the matter to the Managing Director. The errant accountant was interrogated and he admitted the frauds. The company took action against the banks, the accountant and his wife. The Trial Judge rejected the plea of estoppel by negligence but held: " . . In the case of each bank the company by failing to . challenge the debits shown on the bank statements, had represented to each bank that the debits had been correctly made. to query the December 1977 statement of account. " On this finding the Judge gave the company Judgment against one bank, but dismissed its claims against the other two banks. The company appealed and the defeated banks cross appealed. According to the Court of appeal this duty arose in tort as well as in contract. The banks thus succeeded in the Court of appeal. The defeated company moved the Judicial Committee of the Privy Council by filing appeals. This was how the matter reached the Privy Council. that even if this wider duty did not exist. The source of this obligation according to the banks is to be found both in the contract law as an implied term of the banking contract and in the tort law as a civil obligation arising from the relationship of banker and customer. Then the Privy Council proceeded to consider the weightier sub 1154 missions advanced by the bank (1) a wider duty on the part of the customer to act with diligence which must be implied into the contract and alternatively that such a duty arises in tort from the relationship between banker and customer. The Privy Council parted company with the observation by the Court of Appeal here and repelled the plea that it was necessary to imply into a contract between a banker and the customer a wider duty and that it was not a necessary inci dent of banker customer relationship that the customer should owe his banker a wider duty of care. In other words 'the term sought to be implied must be one without which the whole 'transaction would become futile and inefficacious. ' But it does not follow that because they may need protection as their business expands the necessary incidents of their relationship with their customer must also change. The business of banking is the business not of the customer but of the bank. This is a risk of the service which it is their business to offer. The limits of the duty and the confines of contractual obligation cannot be expressed better. This is particularly so in a commercial rela tionship. subject to a few exceptions, the right to determine their obligations to each other. We adopt the reasoning indicated above with great re spect. If banks are to insist upon extreme care by the customers in minutely looking into the pass book and the statements sent by them, no bank perhaps can do profitable business. There is always an element of trust between the bank and its customer. If a cheque is forged there is no such mandate. The bank can escape liability only if it can establish knowledge to the customer of the forgery in the cheques. forged the documents and fraudulently received the cheque from the respondent and 1157 appropriated the amount for himself. In support of a plea of estoppel on the ground of negligence. it must be shown that the party against whom the plea is raised owed a duty to the party who raises the plea. As Halsbury has observed: 'before anyone can be estopped by a representation inferred from negligent con duct. there must be a duty to use due care towards the party misled, or towards the general public of which he is one. ' according to Halsbury, which can sustain a plea of estoppel must be in the transaction itself and it should be so connected with the result to which it led that it is impossible to treat the two separately. This aspect of the matter has not been duly examined by Mukharji. J. when he made his finding against the appellant.
|
The respondent company had a current account with the lant bank in its Mangalore Builder Branch.
The Manag ing Director of the company and the General Manager of a sister concern of the company had been authorised to operate the said current account.
The second defendant was attending to the maintenance of accounts of the respondent company and was also in charge and had the custody of the cheque book issued by the Bank to the respondent company.
During the process of bringing the accounts upto date certain irregu larities were noticed in the account and on verification it was found that cheques purporting to bear the signature of the Managing Director were encashed, though they did not bear 'his signature.
A complaint was lodged by the respond ent Company with the police and a special audit of the company 's accounts for the years 1957 58 to 1960 61 by a firm of Chartered Accountants disclosed that the second defendant had withdrawn a sum of Rs.3,26.047.92 under 42 cheques.
A suit was filed for the recovery of the said amount on the plea that the amounts as per the forged cheques were not utilised for the purpose of the respondent company.
that they were not authorised ones.
that there was no acquiescence or ratification open or tacit on the part of the respondent company and that the respondent was unaware of the fraud till the new accountant discovered it.
The appellant bank resisted the suit on the grounds (1) that the cheques were not forged ones; (2) that even if they were forged ones.
the company was not entitled to recover the amount on account of its own 1139 negligence; (3) that there was settlement of accounts be tween the parties from time to time and as such.
the company was not entitled to reopen the same and claim the sums paid under the cheques; and (4) that the suit was barred by limitation.
The second defendant pleaded that the cheques were utilised for the purpose of the company.
The trial Court negatived the contentions of the bank and passed a decree for the sum claimed with interest at 6%.
In appeal the Division Bench confirmed the judgment of the trial court but as the case involved substantial ques tions of law of general public importance it granted a certificate to file the appeal.
In the appeal before this Court it was contended on behalf of the appellant that: (1) after reasonable opportu nities are given to the customer to examine the bank state ments, its debit entries should be deemed to be final and will not be open for reconstruction to the detriment of the bank; (2) a representation may be made either by statement or by conduct, and conduct included negligence, silence, acquiescence or encouragement, and if a customer of a bank, by his negligence, to give timely information of forged cheques, allows amount to be drawn on such cheques.
the debit will stand for the whole amount and the consumer will be estopped from claiming the amount; and (3) in action for a long period would amount to such negligence as would persuade a court to impute to the customer with knowledge or at any rate constructive knowledge,_to decline him relief in an action for recovery of amounts which would be to the detriment of an innocent party, namely, the bank.
Dismissing the appeal.
HELD: 1.
When a cheque duly signed by a customer is presented before a bank with whom he has an account there is a mandate on the bank to pay the amount covered by the cheque.
However.
if the signature on the cheque is not genuine.
there is no mandate on the bank to pay.
The bank.
when it makes payment on such a cheque, cannot resist the claim of the customer with the defence of negligence on his part such as leaving the cheque book carelessly so that third parties would easily get hold of it.
This is because a document in cheque form.
on which the customer 's name as drawer is forged.
is a mere nullity.
[1147B D] 2.
The relationship between the customer of a bank and the bank is that of a creditor and debtor.
When a cheque presented for encashment contains a forged signature the bank has no authority to make payment against such a cheque.
The bank would be acting against law 1140 in debiting the customer with the amounts covered by such cheques.
When a customer demands payment for the amount covered by such cheques, the bank would be liable to pay the payment to the customer.
The bank can succeed in denying payment only when it establishes that the customer is disen titled to make a claim either on account of adoption, estop pel or ratification.
[1146G H; 1147A B] For negligence to constitute an estoppel.
it is neces sary to imply the existence of some duty which the party against whom estoppel is alleged owes to the other party.
There is a duty of sorts on the part of the customer to inform the bank of the irregularities when he comes to know of it.
But by mere negligence.
one cannot presume that there has been a breach of duty by the customer to the bank.
The customer should not by his conduct facilitate payment of money on forged cheques.
In the absence of such circum stances.
mere negligence will not prevent a customer from successfully suing the bank for recovery of the amount.
[1150B D] 4.
In order to sustain a plea of acquiescence, it is necessary to prove that the party against whom the said plea is raised.
had remained silent about the matter regarding which the plea of acquiescence is raised.
even after knowing the truth of the matter.
[1150D E] 5.
There is no duty for a customer to inform the bank of a fraud committed on him, of which he was unaware.
Nor can in action for a reasonably long time in not discovering fraud or irregularity be made a defence to defeat a customer in an action for loss.
[1157G H] 6.
There is no duty on the part of the customer to intimate the banker about any error that may be seen in the pass book and he will be entitled to claim any amount paid on a forged cheque though there may be some negligence or in action on his part in not being careful to discover the errors in the pass book or other documents.
Banks do business for their benefit.
Customers also get some benefit.
If banks are to insist upon extreme care by the customers in minutely looking into the pass book and the statements sent by them, no bank perhaps can do profita ble business.
It is common knowledge that the entries in the pass books and the statements of account sent by the bank are either not readable.
decipherable or legible.
There is always an element of trust between the bank and its custom er.
The bank 's business depends upon this trust.
[1156B D] 1141 8.
Whenever a cheque purporting to be by a customer is presented before a bank it carries a mandate to the bank to pay.
If a cheque is forged there is no such mandate.
The bank can escape liability only if it can establish knowledge to the customer of the forgery in the cheques.
In action for continuously long period cannot by itself afford a satisfac tory ground for the bank to escape the liability.
[1156D E] 9.
In the present case.
during the relevant period when 42 cheques were encashed, the company did not know anything about the sinister design of the second defendant.
Since the bank had not proved to the satisfaction of the court that the company had with full knowledge acknowledged the cor rectness of the accounts for the relevant period the case of acquiescence cannot be flourished against the company.
There is no evidence to show that any one other than the second defendant knew that the forged cheques had been encashed.
After the matter was discovered immediate action was taken.
Therefore, in the absence of any evidence of the respondent company 's involvement.
it cannot be non suited on the ground of negligence or in action.
Unless the bank is able to satisfy the court of either an express condition in the contract with its customer or an unequivocal ratifica tion it will not be possible to save the bank from its liability.
[1150E F; 1151A B; 1156B] Bihta Co operative Development Cane Marketing Union Ltd. Joint Stock Bank Ltd. vs Macmillan, ; Tai Hing Cotton Ltd. vs Liu Chong Bank, [1985] 2 All England Reports 947; Greenwood vs Martins Bank Ltd., = [1932] All England Reports 318; and New Marine Coal Co. (Bengal) Pvt. Ltd. vs Union of India, ; , referred to.
|
The respondent company had a current account with the lant bank in its Mangalore Builder Branch. the company was not entitled to reopen the same and claim the sums paid under the cheques; and (4) that the suit was barred by limitation. The second defendant pleaded that the cheques were utilised for the purpose of the company. In appeal the Division Bench confirmed the judgment of the trial court but as the case involved substantial ques tions of law of general public importance it granted a certificate to file the appeal. In the appeal before this Court it was contended on behalf of the appellant that: (1) after reasonable opportu nities are given to the customer to examine the bank state ments, its debit entries should be deemed to be final and will not be open for reconstruction to the detriment of the bank; (2) a representation may be made either by statement or by conduct, and conduct included negligence, silence, acquiescence or encouragement, and if a customer of a bank, by his negligence, to give timely information of forged cheques, allows amount to be drawn on such cheques. When a cheque duly signed by a customer is presented before a bank with whom he has an account there is a mandate on the bank to pay the amount covered by the cheque. if the signature on the cheque is not genuine. This is because a document in cheque form. The relationship between the customer of a bank and the bank is that of a creditor and debtor. When a cheque presented for encashment contains a forged signature the bank has no authority to make payment against such a cheque. The bank can succeed in denying payment only when it establishes that the customer is disen titled to make a claim either on account of adoption, estop pel or ratification. [1146G H; 1147A B] For negligence to constitute an estoppel. one cannot presume that there has been a breach of duty by the customer to the bank. The customer should not by his conduct facilitate payment of money on forged cheques. mere negligence will not prevent a customer from successfully suing the bank for recovery of the amount. had remained silent about the matter regarding which the plea of acquiescence is raised. even after knowing the truth of the matter. There is no duty for a customer to inform the bank of a fraud committed on him, of which he was unaware. If banks are to insist upon extreme care by the customers in minutely looking into the pass book and the statements sent by them, no bank perhaps can do profita ble business. There is always an element of trust between the bank and its custom er. The bank 's business depends upon this trust. If a cheque is forged there is no such mandate. The bank can escape liability only if it can establish knowledge to the customer of the forgery in the cheques. In action for continuously long period cannot by itself afford a satisfac tory ground for the bank to escape the liability. during the relevant period when 42 cheques were encashed, the company did not know anything about the sinister design of the second defendant. After the matter was discovered immediate action was taken.
| 0.142538
| 0.511035
| 0.173831
| 0.539028
|
ivil Appeal No. 544 of 1975.
From the Judgment and Order dated 20.8.
1973 of the Gujarat High Court in Special Civil Application No. 631 of 1970.
C.M. Lodha and Miss Subhashini for the Appellant.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This is an appeal by the Revenue by special leave and is directed against the judgment of the Gujarat High Court dated August 20, 1973 in a writ petition.
The High Court quashed the notice for reassessment issued under section 147(b) of the Income tax Act, 1961 (hereinaf ter referred to as 'the Act ') for the assessment year 1965 66.
Inspite of service of notice, the assessee respondent has not appeared.
The High Court has quashed the notice by accepting the assessee 's contention that the action of the Income tax Officer was barred by limitation prescribed by the Act.
There is no dispute that the notice in this case under section 147(b) of the Act was issued by registered post on March 31, 1970, and was received by the assessee on April 3, 1970.
To the facts of the case, section 147(b) of the Act applies.
The two relevant provisions are in sections 148 and 149 of the Act which provide: "148(1) Before making the assessment, reas sessment or recomputation under section 147, the Income tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 139; and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section.
44 (2). . . . . . . "149(1) No notice under section 148 shall be issued, (a). . . . . . . (b) In cases falling under clause (b) of section 147, at any time after the expiry of four years from the end of the relevant as sessment year.
(2) The provisions of sub section (1) as to the issue of notice shall be subject to the provisions of section 151." The High Court relied upon the decision of this Court in the case of Banarsi Debi & Anr.
T. 0., District IV, Cal cutta & Ors., where the validity of a notice under section 34(1) of the Incometax, Act, 1922 and the scope of section 4 of the Income tax (Amendment) Act of 1959 by which sub section (4) was introduced into section 34 were considered.
This Court indicated, keeping the provisions of section 34 in view, that there was really no distinction between "issue" and "service of notice".
Section 34, sub section (1) as far as relevant provided thus: "34(1) If (a). . . . . . . (b) . . he may in cases falling under clause (a) at any time within 8 years and in cases falling under clause (b) at any time within four years at the end of that year, serve on the assessee, . . and may proceed to assess or reassess such income . . ." Section 34, conferred jurisdiction on the Income tax Officer to reopen an assessment subject to service of notice within the prescribed period.
Therefore, service of notice within limitation was the foundation of jurisdiction.
The same view has been taken by this Court in Janni vs Indu Prasad Bhat, as also in C.I.T. vs Robert, The High Court in our opinion went wrong in relying upon the ratio of in disposing of the case in hand.
The scheme of the 1961 Act so far as notice for reassessment is concerned is quite different.
What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147, 148 and 149 in the 45 1961 Act.
A clear distinction has been made out between 'issue of notice ' and 'service of notice ' under the 1961 Act.
Section 149 prescribe the period of limitation.
It categorically prescribes that no notice under section 149 shall be issued after the prescribed limitation has lapsed.
Section 148(1) provides for service of notice as a condition precedent to making the order of assessment.
Once a notice is issued within the period of limitations, jurisdiction becomes vested in the Income tax Officer to proceed to reassess.
The mandate of section 148(1) is that reassessment shall not be made until there has been service.
The require ment of issue of notice is satisfied when a notice is actu ally issued.
In this case, admittedly, the notice was issued within the prescribed period of limitation as March 31, 1970, was the last day of that period.
Service under the new Act is not a condition precedent to conferment of jurisdic tion in the Income tax Officer to deal with the matter but it is a condition precedent to making of the order of as sessment.
The High Court in our opinion lost sight of the distinction and under a wrong basis felt bound by the judg ment in As the Income tax Officer had issued notice within limitations, the appeal is allowed and the order of the High Court is vacated.
The Income tax Officer shall now proceed to complete the assessment after complying with the requirements of law.
Since there has been no ap pearance on behalf of the respondents, we make no orders for costs.
A.P.J. Appeal allowed.
|
The respondent challenged the notice for reasessment issued under section 147(b) of the Income Tax Act, 1961 for the assessment year 1965 66.
The High Court quashed the notice holding that the action of the Income Tax Officer was barred by limitation prescribed by the Act.
Allowing the appeal of the Revenue, HELD: 1.
The scheme of the 1961 Act so tar as notice for reassessment is concerned is quite different.
What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147.
148 and 149 of the 1961 Act.
A clear distinction has been made out between "issue of notice" and "service of notice" under the 1961 Act.
Section 149 prescribes the period of limitation.
It categor ically prescribes that no notice under section 148 shall be issued after the prescribed limitation has lapsed.
Section 148(1) provides for service of notice as a condition prece dent to making the order of assessment.
Once a notice is issued within the period of limitations, jurisdiction be comes vested in the Income Tax Officer to proceed to reas sess.
The mandate of section 148(1) is that reassessment shall not be made until there has been service.
The requirement of issue of notice is satisfied when a notice is actually issued.
Banarsi Debi & Anr.
vs L T.O. District IV, Calcutta & Ors., ; Janni vs Indu Prasad Bhat, and C.I.T. vs Robert, , distinguished.
In the instant case, notice was issued within the prescribed period 43 of limitation as March 31, 1970 was the last day of that period.
Service under the new Act is not a condition prece dent to conferment of jurisdiction in the Income Tax Officer to deal with the matter but it is a condition precedent to making of the order of assessment.
The High Court lost sight of the distinction and under a wrong basis felt bound by the judgment in Banarsi Debi & Anr.
T. 0., District IV, Calcutta & Ors., ( As the Income Tax Officer had issued notice within limitation the order of the High Court is vacated.
|
ivil Appeal No. 544 of 1975.
From the Judgment and Order dated 20.8.
1973 of the Gujarat High Court in Special Civil Application No. 631 of 1970.
C.M. Lodha and Miss Subhashini for the Appellant.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This is an appeal by the Revenue by special leave and is directed against the judgment of the Gujarat High Court dated August 20, 1973 in a writ petition.
The High Court quashed the notice for reassessment issued under section 147(b) of the Income tax Act, 1961 (hereinaf ter referred to as 'the Act ') for the assessment year 1965 66.
Inspite of service of notice, the assessee respondent has not appeared.
The High Court has quashed the notice by accepting the assessee 's contention that the action of the Income tax Officer was barred by limitation prescribed by the Act.
There is no dispute that the notice in this case under section 147(b) of the Act was issued by registered post on March 31, 1970, and was received by the assessee on April 3, 1970.
To the facts of the case, section 147(b) of the Act applies.
The two relevant provisions are in sections 148 and 149 of the Act which provide: "148(1) Before making the assessment, reas sessment or recomputation under section 147, the Income tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 139; and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section.
44 (2). . . . . . . "149(1) No notice under section 148 shall be issued, (a). . . . . . . (b) In cases falling under clause (b) of section 147, at any time after the expiry of four years from the end of the relevant as sessment year.
(2) The provisions of sub section (1) as to the issue of notice shall be subject to the provisions of section 151." The High Court relied upon the decision of this Court in the case of Banarsi Debi & Anr.
T. 0., District IV, Cal cutta & Ors., where the validity of a notice under section 34(1) of the Incometax, Act, 1922 and the scope of section 4 of the Income tax (Amendment) Act of 1959 by which sub section (4) was introduced into section 34 were considered.
This Court indicated, keeping the provisions of section 34 in view, that there was really no distinction between "issue" and "service of notice".
Section 34, sub section (1) as far as relevant provided thus: "34(1) If (a). . . . . . . (b) . . he may in cases falling under clause (a) at any time within 8 years and in cases falling under clause (b) at any time within four years at the end of that year, serve on the assessee, . . and may proceed to assess or reassess such income . . ." Section 34, conferred jurisdiction on the Income tax Officer to reopen an assessment subject to service of notice within the prescribed period.
Therefore, service of notice within limitation was the foundation of jurisdiction.
The same view has been taken by this Court in Janni vs Indu Prasad Bhat, as also in C.I.T. vs Robert, The High Court in our opinion went wrong in relying upon the ratio of in disposing of the case in hand.
The scheme of the 1961 Act so far as notice for reassessment is concerned is quite different.
What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147, 148 and 149 in the 45 1961 Act.
A clear distinction has been made out between 'issue of notice ' and 'service of notice ' under the 1961 Act.
Section 149 prescribe the period of limitation.
It categorically prescribes that no notice under section 149 shall be issued after the prescribed limitation has lapsed.
Section 148(1) provides for service of notice as a condition precedent to making the order of assessment.
Once a notice is issued within the period of limitations, jurisdiction becomes vested in the Income tax Officer to proceed to reassess.
The mandate of section 148(1) is that reassessment shall not be made until there has been service.
The require ment of issue of notice is satisfied when a notice is actu ally issued.
In this case, admittedly, the notice was issued within the prescribed period of limitation as March 31, 1970, was the last day of that period.
Service under the new Act is not a condition precedent to conferment of jurisdic tion in the Income tax Officer to deal with the matter but it is a condition precedent to making of the order of as sessment.
The High Court in our opinion lost sight of the distinction and under a wrong basis felt bound by the judg ment in As the Income tax Officer had issued notice within limitations, the appeal is allowed and the order of the High Court is vacated.
The Income tax Officer shall now proceed to complete the assessment after complying with the requirements of law.
Since there has been no ap pearance on behalf of the respondents, we make no orders for costs.
A.P.J. Appeal allowed.
|
ivil Appeal No. 544 of 1975.
From the Judgment and Order dated 20.8.
1973 of the Gujarat High Court in Special Civil Application No. 631 of 1970.
C.M. Lodha and Miss Subhashini for the Appellant.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This is an appeal by the Revenue by special leave and is directed against the judgment of the Gujarat High Court dated August 20, 1973 in a writ petition.
The High Court quashed the notice for reassessment issued under section 147(b) of the Income tax Act, 1961 (hereinaf ter referred to as 'the Act ') for the assessment year 1965 66.
Inspite of service of notice, the assessee respondent has not appeared.
The High Court has quashed the notice by accepting the assessee 's contention that the action of the Income tax Officer was barred by limitation prescribed by the Act.
There is no dispute that the notice in this case under section 147(b) of the Act was issued by registered post on March 31, 1970, and was received by the assessee on April 3, 1970.
To the facts of the case, section 147(b) of the Act applies.
The two relevant provisions are in sections 148 and 149 of the Act which provide: "148(1) Before making the assessment, reas sessment or recomputation under section 147, the Income tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 139; and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section.
44 (2). . . . . . . "149(1) No notice under section 148 shall be issued, (a). . . . . . . (b) In cases falling under clause (b) of section 147, at any time after the expiry of four years from the end of the relevant as sessment year.
(2) The provisions of sub section (1) as to the issue of notice shall be subject to the provisions of section 151." The High Court relied upon the decision of this Court in the case of Banarsi Debi & Anr.
T. 0., District IV, Cal cutta & Ors., where the validity of a notice under section 34(1) of the Incometax, Act, 1922 and the scope of section 4 of the Income tax (Amendment) Act of 1959 by which sub section (4) was introduced into section 34 were considered.
This Court indicated, keeping the provisions of section 34 in view, that there was really no distinction between "issue" and "service of notice".
Section 34, sub section (1) as far as relevant provided thus: "34(1) If (a). . . . . . . (b) . . he may in cases falling under clause (a) at any time within 8 years and in cases falling under clause (b) at any time within four years at the end of that year, serve on the assessee, . . and may proceed to assess or reassess such income . . ." Section 34, conferred jurisdiction on the Income tax Officer to reopen an assessment subject to service of notice within the prescribed period.
Therefore, service of notice within limitation was the foundation of jurisdiction.
The same view has been taken by this Court in Janni vs Indu Prasad Bhat, as also in C.I.T. vs Robert, The High Court in our opinion went wrong in relying upon the ratio of in disposing of the case in hand.
The scheme of the 1961 Act so far as notice for reassessment is concerned is quite different.
What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147, 148 and 149 in the 45 1961 Act.
A clear distinction has been made out between 'issue of notice ' and 'service of notice ' under the 1961 Act.
Section 149 prescribe the period of limitation.
It categorically prescribes that no notice under section 149 shall be issued after the prescribed limitation has lapsed.
Section 148(1) provides for service of notice as a condition precedent to making the order of assessment.
Once a notice is issued within the period of limitations, jurisdiction becomes vested in the Income tax Officer to proceed to reassess.
The mandate of section 148(1) is that reassessment shall not be made until there has been service.
The require ment of issue of notice is satisfied when a notice is actu ally issued.
In this case, admittedly, the notice was issued within the prescribed period of limitation as March 31, 1970, was the last day of that period.
Service under the new Act is not a condition precedent to conferment of jurisdic tion in the Income tax Officer to deal with the matter but it is a condition precedent to making of the order of as sessment.
The High Court in our opinion lost sight of the distinction and under a wrong basis felt bound by the judg ment in As the Income tax Officer had issued notice within limitations, the appeal is allowed and the order of the High Court is vacated.
The Income tax Officer shall now proceed to complete the assessment after complying with the requirements of law.
Since there has been no ap pearance on behalf of the respondents, we make no orders for costs.
A.P.J. Appeal allowed.
|
The respondent challenged the notice for reasessment issued under section 147(b) of the Income Tax Act, 1961 for the assessment year 1965 66.
The High Court quashed the notice holding that the action of the Income Tax Officer was barred by limitation prescribed by the Act.
Allowing the appeal of the Revenue, HELD: 1.
The scheme of the 1961 Act so tar as notice for reassessment is concerned is quite different.
What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147.
148 and 149 of the 1961 Act.
A clear distinction has been made out between "issue of notice" and "service of notice" under the 1961 Act.
Section 149 prescribes the period of limitation.
It categor ically prescribes that no notice under section 148 shall be issued after the prescribed limitation has lapsed.
Section 148(1) provides for service of notice as a condition prece dent to making the order of assessment.
Once a notice is issued within the period of limitations, jurisdiction be comes vested in the Income Tax Officer to proceed to reas sess.
The mandate of section 148(1) is that reassessment shall not be made until there has been service.
The requirement of issue of notice is satisfied when a notice is actually issued.
Banarsi Debi & Anr.
vs L T.O. District IV, Calcutta & Ors., ; Janni vs Indu Prasad Bhat, and C.I.T. vs Robert, , distinguished.
In the instant case, notice was issued within the prescribed period 43 of limitation as March 31, 1970 was the last day of that period.
Service under the new Act is not a condition prece dent to conferment of jurisdiction in the Income Tax Officer to deal with the matter but it is a condition precedent to making of the order of assessment.
The High Court lost sight of the distinction and under a wrong basis felt bound by the judgment in Banarsi Debi & Anr.
T. 0., District IV, Calcutta & Ors., ( As the Income Tax Officer had issued notice within limitation the order of the High Court is vacated.
|
The respondent challenged the notice for reasessment issued under section 147(b) of the Income Tax Act, 1961 for the assessment year 1965 66.
The High Court quashed the notice holding that the action of the Income Tax Officer was barred by limitation prescribed by the Act.
Allowing the appeal of the Revenue, HELD: 1.
The scheme of the 1961 Act so tar as notice for reassessment is concerned is quite different.
What used to be contained in section 34 of the 1922 Act has been spread out into three sections, being sections 147.
148 and 149 of the 1961 Act.
A clear distinction has been made out between "issue of notice" and "service of notice" under the 1961 Act.
Section 149 prescribes the period of limitation.
It categor ically prescribes that no notice under section 148 shall be issued after the prescribed limitation has lapsed.
Section 148(1) provides for service of notice as a condition prece dent to making the order of assessment.
Once a notice is issued within the period of limitations, jurisdiction be comes vested in the Income Tax Officer to proceed to reas sess.
The mandate of section 148(1) is that reassessment shall not be made until there has been service.
The requirement of issue of notice is satisfied when a notice is actually issued.
Banarsi Debi & Anr.
vs L T.O. District IV, Calcutta & Ors., ; Janni vs Indu Prasad Bhat, and C.I.T. vs Robert, , distinguished.
In the instant case, notice was issued within the prescribed period 43 of limitation as March 31, 1970 was the last day of that period.
Service under the new Act is not a condition prece dent to conferment of jurisdiction in the Income Tax Officer to deal with the matter but it is a condition precedent to making of the order of assessment.
The High Court lost sight of the distinction and under a wrong basis felt bound by the judgment in Banarsi Debi & Anr.
T. 0., District IV, Calcutta & Ors., ( As the Income Tax Officer had issued notice within limitation the order of the High Court is vacated.
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Appeal No. 25 of 1961.
Appeal by special leave from the judgment and decree dated November 26, 1957, of the Allahabad High Court in Special Appeal No. 235 of 1957.
3 C.B. Agarwala and C. P. Lal, for the appellants.
H. N. Sanyal, Additional Solicitor General of India, section K. Kapur, Bishamber Lal and.
K. K. Jain, for the respondent.
March 26.
The Judgment of Sinha, C.J., Subba Rao and Ayyangar, JJ. was delivered by Subba Rao, J., Mudholkar, J., delivered separate Judgment.
SUBBA RAO, J.
This appeal by special leave is directed against the judgment and order of a division Bench of the Allahabad High Court confirming those of a single Judge of that court dismissing the application filed by the appellant to review the order of the High Court dated November 22, 1958.
The facts leading up to the filing of this appeal may be briefly stated.
The respondent held certain zamindari and agricultural properties in different districts of the State of Uttar Pradesh.
On December 22, 1952, the Additional Collector, Banaras, in exercise of the powers conferred on him under the provisions of the U. P. Agricultural Income Tax Act (Act III of 1949), assessed the respondent to an agricultural income tax of Rs. 99,964 12 0 for the year 1359 fasli.
On September 30, 1955, the respondent filed a petition before the High Court under article 226 of the Constitution for quashing the said order on the ground that the Additional Collector, Banaras, had no jurisdiction to make the said assessment. 'On November 22, 1955, Mehrotra J., allowed the writ petition quashing the said assessment.
The State of Uttar Pradesh did not prefer an appeal against the said order and allowed it to become final.
On February 9, 1956, the State of Uttar Pradesh promulgated an Ordinance, being Ordinance No. 11 of 1956, which was subsequently replaced by U. P. Act No. XIV of 1956, Under the provisions of the Ordinance, the assessments made 4 by the Additional Collector were retrospectively validated and, under s.6 thereof, a right was conferred upon any party to the proceedings under the U.P. Agricultural Income tax Act, 1948, (hereinafter called the principal Act), wherein any assessment made by an Additional Collector or Additional Assistant Collector was set aside merely on the ground that the assessing authority had no jurisdiction to make the assessment, to apply within 90 days from the date of the commencement of the said Ordinance for a review of the said, proceedings in the light of the provisions of the Ordinance, and a statutory injunction was imposed upon a court to review the said order accordingly.
Pursuant to the provisions of s.6 of the said Ordinance, on March 14, 1956, the appellants filed an application in the High Court at Allahabad for review of its order dated November 22, 1956.
Subsequently as stated earlier, the.
Ordinance was replaced by the U. P. Act XIV of 1956 hereinafter called the Act.
In the course of the judgment we shall refer only to the provision of the Act.
The said application was heard, in the first instance, by Mehrotra, J.,.
and he held that section II of the Act, which corresponds to s.6 of the Ordinance, did not entitle the appellant to file an application for review of an order made by the High Court under article 226 of the Constitution.
The appellant 's petition was dismissed on that ground.
The appellants preferred an appeal against the said order to a division Bench of that court.
Nootham, C.J., and Srivastava, J., who heard the appeal, dismissed it on two grounds, namely, (1) under Ch.
VIII r.5 of the Rules of Court, a special appeal against an order of a single Judge of the court can be maintained only if that order amounts to a "Judgment," and an order refusing an application for review not being a "Judgment" cannot be the subject of an appeal, (2) on merits, that is on the construction of section II of the Act, the view taken by Mehrotra, J. was correct.
The present appeal, as already stated, was preferred against the said order.
5 Mr. C. B. Aggarwala, learned counsel for the appellants, has raised before us the following points: (1) The order of Mehrotra, J.,, dismissing the application for review of his earlier order is a ,Judgment within the meaning of Ch.
VIII r. 5 of the Rules of Court and, therefore, an appeal lies against that order to a division Bench of that court.
(2) The terms of section 11 of the Act are comprehensive enough to take in an order made by the High Court under article 226 of the Constitution quashing the order of assessment and even if there is some lacuna, the provisions shall be so construed as to carry out clear intention of the Legislature.
(3) In any view, the application for review filed by the appellants could be treated as one filed under Order 47 of the Code of Civil Procedure, and the earlier order reviewed on the ground that there is an error apparent on the face of the record,.
We shall take the questions in the order they were argued.
The first question is whether an appeal Jay against the order of Mehrotra, J., rejecting the application for review filed by the appellants to a division Bench of the High Court.
Chapter VIII r.5 of the Rules of Court provides for an appeal against an order of a single judge.
Under that rule a special appeal against an order of a single judge of the court can be maintained only if that order amounts to a "judgement".
That rule gives effect to cl. 10 of the letters Patent for the High Court of Allahabad, which gives a right _ of appeal against a judgment of a single judge subject to the conditions mentioned therein.
The said cl.10 corresponds to cl.15 of the letters Patent for the High Courts of Calcutta, Bombay and Madras.
The scope of the expression "judgment" came under the judicial scrutiny of the various High Courts: there is a cleavage of opinion on that question.
We shall briefly no" ,ice the leading decisions of the various High Courts on the subject.
Couch, C.J., 6 in The Justices of the Peace for Calcuttu vs The Oriental Gas CO.
(1) defines the word "judgment" in el.
15 of the Letters Patent thus: "We think 'judgment ' in clause 15 means a decision which affects the merits of the question between the parties by determining ,some right or liability.
It may be either final, or preliminary, or interlocutory,, the difference between them being that a final judgment determines the whole cause or suit and a preliminary or interlocutory judgment determines only a part of it, leaving other metters to be determined".
The same High Court in Hadjee Ismael vs Hadjee Mahommed (2 ) held that an appeal lay under the said clause from an order refusing to set aside an order granting leave to sue to the plaintiff under cl.12 of the Letters Patent.
Therein Couch, C.J., observed: "It is not a mere formal order, or an order merely regulating the procedure in the suit, but on that has the effect of giving a jurisdiction to the court it otherwise would not have.
And it may fairly be said to determine some right between them, viz., the right to sue in a particular Court, and to compel the defendants who are not within its jurisdiction to come in and defend the suit, or if they do not, to make them liable to have a decree passed against them in their absence." The Bombay High Court followed the Calcutta view.
The leading judgment of the Madras High Court is that in Tuljaram vs Alagappa (3), where it was held that an order of a single Judge in the Original Side refusing to frame an issue asked for by one of the parties is not a 'judgment ' within (1) , 452.
(2) , 101.
(3) (1912) 1.L.R. , 7, 15. 7 the meaning of cl.15 of the Letters Patent.
White, C.J., laid down the following tests: "The test seems to me to be not what is the form of the adjudication, but what is its effect in the suit or proceeding in which it is made.
If its effect, whatever its form may be, and whatever be the nature of the appli cation on which it is made, is to put an end to the suit or proceeding so far as the Court before which the suit or proceeding is pending is concerned, or if its effect, if it is not complied with, is to put an end to the suit or proceeding, I think the adjudication is a 'judgment ' within the meaning of the clause.
" Referring to the decisions of the Calcutta High Court the learned Chief Justice proceeded to state: "On the other hand I am not prepared to say as was held in The Justices of the Peace for Calcutta vs The Oriental Gas Company (1) and in Sonbai vs Ahamedbhai Habibhai (2), it must be a decision which affects the merits by determining some right or liability.
think the decision may be a judgment for the purposes of the section though it does not affect the merits of the suit or proceeding and does not determine any question of right raised in the suit or proceeding.
Krishnaswami Ayyar, J., observed much to the same effect: "I would only stop here to remark that a decision which determines the cause or proceeding so far as the particular court is concerned, though it refused to adjudge the merits, must also be deemed to be a judgement: far otherwise the rejection of a plaint for defect of form or insufficiency of Court (1) (2) (1872) 9 B.H.C.R. 398.
8 fee or a return of it for want of jurisdiction would be outside the definition of the learned Chief Justice which could hardly have been his meaning.
I may also observe that the "Part" which is determined may be a part of the claim separable from the rest or a determination of liability generally though the actual measure of liability may be a matter of account".
The Lahore High Court generally followed the view expressed by the Madras High Court.
The Allahabad High Court in Muhammad Naim Ullah Khan vs Ihsan Ullah Khan (1) expressed the view that an order which is not appealable under 0.43 r. 1 of the Code of Civil Procedure is not appealable under cl. 10 of the Letters Patent.
This view has been followed by a division Bench of the same High Court in Tirmal Singh vs Kanhayia Singh (2).
But the said decisions do not attempt to lay down a definition of the. expression "judgment" in the Letters Patent.
The Nagpur High Court in Manohar vs Baliram(3) by a majority, after considering the case law on the subject, laid down the following definition.
Hidayatullah, J., who delivered the leading judgment, laid down the test at p. 522 thus: "A judgment means a decision in an action whether final, preliminary, or interlocutory which decides either wholly or partially, but conclusively in so far as the Court is concerned, the controversy which is the subject of the action.
It does not include a decision which is on a matter of procedure, nor one which is ancillary to the action even though it may either imperil the ultimate decision or tend to make it effective.
The decision need not be immediately executable per 88 but if left untouched, must result inevitably without anything further, save the determination of (1) [1892] 1.
L. R. 14 All. 226 (2) [1923] 1.
L. R. 45 All. 535.
(3) 1.
L. R. 9 consequential details, in a decree or decretal order, that is to say, an executive document directing something to be done or not to be done in relation to the facts of the contro versy.
The decision may itself order that thing to be done or not to be done or it may leave that over till after the ascertainment of some details but it must not be interlocutory having for its purpose the ascertainment of some matters or details prior to the determination of the whole or any part of the controversy.
" The foregoing brief analysis of judgment shown that the definition given by the Madras High Court is wider than that given by the Calcutta and Nagpur High Courts.
It is not necessary in this case to attempt to reconcile the said decision or to give a definition of our own, for on the facts of the present case the order of Mehrotra, J., would be a judgment within the meaning of the narrower definition of that expression.
The appellants filed an application to review the order of the High Court quashing the order of assessment made by the Additional Collector.
It was alleged in the affidavit that the impugned assessment had been validated under the Ordinance and that the applicants had the right to have the order of Mehrotra, J., reviewed in the light of the provisions of section 6 thereof.
The assessee denied that the appellants had any such right.
The appellants ' statutory right to have the order of the High Court reviewed was denied by the other side and was put in issue before the High Court.
The relevant provisions of the Act read : Section 2. "In Section 2 of the U. P. Agricultural Income Tax Act, 1948 (hereinafter called the Principal Act), for clause (4), the following shall be and be deemed always to have been substituted 10 "(4 a) 'Collector ' shall have the meaning as in the U, P. Land Revenue Act, 1901, and will include an Additional Collector appointed under the said Act.
" Section 10.
Validation (1) For the removal of doubts it is hereby declared that (a) in rule 18 of the, U. P. Agricultural Income Tax Rules, 1949, the expression "Collector" and "Assistant Collector in charge of a sub division" shall respectively include and be deemed always to have included an "Additional Collector" and an "Additional Assistant Collector in charge of a sub divisional".
(b) all orders, actions or proceedings taken, directions issued or jurisdiction exercised or in accordance with the provisions of the Principal Act or of any rule framed thereunder prior to the amendment of that Act by 'Section 2 of this Act shall be deemed to be as good and valid in law as if Section 2 aforesaid had been in force at all material dates.
(2) Where any question arises as to the validity or legality of anuy assessment made by an Additional Collector in charge of a sub division or by an Additional Collector in pur ported exercise of the powers under Section 14 or of the rules framed under clause (c) of sub section (2) of Section 44 of the Principal Act, the same shall be determined as if the provisions of Section 2 of this Act had been in force at all material dates.
Section 11 Review of Proceedings : Where before the commencement of this Act any court or authority had, in any proceedings under the Principal Act, set aside any assessment made by an Additional Collector or 11 Additional Assistant Collector in charge of a subdivision merely on the ground that the assessing authority had no jurisdiction to make an assessment, any party to the proceedings may, at any time within ninety days from the date of commencement of this Act apply to the Court or authority for a view of the proceedings in the light of the provisions of this Act, and the Court or authority to which the application is made shall review the proceedings accordingly and make such order, if any, varying or revising the order previously made as may be necessary to give effect to the pro.
visions of the Principal Act as amended by Sections 2 and 8 of this Act.
Under the aforesaid provisions the assessments made by the Additional Collector were retrospectively validated and a right was conferred on a party to the proceedings under the Principal Act, wherein the assessments were set aside merely on the ground that the assessing authority bad no jurisdiction to make an assessment, to apply to the court to have that order reviewed.
A statutory injunction was also issued to the court which set aside the assessment on the ground of want of jurisdiction to review its order and to give effect to the provisions of the Principal Act, as amended by sections 2 and 4 of the Act, that is to say, a fresh right has been conferred upon a party to the earlier proceedings to have the previous order set aside and to have decision from the court on the basis of the amended Act.
This is a valuable and substantive right conferred upon a party to the proceeding.
On the rival contentions, the question of the fresh right conferred upon a party to the proceeding and the jurisdiction of the court to enforce the said right would be in issue and any decision thereon could legitimately be said to be a decision determining the rights of parties.
But for the 12 amending Act, the order of the High Court admittedly would have become final; but, because of the amending Act there was, a controversy whether the binding decision could be reopened and the rights of the parties decided in accordance with the amending Act.
The decision of Mehrotra, J., dismissing the application was certainly a decision denying the right of the appellants alleged to have been conferred under the amending Act.
We therefore, hold that the order of Mehrotra, J., dismissing the application, filed for review of his earlier order, on the ground that section 11 of the Act did not confer any such right on the appellants was a 'judgment ' within the meaning of cl.10 of the Letters Patent as well as Ch.
VIII r.5 of the Rules of Court.
If so, we must hold that the division Bench of the High Court went wrong in holding that no appeal lay against the order of Mehrotra, J.
Even so, the appellants would not be entitled to succeed, unless we hold, differing from the High Court, that s.11 of the Act confers a right on the appellants to have the order of Mehrotra, J., reviewed.
We have already extracted the provisions of a. 11.
Section 11 is in two parts: the first part of the section confers a right on a party to the proceedings under the Principal Act to apply to the court or authority for a review of the proceeding in the light of the provisions of the Act within 90 days from the commencement of the Act, and the second part issues a statutory injunction on such a court or authority to review the proceedings accordingly and to make an order as may be necessary to give effect to the provisions of the Principal Act, as amended by ss.2 and 4 of the Act.
The first question, therefore, is whether the order of Mehrotra, J., in an application under article 226 of the Constitution was in any proceeding under the Principal Act.
Obviously a petition under article 226 of the Constitution cannot be a proceeding under the Act: it is a proceeding 13 under the Constitution.
But it is said, relying upon certain passages in Maxwell on the Interpretation of Statutes, at p, 68, and in Crawford on "Statutory Construction ' at p. 492, that it is the duty of the Judge "to make such construction of a statute as shall suppress the mischief and advance the remedy," and for that purpose the more extended meaning could be attributed to the words so as to bring all matters fairly within the scope of such a statute even though outside the letter, if within its spirit or reason.
But both Maxwell and Crawford administered a caution in resorting to such a construction.
Maxwell says at p.68 of his book: "The construction must not, of course, be strained to include cases plainly omitted from the natural meaning of the words." Crawford says that a liberal construction does not justify an extension of the statute 's scope beyond the contemplation of the Legislature.
The fundamental and elementary rule of construction is that the words and phrases used by the Legislature shall be given their ordinary meaning and shall be constructed according to the rules of grammar.
When the language is plain and unambiguous and admits of only one meaning, no question of construction of a statute arises, for the Act speaks for itself.
It is a well recognized rule of construction that the meaning must be collected from the expressed intention of the Legislature.
So construed, there cannot be two possible views on the interpretation of the first part of the section.
Learned counsel suggested that we should read the relevant portion of the first part thus: "in any proceedings to set aside any assessment made on the basis of the Principal Act".
To accept this argument is to rewrite the section.
While the section says that the order sought to be reviewed is that made in a proceeding under 14 the Principal Act, the argument seeks to remove the qualification attached to the proceeding and add the same to the assessment.
The alternative argument, namely, that without changing the position of the words as they stand in the section, the expression ,on the basis of" may be substituted for the expression "under" does Dot also yield the results expected by the learned counsel.
It cannot be held with any justification, without doing violence to the language used, that a proceeding under article 226 of the Constitution is either one under the Principal Act or on the basis of the Principal Act, for it is a proceeding under article 226 of the Constitution to quash the order on the ground that it was made in violation of the Act.
An attempt is then made to contend that a proceeding under article 226 of the Constitution is a continuation of the proceedings before the Additional Collector and, therefore, the said proceedi ings are proceedings under the Act.
This leads us to the consideration of the question of the scope of the proceedings under article 226 of the Constitution.
Article 226 confers a power on a High Court to issue the writs, orders, or directions mentioned therein for the enforcement of any of the rights conferred by Part III or for any other purpose.
This is neither an appellate nor a revisional jurisdiction of the High Court.
Though the power is not confined to the prerogative writs issued by the English Courts, it is modeled on the said writs mainly to enable the High Courts to keep the subordinate tribunals within bounds.
Before the Constitution, the chartered High Court, that is, the High Courts at Bombay, Calcutta and Mad ras, were issuing prerogative writs similar to those issued by the King 's Bench Division, subject to the same limitations imposed on the said.
writs.
In Venkataratnam vs Secretary of State for India(1), (1) (1930) I.L.P. 15 a division Bench of the Madras High Court, consisting of Venkatasubba Rao and Madhavan Nair, JJ,; held that the jurisdiction to issue a writ of certiorari was original jurisdiction.
In Ryots of Garabandha vs The Zamindar of Parlakimedi (1), another division Bench of the same High Court, consisting of Leach, C. J., and Madhavan Nair J., considered the question again incidentally and came to the same conclusion "and held that a writ of certiorari is issued only in exercise of the original jurisdiction of the High Court.
In Ramayya vs State of Madras (2), a division Bench, consisting of Govinda Menon and Ramaswami Oounder, JJ,, considered the question whether the proceedings under article 226 of the Constitution are in exercise of the original Jurisdiction or revisional jurisdiction of the High Court, and the learned Judges held that the power to issue writs under article 226 of the Constitution is original and the jurisdiction exercised is original jurisdiction.
In Moulvi Hamid Hassan Nomani vs Banwarilal Boy (3), the Privy Council was considering the question whether the original civil jurisdiction which the Supreme Court of Calcutta possessed over certain classes of persons outside the territorial limits of that jurisdiction has been inherited by the High Court.
In that context the Judicial Committee.
observed.
"It cannot be disputed that the issue of such writs is a matter of original jurisdiction".
The Calcutta.
High Court, in Budge Budge Munici pality vs Mangru(4) came to the same conclusion, namely, that the jurisdiction exercised under article 226 of the Constitution is original as distinguished from appellate or revisional jurisdiction; but the High Court pointed out that the jurisdiction, though original, is a special jurisdiction and should not be (1) I.L.R (2) A.I.R. 1952 Nad. 300.
(3) (1942) It M. L. J. 32, 35.
(4) 16 confused with ordinary civil jurisdiction under the Letters Patent.
The Andhra High Court in Satyanarayanamurthi vs 1.
T. Appellate Tribunal (1) described it as an extraordinary original jurisdiction.
It is, therefore, clear from the nature of the power conferred under article 226 of the Constitution and the decisions on the subject that the High Court in exercise of its power under article 226 of the Constitution exercises original jurisdiction, though the said jurisdiction shall not be confused with the ordinary civil jurisdiction of the High Court.
This jurisdiction, though original in character as contrasted with its appellate and revisional jurisdictions, is exercisable throughout the territories in relation to which it exercises jurisdiction and may.
for convenience, be described as extraordinary original jurisdiction.
If that be so, it cannot be contended that a petition under article 226 of the Constitution is a continuation of the proceedings under the Act.
There is another insurmountable difficulty in accepting the construction suggested by learned counsel.
Under the second part of the section a party to the earlier proceedings may within the prescribed time apply to the court or authority for a review of the proceedings in the light of the pro visions of the Act, and the court or authority to which the application is made shall review the proceedings accordingly, and make such order, if any, varying or revising the order previously made as may be necessary to give effect to the Principal Act, as amended by section 2 of the Act.
Should it be held that this section applies to an order made by a High Court under article 226 of the Constitution, the statutory mandatory injunction issued under the second part of the section to the High Court to make an order in a particular way would be constitutionally void.
Under the Constitution the Legislature of a (1) A. 1.
R. 1957 Andhra 123.
17 State derives its authority to make laws under article 245 of the Constitution, which reads: (1) " 'Subject to the provisions of this Con stitution, Parliament may make laws for the whole or any part of the territory of India, and the, Legislature of a State may make laws for the whole or any part of the State.
" Article 245 is, therefore, subject to article 226 of the Constitution.
It follows that no law made by the Legislature of a State can be in derogation of the powers of the High Court under article 226 of the Constitution.
It is well settled that article 226 confers a discretionary power on the High Courts to make or issue appropriate orders and writs for the enforcement of any of the rights conferred by Part III of the Constitution or for any other purpose.
While article 226 confers a discretionary power on the High Court, the second part of section 11 of the Act enjoins on the High Court to make an order in a particular way.
We should not give such a construction to the section as would bring it into conflict with article 226 of the Constitution and which ,would have the effect of invalidating it to that extent.
On the other hand, the construction adopted by us would be consistent with the second part of the section, for, if the first part is confined only to an order made by any court or authority, other, than the High Court in exercise of its jurisdiction under article 226 of the Constitution, both the parts fall in a piece, and we would not only be giving a natural meaning to the express words used in the section but we would also be saving the section from the vice of constitutional invalidity.
Learned counsel for the appellants seeks to got over this obvious difficulty by contending that the word "shall" may be treated as 'may" so that the discretion of High Court under article 226 may be maintained.
Alternatively, he contends that the second part of the section comprises two parts the 18 first empowers an aggrieved party only to file an application, and the second imposes a statutory duty, and that the first may conveniently be served from the second and its validity to that extent sustained.
The first argument is contrary to the express words used and the intention of the Legislature.
If we read "shall" as ', 'may" the same discretion will have to be given even to authorities, and courts other than the High Court, with the result the purpose of the section would be defeated.
On the other hand, if the expression "shall" is given its natural meaning, the section carries out the intention of the Legislature, viz., the mandatory injunction imposed on courts and authorities to restore the assessment declared invalid.
The decisions cited by the learned counsel in support of his construction are not of any help, for they were based upon the construction of the relevant provisions under consideration in those cases.
The second argument, if accepted, would be rewriting the section.
While the dominant intention of the Legislature is to issue a mandatory injunction on the courts or authorities to review their orders on a suitable application made to them, we would be deleting it and thus defeating the object of the Legislature.
For the foregoing reasons, we have no hesitation in holding that, on a plain reading of the clear words used in the section, it does not apply to an order made by the High Court under article 226 of the Constitution.
Lastly it is contended that even if section 11 does not apply, we should treat the application filed by the appellants before the High Court as one made under Order 47 of the Code of Civil Procedure.
There are.
many objections for allowing the appellants to do so at this very late stage of the Proceedings.
The application was filed only under section 11 of the Act and no attempt was made either before Mehrotra, J., or before the division Bench of the High Court to ask for an amendment 19 or to sustain the petition under Order 47 of the Code, of Civil Procedure; nor did the appellants raise this plea in the petition filed for special leave or even in the statement of case as originally filed by them.
After the case was argued for sometime on an observation casually made by the Court, time was taken and for the first time this plea was taken in the additional statement of case filed by the appellants.
This is, therefore, a highly belated attempt to convert the application filed on one basis into that on another.
Further, the plea, if allowed, is not so innocuous or smooth sailing as it appears to be, but is brimming with many controversial questions.
It raises the following questions : (1) Whether the application treated as one made under order 47 of the Code of Civil Procedure was within time ; (2) if it was out of time, could the delay be excused without the appellant filing an application for excusing it and giving valid reasons for the same ; (3) whether an order made by the High Court in exercise of its powers under article 226 of the Constitution could be reviewed under Order 47 of the Code of Civil Procedure, and, if not, under section 151 of the said Code ; (4) whether the amendment 'of an Act with retrospective effect could be treated as an error on the face of the record or as a sufficient cause within the meaning of Order 47 of the Code of Civil Procedure for reviewing the final orders and decrees made by courts on the basis of the law obtaining at the time the said orders or decrees were made ; and (5) if the order of Mehrotra, J., was one made under Order 47 of the Code of Civil Procedure, would an appeal lie to a division Bench of the High Court under Order 43 of the Code.
We do not propose to express any opinion on the aforesaid questions.
It would be enough to say that we are not justified to allow the appellants to convert their petition to one made under Order 47 of the Code of Civil Pro 20 cedure at this very late stage, in view of the foregoing reasons.
In the result we hold that the order of the High Court is correct.
The appeal fails and is dismissed with costs.
MUDHOLKAR, J.
I agree with my learned brother that the appeal should be dismissed for the reasons stated in his judgment.
I, however, express no opinion on the question regarding the maintainability of the appeal under the Letters Patent against the decision of a single Judge in a case of this kind.
Appeal dismissed.
|
The respondent, who owned agricultural properties in the different districts of Uttar Pradesh, was assessed to agri cultural income tax by the Additional Collector of Banaras.
On challenge by way of a petition under article 226 of the Constitution, assessment was quashed by the Allahabad High Court on the ground that the assessing authority had no ,jurisdiction to assess.
Under section 6 of the U.P. Act No. XIV of 1956 the assessments by the Additional Collector were validated and a party to the proceedings under Agricultural Income tax Act was given the right to move the Court or authority within the prescribed period to review the proceedings where in the assessments had been set aside on the ground that the assessing authority had no jurisdiction to make the assessment.
By section 11 the authority or court so moved was bound to review the order.
The State of Uttar Pradesh applied to the High Court for review of its earlier order quashing the assessment.
The single judge of the High Court held that section II of the Act did not apply to writ pro ceedings under article 226 of the Constitution.
On appeal the Division Bench held that the order for the single judge did not amount to a 'judgment ' under Ch.
VIII r.5 cl.10 of the Letter Patent and the Rules of Allahabad High Court and that section 11 of the Act did not apply to proceedings.
by way of a writ before the High Court.
On appeal by special leave by the State it was contended that the Division Bench was wrong and by an additional statement of case it was sought to be urged that the application for review should be treated as one under order 47 of the Code of Civil Procedure, 2 Held (per Sinha, C. J, Subba Rao, Ayyangar and Aiyar, jj.), that under cl.
IO of the Letters Patent of the Allahabad High Court and the Rules of the Court the expression 'judgment ' would even on the narrow view of the expression include the order in the present case whereby the statutory right given to the party was finally negatived and that the Division Bench was in error in holding that it was not a 'judgment '.
Held, further, that the proceeding under article 226 of the constitution were neither 'proceedings ' under the Act nor proceedings on the basis of the Act.
The proceedings under article 226 of the Constitution were independent and original proceeding and not a continuation of the assessment proceedings.
Venkataratnam vs Secretary of State for India, (1930) I.L.R.53 Mad.
979, Ryots of Garabandha vs The Zamindar of Parlakimedi I.L.R. , Ramayya vs State of Madras, A.I.R. 1952 Mad.
300, Moulvi Hamid Hassan Nomani vs Banwarilal Coy.
(1947) II M.L.J. 32, Budge Budge Municipality vs Mangru (1952) 57 C.W.N.25 and Satyanarayanamurthi vs 1.T. Appellate Tribunal, A.I.R.1957 Andhra 123, referred to.
The Act had to be interpreted consistently with the Constitution and there was no power in the State Legislature to compel the High Court to act in a particular way in exercise of its jurisdiction under article 226 of the Constitu tion.
Section, II could only apply to cases 'Where any court or authority other than the High Court in exercise of its jurisdiction under article 226 of the Constitution, had decided the matter.
Held, further, that construing shall ' in section II of the Act as `may ' would defeat the very provisions of the Act.
Held, also, that the contention that the application under s.11 of the Act may be treated as one order 47 of the Code of Civil Procedure, was highly belated and further there were many possible objections to such a course and it cannot be acceded to.
|
Appeal No. 25 of 1961.
Appeal by special leave from the judgment and decree dated November 26, 1957, of the Allahabad High Court in Special Appeal No. 235 of 1957.
3 C.B. Agarwala and C. P. Lal, for the appellants.
H. N. Sanyal, Additional Solicitor General of India, section K. Kapur, Bishamber Lal and.
K. K. Jain, for the respondent.
March 26.
The Judgment of Sinha, C.J., Subba Rao and Ayyangar, JJ. was delivered by Subba Rao, J., Mudholkar, J., delivered separate Judgment.
SUBBA RAO, J.
This appeal by special leave is directed against the judgment and order of a division Bench of the Allahabad High Court confirming those of a single Judge of that court dismissing the application filed by the appellant to review the order of the High Court dated November 22, 1958.
The facts leading up to the filing of this appeal may be briefly stated.
The respondent held certain zamindari and agricultural properties in different districts of the State of Uttar Pradesh.
On December 22, 1952, the Additional Collector, Banaras, in exercise of the powers conferred on him under the provisions of the U. P. Agricultural Income Tax Act (Act III of 1949), assessed the respondent to an agricultural income tax of Rs. 99,964 12 0 for the year 1359 fasli.
On September 30, 1955, the respondent filed a petition before the High Court under article 226 of the Constitution for quashing the said order on the ground that the Additional Collector, Banaras, had no jurisdiction to make the said assessment. 'On November 22, 1955, Mehrotra J., allowed the writ petition quashing the said assessment.
The State of Uttar Pradesh did not prefer an appeal against the said order and allowed it to become final.
On February 9, 1956, the State of Uttar Pradesh promulgated an Ordinance, being Ordinance No. 11 of 1956, which was subsequently replaced by U. P. Act No. XIV of 1956, Under the provisions of the Ordinance, the assessments made 4 by the Additional Collector were retrospectively validated and, under s.6 thereof, a right was conferred upon any party to the proceedings under the U.P. Agricultural Income tax Act, 1948, (hereinafter called the principal Act), wherein any assessment made by an Additional Collector or Additional Assistant Collector was set aside merely on the ground that the assessing authority had no jurisdiction to make the assessment, to apply within 90 days from the date of the commencement of the said Ordinance for a review of the said, proceedings in the light of the provisions of the Ordinance, and a statutory injunction was imposed upon a court to review the said order accordingly.
Pursuant to the provisions of s.6 of the said Ordinance, on March 14, 1956, the appellants filed an application in the High Court at Allahabad for review of its order dated November 22, 1956.
Subsequently as stated earlier, the.
Ordinance was replaced by the U. P. Act XIV of 1956 hereinafter called the Act.
In the course of the judgment we shall refer only to the provision of the Act.
The said application was heard, in the first instance, by Mehrotra, J.,.
and he held that section II of the Act, which corresponds to s.6 of the Ordinance, did not entitle the appellant to file an application for review of an order made by the High Court under article 226 of the Constitution.
The appellant 's petition was dismissed on that ground.
The appellants preferred an appeal against the said order to a division Bench of that court.
Nootham, C.J., and Srivastava, J., who heard the appeal, dismissed it on two grounds, namely, (1) under Ch.
VIII r.5 of the Rules of Court, a special appeal against an order of a single Judge of the court can be maintained only if that order amounts to a "Judgment," and an order refusing an application for review not being a "Judgment" cannot be the subject of an appeal, (2) on merits, that is on the construction of section II of the Act, the view taken by Mehrotra, J. was correct.
The present appeal, as already stated, was preferred against the said order.
5 Mr. C. B. Aggarwala, learned counsel for the appellants, has raised before us the following points: (1) The order of Mehrotra, J.,, dismissing the application for review of his earlier order is a ,Judgment within the meaning of Ch.
VIII r. 5 of the Rules of Court and, therefore, an appeal lies against that order to a division Bench of that court.
(2) The terms of section 11 of the Act are comprehensive enough to take in an order made by the High Court under article 226 of the Constitution quashing the order of assessment and even if there is some lacuna, the provisions shall be so construed as to carry out clear intention of the Legislature.
(3) In any view, the application for review filed by the appellants could be treated as one filed under Order 47 of the Code of Civil Procedure, and the earlier order reviewed on the ground that there is an error apparent on the face of the record,.
We shall take the questions in the order they were argued.
The first question is whether an appeal Jay against the order of Mehrotra, J., rejecting the application for review filed by the appellants to a division Bench of the High Court.
Chapter VIII r.5 of the Rules of Court provides for an appeal against an order of a single judge.
Under that rule a special appeal against an order of a single judge of the court can be maintained only if that order amounts to a "judgement".
That rule gives effect to cl. 10 of the letters Patent for the High Court of Allahabad, which gives a right _ of appeal against a judgment of a single judge subject to the conditions mentioned therein.
The said cl.10 corresponds to cl.15 of the letters Patent for the High Courts of Calcutta, Bombay and Madras.
The scope of the expression "judgment" came under the judicial scrutiny of the various High Courts: there is a cleavage of opinion on that question.
We shall briefly no" ,ice the leading decisions of the various High Courts on the subject.
Couch, C.J., 6 in The Justices of the Peace for Calcuttu vs The Oriental Gas CO.
(1) defines the word "judgment" in el.
15 of the Letters Patent thus: "We think 'judgment ' in clause 15 means a decision which affects the merits of the question between the parties by determining ,some right or liability.
It may be either final, or preliminary, or interlocutory,, the difference between them being that a final judgment determines the whole cause or suit and a preliminary or interlocutory judgment determines only a part of it, leaving other metters to be determined".
The same High Court in Hadjee Ismael vs Hadjee Mahommed (2 ) held that an appeal lay under the said clause from an order refusing to set aside an order granting leave to sue to the plaintiff under cl.12 of the Letters Patent.
Therein Couch, C.J., observed: "It is not a mere formal order, or an order merely regulating the procedure in the suit, but on that has the effect of giving a jurisdiction to the court it otherwise would not have.
And it may fairly be said to determine some right between them, viz., the right to sue in a particular Court, and to compel the defendants who are not within its jurisdiction to come in and defend the suit, or if they do not, to make them liable to have a decree passed against them in their absence." The Bombay High Court followed the Calcutta view.
The leading judgment of the Madras High Court is that in Tuljaram vs Alagappa (3), where it was held that an order of a single Judge in the Original Side refusing to frame an issue asked for by one of the parties is not a 'judgment ' within (1) , 452.
(2) , 101.
(3) (1912) 1.L.R. , 7, 15. 7 the meaning of cl.15 of the Letters Patent.
White, C.J., laid down the following tests: "The test seems to me to be not what is the form of the adjudication, but what is its effect in the suit or proceeding in which it is made.
If its effect, whatever its form may be, and whatever be the nature of the appli cation on which it is made, is to put an end to the suit or proceeding so far as the Court before which the suit or proceeding is pending is concerned, or if its effect, if it is not complied with, is to put an end to the suit or proceeding, I think the adjudication is a 'judgment ' within the meaning of the clause.
" Referring to the decisions of the Calcutta High Court the learned Chief Justice proceeded to state: "On the other hand I am not prepared to say as was held in The Justices of the Peace for Calcutta vs The Oriental Gas Company (1) and in Sonbai vs Ahamedbhai Habibhai (2), it must be a decision which affects the merits by determining some right or liability.
think the decision may be a judgment for the purposes of the section though it does not affect the merits of the suit or proceeding and does not determine any question of right raised in the suit or proceeding.
Krishnaswami Ayyar, J., observed much to the same effect: "I would only stop here to remark that a decision which determines the cause or proceeding so far as the particular court is concerned, though it refused to adjudge the merits, must also be deemed to be a judgement: far otherwise the rejection of a plaint for defect of form or insufficiency of Court (1) (2) (1872) 9 B.H.C.R. 398.
8 fee or a return of it for want of jurisdiction would be outside the definition of the learned Chief Justice which could hardly have been his meaning.
I may also observe that the "Part" which is determined may be a part of the claim separable from the rest or a determination of liability generally though the actual measure of liability may be a matter of account".
The Lahore High Court generally followed the view expressed by the Madras High Court.
The Allahabad High Court in Muhammad Naim Ullah Khan vs Ihsan Ullah Khan (1) expressed the view that an order which is not appealable under 0.43 r. 1 of the Code of Civil Procedure is not appealable under cl. 10 of the Letters Patent.
This view has been followed by a division Bench of the same High Court in Tirmal Singh vs Kanhayia Singh (2).
But the said decisions do not attempt to lay down a definition of the. expression "judgment" in the Letters Patent.
The Nagpur High Court in Manohar vs Baliram(3) by a majority, after considering the case law on the subject, laid down the following definition.
Hidayatullah, J., who delivered the leading judgment, laid down the test at p. 522 thus: "A judgment means a decision in an action whether final, preliminary, or interlocutory which decides either wholly or partially, but conclusively in so far as the Court is concerned, the controversy which is the subject of the action.
It does not include a decision which is on a matter of procedure, nor one which is ancillary to the action even though it may either imperil the ultimate decision or tend to make it effective.
The decision need not be immediately executable per 88 but if left untouched, must result inevitably without anything further, save the determination of (1) [1892] 1.
L. R. 14 All. 226 (2) [1923] 1.
L. R. 45 All. 535.
(3) 1.
L. R. 9 consequential details, in a decree or decretal order, that is to say, an executive document directing something to be done or not to be done in relation to the facts of the contro versy.
The decision may itself order that thing to be done or not to be done or it may leave that over till after the ascertainment of some details but it must not be interlocutory having for its purpose the ascertainment of some matters or details prior to the determination of the whole or any part of the controversy.
" The foregoing brief analysis of judgment shown that the definition given by the Madras High Court is wider than that given by the Calcutta and Nagpur High Courts.
It is not necessary in this case to attempt to reconcile the said decision or to give a definition of our own, for on the facts of the present case the order of Mehrotra, J., would be a judgment within the meaning of the narrower definition of that expression.
The appellants filed an application to review the order of the High Court quashing the order of assessment made by the Additional Collector.
It was alleged in the affidavit that the impugned assessment had been validated under the Ordinance and that the applicants had the right to have the order of Mehrotra, J., reviewed in the light of the provisions of section 6 thereof.
The assessee denied that the appellants had any such right.
The appellants ' statutory right to have the order of the High Court reviewed was denied by the other side and was put in issue before the High Court.
The relevant provisions of the Act read : Section 2. "In Section 2 of the U. P. Agricultural Income Tax Act, 1948 (hereinafter called the Principal Act), for clause (4), the following shall be and be deemed always to have been substituted 10 "(4 a) 'Collector ' shall have the meaning as in the U, P. Land Revenue Act, 1901, and will include an Additional Collector appointed under the said Act.
" Section 10.
Validation (1) For the removal of doubts it is hereby declared that (a) in rule 18 of the, U. P. Agricultural Income Tax Rules, 1949, the expression "Collector" and "Assistant Collector in charge of a sub division" shall respectively include and be deemed always to have included an "Additional Collector" and an "Additional Assistant Collector in charge of a sub divisional".
(b) all orders, actions or proceedings taken, directions issued or jurisdiction exercised or in accordance with the provisions of the Principal Act or of any rule framed thereunder prior to the amendment of that Act by 'Section 2 of this Act shall be deemed to be as good and valid in law as if Section 2 aforesaid had been in force at all material dates.
(2) Where any question arises as to the validity or legality of anuy assessment made by an Additional Collector in charge of a sub division or by an Additional Collector in pur ported exercise of the powers under Section 14 or of the rules framed under clause (c) of sub section (2) of Section 44 of the Principal Act, the same shall be determined as if the provisions of Section 2 of this Act had been in force at all material dates.
Section 11 Review of Proceedings : Where before the commencement of this Act any court or authority had, in any proceedings under the Principal Act, set aside any assessment made by an Additional Collector or 11 Additional Assistant Collector in charge of a subdivision merely on the ground that the assessing authority had no jurisdiction to make an assessment, any party to the proceedings may, at any time within ninety days from the date of commencement of this Act apply to the Court or authority for a view of the proceedings in the light of the provisions of this Act, and the Court or authority to which the application is made shall review the proceedings accordingly and make such order, if any, varying or revising the order previously made as may be necessary to give effect to the pro.
visions of the Principal Act as amended by Sections 2 and 8 of this Act.
Under the aforesaid provisions the assessments made by the Additional Collector were retrospectively validated and a right was conferred on a party to the proceedings under the Principal Act, wherein the assessments were set aside merely on the ground that the assessing authority bad no jurisdiction to make an assessment, to apply to the court to have that order reviewed.
A statutory injunction was also issued to the court which set aside the assessment on the ground of want of jurisdiction to review its order and to give effect to the provisions of the Principal Act, as amended by sections 2 and 4 of the Act, that is to say, a fresh right has been conferred upon a party to the earlier proceedings to have the previous order set aside and to have decision from the court on the basis of the amended Act.
This is a valuable and substantive right conferred upon a party to the proceeding.
On the rival contentions, the question of the fresh right conferred upon a party to the proceeding and the jurisdiction of the court to enforce the said right would be in issue and any decision thereon could legitimately be said to be a decision determining the rights of parties.
But for the 12 amending Act, the order of the High Court admittedly would have become final; but, because of the amending Act there was, a controversy whether the binding decision could be reopened and the rights of the parties decided in accordance with the amending Act.
The decision of Mehrotra, J., dismissing the application was certainly a decision denying the right of the appellants alleged to have been conferred under the amending Act.
We therefore, hold that the order of Mehrotra, J., dismissing the application, filed for review of his earlier order, on the ground that section 11 of the Act did not confer any such right on the appellants was a 'judgment ' within the meaning of cl.10 of the Letters Patent as well as Ch.
VIII r.5 of the Rules of Court.
If so, we must hold that the division Bench of the High Court went wrong in holding that no appeal lay against the order of Mehrotra, J.
Even so, the appellants would not be entitled to succeed, unless we hold, differing from the High Court, that s.11 of the Act confers a right on the appellants to have the order of Mehrotra, J., reviewed.
We have already extracted the provisions of a. 11.
Section 11 is in two parts: the first part of the section confers a right on a party to the proceedings under the Principal Act to apply to the court or authority for a review of the proceeding in the light of the provisions of the Act within 90 days from the commencement of the Act, and the second part issues a statutory injunction on such a court or authority to review the proceedings accordingly and to make an order as may be necessary to give effect to the provisions of the Principal Act, as amended by ss.2 and 4 of the Act.
The first question, therefore, is whether the order of Mehrotra, J., in an application under article 226 of the Constitution was in any proceeding under the Principal Act.
Obviously a petition under article 226 of the Constitution cannot be a proceeding under the Act: it is a proceeding 13 under the Constitution.
But it is said, relying upon certain passages in Maxwell on the Interpretation of Statutes, at p, 68, and in Crawford on "Statutory Construction ' at p. 492, that it is the duty of the Judge "to make such construction of a statute as shall suppress the mischief and advance the remedy," and for that purpose the more extended meaning could be attributed to the words so as to bring all matters fairly within the scope of such a statute even though outside the letter, if within its spirit or reason.
But both Maxwell and Crawford administered a caution in resorting to such a construction.
Maxwell says at p.68 of his book: "The construction must not, of course, be strained to include cases plainly omitted from the natural meaning of the words." Crawford says that a liberal construction does not justify an extension of the statute 's scope beyond the contemplation of the Legislature.
The fundamental and elementary rule of construction is that the words and phrases used by the Legislature shall be given their ordinary meaning and shall be constructed according to the rules of grammar.
When the language is plain and unambiguous and admits of only one meaning, no question of construction of a statute arises, for the Act speaks for itself.
It is a well recognized rule of construction that the meaning must be collected from the expressed intention of the Legislature.
So construed, there cannot be two possible views on the interpretation of the first part of the section.
Learned counsel suggested that we should read the relevant portion of the first part thus: "in any proceedings to set aside any assessment made on the basis of the Principal Act".
To accept this argument is to rewrite the section.
While the section says that the order sought to be reviewed is that made in a proceeding under 14 the Principal Act, the argument seeks to remove the qualification attached to the proceeding and add the same to the assessment.
The alternative argument, namely, that without changing the position of the words as they stand in the section, the expression ,on the basis of" may be substituted for the expression "under" does Dot also yield the results expected by the learned counsel.
It cannot be held with any justification, without doing violence to the language used, that a proceeding under article 226 of the Constitution is either one under the Principal Act or on the basis of the Principal Act, for it is a proceeding under article 226 of the Constitution to quash the order on the ground that it was made in violation of the Act.
An attempt is then made to contend that a proceeding under article 226 of the Constitution is a continuation of the proceedings before the Additional Collector and, therefore, the said proceedi ings are proceedings under the Act.
This leads us to the consideration of the question of the scope of the proceedings under article 226 of the Constitution.
Article 226 confers a power on a High Court to issue the writs, orders, or directions mentioned therein for the enforcement of any of the rights conferred by Part III or for any other purpose.
This is neither an appellate nor a revisional jurisdiction of the High Court.
Though the power is not confined to the prerogative writs issued by the English Courts, it is modeled on the said writs mainly to enable the High Courts to keep the subordinate tribunals within bounds.
Before the Constitution, the chartered High Court, that is, the High Courts at Bombay, Calcutta and Mad ras, were issuing prerogative writs similar to those issued by the King 's Bench Division, subject to the same limitations imposed on the said.
writs.
In Venkataratnam vs Secretary of State for India(1), (1) (1930) I.L.P. 15 a division Bench of the Madras High Court, consisting of Venkatasubba Rao and Madhavan Nair, JJ,; held that the jurisdiction to issue a writ of certiorari was original jurisdiction.
In Ryots of Garabandha vs The Zamindar of Parlakimedi (1), another division Bench of the same High Court, consisting of Leach, C. J., and Madhavan Nair J., considered the question again incidentally and came to the same conclusion "and held that a writ of certiorari is issued only in exercise of the original jurisdiction of the High Court.
In Ramayya vs State of Madras (2), a division Bench, consisting of Govinda Menon and Ramaswami Oounder, JJ,, considered the question whether the proceedings under article 226 of the Constitution are in exercise of the original Jurisdiction or revisional jurisdiction of the High Court, and the learned Judges held that the power to issue writs under article 226 of the Constitution is original and the jurisdiction exercised is original jurisdiction.
In Moulvi Hamid Hassan Nomani vs Banwarilal Boy (3), the Privy Council was considering the question whether the original civil jurisdiction which the Supreme Court of Calcutta possessed over certain classes of persons outside the territorial limits of that jurisdiction has been inherited by the High Court.
In that context the Judicial Committee.
observed.
"It cannot be disputed that the issue of such writs is a matter of original jurisdiction".
The Calcutta.
High Court, in Budge Budge Munici pality vs Mangru(4) came to the same conclusion, namely, that the jurisdiction exercised under article 226 of the Constitution is original as distinguished from appellate or revisional jurisdiction; but the High Court pointed out that the jurisdiction, though original, is a special jurisdiction and should not be (1) I.L.R (2) A.I.R. 1952 Nad. 300.
(3) (1942) It M. L. J. 32, 35.
(4) 16 confused with ordinary civil jurisdiction under the Letters Patent.
The Andhra High Court in Satyanarayanamurthi vs 1.
T. Appellate Tribunal (1) described it as an extraordinary original jurisdiction.
It is, therefore, clear from the nature of the power conferred under article 226 of the Constitution and the decisions on the subject that the High Court in exercise of its power under article 226 of the Constitution exercises original jurisdiction, though the said jurisdiction shall not be confused with the ordinary civil jurisdiction of the High Court.
This jurisdiction, though original in character as contrasted with its appellate and revisional jurisdictions, is exercisable throughout the territories in relation to which it exercises jurisdiction and may.
for convenience, be described as extraordinary original jurisdiction.
If that be so, it cannot be contended that a petition under article 226 of the Constitution is a continuation of the proceedings under the Act.
There is another insurmountable difficulty in accepting the construction suggested by learned counsel.
Under the second part of the section a party to the earlier proceedings may within the prescribed time apply to the court or authority for a review of the proceedings in the light of the pro visions of the Act, and the court or authority to which the application is made shall review the proceedings accordingly, and make such order, if any, varying or revising the order previously made as may be necessary to give effect to the Principal Act, as amended by section 2 of the Act.
Should it be held that this section applies to an order made by a High Court under article 226 of the Constitution, the statutory mandatory injunction issued under the second part of the section to the High Court to make an order in a particular way would be constitutionally void.
Under the Constitution the Legislature of a (1) A. 1.
R. 1957 Andhra 123.
17 State derives its authority to make laws under article 245 of the Constitution, which reads: (1) " 'Subject to the provisions of this Con stitution, Parliament may make laws for the whole or any part of the territory of India, and the, Legislature of a State may make laws for the whole or any part of the State.
" Article 245 is, therefore, subject to article 226 of the Constitution.
It follows that no law made by the Legislature of a State can be in derogation of the powers of the High Court under article 226 of the Constitution.
It is well settled that article 226 confers a discretionary power on the High Courts to make or issue appropriate orders and writs for the enforcement of any of the rights conferred by Part III of the Constitution or for any other purpose.
While article 226 confers a discretionary power on the High Court, the second part of section 11 of the Act enjoins on the High Court to make an order in a particular way.
We should not give such a construction to the section as would bring it into conflict with article 226 of the Constitution and which ,would have the effect of invalidating it to that extent.
On the other hand, the construction adopted by us would be consistent with the second part of the section, for, if the first part is confined only to an order made by any court or authority, other, than the High Court in exercise of its jurisdiction under article 226 of the Constitution, both the parts fall in a piece, and we would not only be giving a natural meaning to the express words used in the section but we would also be saving the section from the vice of constitutional invalidity.
Learned counsel for the appellants seeks to got over this obvious difficulty by contending that the word "shall" may be treated as 'may" so that the discretion of High Court under article 226 may be maintained.
Alternatively, he contends that the second part of the section comprises two parts the 18 first empowers an aggrieved party only to file an application, and the second imposes a statutory duty, and that the first may conveniently be served from the second and its validity to that extent sustained.
The first argument is contrary to the express words used and the intention of the Legislature.
If we read "shall" as ', 'may" the same discretion will have to be given even to authorities, and courts other than the High Court, with the result the purpose of the section would be defeated.
On the other hand, if the expression "shall" is given its natural meaning, the section carries out the intention of the Legislature, viz., the mandatory injunction imposed on courts and authorities to restore the assessment declared invalid.
The decisions cited by the learned counsel in support of his construction are not of any help, for they were based upon the construction of the relevant provisions under consideration in those cases.
The second argument, if accepted, would be rewriting the section.
While the dominant intention of the Legislature is to issue a mandatory injunction on the courts or authorities to review their orders on a suitable application made to them, we would be deleting it and thus defeating the object of the Legislature.
For the foregoing reasons, we have no hesitation in holding that, on a plain reading of the clear words used in the section, it does not apply to an order made by the High Court under article 226 of the Constitution.
Lastly it is contended that even if section 11 does not apply, we should treat the application filed by the appellants before the High Court as one made under Order 47 of the Code of Civil Procedure.
There are.
many objections for allowing the appellants to do so at this very late stage of the Proceedings.
The application was filed only under section 11 of the Act and no attempt was made either before Mehrotra, J., or before the division Bench of the High Court to ask for an amendment 19 or to sustain the petition under Order 47 of the Code, of Civil Procedure; nor did the appellants raise this plea in the petition filed for special leave or even in the statement of case as originally filed by them.
After the case was argued for sometime on an observation casually made by the Court, time was taken and for the first time this plea was taken in the additional statement of case filed by the appellants.
This is, therefore, a highly belated attempt to convert the application filed on one basis into that on another.
Further, the plea, if allowed, is not so innocuous or smooth sailing as it appears to be, but is brimming with many controversial questions.
It raises the following questions : (1) Whether the application treated as one made under order 47 of the Code of Civil Procedure was within time ; (2) if it was out of time, could the delay be excused without the appellant filing an application for excusing it and giving valid reasons for the same ; (3) whether an order made by the High Court in exercise of its powers under article 226 of the Constitution could be reviewed under Order 47 of the Code of Civil Procedure, and, if not, under section 151 of the said Code ; (4) whether the amendment 'of an Act with retrospective effect could be treated as an error on the face of the record or as a sufficient cause within the meaning of Order 47 of the Code of Civil Procedure for reviewing the final orders and decrees made by courts on the basis of the law obtaining at the time the said orders or decrees were made ; and (5) if the order of Mehrotra, J., was one made under Order 47 of the Code of Civil Procedure, would an appeal lie to a division Bench of the High Court under Order 43 of the Code.
We do not propose to express any opinion on the aforesaid questions.
It would be enough to say that we are not justified to allow the appellants to convert their petition to one made under Order 47 of the Code of Civil Pro 20 cedure at this very late stage, in view of the foregoing reasons.
In the result we hold that the order of the High Court is correct.
The appeal fails and is dismissed with costs.
MUDHOLKAR, J.
I agree with my learned brother that the appeal should be dismissed for the reasons stated in his judgment.
I, however, express no opinion on the question regarding the maintainability of the appeal under the Letters Patent against the decision of a single Judge in a case of this kind.
Appeal dismissed.
|
Appeal by special leave from the judgment and decree dated November 26, 1957, of the Allahabad High Court in Special Appeal No. 3 C.B. Agarwala and C. P. Lal, for the appellants. H. N. Sanyal, Additional Solicitor General of India, section K. Kapur, Bishamber Lal and. The Judgment of Sinha, C.J., Subba Rao and Ayyangar, JJ. was delivered by Subba Rao, J., Mudholkar, J., delivered separate Judgment. The facts leading up to the filing of this appeal may be briefly stated. The respondent held certain zamindari and agricultural properties in different districts of the State of Uttar Pradesh. On November 22, 1955, Mehrotra J., allowed the writ petition quashing the said assessment. The State of Uttar Pradesh did not prefer an appeal against the said order and allowed it to become final. On February 9, 1956, the State of Uttar Pradesh promulgated an Ordinance, being Ordinance No. 11 of 1956, which was subsequently replaced by U. P. Act No. Ordinance was replaced by the U. P. Act XIV of 1956 hereinafter called the Act. In the course of the judgment we shall refer only to the provision of the Act. The said application was heard, in the first instance, by Mehrotra, J.,. The appellant 's petition was dismissed on that ground. The appellants preferred an appeal against the said order to a division Bench of that court. Nootham, C.J., and Srivastava, J., who heard the appeal, dismissed it on two grounds, namely, (1) under Ch. The present appeal, as already stated, was preferred against the said order. VIII r. 5 of the Rules of Court and, therefore, an appeal lies against that order to a division Bench of that court. We shall take the questions in the order they were argued. Chapter VIII r.5 of the Rules of Court provides for an appeal against an order of a single judge. 10 of the letters Patent for the High Court of Allahabad, which gives a right _ of appeal against a judgment of a single judge subject to the conditions mentioned therein. The said cl.10 corresponds to cl.15 of the letters Patent for the High Courts of Calcutta, Bombay and Madras. We shall briefly no" ,ice the leading decisions of the various High Courts on the subject. Couch, C.J., 6 in The Justices of the Peace for Calcuttu vs The Oriental Gas CO. 15 of the Letters Patent thus: "We think 'judgment ' in clause 15 means a decision which affects the merits of the question between the parties by determining ,some right or liability. Therein Couch, C.J., observed: "It is not a mere formal order, or an order merely regulating the procedure in the suit, but on that has the effect of giving a jurisdiction to the court it otherwise would not have. And it may fairly be said to determine some right between them, viz., the right to sue in a particular Court, and to compel the defendants who are not within its jurisdiction to come in and defend the suit, or if they do not, to make them liable to have a decree passed against them in their absence." The Bombay High Court followed the Calcutta view. 7 the meaning of cl.15 of the Letters Patent. " Referring to the decisions of the Calcutta High Court the learned Chief Justice proceeded to state: "On the other hand I am not prepared to say as was held in The Justices of the Peace for Calcutta vs The Oriental Gas Company (1) and in Sonbai vs Ahamedbhai Habibhai (2), it must be a decision which affects the merits by determining some right or liability. The Lahore High Court generally followed the view expressed by the Madras High Court. But the said decisions do not attempt to lay down a definition of the. expression "judgment" in the Letters Patent. It does not include a decision which is on a matter of procedure, nor one which is ancillary to the action even though it may either imperil the ultimate decision or tend to make it effective. L. R. 9 consequential details, in a decree or decretal order, that is to say, an executive document directing something to be done or not to be done in relation to the facts of the contro versy. The decision may itself order that thing to be done or not to be done or it may leave that over till after the ascertainment of some details but it must not be interlocutory having for its purpose the ascertainment of some matters or details prior to the determination of the whole or any part of the controversy. The assessee denied that the appellants had any such right. The appellants ' statutory right to have the order of the High Court reviewed was denied by the other side and was put in issue before the High Court. The relevant provisions of the Act read : Section 2. " In Section 2 of the U. P. Agricultural Income Tax Act, 1948 (hereinafter called the Principal Act), for clause (4), the following shall be and be deemed always to have been substituted 10 "(4 a) 'Collector ' shall have the meaning as in the U, P. Land Revenue Act, 1901, and will include an Additional Collector appointed under the said Act. (2) Where any question arises as to the validity or legality of anuy assessment made by an Additional Collector in charge of a sub division or by an Additional Collector in pur ported exercise of the powers under Section 14 or of the rules framed under clause (c) of sub section (2) of Section 44 of the Principal Act, the same shall be determined as if the provisions of Section 2 of this Act had been in force at all material dates. visions of the Principal Act as amended by Sections 2 and 8 of this Act. This is a valuable and substantive right conferred upon a party to the proceeding. We have already extracted the provisions of a. 11. But both Maxwell and Crawford administered a caution in resorting to such a construction. Maxwell says at p.68 of his book: "The construction must not, of course, be strained to include cases plainly omitted from the natural meaning of the words." Crawford says that a liberal construction does not justify an extension of the statute 's scope beyond the contemplation of the Legislature. The fundamental and elementary rule of construction is that the words and phrases used by the Legislature shall be given their ordinary meaning and shall be constructed according to the rules of grammar. When the language is plain and unambiguous and admits of only one meaning, no question of construction of a statute arises, for the Act speaks for itself. It is a well recognized rule of construction that the meaning must be collected from the expressed intention of the Legislature. So construed, there cannot be two possible views on the interpretation of the first part of the section. To accept this argument is to rewrite the section. While the section says that the order sought to be reviewed is that made in a proceeding under 14 the Principal Act, the argument seeks to remove the qualification attached to the proceeding and add the same to the assessment. An attempt is then made to contend that a proceeding under article 226 of the Constitution is a continuation of the proceedings before the Additional Collector and, therefore, the said proceedi ings are proceedings under the Act. Article 226 confers a power on a High Court to issue the writs, orders, or directions mentioned therein for the enforcement of any of the rights conferred by Part III or for any other purpose. This is neither an appellate nor a revisional jurisdiction of the High Court. In Ramayya vs State of Madras (2), a division Bench, consisting of Govinda Menon and Ramaswami Oounder, JJ,, considered the question whether the proceedings under article 226 of the Constitution are in exercise of the original Jurisdiction or revisional jurisdiction of the High Court, and the learned Judges held that the power to issue writs under article 226 of the Constitution is original and the jurisdiction exercised is original jurisdiction. "It cannot be disputed that the issue of such writs is a matter of original jurisdiction". (4) 16 confused with ordinary civil jurisdiction under the Letters Patent. The Andhra High Court in Satyanarayanamurthi vs 1. T. Appellate Tribunal (1) described it as an extraordinary original jurisdiction. This jurisdiction, though original in character as contrasted with its appellate and revisional jurisdictions, is exercisable throughout the territories in relation to which it exercises jurisdiction and may. for convenience, be described as extraordinary original jurisdiction. There is another insurmountable difficulty in accepting the construction suggested by learned counsel. Should it be held that this section applies to an order made by a High Court under article 226 of the Constitution, the statutory mandatory injunction issued under the second part of the section to the High Court to make an order in a particular way would be constitutionally void. Under the Constitution the Legislature of a (1) A. 1. " Article 245 is, therefore, subject to article 226 of the Constitution. We should not give such a construction to the section as would bring it into conflict with article 226 of the Constitution and which ,would have the effect of invalidating it to that extent. On the other hand, the construction adopted by us would be consistent with the second part of the section, for, if the first part is confined only to an order made by any court or authority, other, than the High Court in exercise of its jurisdiction under article 226 of the Constitution, both the parts fall in a piece, and we would not only be giving a natural meaning to the express words used in the section but we would also be saving the section from the vice of constitutional invalidity. Alternatively, he contends that the second part of the section comprises two parts the 18 first empowers an aggrieved party only to file an application, and the second imposes a statutory duty, and that the first may conveniently be served from the second and its validity to that extent sustained. The first argument is contrary to the express words used and the intention of the Legislature. If we read "shall" as ', 'may" the same discretion will have to be given even to authorities, and courts other than the High Court, with the result the purpose of the section would be defeated. the mandatory injunction imposed on courts and authorities to restore the assessment declared invalid. The decisions cited by the learned counsel in support of his construction are not of any help, for they were based upon the construction of the relevant provisions under consideration in those cases. The second argument, if accepted, would be rewriting the section. For the foregoing reasons, we have no hesitation in holding that, on a plain reading of the clear words used in the section, it does not apply to an order made by the High Court under article 226 of the Constitution. Lastly it is contended that even if section 11 does not apply, we should treat the application filed by the appellants before the High Court as one made under Order 47 of the Code of Civil Procedure. many objections for allowing the appellants to do so at this very late stage of the Proceedings. The application was filed only under section 11 of the Act and no attempt was made either before Mehrotra, J., or before the division Bench of the High Court to ask for an amendment 19 or to sustain the petition under Order 47 of the Code, of Civil Procedure; nor did the appellants raise this plea in the petition filed for special leave or even in the statement of case as originally filed by them. This is, therefore, a highly belated attempt to convert the application filed on one basis into that on another. Further, the plea, if allowed, is not so innocuous or smooth sailing as it appears to be, but is brimming with many controversial questions. We do not propose to express any opinion on the aforesaid questions. In the result we hold that the order of the High Court is correct. The appeal fails and is dismissed with costs. MUDHOLKAR, J.
I agree with my learned brother that the appeal should be dismissed for the reasons stated in his judgment.
|
The respondent, who owned agricultural properties in the different districts of Uttar Pradesh, was assessed to agri cultural income tax by the Additional Collector of Banaras.
On challenge by way of a petition under article 226 of the Constitution, assessment was quashed by the Allahabad High Court on the ground that the assessing authority had no ,jurisdiction to assess.
Under section 6 of the U.P. Act No. XIV of 1956 the assessments by the Additional Collector were validated and a party to the proceedings under Agricultural Income tax Act was given the right to move the Court or authority within the prescribed period to review the proceedings where in the assessments had been set aside on the ground that the assessing authority had no jurisdiction to make the assessment.
By section 11 the authority or court so moved was bound to review the order.
The State of Uttar Pradesh applied to the High Court for review of its earlier order quashing the assessment.
The single judge of the High Court held that section II of the Act did not apply to writ pro ceedings under article 226 of the Constitution.
On appeal the Division Bench held that the order for the single judge did not amount to a 'judgment ' under Ch.
VIII r.5 cl.10 of the Letter Patent and the Rules of Allahabad High Court and that section 11 of the Act did not apply to proceedings.
by way of a writ before the High Court.
On appeal by special leave by the State it was contended that the Division Bench was wrong and by an additional statement of case it was sought to be urged that the application for review should be treated as one under order 47 of the Code of Civil Procedure, 2 Held (per Sinha, C. J, Subba Rao, Ayyangar and Aiyar, jj.), that under cl.
IO of the Letters Patent of the Allahabad High Court and the Rules of the Court the expression 'judgment ' would even on the narrow view of the expression include the order in the present case whereby the statutory right given to the party was finally negatived and that the Division Bench was in error in holding that it was not a 'judgment '.
Held, further, that the proceeding under article 226 of the constitution were neither 'proceedings ' under the Act nor proceedings on the basis of the Act.
The proceedings under article 226 of the Constitution were independent and original proceeding and not a continuation of the assessment proceedings.
Venkataratnam vs Secretary of State for India, (1930) I.L.R.53 Mad.
979, Ryots of Garabandha vs The Zamindar of Parlakimedi I.L.R. , Ramayya vs State of Madras, A.I.R. 1952 Mad.
300, Moulvi Hamid Hassan Nomani vs Banwarilal Coy.
(1947) II M.L.J. 32, Budge Budge Municipality vs Mangru (1952) 57 C.W.N.25 and Satyanarayanamurthi vs 1.T. Appellate Tribunal, A.I.R.1957 Andhra 123, referred to.
The Act had to be interpreted consistently with the Constitution and there was no power in the State Legislature to compel the High Court to act in a particular way in exercise of its jurisdiction under article 226 of the Constitu tion.
Section, II could only apply to cases 'Where any court or authority other than the High Court in exercise of its jurisdiction under article 226 of the Constitution, had decided the matter.
Held, further, that construing shall ' in section II of the Act as `may ' would defeat the very provisions of the Act.
Held, also, that the contention that the application under s.11 of the Act may be treated as one order 47 of the Code of Civil Procedure, was highly belated and further there were many possible objections to such a course and it cannot be acceded to.
|
The respondent, who owned agricultural properties in the different districts of Uttar Pradesh, was assessed to agri cultural income tax by the Additional Collector of Banaras.
On challenge by way of a petition under article 226 of the Constitution, assessment was quashed by the Allahabad High Court on the ground that the assessing authority had no ,jurisdiction to assess.
Under section 6 of the U.P. Act No. XIV of 1956 the assessments by the Additional Collector were validated and a party to the proceedings under Agricultural Income tax Act was given the right to move the Court or authority within the prescribed period to review the proceedings where in the assessments had been set aside on the ground that the assessing authority had no jurisdiction to make the assessment.
By section 11 the authority or court so moved was bound to review the order.
The State of Uttar Pradesh applied to the High Court for review of its earlier order quashing the assessment.
The single judge of the High Court held that section II of the Act did not apply to writ pro ceedings under article 226 of the Constitution.
On appeal the Division Bench held that the order for the single judge did not amount to a 'judgment ' under Ch.
VIII r.5 cl.10 of the Letter Patent and the Rules of Allahabad High Court and that section 11 of the Act did not apply to proceedings.
by way of a writ before the High Court.
On appeal by special leave by the State it was contended that the Division Bench was wrong and by an additional statement of case it was sought to be urged that the application for review should be treated as one under order 47 of the Code of Civil Procedure, 2 Held (per Sinha, C. J, Subba Rao, Ayyangar and Aiyar, jj.), that under cl.
IO of the Letters Patent of the Allahabad High Court and the Rules of the Court the expression 'judgment ' would even on the narrow view of the expression include the order in the present case whereby the statutory right given to the party was finally negatived and that the Division Bench was in error in holding that it was not a 'judgment '.
Held, further, that the proceeding under article 226 of the constitution were neither 'proceedings ' under the Act nor proceedings on the basis of the Act.
The proceedings under article 226 of the Constitution were independent and original proceeding and not a continuation of the assessment proceedings.
Venkataratnam vs Secretary of State for India, (1930) I.L.R.53 Mad.
979, Ryots of Garabandha vs The Zamindar of Parlakimedi I.L.R. , Ramayya vs State of Madras, A.I.R. 1952 Mad.
300, Moulvi Hamid Hassan Nomani vs Banwarilal Coy.
(1947) II M.L.J. 32, Budge Budge Municipality vs Mangru (1952) 57 C.W.N.25 and Satyanarayanamurthi vs 1.T. Appellate Tribunal, A.I.R.1957 Andhra 123, referred to.
The Act had to be interpreted consistently with the Constitution and there was no power in the State Legislature to compel the High Court to act in a particular way in exercise of its jurisdiction under article 226 of the Constitu tion.
Section, II could only apply to cases 'Where any court or authority other than the High Court in exercise of its jurisdiction under article 226 of the Constitution, had decided the matter.
Held, further, that construing shall ' in section II of the Act as `may ' would defeat the very provisions of the Act.
Held, also, that the contention that the application under s.11 of the Act may be treated as one order 47 of the Code of Civil Procedure, was highly belated and further there were many possible objections to such a course and it cannot be acceded to.
| 0.175634
| 0.538948
| 1
| 1
|
Criminal Appeal No. 221 of 1978.
From the Judgment and Order dated 30.3.1978 of the Punjab and Haryana High Court in Criminal Appeal No. 252 of 1975.
A.N. Mulla, R.L. Kohli, Harjinder Singh and R.C. Kohli for the Appellants.
R.S. Sodhi for the Respondent.
Judgment of the Court was delivered by BALAKRISHNA ERADI, J. This is yet another unfortunate instance of gruesome murder of a young wife by the barbaric process of pouring kerosene oil over the body and setting her on fire as the culmination of a long process of physical and mental harassment for extraction of more dowry.
Whenever such cases come before the Court and the offence is brought home to the accused beyond reasonable doubt, it is the duty of the Court to deal with it in most severe and 1223 strict manner and award the maximum penalty prescribed by the law in order that it may operate as a deterrent to other persons from committing such anti social crimes.
Amandeep Kaur, deceased, was married to Avtar Singh who figured as the first accused in the case in the Sessions Court.
Kailash Kaur, the appellant, is the mother in law of the deceased and Mahinder Kaur who figured as the third accused in the case is the sister of Avtar Singh.
The hus band and his parents were allegedly unhappy about the quan tum of dowry brought by the deceased and she was being subjected to severe harassment and maltreatment with a view to extract more dowry from her parents.
Exhibit PK is a letter written by the deceased to her father Avtar Singh (P.W. 3) in which she has set out the details of the harass ment and maltreatment and expressed her grave apprehension that unless she was immediately taken back to the father 's house, her life itself was in imminent danger.
On may 30, 1974, in the evening.
Kailash Kaur and Mahinder Kaur started quarreling with the deceased and severely abused and threat ened her.
Thereupon, the deceased went to her room and bolted its door from inside.
Sometime later Avtar Singh, husband of the deceased, came to the house and started knocking at the door of the said room with great force because of which the door got unbolted.
It would appear that after the door was opened Avtar Singh went away from the house.
It is the prosecution case that immediately thereaf ter Mahinder Kaur caught hold of the deceased and Kailash Kaur (appellant) poured kerosene oil on her and set her on fire.
The deceased started screaming on hearing which the people residing in the locality rushed to the house.
Avtar Singh, the husband also reached there in the meantime, As she was engulfed in flames, somebody put a blanket on Aman deep Kaur and extinguished the flames.
Thereafter she was carried to the Civil Hospital, Hoshiarpur.
Dr. Har Parkash Bhatia (P.W. 2), who examined her sent information to the local police station on receipt of which Head Constable Naranjan Singh (P.W. 7), went over to the hospital.
The doctor sent everybody other than the Head Constable out of the room where the patient was lying.
He told the deceased that he would put her questions about the cause of her death.
On the basis of the questions put by the doctor, Head Constable Naranjan Singh (P.W. 7) recorded her statement, on the basis of which formal First Information Report was lodged at Police Station, Hoshiarpur.
Amandeep Kaur expired on June 1, 1974.
At the trial the prosecution relied on exhibit PF/3, the dying declaration made by the deceased Amandeep Kaur, the letter exhibit PK writ 1224 ten by her to her father Atar Singh (P.W. 3) and the evi dence of P.W. 3 wherein he stated that the appellant, her son and daughter were dissatisfied about the quantum of dowry brought by Amandeep Kaur and on that account they had been torturing her.
The learned trial Judge acting on the aforesaid evidence convicted Kailash Kaur and Mahinder Kaur of the offence under Section 302 I.P.C. and acquitted Avtar Singh, the husband, accused giving him the benefit of doubt.
Kailash Kaur and Mahinder Kaur carried the matter in appeal before the High Court of Punjab and Haryana.
The High Court confirmed the conviction of the appellant herein namely, Kailash Kaur, but acquitted Mahinder Kaur giving her the benefit of doubt.
Aggrieved by the said judgment, the appellant has preferred this appeal before this Court after obtaining special leave.
Notwithstanding the learned and persuasive arguments advanced before us by Shri A.N. Mulla, Senior Counsel ap pearing on behalf of the appellant, we find absolutely no merit in this appeal.
There is no reason whatever not to act upon the dying declaration of the deceased wherein she has given a clear and vivid account of the pouring of kerosene oil over body and her being set on fire by the appellant.
She had also implicated Mahinder Kaur as the person who held her while the kerosene oil was being poured on her body by the appellant.
We have very grave doubts about the legality, propriety and correctness of the decision of the High Court in so far as it has acquitted Mahinder Kaur by giving her the benefit of doubt.
But since the State has not preferred any appeal, we are not called upon to go into that aspect any further.
In addition to the dying declaration there is also clear circumstantial evidence furnished by the fetter exhibit PK and the testimony of Atar Singh (P.W. 3) father of the deceased regarding the demands for dowry and the harassment and torture inflicted on the deceased by the accused as part of the endeavour to extract more dowry.
The dying declaration made by the deceased has the ring of truth and the testimony of the doctor P.W. 2 and of the Head Constable P.W. 7 clearly establishes that she was in a fit condition to make the statement.
The conviction of the appellant by the High Court was, therefore, fully justified and there is absolute ly no ground for interference with the same by this Court.
We only express our regret that the Sessions Judge did not treat this as a fit case for awarding the maximum penalty under the law and that no steps were taken by the 1225 State Government before the High Court for enhancement of the sentence.
The appeal is accordingly dismissed.
The bail bond of the appellant will stand cancelled and she will be taken into custody forthwith to serve out the remaining portion of her sentence.
P.S.S. Appeal dis missed.
|
The prosecution alleged that on the evening of May 30, 1974 the appellant 's daughter caught hold of the deceased, and the appellant poured kerosene oil on her and set her on fire.
On hearing deceased 's screams the neighbours rushed to the house and extinguished the flames.
Thereafter, she was taken to the hospital where on the basis of questions put by the doctor (P.W. 2), Head Constable (P.W. 7) recorded her statement.
She expired on June 1, 1974.
It was further alleged that the husband and his parents were unhappy about the quantum of dowry brought by the deceased and she was, therefore being subjected to severe harassment and maltreat ment.
In a letter written by the deceased to her father she had set out the details of the iII treatment meted to her and expressed grave apprehension that her life was in immi nent danger.
The trial court convicted the appellant and her daughter of the offence under section 302 I.P.C. acting on the dying declaration made by the deceased, the letter written by her to her father and his evidence as to the demands for dowry and the torture inflicted on his daughter.
The husband was given benefit of doubt and acquitted.
The High Court confirmed the conviction of the appellant but acquitted the daughter giving her benefit of doubt.
Dismissing the appeal, the Court, HELD: 1.1.
The conviction of the appellant by the High Court was fully justified.
The dying declaration made by the deceased wherein 1222 she has given a clear and vivid account of the pouring of kerosene oil over her body and being set on fire by the appellant, has the ring of truth.
The testimony of the doctor (P.W. 2) and the Head Constable (P.W. 7) clearly establishes that she was in a fit condition to make the statement.
There was, therefore, no reason whatever not to act upon it.
[1224D; G] 1.2.
In addition, there was also clear circumstantial evidence furnished by the letter written by the deceased to her father and the testimony of the father regarding the demands for dowry and the harassment and torture inflicted on the deceased as part of the endeavour to extract more dowry.
[1224F G] 2.
Whenever a case of gruesome murder of a young wife by the barbaric process of pouring kerosene oil over the body and setting her on fire as the culmination of a long process of physical and mental harassment for extraction of more dowry comes before the court and the offence is brought home to the accused beyond reasonable doubt, it is the duty of the court to deal with the case in the most severe and strict manner and award the maximum penalty prescribed by the law in order that it may operate as a deterrent to other persons from committing such anti social crimes.
[1222H; 1223A]
|
Criminal Appeal No. 221 of 1978.
From the Judgment and Order dated 30.3.1978 of the Punjab and Haryana High Court in Criminal Appeal No. 252 of 1975.
A.N. Mulla, R.L. Kohli, Harjinder Singh and R.C. Kohli for the Appellants.
R.S. Sodhi for the Respondent.
Judgment of the Court was delivered by BALAKRISHNA ERADI, J. This is yet another unfortunate instance of gruesome murder of a young wife by the barbaric process of pouring kerosene oil over the body and setting her on fire as the culmination of a long process of physical and mental harassment for extraction of more dowry.
Whenever such cases come before the Court and the offence is brought home to the accused beyond reasonable doubt, it is the duty of the Court to deal with it in most severe and 1223 strict manner and award the maximum penalty prescribed by the law in order that it may operate as a deterrent to other persons from committing such anti social crimes.
Amandeep Kaur, deceased, was married to Avtar Singh who figured as the first accused in the case in the Sessions Court.
Kailash Kaur, the appellant, is the mother in law of the deceased and Mahinder Kaur who figured as the third accused in the case is the sister of Avtar Singh.
The hus band and his parents were allegedly unhappy about the quan tum of dowry brought by the deceased and she was being subjected to severe harassment and maltreatment with a view to extract more dowry from her parents.
Exhibit PK is a letter written by the deceased to her father Avtar Singh (P.W. 3) in which she has set out the details of the harass ment and maltreatment and expressed her grave apprehension that unless she was immediately taken back to the father 's house, her life itself was in imminent danger.
On may 30, 1974, in the evening.
Kailash Kaur and Mahinder Kaur started quarreling with the deceased and severely abused and threat ened her.
Thereupon, the deceased went to her room and bolted its door from inside.
Sometime later Avtar Singh, husband of the deceased, came to the house and started knocking at the door of the said room with great force because of which the door got unbolted.
It would appear that after the door was opened Avtar Singh went away from the house.
It is the prosecution case that immediately thereaf ter Mahinder Kaur caught hold of the deceased and Kailash Kaur (appellant) poured kerosene oil on her and set her on fire.
The deceased started screaming on hearing which the people residing in the locality rushed to the house.
Avtar Singh, the husband also reached there in the meantime, As she was engulfed in flames, somebody put a blanket on Aman deep Kaur and extinguished the flames.
Thereafter she was carried to the Civil Hospital, Hoshiarpur.
Dr. Har Parkash Bhatia (P.W. 2), who examined her sent information to the local police station on receipt of which Head Constable Naranjan Singh (P.W. 7), went over to the hospital.
The doctor sent everybody other than the Head Constable out of the room where the patient was lying.
He told the deceased that he would put her questions about the cause of her death.
On the basis of the questions put by the doctor, Head Constable Naranjan Singh (P.W. 7) recorded her statement, on the basis of which formal First Information Report was lodged at Police Station, Hoshiarpur.
Amandeep Kaur expired on June 1, 1974.
At the trial the prosecution relied on exhibit PF/3, the dying declaration made by the deceased Amandeep Kaur, the letter exhibit PK writ 1224 ten by her to her father Atar Singh (P.W. 3) and the evi dence of P.W. 3 wherein he stated that the appellant, her son and daughter were dissatisfied about the quantum of dowry brought by Amandeep Kaur and on that account they had been torturing her.
The learned trial Judge acting on the aforesaid evidence convicted Kailash Kaur and Mahinder Kaur of the offence under Section 302 I.P.C. and acquitted Avtar Singh, the husband, accused giving him the benefit of doubt.
Kailash Kaur and Mahinder Kaur carried the matter in appeal before the High Court of Punjab and Haryana.
The High Court confirmed the conviction of the appellant herein namely, Kailash Kaur, but acquitted Mahinder Kaur giving her the benefit of doubt.
Aggrieved by the said judgment, the appellant has preferred this appeal before this Court after obtaining special leave.
Notwithstanding the learned and persuasive arguments advanced before us by Shri A.N. Mulla, Senior Counsel ap pearing on behalf of the appellant, we find absolutely no merit in this appeal.
There is no reason whatever not to act upon the dying declaration of the deceased wherein she has given a clear and vivid account of the pouring of kerosene oil over body and her being set on fire by the appellant.
She had also implicated Mahinder Kaur as the person who held her while the kerosene oil was being poured on her body by the appellant.
We have very grave doubts about the legality, propriety and correctness of the decision of the High Court in so far as it has acquitted Mahinder Kaur by giving her the benefit of doubt.
But since the State has not preferred any appeal, we are not called upon to go into that aspect any further.
In addition to the dying declaration there is also clear circumstantial evidence furnished by the fetter exhibit PK and the testimony of Atar Singh (P.W. 3) father of the deceased regarding the demands for dowry and the harassment and torture inflicted on the deceased by the accused as part of the endeavour to extract more dowry.
The dying declaration made by the deceased has the ring of truth and the testimony of the doctor P.W. 2 and of the Head Constable P.W. 7 clearly establishes that she was in a fit condition to make the statement.
The conviction of the appellant by the High Court was, therefore, fully justified and there is absolute ly no ground for interference with the same by this Court.
We only express our regret that the Sessions Judge did not treat this as a fit case for awarding the maximum penalty under the law and that no steps were taken by the 1225 State Government before the High Court for enhancement of the sentence.
The appeal is accordingly dismissed.
The bail bond of the appellant will stand cancelled and she will be taken into custody forthwith to serve out the remaining portion of her sentence.
P.S.S. Appeal dis missed.
|
Criminal Appeal No. 221 of 1978.
From the Judgment and Order dated 30.3.1978 of the Punjab and Haryana High Court in Criminal Appeal No. 252 of 1975.
A.N. Mulla, R.L. Kohli, Harjinder Singh and R.C. Kohli for the Appellants.
R.S. Sodhi for the Respondent.
Judgment of the Court was delivered by BALAKRISHNA ERADI, J. This is yet another unfortunate instance of gruesome murder of a young wife by the barbaric process of pouring kerosene oil over the body and setting her on fire as the culmination of a long process of physical and mental harassment for extraction of more dowry.
Whenever such cases come before the Court and the offence is brought home to the accused beyond reasonable doubt, it is the duty of the Court to deal with it in most severe and 1223 strict manner and award the maximum penalty prescribed by the law in order that it may operate as a deterrent to other persons from committing such anti social crimes.
Amandeep Kaur, deceased, was married to Avtar Singh who figured as the first accused in the case in the Sessions Court.
Kailash Kaur, the appellant, is the mother in law of the deceased and Mahinder Kaur who figured as the third accused in the case is the sister of Avtar Singh.
The hus band and his parents were allegedly unhappy about the quan tum of dowry brought by the deceased and she was being subjected to severe harassment and maltreatment with a view to extract more dowry from her parents.
Exhibit PK is a letter written by the deceased to her father Avtar Singh (P.W. 3) in which she has set out the details of the harass ment and maltreatment and expressed her grave apprehension that unless she was immediately taken back to the father 's house, her life itself was in imminent danger.
On may 30, 1974, in the evening.
Kailash Kaur and Mahinder Kaur started quarreling with the deceased and severely abused and threat ened her.
Thereupon, the deceased went to her room and bolted its door from inside.
Sometime later Avtar Singh, husband of the deceased, came to the house and started knocking at the door of the said room with great force because of which the door got unbolted.
It would appear that after the door was opened Avtar Singh went away from the house.
It is the prosecution case that immediately thereaf ter Mahinder Kaur caught hold of the deceased and Kailash Kaur (appellant) poured kerosene oil on her and set her on fire.
The deceased started screaming on hearing which the people residing in the locality rushed to the house.
Avtar Singh, the husband also reached there in the meantime, As she was engulfed in flames, somebody put a blanket on Aman deep Kaur and extinguished the flames.
Thereafter she was carried to the Civil Hospital, Hoshiarpur.
Dr. Har Parkash Bhatia (P.W. 2), who examined her sent information to the local police station on receipt of which Head Constable Naranjan Singh (P.W. 7), went over to the hospital.
The doctor sent everybody other than the Head Constable out of the room where the patient was lying.
He told the deceased that he would put her questions about the cause of her death.
On the basis of the questions put by the doctor, Head Constable Naranjan Singh (P.W. 7) recorded her statement, on the basis of which formal First Information Report was lodged at Police Station, Hoshiarpur.
Amandeep Kaur expired on June 1, 1974.
At the trial the prosecution relied on exhibit PF/3, the dying declaration made by the deceased Amandeep Kaur, the letter exhibit PK writ 1224 ten by her to her father Atar Singh (P.W. 3) and the evi dence of P.W. 3 wherein he stated that the appellant, her son and daughter were dissatisfied about the quantum of dowry brought by Amandeep Kaur and on that account they had been torturing her.
The learned trial Judge acting on the aforesaid evidence convicted Kailash Kaur and Mahinder Kaur of the offence under Section 302 I.P.C. and acquitted Avtar Singh, the husband, accused giving him the benefit of doubt.
Kailash Kaur and Mahinder Kaur carried the matter in appeal before the High Court of Punjab and Haryana.
The High Court confirmed the conviction of the appellant herein namely, Kailash Kaur, but acquitted Mahinder Kaur giving her the benefit of doubt.
Aggrieved by the said judgment, the appellant has preferred this appeal before this Court after obtaining special leave.
Notwithstanding the learned and persuasive arguments advanced before us by Shri A.N. Mulla, Senior Counsel ap pearing on behalf of the appellant, we find absolutely no merit in this appeal.
There is no reason whatever not to act upon the dying declaration of the deceased wherein she has given a clear and vivid account of the pouring of kerosene oil over body and her being set on fire by the appellant.
She had also implicated Mahinder Kaur as the person who held her while the kerosene oil was being poured on her body by the appellant.
We have very grave doubts about the legality, propriety and correctness of the decision of the High Court in so far as it has acquitted Mahinder Kaur by giving her the benefit of doubt.
But since the State has not preferred any appeal, we are not called upon to go into that aspect any further.
In addition to the dying declaration there is also clear circumstantial evidence furnished by the fetter exhibit PK and the testimony of Atar Singh (P.W. 3) father of the deceased regarding the demands for dowry and the harassment and torture inflicted on the deceased by the accused as part of the endeavour to extract more dowry.
The dying declaration made by the deceased has the ring of truth and the testimony of the doctor P.W. 2 and of the Head Constable P.W. 7 clearly establishes that she was in a fit condition to make the statement.
The conviction of the appellant by the High Court was, therefore, fully justified and there is absolute ly no ground for interference with the same by this Court.
We only express our regret that the Sessions Judge did not treat this as a fit case for awarding the maximum penalty under the law and that no steps were taken by the 1225 State Government before the High Court for enhancement of the sentence.
The appeal is accordingly dismissed.
The bail bond of the appellant will stand cancelled and she will be taken into custody forthwith to serve out the remaining portion of her sentence.
P.S.S. Appeal dis missed.
|
The prosecution alleged that on the evening of May 30, 1974 the appellant 's daughter caught hold of the deceased, and the appellant poured kerosene oil on her and set her on fire.
On hearing deceased 's screams the neighbours rushed to the house and extinguished the flames.
Thereafter, she was taken to the hospital where on the basis of questions put by the doctor (P.W. 2), Head Constable (P.W. 7) recorded her statement.
She expired on June 1, 1974.
It was further alleged that the husband and his parents were unhappy about the quantum of dowry brought by the deceased and she was, therefore being subjected to severe harassment and maltreat ment.
In a letter written by the deceased to her father she had set out the details of the iII treatment meted to her and expressed grave apprehension that her life was in immi nent danger.
The trial court convicted the appellant and her daughter of the offence under section 302 I.P.C. acting on the dying declaration made by the deceased, the letter written by her to her father and his evidence as to the demands for dowry and the torture inflicted on his daughter.
The husband was given benefit of doubt and acquitted.
The High Court confirmed the conviction of the appellant but acquitted the daughter giving her benefit of doubt.
Dismissing the appeal, the Court, HELD: 1.1.
The conviction of the appellant by the High Court was fully justified.
The dying declaration made by the deceased wherein 1222 she has given a clear and vivid account of the pouring of kerosene oil over her body and being set on fire by the appellant, has the ring of truth.
The testimony of the doctor (P.W. 2) and the Head Constable (P.W. 7) clearly establishes that she was in a fit condition to make the statement.
There was, therefore, no reason whatever not to act upon it.
[1224D; G] 1.2.
In addition, there was also clear circumstantial evidence furnished by the letter written by the deceased to her father and the testimony of the father regarding the demands for dowry and the harassment and torture inflicted on the deceased as part of the endeavour to extract more dowry.
[1224F G] 2.
Whenever a case of gruesome murder of a young wife by the barbaric process of pouring kerosene oil over the body and setting her on fire as the culmination of a long process of physical and mental harassment for extraction of more dowry comes before the court and the offence is brought home to the accused beyond reasonable doubt, it is the duty of the court to deal with the case in the most severe and strict manner and award the maximum penalty prescribed by the law in order that it may operate as a deterrent to other persons from committing such anti social crimes.
[1222H; 1223A]
|
The prosecution alleged that on the evening of May 30, 1974 the appellant 's daughter caught hold of the deceased, and the appellant poured kerosene oil on her and set her on fire.
On hearing deceased 's screams the neighbours rushed to the house and extinguished the flames.
Thereafter, she was taken to the hospital where on the basis of questions put by the doctor (P.W. 2), Head Constable (P.W. 7) recorded her statement.
She expired on June 1, 1974.
It was further alleged that the husband and his parents were unhappy about the quantum of dowry brought by the deceased and she was, therefore being subjected to severe harassment and maltreat ment.
In a letter written by the deceased to her father she had set out the details of the iII treatment meted to her and expressed grave apprehension that her life was in immi nent danger.
The trial court convicted the appellant and her daughter of the offence under section 302 I.P.C. acting on the dying declaration made by the deceased, the letter written by her to her father and his evidence as to the demands for dowry and the torture inflicted on his daughter.
The husband was given benefit of doubt and acquitted.
The High Court confirmed the conviction of the appellant but acquitted the daughter giving her benefit of doubt.
Dismissing the appeal, the Court, HELD: 1.1.
The conviction of the appellant by the High Court was fully justified.
The dying declaration made by the deceased wherein 1222 she has given a clear and vivid account of the pouring of kerosene oil over her body and being set on fire by the appellant, has the ring of truth.
The testimony of the doctor (P.W. 2) and the Head Constable (P.W. 7) clearly establishes that she was in a fit condition to make the statement.
There was, therefore, no reason whatever not to act upon it.
[1224D; G] 1.2.
In addition, there was also clear circumstantial evidence furnished by the letter written by the deceased to her father and the testimony of the father regarding the demands for dowry and the harassment and torture inflicted on the deceased as part of the endeavour to extract more dowry.
[1224F G] 2.
Whenever a case of gruesome murder of a young wife by the barbaric process of pouring kerosene oil over the body and setting her on fire as the culmination of a long process of physical and mental harassment for extraction of more dowry comes before the court and the offence is brought home to the accused beyond reasonable doubt, it is the duty of the court to deal with the case in the most severe and strict manner and award the maximum penalty prescribed by the law in order that it may operate as a deterrent to other persons from committing such anti social crimes.
[1222H; 1223A]
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(Crl.) No. 292 of 1986.
(Under Article 32 of the Constitution of India).
Ram Jethmalani, Ms. Rani Jethmalani and A.K. Sharma for the Petitioner.
Anil Dev Singh, Mrs. Indra Sawhney and Ms. section Relan for the Respondents.
The Judgment of the Court was delivered by SEN, J.
By this petition under Article 32 of the Consti tution, the petitioner Smt.
Poonam Lata has asked for the issue of a writ of habeas corpus for the release of her husband, Shital Kumar who has been 1127 detained by an order passed by the Additional Secretary to the Government of India, Ministry of Finance, Department of Revenue.
dated February 28, 1986.
made under section 3(1) of (hereinafter referred to as the 'Act '), on being satisfied that it was necessary to detain him "with a view to preventing him from dealing in smuggled goods".
Put very briefly, the essential facts are these.
The Directorate of Enforcement, New Delhi, gathered intelligence over a period of time before making of the impugned order of detention which revealed that the detenu was engaged in receiving smuggled gold from across the Indo Nepal Border and was making payments in foreign currency and remitting the sale proceeds of such smuggled gold out of the country in the shape of U.S. dollars with the help of carriers.
On February 26.
1986, the Directorate received information that the three carriers, namely, Ram Deo Thakur, Shyam Thakur and Bhushan Thakur would be leaving under the assumed names of Dalip, Mukesh and Rajesh respectively by 154 Dn.
Jayanti Janata Express leaving New Delhi Railway Station at 6.45 p.m.
Accordingly, the officers of the Delhi Zone of the Directorate mounted surveillance at Platform No. 5 of the Railway Station from which the train was to steam off.
The said carriers were detrained and upon search of their bag gage, the officers recovered $ 29,750 and Rs.1500 from Ram Deo Thakur @ Dalip, $ 28,900 and Rs.650 from Shyam Thakur @ Mukesh and $ 20,000 and Rs.1,000 from Bhushan Thakur @ Rajesh.
The same ware seized under section 110(1) of the .
The total value of the seized foreign currency was equivalent to Rs.10,25,000 in round figure.
During interrogation by the officers under section 108 of the , these persons stated that the seized for eign currency totaling $ 78,650 had been paid by the detenu towards the price of 48 gold biscuits of foreign origin brought by them from Darbhanga to New Delhi and made over to him and accordingly the detenu was taken into custody on February 27, 1986.
He too made a statement under section 108 of the Act confessing that he was dealing in smuggled gold brought across the Indo Nepal Border and has been remitting the price of such gold in U.S. dollars through different carriers.
On February 28, 1986, the detenu was served with the impugned order of detention along with the grounds thereof and copies of the relevant documents relied upon in the grounds.
On March 25, 1986.
the detenu submitted a represen tation under section 8(b) of the Act and the detaining authority by its order of April 4, 1986 rejected the 1128 same.
On April 12, 1986 the detenu made a representation to the Advisory Board through the Superintendent of the Central Jail, Tihar.
The representation together with comments of the detaining authority and the relevant documents were forwarded by the Ministry of Finance, Department of Revenue to the Advisory Board.
On the same day the detenu appears to have made a representation to the Central Government and it was received in the Ministry of Finance on April 24, 1986.
The Minister of State for Finance rejected the said repre sentation on April 28, 1986 and the detenu was informed about it the following day.
The Advisory Board had its sittings on April 28 and 29, 1986.
and came to the conclu sion that there was sufficient cause for the detention and sent its report on May 8, 1986.
The Minister considered the report of the Advisory Board and confirmed the order of detention on May 14, 1986 and the Central Government 's order of confirmation was duly communicated on May 26, 1986.
The representation of the detenu was still before the Advisory Board when the petitioner moved this Court under Article 32 of the Constitution on April 23, 1986.
On April 29, 1986, notice was ordered by the Court returnable on May 3, 1986, and it directed that the matter may be placed before the Vacation Judge on May 15, 1986.
On that date, the learned Vacation Judge made an order for the release of the detenu on parole in the following terms: "The detenu is released on parole until fur ther orders on the condition that he will report to the Directorate of Revenue Intelli gence, New Delhi every day and the Directorate will be at liberty to ask him to explain his conduct during this time.
Reply affidavit may be filed within two weeks.
The matter will be listed two weeks after reopening of the Court after summer vacation.
In the meantime, the respondents will be at liberty to make an application for the revocation of the parole if any misconduct or any other activity comes to their notice which requires the revocation of the parole.
" Notwithstanding the order of the learned Vacation Judge that the matter should be listed within two weeks after the re opening of the Court after the long vacation it should have been some time in early August of 1986 the case was not listed till January 14, 1987.
The 1129 respondents also took no steps to apply for early listing of the matter.
On January 14, 1987, a prayer was made by the learned counsel appearing for the Union of India seeking two weeks ' time to file an additional affidavit and the case was ordered to be listed on March 3. 1987.
During all these months, the detenu has been out of jail.
Indisputably the detention was for one year.
When the matter came up for hearing on the 3rd of March, 1987, Shri Jethmalani, learned counsel for the petitioner confined his submissions to only one aspect, namely, that the period of parole i.e. from May 15, 1986 till February 28, 1987, could not be added to the period of detention specified in the impugned order under sub section
(1) of section 3 of the Act and the period of one year from the date of detention having expired on February 26, 1987, the impugned order had lapsed and the detenu became entitled to be freed from the shackles of the order of detention.
Ac cording to the learned counsel, section 10 of the Act prescribes the maximum period of detention to be one year or two years, as the case may be, from the date of detention or the specified period, whichever expires earlier.
Admittedly in respect of the detenu no decla ration under section 9 of the Act has been made and, therefore, the maximum period of detention so far as he is concerned is one year and it has to be reckoned as prescribed under section 10 of the Act.
That section indicates not only the starting point but also the outer limit.
In other words, the argument is that once the detenu is taken into custody under the Act pursuant to an order of deten tion, the running of time would not be arrest ed merely because the Court directs release of the detenu on parole.
Shri Jethmalani drew a distinction between 'bail ' and 'parole '; he contended that preven tive detention was not a sentence by way of punishment and, therefore, the concept of serving out which pertains to punitive juris prudence cannot be imported into the realm of preventive detention.
According to him, the grant of parole to a detenu amounts to a provisional release from confinement; yet the detenu continues to be under judicial deten tion; release from jail custody subject to restrictions imposed on free and unfettered movement transfers the detenu to judicial custody.
Since there is no provision to autho rise interruption of running of the period of detention, release on parole does not bring about any change in the situation.
It has further been argued that when the Court enter tains a writ petition for grant of habeas corpus and issues a rule nisi, the detenu is deemed to have come into judicial custody and the effect of grant of parole does not termi nate such custody but merely allows greater freedom of move 1130 ment to the detenu.
Conditions imposed on the detenu during parole impinge upon his freedom and liberty; therefore, the period during which a detenu is released on parole cannot be taken as a period during which the detention is not operative.
Shri Jethmalani placed reliance on the ratio of the Privy Council decision in Lala Jairam Das & Ors.
vs Emperor, AIR 1945 PC 94 to contend that but for the special provision contained in sub section (3) of section 426 of the old Code of Criminal Proce dure, 1898 (corresponding to section 389(4) of the Code of 1973) the power of the Court to grant bail to a convicted person or accused would not include a power to exclude the period of bail from the term of the sentence.
The same principle ought to apply in the case of re lease of a detenu on bail or parole and the Court therefore cannot on general principles add the period of bail or parole to the period of detention.
In the absence of any provision regarding the grant of parole and the computa tion of the period thereof and in view of the special provisions contained regarding com mencement and the computation of the period of detention of one year, the period of parole cannot be deducted while computing the period of one year of detention.
The learned counsel also relied upon the direction made by a Bench of three Judges in the case of Amritlal Chan numal Jain etc.
vs State of Gujarat & Ors.
(Writ Petitions Nos.
1342 43, 1345 48 and 1362 of 1982 and No. 162 of 1983 dated July 10, 1985) where this Court directed that the period during which a detenu was on parole should be taken into account while calculating the total period of detention.
According to learned counsel the direction in Amritlal Channumal Jain 's case was given after a Bench of two Judges in Harish Makhija vs State of U.P. Crl.
M.P. No. 620 of 1984 in U.P. (Crl.) No. 301 of 1983 held on February 11, 1985, that the period of parole cannot be counted towards the period of detention.
Shri Jethmal ani has submitted that in view of the direc tion of the larger Bench of this Court, the ratio laid down in Amritlal Channumal Jain 's case (supra) has to prevail and must be taken as binding on us.
There is no denying the fact that preven tive detention is not punishment and the concept of serving out a sentence would not legitimately be within the purview of preven tive detention.
The grant of parole is essen tially an executive function and instances of release of detenus on parole were literally unknown until this Court and some of the High Courts in India in recent years made orders of release on parole on humanitarian considera tions.
Historically 'parole ' is a concept known to military law and denotes release of a prisoner of war on promise to return.
Parole has become an integral part of the English and American systems of criminal justice inter twined with the evolution of changing atti tudes of the society towards crime and crimi nals.
1131 As a consequence of the introduction of parole into the penal system, all fixed term sen tences of imprisonment of above 18 months are subject to release on licence, that is, parole after a third of the period of sentence has been served.
In those countries, parole is taken as an act of grace and not as a matter of right and the convict prisoner may be released on condition that he abides by the promise.
It is a provisional release from confinement but is deemed to be a part of the imprisonment.
Release on parole is a wing of the reformative process and is expected to provide opportunity to the prisoner to trans form himself into a useful citizen.
Parole is thus a grant of partial liberty or lessening of restrictions to a convict prisoner, but release on parole does not change the status of the prisoner.
Rules are flamed providing supervision by parole authorities of the convicts released on parole and in case of failure to perform the promise, the convict released on parole is directed to surrender to custody.
(See: The Oxford Companion to Law, edited by Walker, 1980 edn., p. 931, Black 's Law Dictionary, 5th edn., p. 1006, Jowitt 's Dictionary of English Law, 2nd edn., Vol. 2, p. 1320, Kenny 's Outlines of Criminal Law, 17th edn., p. 574 76, The English Sentencing System by Sir Rupert Cross at pp.
31 34, 87 et seq.
, American Jurisprudence, 2nd edn., Vol.
59, pp.
53 61, Corpus Juris Secundum, vol.
67, Probation and Parole, Legal and Social Dimen sions by Louis P. Carney).
It follows from these authorities that parole is the release of a very long term prisoner from a penal or correctional institution after he has served a part of his sentence under the continuous custody of the State and under conditions that permit his incarceration in the event of misbehavior.
There is abundance of authority that High Courts in exercise of their jurisdiction under Article 226 of the Constitution do not release a detenu on bail or parole.
There is no reason why a different view should be taken in regard to exercise of jurisdiction under Article 32 of the Constitution particularly when the power to grant relief to a detenu in such proceedings is exercisable on very narrow and limited grounds.
In State of Bihar vs Rambalak Singh & Ors., a Constitution Bench laid down that the release of a detenu placed under detention under Rule 30 of the Defence of India Rules, 1962.
on bail pending the hearing of a petition for grant of a writ of habeas corpus was an improper exercise of jurisdiction; It was observed in that case that if the High Court was of the view that prima facie the impugned order of detention was patently illegal in that there was a serious defect in the order of detention which would justify the release of the detenu, the proper and more sensible and reasonable course would invariably be to expedite the hearing of the writ petition and 1132 deal with the merits without any delay rather than direct release of the detenu on bail.
Again, in State of Uttar Pradesh vs Jairam & Ors., [1982] 1 SCC 176 a three Judge Bench speaking through Chandrachud, CJ., referred to Rambalak Singh 's case and set aside the order passed by the learned Single Judge of the High Court admitting the detenu to bail on the ground that it was an improper exercise of jurisdiction.
As to grant of parole, it is worthy of note that in none of the cases this Court made a direction under Article 32 of the Constitution for grant of parole to the detenu but left it to the executive to consider whether it should make an order in terms of the relevant provision for temporary release of the person detained as under section 12 of the COFEPOSA, in the facts and circumstances of a particular case.
In Samir Chatterjee vs State of West Bengal; , , the Court set aside the order of the Calcutta High Court releasing on parole a person detained under section 3(1) of the and unequivocally viewed with disfavor the observations made by Krishna Iyer, J. in Babulal Das vs State of West Bengal, ; to the effect: "While discharging the rule issued and dis missing the petition, we wish to emphasize that section 15 is often lost sight of by the Government in such situations, as long term preventive detention can be self defeating or criminally counter productive.
Section 15 reads: 15.
Temporary release of persons detained We consider that it is fair that persons kept incarcerated and embittered without trial should be given some chance to reform them selves by reasonable recourse to the parole power under section 15.
Calculated risks, by re lease for short periods may, perhaps, be a social gain, the beneficent jurisdiction being wisely exercised.
" Alagiriswamy, J. speaking for the Court, observed in no uncertain terms: 1133 "We fail to see that these observations lay down any principle of law.
Section 15 merely confers a power on the Government.
The power and duty of this Court is to decide cases coming before it according to law.
In so doing it may take various considerations into ac count.
But to advise the Government as to how they should exercise their functions or powers conferred on them by statute is not one of this Court 's functions.
Where the Court is able to give effect to its view in the form of a valid and binding order that is a different matter.
Furthermore, section 15 deals with release on parole and there is nothing to show that the petitioner applied for to be released on parole for any specific purpose.
As far as we are able to see, release on parole is made only on the request of the party and for a specific purpose.
" The innovative view expressed by Krishna lyer, J. in Anil Dey vs State of West Bengal, 14 which he tried to reiterate in Golam Hussain vs The Commissioner of Police, Calcutta & Ors., ; and in Babulal Das ' case, (supra), therefore, no longer holds the field, and rightly so, because the Court cannot usurp the functions of the Government.
Section 10 of the Act provides that the maximum period for which any person may be detained in pursuance of an order of detention to which provisions of section 9 do not apply shall be for a period of one year from the date of detention or the specified period, whichever expires earli er.
The key to the interpretation of section 10 of the Act is in the words 'may be detained '.
The subsequent words 'from the date of detention ' which follow the words 'maximum period of one year ' merely define the starting point from which the maximum period of detention of one year is to be reckoned in a case not falling.
under section 9.
There is no justifiable reason why the word 'detain ' should not receive its plain and natural meaning.
According to the Shorter Oxford English Dictionary, vol. 1, p. 531, the word 'detain ' means "to keep in confinement or custody".
Webster 's Campre hensive Dictionary, International Edition at p. 349 gives the meaning as "to hold in custody".
The purpose and object of section 10 is to prescribe a maximum period for which a person against whom a detention order under the Act is made may be held in actual custody pursuant to the said order.
It would not be violated if a person against whom an order of deten tion is passed is held in actual custody in jail for the period prescribed by the section.
The period during which the detenu is on parole cannot be 1134 said to be a period during which he has been held in custody pursuant to the order of his detention, for in such a case he was not in actual custody.
The order of detention pre scribes the place where the detenu is to be detained.
Parole brings him out of confinement from that place.
Whatever may be the terms and conditions imposed for grant of parole, detention as contemplated by the Act is interrupted when release on parole is obtained.
The position would be well met by the appropriate answer to the question "how long has the detenu been in actual custody pursuant to the order?" According to its plain construction, the purpose and object of section 10 is to prescribe not only for the maximum period but also the method by which the period is to be computed.
The computation has to commence from the date on which the detenu is taken into actual custody but if it is interrupted by an order of parole, the detention would not continue when parole operates and until the detenu is put back into custo dy.
The running of the period recommences then and a total period of one year has to be counted by putting the differ ent periods of actual detention together.
We see no force in Shri Jethmalani 's submission that the period during which the detenu was on parole has to be taken into consideration in computing the maximum period of detention authorised by section 10 of the Act.
It is pertinent to observe that the Court has no power to substitute the period of detention either by abridging or enlarging it.
The only power that is available to the Court is to quash the order in case it is found to be illegal.
That being so, it would not be open to the Court to reduce the period of detention by admitting the detenu on parole.
What in a given situation should be the sufficient period for a person to be detained for the purpose of the Act is one for the subjective satisfaction of the detaining author ity.
Preventive detention jurisprudence in this regard is very different from regular conviction followed by sentence that an accused is to suffer.
Whether it be under Article 226 or Article 32 of the Constitution, the Court would, therefore, have no jurisdiction either under the Act or under the general principles of law or in exercise of ex traordinary jurisdiction to deal with the duration of the period of detention.
Parliament has authorised the detention of persons under the COFEPOSA to serve two purposes: "(1) To prevent the person concerned from engaging himself in an activity prejudicial to the conservation of foreign exchange and also preventing him from smuggling activities 1135 and thereby to render him immobile for the period considered necessary by the detaining authority so that during that period the society is protected from such prejudicial activities on the part of the detenu.
And (2) In order to break the links between the person so engaged and the source of such activity and from his associates engaged in that activity or to break the continuity of such prejudicial activities so that it would become difficult, if not impossible, for him to resume the activities.
" Release of a detenu on parole after an order of detention has been made and the detenu lodged in custody for achieving one or the other of the aforesaid legislative objects is thus contrary to the purpose of the statute.
There is a statutory prohibition against release of a detenu during the period of detention in sub section (6) of section 12 of the Act.
That sub section which was inserted by Amending Act 39 of 1975 with effect from 1.7.1975 reads: "Notwithstanding anything contained in any other law and save as otherwise provided in this section, no person against whom a deten tion order made under this Act is in force shall be released whether on bail or bail bond or otherwise.
" Sub section (6) puts a statutory bar to the release of the detenu during the period of detention in a manner otherwise than the one provided in section 12.
Section 12 authorises either the Central Government or the State Government to temporarily release the detenu on such terms and conditions as the appropriate Government considers necessary to impose.
The scheme of section 12, unless release by the appropriate Government is taken to be one of parole, keeps away parole from the subject of preventive detention.
At any rate, it is the appropriate Government and not the Court which deals with a case of temporary release of the detenu.
Since the Act authorises the appropriate Government to make an order of temporary release, invariably the detenu seeking to have the benefit of temporary relief must go to the appropriate Government first.
It may be that in a given case the Court may be required to consider the propriety of an adverse order by the Government in exercise of the jurisdiction under section 12 of the Act.
On the principle that exercise ' of administrative jurisdiction is open to judicial review by the superior court, the High Court under Article 226 or this Court under Article 32 may be called upon in a suitable case to 1136 examine the legality and propriety of the governmental action.
There is no scope for entertaining an application for parole by the Court straightaway.
The legislative scheme, keeping the purpose of the statute and the manner of its fulfilment provided thereunder, would not justify enter taining of an application for release of a detenu on parole.
Since in our view release on parole is not a matter of judicial determination, apparently no provision as contained in the Code of Criminal Procedure relating to the computa tion of the period of bail was thought necessary in the Act.
But we would like to point out to the Government the desira bility of inserting a provision like sub s.(4) of section 389 of the Code of Criminal Procedure, 1973 that when an action is taken under section 12 of the Act and the appropriate Gov ernment makes a temporary release order, the period of such temporary release whether on bail or parole has to be ex cluded in computing the period of detention.
Either the statute or the rules made thereunder should provide for this eventuality.
In the premises, it must accordingly be held that the period of parole has to be excluded in reckoning the period of detention under sub section (1) of section 3 of the Act.
We find it difficult from the observations made by the three Judge Bench in Amritlal Channumal Jain 's case to infer a direction by this Court that the period of parole shall not be added to the period of detention.
The words used 'shall be taken into account ' are susceptible of an inter pretation to the contrary.
We find that an order made by a bench of two Judges of this Court in Harish Makhija 's case (supra) unequivocally laid down that the period of parole cannot be counted towards the period of detention.
This accords with the view taken by this Court in a bench of two Judges in State of Gujarat vs Adam Kasam Bhaya, ; and State of Gujarat vs Ismail Juma & Ors., ; In view of these authorities which appear to be in consonance with the object and purpose of the Act and the statutory provisions and also having regard to the fact that the direction made in Amritlal Channumal Jain 's case (supra) is capable of another construction as well, we do not find Shri Jethmalani 's contention on this score as acceptable.
For these reasons, the only contention advanced by Shri Jethmalani in course of the hearing, namely, that the period of parole from May 15, 1986 to February 28, 1987 could not be added to the maximum period of detention of the detenu Shital Kumar for one year as specified in the impugned order of detention passed under sub s.(1) of section 3 of the Conserva tion of Foreign Exchange & Prevention of Smuggling Activi ties Act, 1974, must fail.
The writ petition is accordingly 1137 dismissed.
There shall be no order as to costs.
We direct that the petitioner shall surrender to custody to undergo remaining period of detention.
We give the detenu ten days ' time to comply with this direction failing which a non bailable warrant for his arrest shall issue.
P.S.S. Petition dis missed.
|
Sub section (6) of section 12 of the prohibits release of a detenu on bail, or bail bond or otherwise, during the period a detention order is in force.
Sub sections (1) and (1A) of section 12, however, permit tempo rary release by the Central or State Governments on certain terms and conditions.
Section 10 provides for a maximum period of detention of one year in cases .to which provi sions of section 9 do not apply.
The husband of the petitioner was detained under section 3(1) of the Act by an order dated February 28, 1986.
His repre sentation under section 8(b) was rejected by the detaining au thority on April 4, 1986.
The Advisory Board in its sittings on April 28 and 29, 1986 concluded that there was sufficient cause for detention.
The order of detention was confirmed by the Minister on May 14, 1986.
The writ petition filed under Article 32 of the Consti tution on April 23, 1986 was heard by the Vacation Judge on May 15 1986 who made an order for the release of the detenu on parole and directed the matter to be listed in early August of 1986.
The case, however, could not be listed till January 14, 1987, and was finally heard on March 3, 1987.
The detenu had been out of Jail during the entire period.
The period of one year expired on February 28, 1987.
1124 It was contended for the petitioner that the period of parole from May 15.
1986 till February 28.
1987 could not be added to the period of detention specified in the order under sub section
(1) of section 3 of the Act, that the period of one year from the date of detention having expired on February 28.
1987 the order of detention had lapsed entitling the detenu to be freed, and that once the detenu is taken into custody under the Act pursuant to an order of detention the running of time would not be arrested merely because the court directs the release of the detenu on parole.
Relying on the decision in Lala Jairam Das & Ors.
vs Emperor.
(AIR it was contended that the court cannot on gener al principles add the period of bail or parole to the period of detention, and that the ratio laid down in Amritlal Channumal Jain etc.
vs State of Gujarat & Ors., (W.P. Nos.
1342 43 of 1982 decided on July 10, 1985) that the period during which a detenu was on parole should be taken into account while calculating the period of detention has to prevail and must be taken as binding.
Dismissing the writ petition.
the Court.
HELD: 1.
The period of parole of the detenu from May 15, 1986 to February 28.
1987 has to be excluded in reckoning the period of his detention for one year under sub section
(1) of section 3 of the .
[1136D, G H] 2.1 The purpose and object of section 10 of the Act is to prescribe not only a maximum period for which a person against whom a detention order under the Act is made may be held in actual custody pursuant to the said order but also the method by which the period is to be computed.
The key to the interpretation of the section is in the words "may be detained.
" The subsequent words "from the date of detention" which follow the words "maximum period of one year" merely define the starting point from which the maximum period of detention of one year is to be reckoned in a case not fall ing under section 9.
There is no justifiable reason why the word "detain" should not receive its plain and natural meaning 'to hold in custody '.
[1134B; 1133G, EP] 2.2 The period during which the detenu is on parole cannot be said to be a period during which he has been held in custody pursuant to the order of his detention.
In such a case he was not in actual custody.
The order of detention prescribes the place where the detenu is to be detained.
Parole brings him out of confinement from that place and detention as contemplated by the Act is interrupted until the detenu is put back into custody.
The running of the period recommences then and 1125 a total period of one year has to be counted by putting the different periods of actual detention together.
In the instant case it cannot, therefore, be said that the period during which the detenu was on.
parole has to be taken into consideration in computing the maximum period of detention authorised by section 10 of the Act.
[1133H; 1134A D] Harish Makhija vs State of U.P., Crl.
M.P. No. 620 of 1984 in W.P. (Crl.) No. 301 of 1983 decided on February 11, 1985; State of Gujarat vs Adam Kasam Bhaya, ; and State of Gujarat vs IsmaiI Juma & Ors., ; referred to.
Amritlal Channumal Jain etc.
vs State of Gujarat & Ors.
, Writ Petitions Nos.
1342 43 of 1982 decided on July 10, 1985, distinguished.
Parole is the release of a prisoner from a penal or correctional institution after he has served a part of his sentence under the continuous custody of the State and under conditions that permit his in carceration in the event of misbehavior.
It is a grant of partial liberty or lessening of restrictions to a convict prisoner and does not change the status of the prisoner.
[1131E, BC] Preventive detention is not punishment.
The scheme of section 12.
unless temporary release by the appropriate Government is taken to be one of parole, keeps away parole from the subject of preventive detention.
[1130F; 1135F] 4.1 What in a given situation should be the sufficient period for a person to be detained for the purpose of the COFEPOSA Act is one for the subjective satisfaction of the detaining authority.
Preventive detention jurisprudence in this regard is very different from regular conviction fol lowed by sentence that an accused is to suffer.
[1134EF] 4.2 Whether it be under article 226 or article 32 of the Constitution.
the Court has no jurisdiction either under the Act or under the general principles of law or in exercise of extraordinary jurisdiction to deal with the duration of the period of detention either by abridging or enlarging it.
The only power that is available to it is to quash the order in case it is found to be illegal.
It would not, therefore, be open to the Court to reduce the period of detention by admitting the detenu on parole.
[1134F,E] 5.
Sub section
(6) of section 12 of the Act puts a statutory bar to the release of the detenu after an order of detention has been made and the detenu lodged in custody.
It is the appro priate Government and not the Court 1126 which deal with a case of temporary release of the detenu under subss.(1) and (1A) of section 12 of the Act.
The detenu seeking to have the benefit of temporary relief must go to the appropriate Government first.
The Court cannot entertain his application for parole straightaway.
On the principle that exercise of administrative jurisdiction is open to Judicial review by the superior Court, the High Court under article 226 or this Court under article 32 may in a given case examine the legality and propriety of the Government action.
[1135E,C, F, G; 1136A; 1135H] Samir Chatterjee vs State of West Bengal, ; ; State of Bihar vs Rambalak Singh & Ors., and State of; Uttar Pradesh vs Jairam & Ors., [1982] 1 SCC 176, referred to.
Babulal Das vs State of West Bengal, ; ; Anil Dey vs State of West Bengal, and Golam Hussain vs Commissioner of Police, Calcutta & Ors. ; , overruled.
It is desirable to insert in the COFEPOSA Act or the Rules made thereunder a provision like sub s.(4) of section 389 of the Code of.
Criminal Procedure, 1973 that when an action is taken under section 12 of the Act and the appropriate Govern ment makes a temporary release order the order of such temporary release whether on bail or parole has to be ex cluded in computing the period of detention.
[1136C] Lala Jairam Das & Ors.
y. Emperor AIR 1945 PC 94, referred to.
|
(Crl.) No. 292 of 1986.
(Under Article 32 of the Constitution of India).
Ram Jethmalani, Ms. Rani Jethmalani and A.K. Sharma for the Petitioner.
Anil Dev Singh, Mrs. Indra Sawhney and Ms. section Relan for the Respondents.
The Judgment of the Court was delivered by SEN, J.
By this petition under Article 32 of the Consti tution, the petitioner Smt.
Poonam Lata has asked for the issue of a writ of habeas corpus for the release of her husband, Shital Kumar who has been 1127 detained by an order passed by the Additional Secretary to the Government of India, Ministry of Finance, Department of Revenue.
dated February 28, 1986.
made under section 3(1) of (hereinafter referred to as the 'Act '), on being satisfied that it was necessary to detain him "with a view to preventing him from dealing in smuggled goods".
Put very briefly, the essential facts are these.
The Directorate of Enforcement, New Delhi, gathered intelligence over a period of time before making of the impugned order of detention which revealed that the detenu was engaged in receiving smuggled gold from across the Indo Nepal Border and was making payments in foreign currency and remitting the sale proceeds of such smuggled gold out of the country in the shape of U.S. dollars with the help of carriers.
On February 26.
1986, the Directorate received information that the three carriers, namely, Ram Deo Thakur, Shyam Thakur and Bhushan Thakur would be leaving under the assumed names of Dalip, Mukesh and Rajesh respectively by 154 Dn.
Jayanti Janata Express leaving New Delhi Railway Station at 6.45 p.m.
Accordingly, the officers of the Delhi Zone of the Directorate mounted surveillance at Platform No. 5 of the Railway Station from which the train was to steam off.
The said carriers were detrained and upon search of their bag gage, the officers recovered $ 29,750 and Rs.1500 from Ram Deo Thakur @ Dalip, $ 28,900 and Rs.650 from Shyam Thakur @ Mukesh and $ 20,000 and Rs.1,000 from Bhushan Thakur @ Rajesh.
The same ware seized under section 110(1) of the .
The total value of the seized foreign currency was equivalent to Rs.10,25,000 in round figure.
During interrogation by the officers under section 108 of the , these persons stated that the seized for eign currency totaling $ 78,650 had been paid by the detenu towards the price of 48 gold biscuits of foreign origin brought by them from Darbhanga to New Delhi and made over to him and accordingly the detenu was taken into custody on February 27, 1986.
He too made a statement under section 108 of the Act confessing that he was dealing in smuggled gold brought across the Indo Nepal Border and has been remitting the price of such gold in U.S. dollars through different carriers.
On February 28, 1986, the detenu was served with the impugned order of detention along with the grounds thereof and copies of the relevant documents relied upon in the grounds.
On March 25, 1986.
the detenu submitted a represen tation under section 8(b) of the Act and the detaining authority by its order of April 4, 1986 rejected the 1128 same.
On April 12, 1986 the detenu made a representation to the Advisory Board through the Superintendent of the Central Jail, Tihar.
The representation together with comments of the detaining authority and the relevant documents were forwarded by the Ministry of Finance, Department of Revenue to the Advisory Board.
On the same day the detenu appears to have made a representation to the Central Government and it was received in the Ministry of Finance on April 24, 1986.
The Minister of State for Finance rejected the said repre sentation on April 28, 1986 and the detenu was informed about it the following day.
The Advisory Board had its sittings on April 28 and 29, 1986.
and came to the conclu sion that there was sufficient cause for the detention and sent its report on May 8, 1986.
The Minister considered the report of the Advisory Board and confirmed the order of detention on May 14, 1986 and the Central Government 's order of confirmation was duly communicated on May 26, 1986.
The representation of the detenu was still before the Advisory Board when the petitioner moved this Court under Article 32 of the Constitution on April 23, 1986.
On April 29, 1986, notice was ordered by the Court returnable on May 3, 1986, and it directed that the matter may be placed before the Vacation Judge on May 15, 1986.
On that date, the learned Vacation Judge made an order for the release of the detenu on parole in the following terms: "The detenu is released on parole until fur ther orders on the condition that he will report to the Directorate of Revenue Intelli gence, New Delhi every day and the Directorate will be at liberty to ask him to explain his conduct during this time.
Reply affidavit may be filed within two weeks.
The matter will be listed two weeks after reopening of the Court after summer vacation.
In the meantime, the respondents will be at liberty to make an application for the revocation of the parole if any misconduct or any other activity comes to their notice which requires the revocation of the parole.
" Notwithstanding the order of the learned Vacation Judge that the matter should be listed within two weeks after the re opening of the Court after the long vacation it should have been some time in early August of 1986 the case was not listed till January 14, 1987.
The 1129 respondents also took no steps to apply for early listing of the matter.
On January 14, 1987, a prayer was made by the learned counsel appearing for the Union of India seeking two weeks ' time to file an additional affidavit and the case was ordered to be listed on March 3. 1987.
During all these months, the detenu has been out of jail.
Indisputably the detention was for one year.
When the matter came up for hearing on the 3rd of March, 1987, Shri Jethmalani, learned counsel for the petitioner confined his submissions to only one aspect, namely, that the period of parole i.e. from May 15, 1986 till February 28, 1987, could not be added to the period of detention specified in the impugned order under sub section
(1) of section 3 of the Act and the period of one year from the date of detention having expired on February 26, 1987, the impugned order had lapsed and the detenu became entitled to be freed from the shackles of the order of detention.
Ac cording to the learned counsel, section 10 of the Act prescribes the maximum period of detention to be one year or two years, as the case may be, from the date of detention or the specified period, whichever expires earlier.
Admittedly in respect of the detenu no decla ration under section 9 of the Act has been made and, therefore, the maximum period of detention so far as he is concerned is one year and it has to be reckoned as prescribed under section 10 of the Act.
That section indicates not only the starting point but also the outer limit.
In other words, the argument is that once the detenu is taken into custody under the Act pursuant to an order of deten tion, the running of time would not be arrest ed merely because the Court directs release of the detenu on parole.
Shri Jethmalani drew a distinction between 'bail ' and 'parole '; he contended that preven tive detention was not a sentence by way of punishment and, therefore, the concept of serving out which pertains to punitive juris prudence cannot be imported into the realm of preventive detention.
According to him, the grant of parole to a detenu amounts to a provisional release from confinement; yet the detenu continues to be under judicial deten tion; release from jail custody subject to restrictions imposed on free and unfettered movement transfers the detenu to judicial custody.
Since there is no provision to autho rise interruption of running of the period of detention, release on parole does not bring about any change in the situation.
It has further been argued that when the Court enter tains a writ petition for grant of habeas corpus and issues a rule nisi, the detenu is deemed to have come into judicial custody and the effect of grant of parole does not termi nate such custody but merely allows greater freedom of move 1130 ment to the detenu.
Conditions imposed on the detenu during parole impinge upon his freedom and liberty; therefore, the period during which a detenu is released on parole cannot be taken as a period during which the detention is not operative.
Shri Jethmalani placed reliance on the ratio of the Privy Council decision in Lala Jairam Das & Ors.
vs Emperor, AIR 1945 PC 94 to contend that but for the special provision contained in sub section (3) of section 426 of the old Code of Criminal Proce dure, 1898 (corresponding to section 389(4) of the Code of 1973) the power of the Court to grant bail to a convicted person or accused would not include a power to exclude the period of bail from the term of the sentence.
The same principle ought to apply in the case of re lease of a detenu on bail or parole and the Court therefore cannot on general principles add the period of bail or parole to the period of detention.
In the absence of any provision regarding the grant of parole and the computa tion of the period thereof and in view of the special provisions contained regarding com mencement and the computation of the period of detention of one year, the period of parole cannot be deducted while computing the period of one year of detention.
The learned counsel also relied upon the direction made by a Bench of three Judges in the case of Amritlal Chan numal Jain etc.
vs State of Gujarat & Ors.
(Writ Petitions Nos.
1342 43, 1345 48 and 1362 of 1982 and No. 162 of 1983 dated July 10, 1985) where this Court directed that the period during which a detenu was on parole should be taken into account while calculating the total period of detention.
According to learned counsel the direction in Amritlal Channumal Jain 's case was given after a Bench of two Judges in Harish Makhija vs State of U.P. Crl.
M.P. No. 620 of 1984 in U.P. (Crl.) No. 301 of 1983 held on February 11, 1985, that the period of parole cannot be counted towards the period of detention.
Shri Jethmal ani has submitted that in view of the direc tion of the larger Bench of this Court, the ratio laid down in Amritlal Channumal Jain 's case (supra) has to prevail and must be taken as binding on us.
There is no denying the fact that preven tive detention is not punishment and the concept of serving out a sentence would not legitimately be within the purview of preven tive detention.
The grant of parole is essen tially an executive function and instances of release of detenus on parole were literally unknown until this Court and some of the High Courts in India in recent years made orders of release on parole on humanitarian considera tions.
Historically 'parole ' is a concept known to military law and denotes release of a prisoner of war on promise to return.
Parole has become an integral part of the English and American systems of criminal justice inter twined with the evolution of changing atti tudes of the society towards crime and crimi nals.
1131 As a consequence of the introduction of parole into the penal system, all fixed term sen tences of imprisonment of above 18 months are subject to release on licence, that is, parole after a third of the period of sentence has been served.
In those countries, parole is taken as an act of grace and not as a matter of right and the convict prisoner may be released on condition that he abides by the promise.
It is a provisional release from confinement but is deemed to be a part of the imprisonment.
Release on parole is a wing of the reformative process and is expected to provide opportunity to the prisoner to trans form himself into a useful citizen.
Parole is thus a grant of partial liberty or lessening of restrictions to a convict prisoner, but release on parole does not change the status of the prisoner.
Rules are flamed providing supervision by parole authorities of the convicts released on parole and in case of failure to perform the promise, the convict released on parole is directed to surrender to custody.
(See: The Oxford Companion to Law, edited by Walker, 1980 edn., p. 931, Black 's Law Dictionary, 5th edn., p. 1006, Jowitt 's Dictionary of English Law, 2nd edn., Vol. 2, p. 1320, Kenny 's Outlines of Criminal Law, 17th edn., p. 574 76, The English Sentencing System by Sir Rupert Cross at pp.
31 34, 87 et seq.
, American Jurisprudence, 2nd edn., Vol.
59, pp.
53 61, Corpus Juris Secundum, vol.
67, Probation and Parole, Legal and Social Dimen sions by Louis P. Carney).
It follows from these authorities that parole is the release of a very long term prisoner from a penal or correctional institution after he has served a part of his sentence under the continuous custody of the State and under conditions that permit his incarceration in the event of misbehavior.
There is abundance of authority that High Courts in exercise of their jurisdiction under Article 226 of the Constitution do not release a detenu on bail or parole.
There is no reason why a different view should be taken in regard to exercise of jurisdiction under Article 32 of the Constitution particularly when the power to grant relief to a detenu in such proceedings is exercisable on very narrow and limited grounds.
In State of Bihar vs Rambalak Singh & Ors., a Constitution Bench laid down that the release of a detenu placed under detention under Rule 30 of the Defence of India Rules, 1962.
on bail pending the hearing of a petition for grant of a writ of habeas corpus was an improper exercise of jurisdiction; It was observed in that case that if the High Court was of the view that prima facie the impugned order of detention was patently illegal in that there was a serious defect in the order of detention which would justify the release of the detenu, the proper and more sensible and reasonable course would invariably be to expedite the hearing of the writ petition and 1132 deal with the merits without any delay rather than direct release of the detenu on bail.
Again, in State of Uttar Pradesh vs Jairam & Ors., [1982] 1 SCC 176 a three Judge Bench speaking through Chandrachud, CJ., referred to Rambalak Singh 's case and set aside the order passed by the learned Single Judge of the High Court admitting the detenu to bail on the ground that it was an improper exercise of jurisdiction.
As to grant of parole, it is worthy of note that in none of the cases this Court made a direction under Article 32 of the Constitution for grant of parole to the detenu but left it to the executive to consider whether it should make an order in terms of the relevant provision for temporary release of the person detained as under section 12 of the COFEPOSA, in the facts and circumstances of a particular case.
In Samir Chatterjee vs State of West Bengal; , , the Court set aside the order of the Calcutta High Court releasing on parole a person detained under section 3(1) of the and unequivocally viewed with disfavor the observations made by Krishna Iyer, J. in Babulal Das vs State of West Bengal, ; to the effect: "While discharging the rule issued and dis missing the petition, we wish to emphasize that section 15 is often lost sight of by the Government in such situations, as long term preventive detention can be self defeating or criminally counter productive.
Section 15 reads: 15.
Temporary release of persons detained We consider that it is fair that persons kept incarcerated and embittered without trial should be given some chance to reform them selves by reasonable recourse to the parole power under section 15.
Calculated risks, by re lease for short periods may, perhaps, be a social gain, the beneficent jurisdiction being wisely exercised.
" Alagiriswamy, J. speaking for the Court, observed in no uncertain terms: 1133 "We fail to see that these observations lay down any principle of law.
Section 15 merely confers a power on the Government.
The power and duty of this Court is to decide cases coming before it according to law.
In so doing it may take various considerations into ac count.
But to advise the Government as to how they should exercise their functions or powers conferred on them by statute is not one of this Court 's functions.
Where the Court is able to give effect to its view in the form of a valid and binding order that is a different matter.
Furthermore, section 15 deals with release on parole and there is nothing to show that the petitioner applied for to be released on parole for any specific purpose.
As far as we are able to see, release on parole is made only on the request of the party and for a specific purpose.
" The innovative view expressed by Krishna lyer, J. in Anil Dey vs State of West Bengal, 14 which he tried to reiterate in Golam Hussain vs The Commissioner of Police, Calcutta & Ors., ; and in Babulal Das ' case, (supra), therefore, no longer holds the field, and rightly so, because the Court cannot usurp the functions of the Government.
Section 10 of the Act provides that the maximum period for which any person may be detained in pursuance of an order of detention to which provisions of section 9 do not apply shall be for a period of one year from the date of detention or the specified period, whichever expires earli er.
The key to the interpretation of section 10 of the Act is in the words 'may be detained '.
The subsequent words 'from the date of detention ' which follow the words 'maximum period of one year ' merely define the starting point from which the maximum period of detention of one year is to be reckoned in a case not falling.
under section 9.
There is no justifiable reason why the word 'detain ' should not receive its plain and natural meaning.
According to the Shorter Oxford English Dictionary, vol. 1, p. 531, the word 'detain ' means "to keep in confinement or custody".
Webster 's Campre hensive Dictionary, International Edition at p. 349 gives the meaning as "to hold in custody".
The purpose and object of section 10 is to prescribe a maximum period for which a person against whom a detention order under the Act is made may be held in actual custody pursuant to the said order.
It would not be violated if a person against whom an order of deten tion is passed is held in actual custody in jail for the period prescribed by the section.
The period during which the detenu is on parole cannot be 1134 said to be a period during which he has been held in custody pursuant to the order of his detention, for in such a case he was not in actual custody.
The order of detention pre scribes the place where the detenu is to be detained.
Parole brings him out of confinement from that place.
Whatever may be the terms and conditions imposed for grant of parole, detention as contemplated by the Act is interrupted when release on parole is obtained.
The position would be well met by the appropriate answer to the question "how long has the detenu been in actual custody pursuant to the order?" According to its plain construction, the purpose and object of section 10 is to prescribe not only for the maximum period but also the method by which the period is to be computed.
The computation has to commence from the date on which the detenu is taken into actual custody but if it is interrupted by an order of parole, the detention would not continue when parole operates and until the detenu is put back into custo dy.
The running of the period recommences then and a total period of one year has to be counted by putting the differ ent periods of actual detention together.
We see no force in Shri Jethmalani 's submission that the period during which the detenu was on parole has to be taken into consideration in computing the maximum period of detention authorised by section 10 of the Act.
It is pertinent to observe that the Court has no power to substitute the period of detention either by abridging or enlarging it.
The only power that is available to the Court is to quash the order in case it is found to be illegal.
That being so, it would not be open to the Court to reduce the period of detention by admitting the detenu on parole.
What in a given situation should be the sufficient period for a person to be detained for the purpose of the Act is one for the subjective satisfaction of the detaining author ity.
Preventive detention jurisprudence in this regard is very different from regular conviction followed by sentence that an accused is to suffer.
Whether it be under Article 226 or Article 32 of the Constitution, the Court would, therefore, have no jurisdiction either under the Act or under the general principles of law or in exercise of ex traordinary jurisdiction to deal with the duration of the period of detention.
Parliament has authorised the detention of persons under the COFEPOSA to serve two purposes: "(1) To prevent the person concerned from engaging himself in an activity prejudicial to the conservation of foreign exchange and also preventing him from smuggling activities 1135 and thereby to render him immobile for the period considered necessary by the detaining authority so that during that period the society is protected from such prejudicial activities on the part of the detenu.
And (2) In order to break the links between the person so engaged and the source of such activity and from his associates engaged in that activity or to break the continuity of such prejudicial activities so that it would become difficult, if not impossible, for him to resume the activities.
" Release of a detenu on parole after an order of detention has been made and the detenu lodged in custody for achieving one or the other of the aforesaid legislative objects is thus contrary to the purpose of the statute.
There is a statutory prohibition against release of a detenu during the period of detention in sub section (6) of section 12 of the Act.
That sub section which was inserted by Amending Act 39 of 1975 with effect from 1.7.1975 reads: "Notwithstanding anything contained in any other law and save as otherwise provided in this section, no person against whom a deten tion order made under this Act is in force shall be released whether on bail or bail bond or otherwise.
" Sub section (6) puts a statutory bar to the release of the detenu during the period of detention in a manner otherwise than the one provided in section 12.
Section 12 authorises either the Central Government or the State Government to temporarily release the detenu on such terms and conditions as the appropriate Government considers necessary to impose.
The scheme of section 12, unless release by the appropriate Government is taken to be one of parole, keeps away parole from the subject of preventive detention.
At any rate, it is the appropriate Government and not the Court which deals with a case of temporary release of the detenu.
Since the Act authorises the appropriate Government to make an order of temporary release, invariably the detenu seeking to have the benefit of temporary relief must go to the appropriate Government first.
It may be that in a given case the Court may be required to consider the propriety of an adverse order by the Government in exercise of the jurisdiction under section 12 of the Act.
On the principle that exercise ' of administrative jurisdiction is open to judicial review by the superior court, the High Court under Article 226 or this Court under Article 32 may be called upon in a suitable case to 1136 examine the legality and propriety of the governmental action.
There is no scope for entertaining an application for parole by the Court straightaway.
The legislative scheme, keeping the purpose of the statute and the manner of its fulfilment provided thereunder, would not justify enter taining of an application for release of a detenu on parole.
Since in our view release on parole is not a matter of judicial determination, apparently no provision as contained in the Code of Criminal Procedure relating to the computa tion of the period of bail was thought necessary in the Act.
But we would like to point out to the Government the desira bility of inserting a provision like sub s.(4) of section 389 of the Code of Criminal Procedure, 1973 that when an action is taken under section 12 of the Act and the appropriate Gov ernment makes a temporary release order, the period of such temporary release whether on bail or parole has to be ex cluded in computing the period of detention.
Either the statute or the rules made thereunder should provide for this eventuality.
In the premises, it must accordingly be held that the period of parole has to be excluded in reckoning the period of detention under sub section (1) of section 3 of the Act.
We find it difficult from the observations made by the three Judge Bench in Amritlal Channumal Jain 's case to infer a direction by this Court that the period of parole shall not be added to the period of detention.
The words used 'shall be taken into account ' are susceptible of an inter pretation to the contrary.
We find that an order made by a bench of two Judges of this Court in Harish Makhija 's case (supra) unequivocally laid down that the period of parole cannot be counted towards the period of detention.
This accords with the view taken by this Court in a bench of two Judges in State of Gujarat vs Adam Kasam Bhaya, ; and State of Gujarat vs Ismail Juma & Ors., ; In view of these authorities which appear to be in consonance with the object and purpose of the Act and the statutory provisions and also having regard to the fact that the direction made in Amritlal Channumal Jain 's case (supra) is capable of another construction as well, we do not find Shri Jethmalani 's contention on this score as acceptable.
For these reasons, the only contention advanced by Shri Jethmalani in course of the hearing, namely, that the period of parole from May 15, 1986 to February 28, 1987 could not be added to the maximum period of detention of the detenu Shital Kumar for one year as specified in the impugned order of detention passed under sub s.(1) of section 3 of the Conserva tion of Foreign Exchange & Prevention of Smuggling Activi ties Act, 1974, must fail.
The writ petition is accordingly 1137 dismissed.
There shall be no order as to costs.
We direct that the petitioner shall surrender to custody to undergo remaining period of detention.
We give the detenu ten days ' time to comply with this direction failing which a non bailable warrant for his arrest shall issue.
P.S.S. Petition dis missed.
|
(Under Article 32 of the Constitution of India). Ram Jethmalani, Ms. Rani Jethmalani and A.K. Sharma for the Petitioner. Anil Dev Singh, Mrs. Indra Sawhney and Ms. section Relan for the Respondents. Put very briefly, the essential facts are these. The Directorate of Enforcement, New Delhi, gathered intelligence over a period of time before making of the impugned order of detention which revealed that the detenu was engaged in receiving smuggled gold from across the Indo Nepal Border and was making payments in foreign currency and remitting the sale proceeds of such smuggled gold out of the country in the shape of U.S. dollars with the help of carriers. 1986, the Directorate received information that the three carriers, namely, Ram Deo Thakur, Shyam Thakur and Bhushan Thakur would be leaving under the assumed names of Dalip, Mukesh and Rajesh respectively by 154 Dn. Jayanti Janata Express leaving New Delhi Railway Station at 6.45 p.m.
Accordingly, the officers of the Delhi Zone of the Directorate mounted surveillance at Platform No. 5 of the Railway Station from which the train was to steam off. The said carriers were detrained and upon search of their bag gage, the officers recovered $ 29,750 and Rs.1500 from Ram Deo Thakur @ Dalip, $ 28,900 and Rs.650 from Shyam Thakur @ Mukesh and $ 20,000 and Rs.1,000 from Bhushan Thakur @ Rajesh. The same ware seized under section 110(1) of the . The total value of the seized foreign currency was equivalent to Rs.10,25,000 in round figure. On February 28, 1986, the detenu was served with the impugned order of detention along with the grounds thereof and copies of the relevant documents relied upon in the grounds. On April 12, 1986 the detenu made a representation to the Advisory Board through the Superintendent of the Central Jail, Tihar. The Minister of State for Finance rejected the said repre sentation on April 28, 1986 and the detenu was informed about it the following day. The Advisory Board had its sittings on April 28 and 29, 1986. The representation of the detenu was still before the Advisory Board when the petitioner moved this Court under Article 32 of the Constitution on April 23, 1986. On April 29, 1986, notice was ordered by the Court returnable on May 3, 1986, and it directed that the matter may be placed before the Vacation Judge on May 15, 1986. Reply affidavit may be filed within two weeks. The matter will be listed two weeks after reopening of the Court after summer vacation. " Notwithstanding the order of the learned Vacation Judge that the matter should be listed within two weeks after the re opening of the Court after the long vacation it should have been some time in early August of 1986 the case was not listed till January 14, 1987. The 1129 respondents also took no steps to apply for early listing of the matter. During all these months, the detenu has been out of jail. Indisputably the detention was for one year. Ac cording to the learned counsel, section 10 of the Act prescribes the maximum period of detention to be one year or two years, as the case may be, from the date of detention or the specified period, whichever expires earlier. That section indicates not only the starting point but also the outer limit. Since there is no provision to autho rise interruption of running of the period of detention, release on parole does not bring about any change in the situation. It has further been argued that when the Court enter tains a writ petition for grant of habeas corpus and issues a rule nisi, the detenu is deemed to have come into judicial custody and the effect of grant of parole does not termi nate such custody but merely allows greater freedom of move 1130 ment to the detenu. Conditions imposed on the detenu during parole impinge upon his freedom and liberty; therefore, the period during which a detenu is released on parole cannot be taken as a period during which the detention is not operative. Shri Jethmalani placed reliance on the ratio of the Privy Council decision in Lala Jairam Das & Ors. vs Emperor, AIR 1945 PC 94 to contend that but for the special provision contained in sub section (3) of section 426 of the old Code of Criminal Proce dure, 1898 (corresponding to section 389(4) of the Code of 1973) the power of the Court to grant bail to a convicted person or accused would not include a power to exclude the period of bail from the term of the sentence. In the absence of any provision regarding the grant of parole and the computa tion of the period thereof and in view of the special provisions contained regarding com mencement and the computation of the period of detention of one year, the period of parole cannot be deducted while computing the period of one year of detention. The learned counsel also relied upon the direction made by a Bench of three Judges in the case of Amritlal Chan numal Jain etc. 1342 43, 1345 48 and 1362 of 1982 and No. 301 of 1983 held on February 11, 1985, that the period of parole cannot be counted towards the period of detention. Shri Jethmal ani has submitted that in view of the direc tion of the larger Bench of this Court, the ratio laid down in Amritlal Channumal Jain 's case (supra) has to prevail and must be taken as binding on us. There is no denying the fact that preven tive detention is not punishment and the concept of serving out a sentence would not legitimately be within the purview of preven tive detention. Historically 'parole ' is a concept known to military law and denotes release of a prisoner of war on promise to return. Parole has become an integral part of the English and American systems of criminal justice inter twined with the evolution of changing atti tudes of the society towards crime and crimi nals. 1131 As a consequence of the introduction of parole into the penal system, all fixed term sen tences of imprisonment of above 18 months are subject to release on licence, that is, parole after a third of the period of sentence has been served. In those countries, parole is taken as an act of grace and not as a matter of right and the convict prisoner may be released on condition that he abides by the promise. It is a provisional release from confinement but is deemed to be a part of the imprisonment. Release on parole is a wing of the reformative process and is expected to provide opportunity to the prisoner to trans form himself into a useful citizen. Parole is thus a grant of partial liberty or lessening of restrictions to a convict prisoner, but release on parole does not change the status of the prisoner. (See: The Oxford Companion to Law, edited by Walker, 1980 edn., p. 931, Black 's Law Dictionary, 5th edn., 2, p. 1320, Kenny 's Outlines of Criminal Law, 17th edn., p. 574 76, The English Sentencing System by Sir Rupert Cross at pp. 67, Probation and Parole, Legal and Social Dimen sions by Louis P. Carney). It follows from these authorities that parole is the release of a very long term prisoner from a penal or correctional institution after he has served a part of his sentence under the continuous custody of the State and under conditions that permit his incarceration in the event of misbehavior. There is abundance of authority that High Courts in exercise of their jurisdiction under Article 226 of the Constitution do not release a detenu on bail or parole. In State of Bihar vs Rambalak Singh & Ors., a Constitution Bench laid down that the release of a detenu placed under detention under Rule 30 of the Defence of India Rules, 1962. Again, in State of Uttar Pradesh vs Jairam & Ors., [ 1982] 1 SCC 176 a three Judge Bench speaking through Chandrachud, CJ., Calculated risks, by re lease for short periods may, perhaps, be a social gain, the beneficent jurisdiction being wisely exercised. " Alagiriswamy, J. speaking for the Court, observed in no uncertain terms: 1133 "We fail to see that these observations lay down any principle of law. Section 15 merely confers a power on the Government. The power and duty of this Court is to decide cases coming before it according to law. In so doing it may take various considerations into ac count. But to advise the Government as to how they should exercise their functions or powers conferred on them by statute is not one of this Court 's functions. Where the Court is able to give effect to its view in the form of a valid and binding order that is a different matter. Furthermore, section 15 deals with release on parole and there is nothing to show that the petitioner applied for to be released on parole for any specific purpose. As far as we are able to see, release on parole is made only on the request of the party and for a specific purpose. " The innovative view expressed by Krishna lyer, J. in Anil Dey vs State of West Bengal, 14 which he tried to reiterate in Golam Hussain vs The Commissioner of Police, Calcutta & Ors., ; The key to the interpretation of section 10 of the Act is in the words 'may be detained '. There is no justifiable reason why the word 'detain ' should not receive its plain and natural meaning. According to the Shorter Oxford English Dictionary, vol. 1, p. 531, the word 'detain ' means "to keep in confinement or custody". Webster 's Campre hensive Dictionary, International Edition at p. 349 gives the meaning as "to hold in custody". It would not be violated if a person against whom an order of deten tion is passed is held in actual custody in jail for the period prescribed by the section. The period during which the detenu is on parole cannot be 1134 said to be a period during which he has been held in custody pursuant to the order of his detention, for in such a case he was not in actual custody. The order of detention pre scribes the place where the detenu is to be detained. Parole brings him out of confinement from that place. Whatever may be the terms and conditions imposed for grant of parole, detention as contemplated by the Act is interrupted when release on parole is obtained. The position would be well met by the appropriate answer to the question "how long has the detenu been in actual custody pursuant to the order?" According to its plain construction, the purpose and object of section 10 is to prescribe not only for the maximum period but also the method by which the period is to be computed. The running of the period recommences then and a total period of one year has to be counted by putting the differ ent periods of actual detention together. It is pertinent to observe that the Court has no power to substitute the period of detention either by abridging or enlarging it. The only power that is available to the Court is to quash the order in case it is found to be illegal. That being so, it would not be open to the Court to reduce the period of detention by admitting the detenu on parole. What in a given situation should be the sufficient period for a person to be detained for the purpose of the Act is one for the subjective satisfaction of the detaining author ity. Preventive detention jurisprudence in this regard is very different from regular conviction followed by sentence that an accused is to suffer. Whether it be under Article 226 or Article 32 of the Constitution, the Court would, therefore, have no jurisdiction either under the Act or under the general principles of law or in exercise of ex traordinary jurisdiction to deal with the duration of the period of detention. Parliament has authorised the detention of persons under the COFEPOSA to serve two purposes: "(1) To prevent the person concerned from engaging himself in an activity prejudicial to the conservation of foreign exchange and also preventing him from smuggling activities 1135 and thereby to render him immobile for the period considered necessary by the detaining authority so that during that period the society is protected from such prejudicial activities on the part of the detenu. There is a statutory prohibition against release of a detenu during the period of detention in sub section (6) of section 12 of the Act. Section 12 authorises either the Central Government or the State Government to temporarily release the detenu on such terms and conditions as the appropriate Government considers necessary to impose. The scheme of section 12, unless release by the appropriate Government is taken to be one of parole, keeps away parole from the subject of preventive detention. At any rate, it is the appropriate Government and not the Court which deals with a case of temporary release of the detenu. Since the Act authorises the appropriate Government to make an order of temporary release, invariably the detenu seeking to have the benefit of temporary relief must go to the appropriate Government first. It may be that in a given case the Court may be required to consider the propriety of an adverse order by the Government in exercise of the jurisdiction under section 12 of the Act. There is no scope for entertaining an application for parole by the Court straightaway. But we would like to point out to the Government the desira bility of inserting a provision like sub s.(4) of section 389 of the Code of Criminal Procedure, 1973 that when an action is taken under section 12 of the Act and the appropriate Gov ernment makes a temporary release order, the period of such temporary release whether on bail or parole has to be ex cluded in computing the period of detention. Either the statute or the rules made thereunder should provide for this eventuality. We find it difficult from the observations made by the three Judge Bench in Amritlal Channumal Jain 's case to infer a direction by this Court that the period of parole shall not be added to the period of detention. The words used 'shall be taken into account ' are susceptible of an inter pretation to the contrary. For these reasons, the only contention advanced by Shri Jethmalani in course of the hearing, namely, that the period of parole from May 15, 1986 to February 28, 1987 could not be added to the maximum period of detention of the detenu Shital Kumar for one year as specified in the impugned order of detention passed under sub s.(1) of section 3 of the Conserva tion of Foreign Exchange & Prevention of Smuggling Activi ties Act, 1974, must fail. The writ petition is accordingly 1137 dismissed. We direct that the petitioner shall surrender to custody to undergo remaining period of detention.
|
Sub section (6) of section 12 of the prohibits release of a detenu on bail, or bail bond or otherwise, during the period a detention order is in force.
Sub sections (1) and (1A) of section 12, however, permit tempo rary release by the Central or State Governments on certain terms and conditions.
Section 10 provides for a maximum period of detention of one year in cases .to which provi sions of section 9 do not apply.
The husband of the petitioner was detained under section 3(1) of the Act by an order dated February 28, 1986.
His repre sentation under section 8(b) was rejected by the detaining au thority on April 4, 1986.
The Advisory Board in its sittings on April 28 and 29, 1986 concluded that there was sufficient cause for detention.
The order of detention was confirmed by the Minister on May 14, 1986.
The writ petition filed under Article 32 of the Consti tution on April 23, 1986 was heard by the Vacation Judge on May 15 1986 who made an order for the release of the detenu on parole and directed the matter to be listed in early August of 1986.
The case, however, could not be listed till January 14, 1987, and was finally heard on March 3, 1987.
The detenu had been out of Jail during the entire period.
The period of one year expired on February 28, 1987.
1124 It was contended for the petitioner that the period of parole from May 15.
1986 till February 28.
1987 could not be added to the period of detention specified in the order under sub section
(1) of section 3 of the Act, that the period of one year from the date of detention having expired on February 28.
1987 the order of detention had lapsed entitling the detenu to be freed, and that once the detenu is taken into custody under the Act pursuant to an order of detention the running of time would not be arrested merely because the court directs the release of the detenu on parole.
Relying on the decision in Lala Jairam Das & Ors.
vs Emperor.
(AIR it was contended that the court cannot on gener al principles add the period of bail or parole to the period of detention, and that the ratio laid down in Amritlal Channumal Jain etc.
vs State of Gujarat & Ors., (W.P. Nos.
1342 43 of 1982 decided on July 10, 1985) that the period during which a detenu was on parole should be taken into account while calculating the period of detention has to prevail and must be taken as binding.
Dismissing the writ petition.
the Court.
HELD: 1.
The period of parole of the detenu from May 15, 1986 to February 28.
1987 has to be excluded in reckoning the period of his detention for one year under sub section
(1) of section 3 of the .
[1136D, G H] 2.1 The purpose and object of section 10 of the Act is to prescribe not only a maximum period for which a person against whom a detention order under the Act is made may be held in actual custody pursuant to the said order but also the method by which the period is to be computed.
The key to the interpretation of the section is in the words "may be detained.
" The subsequent words "from the date of detention" which follow the words "maximum period of one year" merely define the starting point from which the maximum period of detention of one year is to be reckoned in a case not fall ing under section 9.
There is no justifiable reason why the word "detain" should not receive its plain and natural meaning 'to hold in custody '.
[1134B; 1133G, EP] 2.2 The period during which the detenu is on parole cannot be said to be a period during which he has been held in custody pursuant to the order of his detention.
In such a case he was not in actual custody.
The order of detention prescribes the place where the detenu is to be detained.
Parole brings him out of confinement from that place and detention as contemplated by the Act is interrupted until the detenu is put back into custody.
The running of the period recommences then and 1125 a total period of one year has to be counted by putting the different periods of actual detention together.
In the instant case it cannot, therefore, be said that the period during which the detenu was on.
parole has to be taken into consideration in computing the maximum period of detention authorised by section 10 of the Act.
[1133H; 1134A D] Harish Makhija vs State of U.P., Crl.
M.P. No. 620 of 1984 in W.P. (Crl.) No. 301 of 1983 decided on February 11, 1985; State of Gujarat vs Adam Kasam Bhaya, ; and State of Gujarat vs IsmaiI Juma & Ors., ; referred to.
Amritlal Channumal Jain etc.
vs State of Gujarat & Ors.
, Writ Petitions Nos.
1342 43 of 1982 decided on July 10, 1985, distinguished.
Parole is the release of a prisoner from a penal or correctional institution after he has served a part of his sentence under the continuous custody of the State and under conditions that permit his in carceration in the event of misbehavior.
It is a grant of partial liberty or lessening of restrictions to a convict prisoner and does not change the status of the prisoner.
[1131E, BC] Preventive detention is not punishment.
The scheme of section 12.
unless temporary release by the appropriate Government is taken to be one of parole, keeps away parole from the subject of preventive detention.
[1130F; 1135F] 4.1 What in a given situation should be the sufficient period for a person to be detained for the purpose of the COFEPOSA Act is one for the subjective satisfaction of the detaining authority.
Preventive detention jurisprudence in this regard is very different from regular conviction fol lowed by sentence that an accused is to suffer.
[1134EF] 4.2 Whether it be under article 226 or article 32 of the Constitution.
the Court has no jurisdiction either under the Act or under the general principles of law or in exercise of extraordinary jurisdiction to deal with the duration of the period of detention either by abridging or enlarging it.
The only power that is available to it is to quash the order in case it is found to be illegal.
It would not, therefore, be open to the Court to reduce the period of detention by admitting the detenu on parole.
[1134F,E] 5.
Sub section
(6) of section 12 of the Act puts a statutory bar to the release of the detenu after an order of detention has been made and the detenu lodged in custody.
It is the appro priate Government and not the Court 1126 which deal with a case of temporary release of the detenu under subss.(1) and (1A) of section 12 of the Act.
The detenu seeking to have the benefit of temporary relief must go to the appropriate Government first.
The Court cannot entertain his application for parole straightaway.
On the principle that exercise of administrative jurisdiction is open to Judicial review by the superior Court, the High Court under article 226 or this Court under article 32 may in a given case examine the legality and propriety of the Government action.
[1135E,C, F, G; 1136A; 1135H] Samir Chatterjee vs State of West Bengal, ; ; State of Bihar vs Rambalak Singh & Ors., and State of; Uttar Pradesh vs Jairam & Ors., [1982] 1 SCC 176, referred to.
Babulal Das vs State of West Bengal, ; ; Anil Dey vs State of West Bengal, and Golam Hussain vs Commissioner of Police, Calcutta & Ors. ; , overruled.
It is desirable to insert in the COFEPOSA Act or the Rules made thereunder a provision like sub s.(4) of section 389 of the Code of.
Criminal Procedure, 1973 that when an action is taken under section 12 of the Act and the appropriate Govern ment makes a temporary release order the order of such temporary release whether on bail or parole has to be ex cluded in computing the period of detention.
[1136C] Lala Jairam Das & Ors.
y. Emperor AIR 1945 PC 94, referred to.
|
Sub section (6) of section 12 of the prohibits release of a detenu on bail, or bail bond or otherwise, during the period a detention order is in force. Sub sections (1) and (1A) of section 12, however, permit tempo rary release by the Central or State Governments on certain terms and conditions. Section 10 provides for a maximum period of detention of one year in cases .to which provi sions of section 9 do not apply. The order of detention was confirmed by the Minister on May 14, 1986. The writ petition filed under Article 32 of the Consti tution on April 23, 1986 was heard by the Vacation Judge on May 15 1986 who made an order for the release of the detenu on parole and directed the matter to be listed in early August of 1986. The case, however, could not be listed till January 14, 1987, and was finally heard on March 3, 1987. The detenu had been out of Jail during the entire period. The period of one year expired on February 28, 1987. 1987 the order of detention had lapsed entitling the detenu to be freed, and that once the detenu is taken into custody under the Act pursuant to an order of detention the running of time would not be arrested merely because the court directs the release of the detenu on parole. Relying on the decision in Lala Jairam Das & Ors. The period of parole of the detenu from May 15, 1986 to February 28. 1987 has to be excluded in reckoning the period of his detention for one year under sub section
(1) of section 3 of the . [1134B; 1133G, EP] 2.2 The period during which the detenu is on parole cannot be said to be a period during which he has been held in custody pursuant to the order of his detention. In such a case he was not in actual custody. The order of detention prescribes the place where the detenu is to be detained. Parole brings him out of confinement from that place and detention as contemplated by the Act is interrupted until the detenu is put back into custody. The running of the period recommences then and 1125 a total period of one year has to be counted by putting the different periods of actual detention together. 301 of 1983 decided on February 11, 1985; State of Gujarat vs Adam Kasam Bhaya, ; and State of Gujarat vs IsmaiI Juma & Ors., ; 1342 43 of 1982 decided on July 10, 1985, distinguished. Parole is the release of a prisoner from a penal or correctional institution after he has served a part of his sentence under the continuous custody of the State and under conditions that permit his in carceration in the event of misbehavior. It is a grant of partial liberty or lessening of restrictions to a convict prisoner and does not change the status of the prisoner. [1131E, BC] Preventive detention is not punishment. unless temporary release by the appropriate Government is taken to be one of parole, keeps away parole from the subject of preventive detention. [1130F; 1135F] 4.1 What in a given situation should be the sufficient period for a person to be detained for the purpose of the COFEPOSA Act is one for the subjective satisfaction of the detaining authority. [1134EF] 4.2 Whether it be under article 226 or article 32 of the Constitution. The Court cannot entertain his application for parole straightaway. Criminal Procedure, 1973 that when an action is taken under section 12 of the Act and the appropriate Govern ment makes a temporary release order the order of such temporary release whether on bail or parole has to be ex cluded in computing the period of detention.
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| 0.700429
| 0.290596
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vil Appeal No. 1134 (NT) of 1987.
From the Judgment and Order dated 2.3.
1984 of the Allahabad High Court in Sales Tax Revision No. 146 of 1983.
Prithvi Raj, Ashok K. Srivastava for the Appellant.
S.T. Desai, K.B. Rohtagi, S.K. Dhingra, Baldev Atreya and Shashank Shekhar for the Respondent.
The following Judgments of the Court were delivered RANGANATH MISRA, J. Special leave granted.
Delay of six days is condoned.
The short question for consideration in this appeal at the instance of the Revenue is whether the High Court was justified in holding that in the absence of a notification withdrawing the earlier notification dated 25.11.
1958 made in exercise of power vested under section 4 of the U.P. Sales Tax Act, 1948, Sales Tax would not be exigible in terms of the notification dated 1.12.
1973 issued under section 3A of that Act.
The notification of 1958 exempted 'cotton fabrics of all varieties ' from sales tax.
It is not disputed that under it sale of patta, the goods in question on being treated as cotton fabric was exempted from sales tax.
The notification of 1973 made under section 3A of the Act prescribed sales tax of seven per cent on the sale of beltings of all kinds.
There is no dispute now that patta is a kind of belting material.
Section 3 of the Act contains the charging provision and prescribes a uniform rate of tax on sales.
Section 3A empow ers the State Government to modify the rate of tax by noti fication.
The notification of 1973 in fact prescribes a rate of tax higher than provided by section 3.
In 1958, under the notification referred to above, patta as an item of cotton fabric stood exempted from tax liability.
The High Court has 96 referred to some of its earlier decisions and has concluded thus: "Thus the consistent view of this court throughout has been that by issuing a separate notification under section 3A, the earlier exemption granted under section 4 of the Act cannot be negatived.
If the State wanted to tax 'beltings of all kinds ', it has to amend the general notification issued under section 4 by deleting cotton fabric belts from the notification issued under section 4 of the Act. ' ' As has been pointed out above, section 3 is the charging provision; section 3A authorises variation of the rate of tax and section 4 provides for exemption from tax.
All the three sections are parts of the taxing scheme incorporated in the Act and the power both under sections 3A as also under section 4 is exercisable by the State Government only.
When after a notification under section 4 granting exemption from liability, a subsequent notification under section 3A prescribes the rate of tax, it is beyond doubt that the intention is to withdraw the exemption and make the sale liable to tax at the rate prescribed in the notification.
As the power both for the grant of exemption and the variation of the rate of tax vests in the State Government and it is not the requirement of the statute that a notification of recall of exemption is a condition precedent to imposing tax at any prescribed rate by a valid notification under section 3A, we see no force in the contention of the assessee which has been upheld by the High Court.
In fact, the second notification can easily be treated as a combined notifica tion both for withdrawal of exemption and also for provid ing higher tax.
When power for both the operations vests in the State and the intention to levy the tax is clear we see no justification for not giving effect to the 2nd notifica tion.
We would like to point out that the exemption was in regard to a class of goods and while the exemption continues a specific item has now been notified under section 3A of the Act.
The appeal is allowed.
The order of the Tribunal which has been affirmed by the High Court is set aside and the assessment is restored.
Parties are directed to bear their respective costs throughout.
B.C. Ray, J. I have had the privilege of going through the judgment rendered by my learned brother but I am unable to concur with the reasonings recorded by my learned brother in his judgment so far as it relates to the scope and effect of the notification dated 1.12.1973 made under Section 3A of the U.P. Sales Tax Act, 1948 by providing for imposition of sales tax on "beltings of all kinds" for the reasons given hereunder: 97 Under Section 4 of the 1J.P. Sales Tax Act, 1948 the Government issued two notifications No. S.T. 4486/x dated 14.12.1957 and No. 4064/x 960(4)/58 dated 25.11.
1958 where by "cotton fabrics of all kinds" were exempted from the imposition of sales tax under the Act.
Thereafter on 1st of December 1973 a notification was issued by the Government under Section 3 A of the said Act which introduces in the Schedule in Item No. 8 "beltings of all kinds" for imposi tion of sales tax.
The sole question arising in this appeal is whether beltings of all kinds are excisable to sales tax by virtue of the notification dated 1.12.
1973 even though they fall within "cotton fabrics of all kinds" which are exempted from tax by virtue of the notifications dated 14.12.
1957 and 25.11.
Similar question arose in the case of Porritts & Spencer Asia Ltd. vs State of Haryana, [1978] 42 S.T.C. 433 (SC) before this Court for considera tion.
It was held by this Court that the words "all varie ties of cotton, woollen or silken textiles".
In item 30 of Schedule B to the Punjab General Sales Tax Act must be interpreted according to its popular sense, meaning "that sense which people conversant with the subject matter with which the statute is dealing would attribute to it.
" This Court further observed "whatever be the mode of weaving employed, woven fabric would be "textiles".
What is neces sary is no more than weaving of yarn and weaving would mean binding or putting together by some process so as to form a fabric.
Moreover a textile need not be of any particular size or strength or weight.
It may be in small pieces or in big rolls: It may be weak or strong, light or heavy, bleached or dyed, according to the requirement of the pur chaser.
The use to which it may be put is also immaterial and does not bear in its character as a textile.
It may be used for making wearing apparel, or it may be used as a covering or bed sheet or it may be used as tapestry or upholstery or as duster for clearing or as towel for drying the body.
A textile may have diverse uses and it is not the use which determines its character as textile.
" It was also held that the textile has only one meaning namely a woven fabric and that is the meaning which it bears in ordinary parlance.
The Court therefore held that dryer felts are textiles as these were made of yarn and the proc ess employed was that of weaving according to warp and woof pattern.
It therefore falls within the meaning of textiles and so exempted from tax.
Similar question arose in the case of State of Tamil Nadu vs Navinchandra & Company, [1981] (48) S.T.C. 118 (Madras) where exemption was claimed on the basis of a notification under Section 4 of the Tamil Nadu General Sales Tax Act 1959 in respect of hair belting 98 and cotton belting as falling within item No. 4 of the Third Schedule of the said Act.
This item No. 4 reads as follows: "All varieties of textiles (other than durries, carpets, druggets and pure silk cloth) made wholly or partly of cotton, staple fibre, rayon, artificial silk or wool includ ing handkerchiefs, towels, napkins, dusters, cotton velvets and velvetten, tapes, niwars and laces and hosiery cloth in lengths.
" It was held that textiles haying a wider meaning than fab rics cottonbelting and hair belting were included in the expression cotton fabrics and as such they are exempted from taxation falling within Item No. 4 of the Third Schedule as it stood prior to its amendment.
It is pertinent to mention in this connection that in the case of Delhi cloth and General Mills Co. Ltd. vs State of Rajasthan and Others, ; the question arose whether rayon tyre cord fabric manufactured by the appellate company included within item No. 18 inserted in the Schedule by the Rajasthan Taxation Laws (Amendment) Act, 1964 and rayon or artificial silk fabrics extended to exemp tion under Section 4(1) of the Rajasthan Sales Tax Act which provides for exemption of sales tax of goods specified in the Schedule.
It has been held that the product falls within the exempted item rayon or artificial silk fabrics in item No. 18 of the Schedule inserted by Section 4 of the said Act.
This judgment was rendered by this Court to which one of us was a party.
In the instant case the question arising for considera tion is whether patta covered by "cotton fabrics of all varieties" is excisable to sales tax under the notification dated 1.12.
1973 namely "beltings of all kinds".
In view of the decisions referred to hereinbefore cotton beltings fall within the textiles of all varieties as notified under Section 4 of the said Act being exempt from the imposition of sales tax.
The question that falls for consideration is what is the effect of the notification issued under Section 3 A of the said Act on 1.12.
1973 mentioned in the Schedule "beltings of all kinds".
There is no dispute nor any chal lenge that these beltings.are cotton beltings falling within cotton fabrics of all kinds and as there is a general exemp tion granted by the notification issued in 1957 and 1958 exempting 'cotton fabrics of all kinds ', it is not possible to hold in any view of the matter that it will be excisable to sales tax on the basis of the notification dated 1.12.1973 under Section 3 A of the said Act, by the Govern ment.
The next question for consideration is what is the effect of a 99 notification under Section 3 A including an item in the Schedule for imposition of sales tax though there is a general exemption from sales tax under Section 4 of the Sales Tax Act.
It has been held in the case of Commissioner of Sales Tax vs M/s Dayal Singh Kulfi Wala, Lucknow, [1980] U.P.T.C. 360 as follows: "A fiscal statute like the one before me has to be interpreted strictly.
If there is any ambiguity or doubt it should be resolved in favour of the subject.
There is no equity about tax.
The taxing liability must be express and absolute.
In the present case, the specification of the goods for purpose of section 3 A is one thing, but whether or not such goods would be exempted from tax is the power conferred upon the State Government under section 4 of the Act.
So long the exemption continues, the dealer can cer tainly urge and with jurtisification that the mere specifi cation of goods under section 3 A or declaring the point of sales at such turnover liable to tax would not take away the exemption from payment of tax which the goods enjoyed by virtue of the exercise of power by the State Government under Section 4 of the Act.
The operating fields of the two sections namely sections 3 A by itself cannot override the power under section 4.
On the other hand, if certain goods have been classified for purposes of by the State Govern ment, if such goods had been exempted from sales, the De partment cannot contend that the exemption should not be construed in favour of the assessee.
" In this case the question arose whether the general exemption granted under Section 4 of the Act in respect of milk and milk products is sufficient to exempt kulfi and lassi in respect of which a separate notification was issued under Section 3 A for imposition of tax.
A similar question also arose in the case of Commission er of Sales Tax vs Rita Ice Cream Co., Gorakhpur, [1981] U.P.T.C. 1239 and it was held that so long as the general exemption under Section 4 continues a particular item noti fied under Section 3 A of the Sales Tax Act cannot be taxed.
On a conspectus of all these decisions aforesaid, the only irresistible inference follows that so long as the general exemption granted under Section 4 with regard to cotton fabrics of all kinds continues no sales tax can be imposed on beltings of all kinds which fall within the cotton fabrics of all kinds and the general exemption under section 4 will prevail over the notification made under section 3 A of the Sales Tax Act.
I am unable to subscribe to the view that since the notification under section 3 A of the U.P. Sales Tax Act has been made subse 100 quent to the notification issued under Section 4 of the said Act, the subsequent notification under Section 3 A will prevail over the general exemption granted under Section 4 of the said Act.
In my considered opinion the reasonings and conclusions arrived at by the High Court are unexception able.
The appeal is accordingly dismissed and the judgment and order of the High Court of Allahabad is hereby affirmed.
N.P.V. Appeal allowed.
|
The State Government issued a Notification on November 25, 1958 In exercise of power vested under Section 4 of the U.P. Sales Tax Act, 1948.
This Notification exempted 'cotton fabrics of all varieties ' from sales tax.
Under it, patta as an item of cotton fabric stood exempted from tax liability.
Subsequently, another Notification was issued on December 1, 1973 under Section 3 A of the Act.
This Notification pre scribed a rate of tax higher than that provided by Section 3 of the Act which contains the charging provision and pre scribes a uniform rate of tax on sales.
Section 3 A empowers the State Government to modify the rate of tax by Notifica tion.
This Notification of 1973 was issued without withdraw ing the earlier Notification of 1958.
The High Court, affirming the order of the Tribunal, held that in the absence of a Notification withdrawing the earlier Notification of 1958, sales tax would not be exigi ble in terms of the Notification of 1973.
Allowing the Appeal, HELD: (Per majority Pathak, CJI and Ranganath Misra, J., Ray, J. dissenting) 1.
The High Court was not justified in holding that in the absence of a notification withdrawing the earlier Noti fication of 1958, sales tax would not be exigible in terms of the Notification of 1973.
The order of the Tribunal, which has been affirmed by the High Court, is set aside and the assessment restored.
[96G] 2.
The Notification of 1958 issued under Section 4 of the Act exempted 'cotton fabrics of all varieties ' from sales tax.
The Notification of 1973 under Section 3 A of the Act prescribed sales tax of 7% on the sale of beltings of all kinds.
There is no dispute that patta is a kind of 94 belting material and, on being treated as cotton fabric, was exempted from sales tax.
[95FG] 3.
Section 3 is the charging provision; Section 3 A authorises variation of the rate of tax and Section 4 pro vides for exemption from the tax.
When after a Notification under Section 4 granting exemption from liability, a subse quent Notification under Section 3 A prescribes the rate of tax, the intention is to withdraw the exemption and make the sale liable to tax at the rate prescribed in the Notifica tion.
[96B D] 4.
As the power both for the grant of exemption and the variation of the rate of tax vests in the State Government and it is not the requirement of the Statute that a Notifi cation of recall of exemption is a condition precedent to imposing tax at any prescribed rate by a valid Notification under Section 3 A, the second Notification can easily be treated as a combined Notification both for withdrawal of exemption and also for providing higher tax.
[96D E] 5.
The exemption was in regard to a class of goods and while the exemption continues, a specific item has now been notified under Section 3 A of the Act.
[96F] (Per Ray, J. dissenting) 1.
Cotton beltings fail within 'beltings of all kinds ' as notified under Section 4 of the Act, being exempt from the imposition of sales tax.
As there is a general exemption granted by the Notifications issued in 1957 and 1958 exempt ing 'cotton fabrics of all kinds ', it is not possible to hold, in any view of the matter, that it will be excisable to sales tax on the basis of the Notification dated December 1, 1973 under Section 3 A of the said Act, by the Govern ment.
i98F; G H] 2.
So long as the general exemption granted under Sec tion 4 with regard to 'cotton fabrics of all kinds ' contin ues, no sales tax can be imposed on beltings of all kinds which fail within the 'cotton fabrics of all kinds ' and the general exemption under Section 4 will prevail over the Notification made under Section 3 A of the Sales Tax Act.
[99GH] 3.
It is not possible to subscribe to the view that since the Notification under Section 3 A has been made subsequent to the Notification issued under Section 4 of the Act, the subsequent Notification under Section 3 A will prevail over the general exemption granted under Section 4 of the Act.
[99H; 100A] 95 Porritts & Spencer Asia Ltd. vs State of Haryana, [1978] 42 S.T.C. 433 (SC); State of Tamil Nadu vs Navinchandra & Company, [1981] (48) S.T.C. 118 (Madras); Delhi Cloth and General Mills Co. Ltd. vs State of Rajasthan and Others, ; ; Commissioner of Sales Tax vs M/s Dayal Singh Kulfi Wala, Lucknow, [1980] U.P.T.C. 360 and Commis sioner of Sales Tax vs Rita Ice Cream Co., Gorakhpur, [1981] U.P.T.C. 1239, referred to.
|
vil Appeal No. 1134 (NT) of 1987.
From the Judgment and Order dated 2.3.
1984 of the Allahabad High Court in Sales Tax Revision No. 146 of 1983.
Prithvi Raj, Ashok K. Srivastava for the Appellant.
S.T. Desai, K.B. Rohtagi, S.K. Dhingra, Baldev Atreya and Shashank Shekhar for the Respondent.
The following Judgments of the Court were delivered RANGANATH MISRA, J. Special leave granted.
Delay of six days is condoned.
The short question for consideration in this appeal at the instance of the Revenue is whether the High Court was justified in holding that in the absence of a notification withdrawing the earlier notification dated 25.11.
1958 made in exercise of power vested under section 4 of the U.P. Sales Tax Act, 1948, Sales Tax would not be exigible in terms of the notification dated 1.12.
1973 issued under section 3A of that Act.
The notification of 1958 exempted 'cotton fabrics of all varieties ' from sales tax.
It is not disputed that under it sale of patta, the goods in question on being treated as cotton fabric was exempted from sales tax.
The notification of 1973 made under section 3A of the Act prescribed sales tax of seven per cent on the sale of beltings of all kinds.
There is no dispute now that patta is a kind of belting material.
Section 3 of the Act contains the charging provision and prescribes a uniform rate of tax on sales.
Section 3A empow ers the State Government to modify the rate of tax by noti fication.
The notification of 1973 in fact prescribes a rate of tax higher than provided by section 3.
In 1958, under the notification referred to above, patta as an item of cotton fabric stood exempted from tax liability.
The High Court has 96 referred to some of its earlier decisions and has concluded thus: "Thus the consistent view of this court throughout has been that by issuing a separate notification under section 3A, the earlier exemption granted under section 4 of the Act cannot be negatived.
If the State wanted to tax 'beltings of all kinds ', it has to amend the general notification issued under section 4 by deleting cotton fabric belts from the notification issued under section 4 of the Act. ' ' As has been pointed out above, section 3 is the charging provision; section 3A authorises variation of the rate of tax and section 4 provides for exemption from tax.
All the three sections are parts of the taxing scheme incorporated in the Act and the power both under sections 3A as also under section 4 is exercisable by the State Government only.
When after a notification under section 4 granting exemption from liability, a subsequent notification under section 3A prescribes the rate of tax, it is beyond doubt that the intention is to withdraw the exemption and make the sale liable to tax at the rate prescribed in the notification.
As the power both for the grant of exemption and the variation of the rate of tax vests in the State Government and it is not the requirement of the statute that a notification of recall of exemption is a condition precedent to imposing tax at any prescribed rate by a valid notification under section 3A, we see no force in the contention of the assessee which has been upheld by the High Court.
In fact, the second notification can easily be treated as a combined notifica tion both for withdrawal of exemption and also for provid ing higher tax.
When power for both the operations vests in the State and the intention to levy the tax is clear we see no justification for not giving effect to the 2nd notifica tion.
We would like to point out that the exemption was in regard to a class of goods and while the exemption continues a specific item has now been notified under section 3A of the Act.
The appeal is allowed.
The order of the Tribunal which has been affirmed by the High Court is set aside and the assessment is restored.
Parties are directed to bear their respective costs throughout.
B.C. Ray, J. I have had the privilege of going through the judgment rendered by my learned brother but I am unable to concur with the reasonings recorded by my learned brother in his judgment so far as it relates to the scope and effect of the notification dated 1.12.1973 made under Section 3A of the U.P. Sales Tax Act, 1948 by providing for imposition of sales tax on "beltings of all kinds" for the reasons given hereunder: 97 Under Section 4 of the 1J.P. Sales Tax Act, 1948 the Government issued two notifications No. S.T. 4486/x dated 14.12.1957 and No. 4064/x 960(4)/58 dated 25.11.
1958 where by "cotton fabrics of all kinds" were exempted from the imposition of sales tax under the Act.
Thereafter on 1st of December 1973 a notification was issued by the Government under Section 3 A of the said Act which introduces in the Schedule in Item No. 8 "beltings of all kinds" for imposi tion of sales tax.
The sole question arising in this appeal is whether beltings of all kinds are excisable to sales tax by virtue of the notification dated 1.12.
1973 even though they fall within "cotton fabrics of all kinds" which are exempted from tax by virtue of the notifications dated 14.12.
1957 and 25.11.
Similar question arose in the case of Porritts & Spencer Asia Ltd. vs State of Haryana, [1978] 42 S.T.C. 433 (SC) before this Court for considera tion.
It was held by this Court that the words "all varie ties of cotton, woollen or silken textiles".
In item 30 of Schedule B to the Punjab General Sales Tax Act must be interpreted according to its popular sense, meaning "that sense which people conversant with the subject matter with which the statute is dealing would attribute to it.
" This Court further observed "whatever be the mode of weaving employed, woven fabric would be "textiles".
What is neces sary is no more than weaving of yarn and weaving would mean binding or putting together by some process so as to form a fabric.
Moreover a textile need not be of any particular size or strength or weight.
It may be in small pieces or in big rolls: It may be weak or strong, light or heavy, bleached or dyed, according to the requirement of the pur chaser.
The use to which it may be put is also immaterial and does not bear in its character as a textile.
It may be used for making wearing apparel, or it may be used as a covering or bed sheet or it may be used as tapestry or upholstery or as duster for clearing or as towel for drying the body.
A textile may have diverse uses and it is not the use which determines its character as textile.
" It was also held that the textile has only one meaning namely a woven fabric and that is the meaning which it bears in ordinary parlance.
The Court therefore held that dryer felts are textiles as these were made of yarn and the proc ess employed was that of weaving according to warp and woof pattern.
It therefore falls within the meaning of textiles and so exempted from tax.
Similar question arose in the case of State of Tamil Nadu vs Navinchandra & Company, [1981] (48) S.T.C. 118 (Madras) where exemption was claimed on the basis of a notification under Section 4 of the Tamil Nadu General Sales Tax Act 1959 in respect of hair belting 98 and cotton belting as falling within item No. 4 of the Third Schedule of the said Act.
This item No. 4 reads as follows: "All varieties of textiles (other than durries, carpets, druggets and pure silk cloth) made wholly or partly of cotton, staple fibre, rayon, artificial silk or wool includ ing handkerchiefs, towels, napkins, dusters, cotton velvets and velvetten, tapes, niwars and laces and hosiery cloth in lengths.
" It was held that textiles haying a wider meaning than fab rics cottonbelting and hair belting were included in the expression cotton fabrics and as such they are exempted from taxation falling within Item No. 4 of the Third Schedule as it stood prior to its amendment.
It is pertinent to mention in this connection that in the case of Delhi cloth and General Mills Co. Ltd. vs State of Rajasthan and Others, ; the question arose whether rayon tyre cord fabric manufactured by the appellate company included within item No. 18 inserted in the Schedule by the Rajasthan Taxation Laws (Amendment) Act, 1964 and rayon or artificial silk fabrics extended to exemp tion under Section 4(1) of the Rajasthan Sales Tax Act which provides for exemption of sales tax of goods specified in the Schedule.
It has been held that the product falls within the exempted item rayon or artificial silk fabrics in item No. 18 of the Schedule inserted by Section 4 of the said Act.
This judgment was rendered by this Court to which one of us was a party.
In the instant case the question arising for considera tion is whether patta covered by "cotton fabrics of all varieties" is excisable to sales tax under the notification dated 1.12.
1973 namely "beltings of all kinds".
In view of the decisions referred to hereinbefore cotton beltings fall within the textiles of all varieties as notified under Section 4 of the said Act being exempt from the imposition of sales tax.
The question that falls for consideration is what is the effect of the notification issued under Section 3 A of the said Act on 1.12.
1973 mentioned in the Schedule "beltings of all kinds".
There is no dispute nor any chal lenge that these beltings.are cotton beltings falling within cotton fabrics of all kinds and as there is a general exemp tion granted by the notification issued in 1957 and 1958 exempting 'cotton fabrics of all kinds ', it is not possible to hold in any view of the matter that it will be excisable to sales tax on the basis of the notification dated 1.12.1973 under Section 3 A of the said Act, by the Govern ment.
The next question for consideration is what is the effect of a 99 notification under Section 3 A including an item in the Schedule for imposition of sales tax though there is a general exemption from sales tax under Section 4 of the Sales Tax Act.
It has been held in the case of Commissioner of Sales Tax vs M/s Dayal Singh Kulfi Wala, Lucknow, [1980] U.P.T.C. 360 as follows: "A fiscal statute like the one before me has to be interpreted strictly.
If there is any ambiguity or doubt it should be resolved in favour of the subject.
There is no equity about tax.
The taxing liability must be express and absolute.
In the present case, the specification of the goods for purpose of section 3 A is one thing, but whether or not such goods would be exempted from tax is the power conferred upon the State Government under section 4 of the Act.
So long the exemption continues, the dealer can cer tainly urge and with jurtisification that the mere specifi cation of goods under section 3 A or declaring the point of sales at such turnover liable to tax would not take away the exemption from payment of tax which the goods enjoyed by virtue of the exercise of power by the State Government under Section 4 of the Act.
The operating fields of the two sections namely sections 3 A by itself cannot override the power under section 4.
On the other hand, if certain goods have been classified for purposes of by the State Govern ment, if such goods had been exempted from sales, the De partment cannot contend that the exemption should not be construed in favour of the assessee.
" In this case the question arose whether the general exemption granted under Section 4 of the Act in respect of milk and milk products is sufficient to exempt kulfi and lassi in respect of which a separate notification was issued under Section 3 A for imposition of tax.
A similar question also arose in the case of Commission er of Sales Tax vs Rita Ice Cream Co., Gorakhpur, [1981] U.P.T.C. 1239 and it was held that so long as the general exemption under Section 4 continues a particular item noti fied under Section 3 A of the Sales Tax Act cannot be taxed.
On a conspectus of all these decisions aforesaid, the only irresistible inference follows that so long as the general exemption granted under Section 4 with regard to cotton fabrics of all kinds continues no sales tax can be imposed on beltings of all kinds which fall within the cotton fabrics of all kinds and the general exemption under section 4 will prevail over the notification made under section 3 A of the Sales Tax Act.
I am unable to subscribe to the view that since the notification under section 3 A of the U.P. Sales Tax Act has been made subse 100 quent to the notification issued under Section 4 of the said Act, the subsequent notification under Section 3 A will prevail over the general exemption granted under Section 4 of the said Act.
In my considered opinion the reasonings and conclusions arrived at by the High Court are unexception able.
The appeal is accordingly dismissed and the judgment and order of the High Court of Allahabad is hereby affirmed.
N.P.V. Appeal allowed.
|
vil Appeal No. 1134 (NT) of 1987.
From the Judgment and Order dated 2.3.
1984 of the Allahabad High Court in Sales Tax Revision No. 146 of 1983.
Prithvi Raj, Ashok K. Srivastava for the Appellant.
S.T. Desai, K.B. Rohtagi, S.K. Dhingra, Baldev Atreya and Shashank Shekhar for the Respondent.
The following Judgments of the Court were delivered RANGANATH MISRA, J. Special leave granted.
Delay of six days is condoned.
The short question for consideration in this appeal at the instance of the Revenue is whether the High Court was justified in holding that in the absence of a notification withdrawing the earlier notification dated 25.11.
1958 made in exercise of power vested under section 4 of the U.P. Sales Tax Act, 1948, Sales Tax would not be exigible in terms of the notification dated 1.12.
1973 issued under section 3A of that Act.
The notification of 1958 exempted 'cotton fabrics of all varieties ' from sales tax.
It is not disputed that under it sale of patta, the goods in question on being treated as cotton fabric was exempted from sales tax.
The notification of 1973 made under section 3A of the Act prescribed sales tax of seven per cent on the sale of beltings of all kinds.
There is no dispute now that patta is a kind of belting material.
Section 3 of the Act contains the charging provision and prescribes a uniform rate of tax on sales.
Section 3A empow ers the State Government to modify the rate of tax by noti fication.
The notification of 1973 in fact prescribes a rate of tax higher than provided by section 3.
In 1958, under the notification referred to above, patta as an item of cotton fabric stood exempted from tax liability.
The High Court has 96 referred to some of its earlier decisions and has concluded thus: "Thus the consistent view of this court throughout has been that by issuing a separate notification under section 3A, the earlier exemption granted under section 4 of the Act cannot be negatived.
If the State wanted to tax 'beltings of all kinds ', it has to amend the general notification issued under section 4 by deleting cotton fabric belts from the notification issued under section 4 of the Act. ' ' As has been pointed out above, section 3 is the charging provision; section 3A authorises variation of the rate of tax and section 4 provides for exemption from tax.
All the three sections are parts of the taxing scheme incorporated in the Act and the power both under sections 3A as also under section 4 is exercisable by the State Government only.
When after a notification under section 4 granting exemption from liability, a subsequent notification under section 3A prescribes the rate of tax, it is beyond doubt that the intention is to withdraw the exemption and make the sale liable to tax at the rate prescribed in the notification.
As the power both for the grant of exemption and the variation of the rate of tax vests in the State Government and it is not the requirement of the statute that a notification of recall of exemption is a condition precedent to imposing tax at any prescribed rate by a valid notification under section 3A, we see no force in the contention of the assessee which has been upheld by the High Court.
In fact, the second notification can easily be treated as a combined notifica tion both for withdrawal of exemption and also for provid ing higher tax.
When power for both the operations vests in the State and the intention to levy the tax is clear we see no justification for not giving effect to the 2nd notifica tion.
We would like to point out that the exemption was in regard to a class of goods and while the exemption continues a specific item has now been notified under section 3A of the Act.
The appeal is allowed.
The order of the Tribunal which has been affirmed by the High Court is set aside and the assessment is restored.
Parties are directed to bear their respective costs throughout.
B.C. Ray, J. I have had the privilege of going through the judgment rendered by my learned brother but I am unable to concur with the reasonings recorded by my learned brother in his judgment so far as it relates to the scope and effect of the notification dated 1.12.1973 made under Section 3A of the U.P. Sales Tax Act, 1948 by providing for imposition of sales tax on "beltings of all kinds" for the reasons given hereunder: 97 Under Section 4 of the 1J.P. Sales Tax Act, 1948 the Government issued two notifications No. S.T. 4486/x dated 14.12.1957 and No. 4064/x 960(4)/58 dated 25.11.
1958 where by "cotton fabrics of all kinds" were exempted from the imposition of sales tax under the Act.
Thereafter on 1st of December 1973 a notification was issued by the Government under Section 3 A of the said Act which introduces in the Schedule in Item No. 8 "beltings of all kinds" for imposi tion of sales tax.
The sole question arising in this appeal is whether beltings of all kinds are excisable to sales tax by virtue of the notification dated 1.12.
1973 even though they fall within "cotton fabrics of all kinds" which are exempted from tax by virtue of the notifications dated 14.12.
1957 and 25.11.
Similar question arose in the case of Porritts & Spencer Asia Ltd. vs State of Haryana, [1978] 42 S.T.C. 433 (SC) before this Court for considera tion.
It was held by this Court that the words "all varie ties of cotton, woollen or silken textiles".
In item 30 of Schedule B to the Punjab General Sales Tax Act must be interpreted according to its popular sense, meaning "that sense which people conversant with the subject matter with which the statute is dealing would attribute to it.
" This Court further observed "whatever be the mode of weaving employed, woven fabric would be "textiles".
What is neces sary is no more than weaving of yarn and weaving would mean binding or putting together by some process so as to form a fabric.
Moreover a textile need not be of any particular size or strength or weight.
It may be in small pieces or in big rolls: It may be weak or strong, light or heavy, bleached or dyed, according to the requirement of the pur chaser.
The use to which it may be put is also immaterial and does not bear in its character as a textile.
It may be used for making wearing apparel, or it may be used as a covering or bed sheet or it may be used as tapestry or upholstery or as duster for clearing or as towel for drying the body.
A textile may have diverse uses and it is not the use which determines its character as textile.
" It was also held that the textile has only one meaning namely a woven fabric and that is the meaning which it bears in ordinary parlance.
The Court therefore held that dryer felts are textiles as these were made of yarn and the proc ess employed was that of weaving according to warp and woof pattern.
It therefore falls within the meaning of textiles and so exempted from tax.
Similar question arose in the case of State of Tamil Nadu vs Navinchandra & Company, [1981] (48) S.T.C. 118 (Madras) where exemption was claimed on the basis of a notification under Section 4 of the Tamil Nadu General Sales Tax Act 1959 in respect of hair belting 98 and cotton belting as falling within item No. 4 of the Third Schedule of the said Act.
This item No. 4 reads as follows: "All varieties of textiles (other than durries, carpets, druggets and pure silk cloth) made wholly or partly of cotton, staple fibre, rayon, artificial silk or wool includ ing handkerchiefs, towels, napkins, dusters, cotton velvets and velvetten, tapes, niwars and laces and hosiery cloth in lengths.
" It was held that textiles haying a wider meaning than fab rics cottonbelting and hair belting were included in the expression cotton fabrics and as such they are exempted from taxation falling within Item No. 4 of the Third Schedule as it stood prior to its amendment.
It is pertinent to mention in this connection that in the case of Delhi cloth and General Mills Co. Ltd. vs State of Rajasthan and Others, ; the question arose whether rayon tyre cord fabric manufactured by the appellate company included within item No. 18 inserted in the Schedule by the Rajasthan Taxation Laws (Amendment) Act, 1964 and rayon or artificial silk fabrics extended to exemp tion under Section 4(1) of the Rajasthan Sales Tax Act which provides for exemption of sales tax of goods specified in the Schedule.
It has been held that the product falls within the exempted item rayon or artificial silk fabrics in item No. 18 of the Schedule inserted by Section 4 of the said Act.
This judgment was rendered by this Court to which one of us was a party.
In the instant case the question arising for considera tion is whether patta covered by "cotton fabrics of all varieties" is excisable to sales tax under the notification dated 1.12.
1973 namely "beltings of all kinds".
In view of the decisions referred to hereinbefore cotton beltings fall within the textiles of all varieties as notified under Section 4 of the said Act being exempt from the imposition of sales tax.
The question that falls for consideration is what is the effect of the notification issued under Section 3 A of the said Act on 1.12.
1973 mentioned in the Schedule "beltings of all kinds".
There is no dispute nor any chal lenge that these beltings.are cotton beltings falling within cotton fabrics of all kinds and as there is a general exemp tion granted by the notification issued in 1957 and 1958 exempting 'cotton fabrics of all kinds ', it is not possible to hold in any view of the matter that it will be excisable to sales tax on the basis of the notification dated 1.12.1973 under Section 3 A of the said Act, by the Govern ment.
The next question for consideration is what is the effect of a 99 notification under Section 3 A including an item in the Schedule for imposition of sales tax though there is a general exemption from sales tax under Section 4 of the Sales Tax Act.
It has been held in the case of Commissioner of Sales Tax vs M/s Dayal Singh Kulfi Wala, Lucknow, [1980] U.P.T.C. 360 as follows: "A fiscal statute like the one before me has to be interpreted strictly.
If there is any ambiguity or doubt it should be resolved in favour of the subject.
There is no equity about tax.
The taxing liability must be express and absolute.
In the present case, the specification of the goods for purpose of section 3 A is one thing, but whether or not such goods would be exempted from tax is the power conferred upon the State Government under section 4 of the Act.
So long the exemption continues, the dealer can cer tainly urge and with jurtisification that the mere specifi cation of goods under section 3 A or declaring the point of sales at such turnover liable to tax would not take away the exemption from payment of tax which the goods enjoyed by virtue of the exercise of power by the State Government under Section 4 of the Act.
The operating fields of the two sections namely sections 3 A by itself cannot override the power under section 4.
On the other hand, if certain goods have been classified for purposes of by the State Govern ment, if such goods had been exempted from sales, the De partment cannot contend that the exemption should not be construed in favour of the assessee.
" In this case the question arose whether the general exemption granted under Section 4 of the Act in respect of milk and milk products is sufficient to exempt kulfi and lassi in respect of which a separate notification was issued under Section 3 A for imposition of tax.
A similar question also arose in the case of Commission er of Sales Tax vs Rita Ice Cream Co., Gorakhpur, [1981] U.P.T.C. 1239 and it was held that so long as the general exemption under Section 4 continues a particular item noti fied under Section 3 A of the Sales Tax Act cannot be taxed.
On a conspectus of all these decisions aforesaid, the only irresistible inference follows that so long as the general exemption granted under Section 4 with regard to cotton fabrics of all kinds continues no sales tax can be imposed on beltings of all kinds which fall within the cotton fabrics of all kinds and the general exemption under section 4 will prevail over the notification made under section 3 A of the Sales Tax Act.
I am unable to subscribe to the view that since the notification under section 3 A of the U.P. Sales Tax Act has been made subse 100 quent to the notification issued under Section 4 of the said Act, the subsequent notification under Section 3 A will prevail over the general exemption granted under Section 4 of the said Act.
In my considered opinion the reasonings and conclusions arrived at by the High Court are unexception able.
The appeal is accordingly dismissed and the judgment and order of the High Court of Allahabad is hereby affirmed.
N.P.V. Appeal allowed.
|
The State Government issued a Notification on November 25, 1958 In exercise of power vested under Section 4 of the U.P. Sales Tax Act, 1948.
This Notification exempted 'cotton fabrics of all varieties ' from sales tax.
Under it, patta as an item of cotton fabric stood exempted from tax liability.
Subsequently, another Notification was issued on December 1, 1973 under Section 3 A of the Act.
This Notification pre scribed a rate of tax higher than that provided by Section 3 of the Act which contains the charging provision and pre scribes a uniform rate of tax on sales.
Section 3 A empowers the State Government to modify the rate of tax by Notifica tion.
This Notification of 1973 was issued without withdraw ing the earlier Notification of 1958.
The High Court, affirming the order of the Tribunal, held that in the absence of a Notification withdrawing the earlier Notification of 1958, sales tax would not be exigi ble in terms of the Notification of 1973.
Allowing the Appeal, HELD: (Per majority Pathak, CJI and Ranganath Misra, J., Ray, J. dissenting) 1.
The High Court was not justified in holding that in the absence of a notification withdrawing the earlier Noti fication of 1958, sales tax would not be exigible in terms of the Notification of 1973.
The order of the Tribunal, which has been affirmed by the High Court, is set aside and the assessment restored.
[96G] 2.
The Notification of 1958 issued under Section 4 of the Act exempted 'cotton fabrics of all varieties ' from sales tax.
The Notification of 1973 under Section 3 A of the Act prescribed sales tax of 7% on the sale of beltings of all kinds.
There is no dispute that patta is a kind of 94 belting material and, on being treated as cotton fabric, was exempted from sales tax.
[95FG] 3.
Section 3 is the charging provision; Section 3 A authorises variation of the rate of tax and Section 4 pro vides for exemption from the tax.
When after a Notification under Section 4 granting exemption from liability, a subse quent Notification under Section 3 A prescribes the rate of tax, the intention is to withdraw the exemption and make the sale liable to tax at the rate prescribed in the Notifica tion.
[96B D] 4.
As the power both for the grant of exemption and the variation of the rate of tax vests in the State Government and it is not the requirement of the Statute that a Notifi cation of recall of exemption is a condition precedent to imposing tax at any prescribed rate by a valid Notification under Section 3 A, the second Notification can easily be treated as a combined Notification both for withdrawal of exemption and also for providing higher tax.
[96D E] 5.
The exemption was in regard to a class of goods and while the exemption continues, a specific item has now been notified under Section 3 A of the Act.
[96F] (Per Ray, J. dissenting) 1.
Cotton beltings fail within 'beltings of all kinds ' as notified under Section 4 of the Act, being exempt from the imposition of sales tax.
As there is a general exemption granted by the Notifications issued in 1957 and 1958 exempt ing 'cotton fabrics of all kinds ', it is not possible to hold, in any view of the matter, that it will be excisable to sales tax on the basis of the Notification dated December 1, 1973 under Section 3 A of the said Act, by the Govern ment.
i98F; G H] 2.
So long as the general exemption granted under Sec tion 4 with regard to 'cotton fabrics of all kinds ' contin ues, no sales tax can be imposed on beltings of all kinds which fail within the 'cotton fabrics of all kinds ' and the general exemption under Section 4 will prevail over the Notification made under Section 3 A of the Sales Tax Act.
[99GH] 3.
It is not possible to subscribe to the view that since the Notification under Section 3 A has been made subsequent to the Notification issued under Section 4 of the Act, the subsequent Notification under Section 3 A will prevail over the general exemption granted under Section 4 of the Act.
[99H; 100A] 95 Porritts & Spencer Asia Ltd. vs State of Haryana, [1978] 42 S.T.C. 433 (SC); State of Tamil Nadu vs Navinchandra & Company, [1981] (48) S.T.C. 118 (Madras); Delhi Cloth and General Mills Co. Ltd. vs State of Rajasthan and Others, ; ; Commissioner of Sales Tax vs M/s Dayal Singh Kulfi Wala, Lucknow, [1980] U.P.T.C. 360 and Commis sioner of Sales Tax vs Rita Ice Cream Co., Gorakhpur, [1981] U.P.T.C. 1239, referred to.
|
The State Government issued a Notification on November 25, 1958 In exercise of power vested under Section 4 of the U.P. Sales Tax Act, 1948. This Notification exempted 'cotton fabrics of all varieties ' from sales tax. Under it, patta as an item of cotton fabric stood exempted from tax liability. Subsequently, another Notification was issued on December 1, 1973 under Section 3 A of the Act. This Notification pre scribed a rate of tax higher than that provided by Section 3 of the Act which contains the charging provision and pre scribes a uniform rate of tax on sales. Section 3 A empowers the State Government to modify the rate of tax by Notifica tion. This Notification of 1973 was issued without withdraw ing the earlier Notification of 1958. The High Court, affirming the order of the Tribunal, held that in the absence of a Notification withdrawing the earlier Notification of 1958, sales tax would not be exigi ble in terms of the Notification of 1973. Allowing the Appeal, HELD: (Per majority Pathak, CJI and Ranganath Misra, J., Ray, J. dissenting) 1. The order of the Tribunal, which has been affirmed by the High Court, is set aside and the assessment restored. The Notification of 1958 issued under Section 4 of the Act exempted 'cotton fabrics of all varieties ' from sales tax. The Notification of 1973 under Section 3 A of the Act prescribed sales tax of 7% on the sale of beltings of all kinds. There is no dispute that patta is a kind of 94 belting material and, on being treated as cotton fabric, was exempted from sales tax. Section 3 is the charging provision; Section 3 A authorises variation of the rate of tax and Section 4 pro vides for exemption from the tax. As the power both for the grant of exemption and the variation of the rate of tax vests in the State Government and it is not the requirement of the Statute that a Notifi cation of recall of exemption is a condition precedent to imposing tax at any prescribed rate by a valid Notification under Section 3 A, the second Notification can easily be treated as a combined Notification both for withdrawal of exemption and also for providing higher tax. The exemption was in regard to a class of goods and while the exemption continues, a specific item has now been notified under Section 3 A of the Act. Cotton beltings fail within 'beltings of all kinds ' as notified under Section 4 of the Act, being exempt from the imposition of sales tax. So long as the general exemption granted under Sec tion 4 with regard to 'cotton fabrics of all kinds ' contin ues, no sales tax can be imposed on beltings of all kinds which fail within the 'cotton fabrics of all kinds ' and the general exemption under Section 4 will prevail over the Notification made under Section 3 A of the Sales Tax Act. It is not possible to subscribe to the view that since the Notification under Section 3 A has been made subsequent to the Notification issued under Section 4 of the Act, the subsequent Notification under Section 3 A will prevail over the general exemption granted under Section 4 of the Act. [99H; 100A] 95 Porritts & Spencer Asia Ltd. vs State of Haryana, [1978] 42 S.T.C. 433 (SC); State of Tamil Nadu vs Navinchandra & Company, [1981] (48) S.T.C. 118 (Madras); Delhi Cloth and General Mills Co. Ltd. vs State of Rajasthan and Others, ; ; Commissioner of Sales Tax vs M/s Dayal Singh Kulfi Wala, Lucknow, [1980] U.P.T.C. 360 and Commis sioner of Sales Tax vs Rita Ice Cream Co., Gorakhpur, [1981] U.P.T.C. 1239, referred to.
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vil Appeal Nos.
23 19 2320 of 1981.
From the Judgment and Order dated 14.3.1980 of the Madras High Court in Writ Petition Nos. 4959 and 4960 of 1975.
236 Soli J, Sorabjee, Harish N. Salve, section Ganesh, Mahapa tra, P.S. Shroff and Mrs. P.S. Shroff for the Appellant.
N.A. Palkhiwala, Gauri Shanker, S.C. Manchanda, J.B. Dadachanji, Mrs. A.K. Verma, D.N. Mishra, M.S. Harau, Ram Chandran, Mrs. J. Ramachandran Ms. A. Subhashini and C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by PATHAK, CJ.
These appeals by special leave are directed against the judgment and order of the High Court of Madras dismissing the writ petitions filed by the appellant against the refusal of the first respondent to rectify an assess ment order and pass consequential directions.
Shri Anantharamakrishnan, a reputed industrialist in Tamil Nadu, died in the state in Madras on 18 April, 1964.
He left behind his widow, Valli, his two sons, Sivasailam and Krish namoorthy and two daughters, Kalyani and Seetha.
Some time after his death, Sivasailam, as an accountable person ren dered the estate duty account.
All the heirs, other than Sri Sivasailam, who were also accountable persons wrote to the Assistant Controller of Estate Duty on 15 December, 1964 that as accountable persons they agreed to abide by the accounts , rendered by Sri Sivasailam and any explanation furnished by him with regard to the Estate Duty case would be binding on them.
Messrs. Amalgamations Private Ltd. (shortly referred to as 'Amalgamations ') is a company which holds shares in most of the companies including Simpson and Company Ltd. (shortly referred to as 'Simpson ') of the group.
By letter dated 27 April, 1965 Amalgamations informed the assessing authority that the deceased had transferred property in the form of shares in Simpson to it and that the deceased had controlling interest in that company at the time of his death.
On 13 September, 1965 the assessing authority wrote to Amalgamations that the deceased had transferred 80,377 shares of Simpson, and therefore Amalga mations was a controlled company within the meaning of section 17 of the Estate Duty Act.
By virtue of section 19(1) of the Estate Duty Act the controlled company had to be regarded as one of the persons accountable for the estate of the deceased.
Amalgamations was required to submit an account of the estate.
Amalgamations filed a return before the Assistant Controller.
No objection was raised by the heirs of the deceased or by Amalgama 237 tions to the latter being treated as an accountable person.
After due enquiry the assessment of Estate Duty was completed on 27 January, 1970 and the duty payable by the estate was determined at Rs. 1,67,74,697.58, of which provi sional duty had been paid in the amount of Rs.65,50,452.73 leaving a balance of Rs.1,02,24,244.85.
The assessment order was addressed to Amalgamations as well as Sri Sivasailam as accountable persons.
The Assistant Controller of Estate Duty proceeded on the basis that Amalgamations was a "controlled company" and the deceased had control over its affairs, and therefore valuation of the shares held by the deceased in the company had to be made in the manner laid down in Rule 15 framed by the Board under section 30(1)(e) of the Estate Duty Act.
The principal value of the assets was determined at Rs.2,12,29,998 and the duty was computed at Rs. 1,67,74,697.58.
There was no appeal against the assessment by any of the accountable persons.
Kalyani Sundaram, one of the daughters of the deceased and the appellant before us, became entitled to the death of Anantharamakrishnan to a fifth share in his estate under the Hindu Succession Act.
Her husband, K.S. Sundaram, as her agent constituted by power of attorney, wrote on 11 June, 1974 to the Assistant Controller seeking certain clarifica tions regarding the assessment.
The Assistant Controller replied on 25 June, 1974 referring to the specific agreement of the accountable persons to abide by the accounts rendered by Sri Sivasailam and to be bound by any explanation given by him.
The Assistant Controller referred to the fact that all subsequent proceedings had been completed after discus sion with Sri Sivasailam and Amalgamations and as the as sessment had now become final it was not possible to enter into any discussion concerning it.
On 2 January, 1975 the appellant 's husband as agent filed an application under section 61 of the Estate Duty Act contending that the assessment order was vitiated by several errors inasmuch as Rule 15 prescribed only the method of valuation of the shares and debentures of the controlled company and the Rule was an appendage to sections 36 & 37 of the Act, that unless property was transferred without considera tion by the deceased to Amalgamations and some benefit accrued to the deceased from the company section 17(1) of the Act would not be attracted, that the decision to treat Amalgama tions as an accountable person because of the transfer of shares rested on the transfer of shares made by the de ceased, that on a number of aspects of the case the assess ment order did not show any detail, and therefore a rectifi cation 238 order should be made indicating the exact amount included under section 17(1) of the Act as the property passing on the death of the deceased.
He required this information, he said, to enable him to work out the amount which his princi pal had to pay to Amalgamations by way of reimbursement of the duty.
If the apportionment of the duty had been effected by the order itself, he said, the need for rectification would not have arisen.
Section 61 empowers the Controller "to rectify any mistake apparent from the record" at any time within five years from the date of the order passed by him.
On 25 Janu ary, 1975 the Assistant Controller passed an Order declaring that he was unable to discover any mistake which called for rectification in the assessment order and therefore he declined to act under section 61 of the Act.
This order was challenged by the writ petitions out of which the present appeals arise.
The High Court dismissed the writ petitions.
Sethuraman, J. held that there was no apparent error, and therefore no reason for invoking section 61 of the Act and Balasubramanyan, J. in a concurring judgment, held likewise and also dealt with other aspects of the case.
BOth learned Judges were of the view that the proceeding reflected a private dispute between the appellant and other members of the family, and that the forum and remedy selected by the appellant were not appro priate for that purpose.
The fundamental question in these appeals is whether the appellant is right in invoking section 61 of the Act.
Learned counsel for the appellant contends that the heirs of the deceased on whom the estate devolves are liable to pay estate duty attributable to the property which falls to their respective shares and that if an accountable person pays any part of the estate duty in respect of any property not passing to him he is entitled to reimbursement by the person entitled to such property.
This, says learned coun sel, has no application in respect of the duty payable by virtue of section 17 of the Act, which provides that the slice of the assets of a controlled company shall be deemed to pass on the death of the deceased for the purposes of estate duty and the slice will be included in the property passing on his death if the deceased made a transfer of that property to the controlled company and benefit accrued to the de ceased in the three years ending his death.
The slice of the assets of the controlled company does not come to any heir; therefore no heir is called upon to pay the amount of estate duty attributable to the inclusion of that slice 239 in the chargeable estate.
By section 19 the controlled company itself is liable to pay the corresponding amount of estate duty.
In the present case, however, learned counsel urges, no slice of the assets of Amalgamations has been included in the estate of the deceased by the assessing authority as property deemed to pass on the death of the deceased and therefore the demand issued to the controlled company con stitutes a mistake apparent from the record.
The application of Rule 15 is also contested and this, according to learned counsel, is a clear mistake committed by the Controller.
It is urged that there is a mistake apparent from the record in the directions requiring Amalgamations to pay the entire amount of estate duty.
It seems to us that all the heirs other than Sivasailam had agreed that as accountable persons they would abide by the accounts rendered by Sivasailam, and any information furnished by him with regard to the estate duty matter would be binding on them.
The appellant cannot be heard now to dispute the quantum of liability and the basis on which the liability was computed.
Nor is it open to her to contend that it is not Amalgamations which is liable to pay the duty, but the duty is payable by the heirs of the deceased.
The assessment has become final and no appeal against it has been attempted.
It was for the benefit of the heirs that there was general agreement to have the assessment made on Amalgamations and indeed when the assessment was completed and finalised, no objection was taken.
The appellant acqui esced wholly and completely in the assessment to estate duty being made on Amalgamations.
No separate assessment was made on the appellant nor on the other heirs.
The assessment was completed in 1970 and the entire estate duty has now been paid up.
It was only after the entire estate duty was paid that the appellant filed the application for rectification on 2 January, 1975.
It was contended by learned counsel for the private respondents that the appellant enjoyed no locus standi in order to maintain the application under section 61 and these appeals thereafter, but we do not propose to enter into this question.
Further, it appears that this litigation is woven around a private dispute among the family members.
That is hardly any justification for invoking section 61 of the Act.
We have carefully perused the reasons given individually by the two learned Judges of the High Court and we are in complete agreement with them that there is no mistake appar ent on the record.
240 In support of the contention that there was a mistake apparent on the record, learned counsel has referred us to Hari Vishnu Kamath vs Syed Ahmed Ishaque and Others, ; , 1123; Hind Trading Company vs Union of India & Anr., ; ; M.K. Venkatachalam, Income Tax Officer and Another vs Bombay Dyeing and Manufacturing Co. Ltd.; , , 149 50 and Commissioner of Income Tax, Madras vs Mr. P. Firm, Muar, 15,822 but having regard to the facts of the case before us we do not find anything in those cases which can be of assistance to the appellant.
Learned counsel for the appellant states that having regard to the terms of the order granting special leave to appeal the appellant is justified in requesting the court to consider the issues on the merits.
We are unable to spell out such intent of the Court from the terms of the order granting special leave to appeal.
We do not think that the observations of the Court in Thungabhadra Industries Ltd. vs The Government of Andhra Pradesh; , , 180 affect the position before us.
The real question is whether the assessment was justi fied on Amalgamations or should it have been taken against the heirs of the deceased.
In our opinion, that question stands concluded now and upon all the facts and circum stances of the case we do not think it permissible for the appellant to have recourse to section 61 of the Act in order to re open the case.
The appeals are dismissed, there is no order as to costs.
Y.L. Appeals dis missed.
|
Shri Anantharamakrishnan, a reputed industrialist died in Madras on April 18, 1964 intestate leaving behind his widow, Valli, two sons, Sivasailam and Krishnamoorthy and two daughters, Kalyani and Seetha.
Some time thereafter, his son Sivasailam, being an accountable person rendered the Estate Duty account.
All other heirs i.e. his mother, broth er and sisters, who were also accountable persons, being the heirs of the deceased wrote to the Assistant Controller of Estate Duty that as accountable persons they agreed to abide by the accounts rendered by Sivasailam and whatever explana tion is furnished by him would be binding on them.
M/s. Amalgamations Private Ltd. is a company which held shares in most of the companies including Simpson and Compa ny Ltd. in which company the deceased Anantharamakrishnan too held shares.
By a letter of April 27, 1965, Amalgama tions informed the assessing authority that the deceased had transferred property to it in the form of shares and that at the time of his death, he had controlling interest in the Company.
On September 13, 1965, the Assessing Authority wrote to Amalgamations that the deceased having transferred 80,377 shares of Simpson, as such Amalgamations was a con trolled company within the meaning of section 17 of the Estate Duty Act and thus the said company had to be regarded as one of the accountable persons in respect of the estate of the deceased.
Amalgamations was therefore required to submit an account of the estate.
Accordingly Amalgamations flied a return and no objection thereto was taken by any of the heirs.
Treating Amalgamations as a controlled company and in view of the fact that the deceased had control over its affairs, the assessing authority valued the shares as per the provisions of Rule 15 of the Rule framed by 234 the Board under Section 30(1)(e) of the Act.
The principal value of the shares was determined of Rs.2,12,29,998 and the duty was computed at Rs.1,67,74,697.58, out of which provi sional duty in the sum of Rs.65,50,542.73 had been paid.
The assessment order was addressed both to Amalgamations as also to Shri Sivasailam as accountable persons.
No appeal was preferred against the said assessment by the accountable persons.
K.S. Sundaram husband of the appellant as her agent and constituted power of attorney, on June 11, 1974 wrote to the Assistant Controller seeking certain clarifications.
The Assistant Controller referring to the agreement between the heirs of the deceased Anantharamakrishnan that they were bound by the accounts rendered or explanation given by Sivasailam, replied that, since all subsequent proceedings had been completed after discussion with Sivasailam and Amalgamations, the assessment had become final and that it was not possible to enter into any further discussion.
On 2nd January, 1975, appellant 's husband as agent filed an application under Sec.
61 of the Estate Duty Act, and it was contended by him that the assessment order was vitiated by several errors inasmuch as Rule 15 only prescribed the method of valuation of shares and debentures of the con trolled company and the rule was appendage to Sections 36 & 37 of the Act.
It was urged that the assessment order did not show any details and therefore a rectification order should be made indicating the exact amount included under Section 17(1) of the Act as the property passing on the death of the deceased.
He stated that he required this information to know the precise amount which his principal had to pay to Amalgamations, as the assessment order did not, in terms, indicate apportionment of the duty, for which reason rectification was required.
On January 25, 1975, the Assistant Controller declared by an order that he was unable to find any mistake in the assessment order which called for any rectification and therefore he declined to act under Sec.
61 of the Act.
Order passed by the Assistant Controller was challenged in the High Court by means of Writ Petitions.
The High Court dismissed the Writ Petitions holding that there was no error apparent on the record and therefore there was no reason for invoking Sec.
61 of the Act.
The High Court took the view that proceedings reflected a private dispute between the appellant and other members of the family.
Hence this appeal by the appellant.
235 Dismissing the appeal the Court, HELD: All the heirs other than Sivasailam had agreed that as accountable persons they would abide by the accounts rendered by Sivasailam and any information furnished by him with regard to the estate duty matter would be binding on them.
The appellant cannot be heard now to dispute the quantum of liability and the basis on which the liability was computed.
Nor is it open to her to contend that it is not Amalgamations which is liable to pay the duty, but the duty is payable by the heirs of the deceased.
The assessment had become final and no appeal against it had been attempt ed.
[239C D] The appellant acquiesced wholly and completely in the assessment to estate duty being made on Amalgamations.
[239E] The assessment was completed in 1970 and the entire estate duty has now been paid up.
It was only after the entire estate duty was paid that the appellant filed the application for rectification on January 2, 1975.
[239E F] The question whether the assessment was justified on Amalgamations or should it have been taken against the heirs of the deceased stands concluded now and upon all the facts and circumstances of the case it was not permissible for the appellant to have recourse to Sec.
61 of the Act in order to re open the case, as there was no mistake apparent on the record.
[240D E] That this litigation was woven around a private dispute among the family members.
[239G] Hari Vishnu Kamath vs Syed Ahmed Ishaque and Others, ; , 1123; Hind Trading Company vs Union of India & Anr., ; ; M.K. Venkatachalam, Income tax Officer and Another vs Bombay Dyeing and Manufacturing Co. Ltd., ; , 149 50; Commissioner of Income tax, Madras vs Mr. P. Firm Muar, ; ,822 and Thungabhadra Industries Ltd. vs The Government of Andhra Pradesh, ; , 180, referred to.
|
vil Appeal Nos.
23 19 2320 of 1981.
From the Judgment and Order dated 14.3.1980 of the Madras High Court in Writ Petition Nos. 4959 and 4960 of 1975.
236 Soli J, Sorabjee, Harish N. Salve, section Ganesh, Mahapa tra, P.S. Shroff and Mrs. P.S. Shroff for the Appellant.
N.A. Palkhiwala, Gauri Shanker, S.C. Manchanda, J.B. Dadachanji, Mrs. A.K. Verma, D.N. Mishra, M.S. Harau, Ram Chandran, Mrs. J. Ramachandran Ms. A. Subhashini and C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by PATHAK, CJ.
These appeals by special leave are directed against the judgment and order of the High Court of Madras dismissing the writ petitions filed by the appellant against the refusal of the first respondent to rectify an assess ment order and pass consequential directions.
Shri Anantharamakrishnan, a reputed industrialist in Tamil Nadu, died in the state in Madras on 18 April, 1964.
He left behind his widow, Valli, his two sons, Sivasailam and Krish namoorthy and two daughters, Kalyani and Seetha.
Some time after his death, Sivasailam, as an accountable person ren dered the estate duty account.
All the heirs, other than Sri Sivasailam, who were also accountable persons wrote to the Assistant Controller of Estate Duty on 15 December, 1964 that as accountable persons they agreed to abide by the accounts , rendered by Sri Sivasailam and any explanation furnished by him with regard to the Estate Duty case would be binding on them.
Messrs. Amalgamations Private Ltd. (shortly referred to as 'Amalgamations ') is a company which holds shares in most of the companies including Simpson and Company Ltd. (shortly referred to as 'Simpson ') of the group.
By letter dated 27 April, 1965 Amalgamations informed the assessing authority that the deceased had transferred property in the form of shares in Simpson to it and that the deceased had controlling interest in that company at the time of his death.
On 13 September, 1965 the assessing authority wrote to Amalgamations that the deceased had transferred 80,377 shares of Simpson, and therefore Amalga mations was a controlled company within the meaning of section 17 of the Estate Duty Act.
By virtue of section 19(1) of the Estate Duty Act the controlled company had to be regarded as one of the persons accountable for the estate of the deceased.
Amalgamations was required to submit an account of the estate.
Amalgamations filed a return before the Assistant Controller.
No objection was raised by the heirs of the deceased or by Amalgama 237 tions to the latter being treated as an accountable person.
After due enquiry the assessment of Estate Duty was completed on 27 January, 1970 and the duty payable by the estate was determined at Rs. 1,67,74,697.58, of which provi sional duty had been paid in the amount of Rs.65,50,452.73 leaving a balance of Rs.1,02,24,244.85.
The assessment order was addressed to Amalgamations as well as Sri Sivasailam as accountable persons.
The Assistant Controller of Estate Duty proceeded on the basis that Amalgamations was a "controlled company" and the deceased had control over its affairs, and therefore valuation of the shares held by the deceased in the company had to be made in the manner laid down in Rule 15 framed by the Board under section 30(1)(e) of the Estate Duty Act.
The principal value of the assets was determined at Rs.2,12,29,998 and the duty was computed at Rs. 1,67,74,697.58.
There was no appeal against the assessment by any of the accountable persons.
Kalyani Sundaram, one of the daughters of the deceased and the appellant before us, became entitled to the death of Anantharamakrishnan to a fifth share in his estate under the Hindu Succession Act.
Her husband, K.S. Sundaram, as her agent constituted by power of attorney, wrote on 11 June, 1974 to the Assistant Controller seeking certain clarifica tions regarding the assessment.
The Assistant Controller replied on 25 June, 1974 referring to the specific agreement of the accountable persons to abide by the accounts rendered by Sri Sivasailam and to be bound by any explanation given by him.
The Assistant Controller referred to the fact that all subsequent proceedings had been completed after discus sion with Sri Sivasailam and Amalgamations and as the as sessment had now become final it was not possible to enter into any discussion concerning it.
On 2 January, 1975 the appellant 's husband as agent filed an application under section 61 of the Estate Duty Act contending that the assessment order was vitiated by several errors inasmuch as Rule 15 prescribed only the method of valuation of the shares and debentures of the controlled company and the Rule was an appendage to sections 36 & 37 of the Act, that unless property was transferred without considera tion by the deceased to Amalgamations and some benefit accrued to the deceased from the company section 17(1) of the Act would not be attracted, that the decision to treat Amalgama tions as an accountable person because of the transfer of shares rested on the transfer of shares made by the de ceased, that on a number of aspects of the case the assess ment order did not show any detail, and therefore a rectifi cation 238 order should be made indicating the exact amount included under section 17(1) of the Act as the property passing on the death of the deceased.
He required this information, he said, to enable him to work out the amount which his princi pal had to pay to Amalgamations by way of reimbursement of the duty.
If the apportionment of the duty had been effected by the order itself, he said, the need for rectification would not have arisen.
Section 61 empowers the Controller "to rectify any mistake apparent from the record" at any time within five years from the date of the order passed by him.
On 25 Janu ary, 1975 the Assistant Controller passed an Order declaring that he was unable to discover any mistake which called for rectification in the assessment order and therefore he declined to act under section 61 of the Act.
This order was challenged by the writ petitions out of which the present appeals arise.
The High Court dismissed the writ petitions.
Sethuraman, J. held that there was no apparent error, and therefore no reason for invoking section 61 of the Act and Balasubramanyan, J. in a concurring judgment, held likewise and also dealt with other aspects of the case.
BOth learned Judges were of the view that the proceeding reflected a private dispute between the appellant and other members of the family, and that the forum and remedy selected by the appellant were not appro priate for that purpose.
The fundamental question in these appeals is whether the appellant is right in invoking section 61 of the Act.
Learned counsel for the appellant contends that the heirs of the deceased on whom the estate devolves are liable to pay estate duty attributable to the property which falls to their respective shares and that if an accountable person pays any part of the estate duty in respect of any property not passing to him he is entitled to reimbursement by the person entitled to such property.
This, says learned coun sel, has no application in respect of the duty payable by virtue of section 17 of the Act, which provides that the slice of the assets of a controlled company shall be deemed to pass on the death of the deceased for the purposes of estate duty and the slice will be included in the property passing on his death if the deceased made a transfer of that property to the controlled company and benefit accrued to the de ceased in the three years ending his death.
The slice of the assets of the controlled company does not come to any heir; therefore no heir is called upon to pay the amount of estate duty attributable to the inclusion of that slice 239 in the chargeable estate.
By section 19 the controlled company itself is liable to pay the corresponding amount of estate duty.
In the present case, however, learned counsel urges, no slice of the assets of Amalgamations has been included in the estate of the deceased by the assessing authority as property deemed to pass on the death of the deceased and therefore the demand issued to the controlled company con stitutes a mistake apparent from the record.
The application of Rule 15 is also contested and this, according to learned counsel, is a clear mistake committed by the Controller.
It is urged that there is a mistake apparent from the record in the directions requiring Amalgamations to pay the entire amount of estate duty.
It seems to us that all the heirs other than Sivasailam had agreed that as accountable persons they would abide by the accounts rendered by Sivasailam, and any information furnished by him with regard to the estate duty matter would be binding on them.
The appellant cannot be heard now to dispute the quantum of liability and the basis on which the liability was computed.
Nor is it open to her to contend that it is not Amalgamations which is liable to pay the duty, but the duty is payable by the heirs of the deceased.
The assessment has become final and no appeal against it has been attempted.
It was for the benefit of the heirs that there was general agreement to have the assessment made on Amalgamations and indeed when the assessment was completed and finalised, no objection was taken.
The appellant acqui esced wholly and completely in the assessment to estate duty being made on Amalgamations.
No separate assessment was made on the appellant nor on the other heirs.
The assessment was completed in 1970 and the entire estate duty has now been paid up.
It was only after the entire estate duty was paid that the appellant filed the application for rectification on 2 January, 1975.
It was contended by learned counsel for the private respondents that the appellant enjoyed no locus standi in order to maintain the application under section 61 and these appeals thereafter, but we do not propose to enter into this question.
Further, it appears that this litigation is woven around a private dispute among the family members.
That is hardly any justification for invoking section 61 of the Act.
We have carefully perused the reasons given individually by the two learned Judges of the High Court and we are in complete agreement with them that there is no mistake appar ent on the record.
240 In support of the contention that there was a mistake apparent on the record, learned counsel has referred us to Hari Vishnu Kamath vs Syed Ahmed Ishaque and Others, ; , 1123; Hind Trading Company vs Union of India & Anr., ; ; M.K. Venkatachalam, Income Tax Officer and Another vs Bombay Dyeing and Manufacturing Co. Ltd.; , , 149 50 and Commissioner of Income Tax, Madras vs Mr. P. Firm, Muar, 15,822 but having regard to the facts of the case before us we do not find anything in those cases which can be of assistance to the appellant.
Learned counsel for the appellant states that having regard to the terms of the order granting special leave to appeal the appellant is justified in requesting the court to consider the issues on the merits.
We are unable to spell out such intent of the Court from the terms of the order granting special leave to appeal.
We do not think that the observations of the Court in Thungabhadra Industries Ltd. vs The Government of Andhra Pradesh; , , 180 affect the position before us.
The real question is whether the assessment was justi fied on Amalgamations or should it have been taken against the heirs of the deceased.
In our opinion, that question stands concluded now and upon all the facts and circum stances of the case we do not think it permissible for the appellant to have recourse to section 61 of the Act in order to re open the case.
The appeals are dismissed, there is no order as to costs.
Y.L. Appeals dis missed.
|
vil Appeal Nos.
23 19 2320 of 1981.
From the Judgment and Order dated 14.3.1980 of the Madras High Court in Writ Petition Nos. 4959 and 4960 of 1975.
236 Soli J, Sorabjee, Harish N. Salve, section Ganesh, Mahapa tra, P.S. Shroff and Mrs. P.S. Shroff for the Appellant.
N.A. Palkhiwala, Gauri Shanker, S.C. Manchanda, J.B. Dadachanji, Mrs. A.K. Verma, D.N. Mishra, M.S. Harau, Ram Chandran, Mrs. J. Ramachandran Ms. A. Subhashini and C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by PATHAK, CJ.
These appeals by special leave are directed against the judgment and order of the High Court of Madras dismissing the writ petitions filed by the appellant against the refusal of the first respondent to rectify an assess ment order and pass consequential directions.
Shri Anantharamakrishnan, a reputed industrialist in Tamil Nadu, died in the state in Madras on 18 April, 1964.
He left behind his widow, Valli, his two sons, Sivasailam and Krish namoorthy and two daughters, Kalyani and Seetha.
Some time after his death, Sivasailam, as an accountable person ren dered the estate duty account.
All the heirs, other than Sri Sivasailam, who were also accountable persons wrote to the Assistant Controller of Estate Duty on 15 December, 1964 that as accountable persons they agreed to abide by the accounts , rendered by Sri Sivasailam and any explanation furnished by him with regard to the Estate Duty case would be binding on them.
Messrs. Amalgamations Private Ltd. (shortly referred to as 'Amalgamations ') is a company which holds shares in most of the companies including Simpson and Company Ltd. (shortly referred to as 'Simpson ') of the group.
By letter dated 27 April, 1965 Amalgamations informed the assessing authority that the deceased had transferred property in the form of shares in Simpson to it and that the deceased had controlling interest in that company at the time of his death.
On 13 September, 1965 the assessing authority wrote to Amalgamations that the deceased had transferred 80,377 shares of Simpson, and therefore Amalga mations was a controlled company within the meaning of section 17 of the Estate Duty Act.
By virtue of section 19(1) of the Estate Duty Act the controlled company had to be regarded as one of the persons accountable for the estate of the deceased.
Amalgamations was required to submit an account of the estate.
Amalgamations filed a return before the Assistant Controller.
No objection was raised by the heirs of the deceased or by Amalgama 237 tions to the latter being treated as an accountable person.
After due enquiry the assessment of Estate Duty was completed on 27 January, 1970 and the duty payable by the estate was determined at Rs. 1,67,74,697.58, of which provi sional duty had been paid in the amount of Rs.65,50,452.73 leaving a balance of Rs.1,02,24,244.85.
The assessment order was addressed to Amalgamations as well as Sri Sivasailam as accountable persons.
The Assistant Controller of Estate Duty proceeded on the basis that Amalgamations was a "controlled company" and the deceased had control over its affairs, and therefore valuation of the shares held by the deceased in the company had to be made in the manner laid down in Rule 15 framed by the Board under section 30(1)(e) of the Estate Duty Act.
The principal value of the assets was determined at Rs.2,12,29,998 and the duty was computed at Rs. 1,67,74,697.58.
There was no appeal against the assessment by any of the accountable persons.
Kalyani Sundaram, one of the daughters of the deceased and the appellant before us, became entitled to the death of Anantharamakrishnan to a fifth share in his estate under the Hindu Succession Act.
Her husband, K.S. Sundaram, as her agent constituted by power of attorney, wrote on 11 June, 1974 to the Assistant Controller seeking certain clarifica tions regarding the assessment.
The Assistant Controller replied on 25 June, 1974 referring to the specific agreement of the accountable persons to abide by the accounts rendered by Sri Sivasailam and to be bound by any explanation given by him.
The Assistant Controller referred to the fact that all subsequent proceedings had been completed after discus sion with Sri Sivasailam and Amalgamations and as the as sessment had now become final it was not possible to enter into any discussion concerning it.
On 2 January, 1975 the appellant 's husband as agent filed an application under section 61 of the Estate Duty Act contending that the assessment order was vitiated by several errors inasmuch as Rule 15 prescribed only the method of valuation of the shares and debentures of the controlled company and the Rule was an appendage to sections 36 & 37 of the Act, that unless property was transferred without considera tion by the deceased to Amalgamations and some benefit accrued to the deceased from the company section 17(1) of the Act would not be attracted, that the decision to treat Amalgama tions as an accountable person because of the transfer of shares rested on the transfer of shares made by the de ceased, that on a number of aspects of the case the assess ment order did not show any detail, and therefore a rectifi cation 238 order should be made indicating the exact amount included under section 17(1) of the Act as the property passing on the death of the deceased.
He required this information, he said, to enable him to work out the amount which his princi pal had to pay to Amalgamations by way of reimbursement of the duty.
If the apportionment of the duty had been effected by the order itself, he said, the need for rectification would not have arisen.
Section 61 empowers the Controller "to rectify any mistake apparent from the record" at any time within five years from the date of the order passed by him.
On 25 Janu ary, 1975 the Assistant Controller passed an Order declaring that he was unable to discover any mistake which called for rectification in the assessment order and therefore he declined to act under section 61 of the Act.
This order was challenged by the writ petitions out of which the present appeals arise.
The High Court dismissed the writ petitions.
Sethuraman, J. held that there was no apparent error, and therefore no reason for invoking section 61 of the Act and Balasubramanyan, J. in a concurring judgment, held likewise and also dealt with other aspects of the case.
BOth learned Judges were of the view that the proceeding reflected a private dispute between the appellant and other members of the family, and that the forum and remedy selected by the appellant were not appro priate for that purpose.
The fundamental question in these appeals is whether the appellant is right in invoking section 61 of the Act.
Learned counsel for the appellant contends that the heirs of the deceased on whom the estate devolves are liable to pay estate duty attributable to the property which falls to their respective shares and that if an accountable person pays any part of the estate duty in respect of any property not passing to him he is entitled to reimbursement by the person entitled to such property.
This, says learned coun sel, has no application in respect of the duty payable by virtue of section 17 of the Act, which provides that the slice of the assets of a controlled company shall be deemed to pass on the death of the deceased for the purposes of estate duty and the slice will be included in the property passing on his death if the deceased made a transfer of that property to the controlled company and benefit accrued to the de ceased in the three years ending his death.
The slice of the assets of the controlled company does not come to any heir; therefore no heir is called upon to pay the amount of estate duty attributable to the inclusion of that slice 239 in the chargeable estate.
By section 19 the controlled company itself is liable to pay the corresponding amount of estate duty.
In the present case, however, learned counsel urges, no slice of the assets of Amalgamations has been included in the estate of the deceased by the assessing authority as property deemed to pass on the death of the deceased and therefore the demand issued to the controlled company con stitutes a mistake apparent from the record.
The application of Rule 15 is also contested and this, according to learned counsel, is a clear mistake committed by the Controller.
It is urged that there is a mistake apparent from the record in the directions requiring Amalgamations to pay the entire amount of estate duty.
It seems to us that all the heirs other than Sivasailam had agreed that as accountable persons they would abide by the accounts rendered by Sivasailam, and any information furnished by him with regard to the estate duty matter would be binding on them.
The appellant cannot be heard now to dispute the quantum of liability and the basis on which the liability was computed.
Nor is it open to her to contend that it is not Amalgamations which is liable to pay the duty, but the duty is payable by the heirs of the deceased.
The assessment has become final and no appeal against it has been attempted.
It was for the benefit of the heirs that there was general agreement to have the assessment made on Amalgamations and indeed when the assessment was completed and finalised, no objection was taken.
The appellant acqui esced wholly and completely in the assessment to estate duty being made on Amalgamations.
No separate assessment was made on the appellant nor on the other heirs.
The assessment was completed in 1970 and the entire estate duty has now been paid up.
It was only after the entire estate duty was paid that the appellant filed the application for rectification on 2 January, 1975.
It was contended by learned counsel for the private respondents that the appellant enjoyed no locus standi in order to maintain the application under section 61 and these appeals thereafter, but we do not propose to enter into this question.
Further, it appears that this litigation is woven around a private dispute among the family members.
That is hardly any justification for invoking section 61 of the Act.
We have carefully perused the reasons given individually by the two learned Judges of the High Court and we are in complete agreement with them that there is no mistake appar ent on the record.
240 In support of the contention that there was a mistake apparent on the record, learned counsel has referred us to Hari Vishnu Kamath vs Syed Ahmed Ishaque and Others, ; , 1123; Hind Trading Company vs Union of India & Anr., ; ; M.K. Venkatachalam, Income Tax Officer and Another vs Bombay Dyeing and Manufacturing Co. Ltd.; , , 149 50 and Commissioner of Income Tax, Madras vs Mr. P. Firm, Muar, 15,822 but having regard to the facts of the case before us we do not find anything in those cases which can be of assistance to the appellant.
Learned counsel for the appellant states that having regard to the terms of the order granting special leave to appeal the appellant is justified in requesting the court to consider the issues on the merits.
We are unable to spell out such intent of the Court from the terms of the order granting special leave to appeal.
We do not think that the observations of the Court in Thungabhadra Industries Ltd. vs The Government of Andhra Pradesh; , , 180 affect the position before us.
The real question is whether the assessment was justi fied on Amalgamations or should it have been taken against the heirs of the deceased.
In our opinion, that question stands concluded now and upon all the facts and circum stances of the case we do not think it permissible for the appellant to have recourse to section 61 of the Act in order to re open the case.
The appeals are dismissed, there is no order as to costs.
Y.L. Appeals dis missed.
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Shri Anantharamakrishnan, a reputed industrialist died in Madras on April 18, 1964 intestate leaving behind his widow, Valli, two sons, Sivasailam and Krishnamoorthy and two daughters, Kalyani and Seetha.
Some time thereafter, his son Sivasailam, being an accountable person rendered the Estate Duty account.
All other heirs i.e. his mother, broth er and sisters, who were also accountable persons, being the heirs of the deceased wrote to the Assistant Controller of Estate Duty that as accountable persons they agreed to abide by the accounts rendered by Sivasailam and whatever explana tion is furnished by him would be binding on them.
M/s. Amalgamations Private Ltd. is a company which held shares in most of the companies including Simpson and Compa ny Ltd. in which company the deceased Anantharamakrishnan too held shares.
By a letter of April 27, 1965, Amalgama tions informed the assessing authority that the deceased had transferred property to it in the form of shares and that at the time of his death, he had controlling interest in the Company.
On September 13, 1965, the Assessing Authority wrote to Amalgamations that the deceased having transferred 80,377 shares of Simpson, as such Amalgamations was a con trolled company within the meaning of section 17 of the Estate Duty Act and thus the said company had to be regarded as one of the accountable persons in respect of the estate of the deceased.
Amalgamations was therefore required to submit an account of the estate.
Accordingly Amalgamations flied a return and no objection thereto was taken by any of the heirs.
Treating Amalgamations as a controlled company and in view of the fact that the deceased had control over its affairs, the assessing authority valued the shares as per the provisions of Rule 15 of the Rule framed by 234 the Board under Section 30(1)(e) of the Act.
The principal value of the shares was determined of Rs.2,12,29,998 and the duty was computed at Rs.1,67,74,697.58, out of which provi sional duty in the sum of Rs.65,50,542.73 had been paid.
The assessment order was addressed both to Amalgamations as also to Shri Sivasailam as accountable persons.
No appeal was preferred against the said assessment by the accountable persons.
K.S. Sundaram husband of the appellant as her agent and constituted power of attorney, on June 11, 1974 wrote to the Assistant Controller seeking certain clarifications.
The Assistant Controller referring to the agreement between the heirs of the deceased Anantharamakrishnan that they were bound by the accounts rendered or explanation given by Sivasailam, replied that, since all subsequent proceedings had been completed after discussion with Sivasailam and Amalgamations, the assessment had become final and that it was not possible to enter into any further discussion.
On 2nd January, 1975, appellant 's husband as agent filed an application under Sec.
61 of the Estate Duty Act, and it was contended by him that the assessment order was vitiated by several errors inasmuch as Rule 15 only prescribed the method of valuation of shares and debentures of the con trolled company and the rule was appendage to Sections 36 & 37 of the Act.
It was urged that the assessment order did not show any details and therefore a rectification order should be made indicating the exact amount included under Section 17(1) of the Act as the property passing on the death of the deceased.
He stated that he required this information to know the precise amount which his principal had to pay to Amalgamations, as the assessment order did not, in terms, indicate apportionment of the duty, for which reason rectification was required.
On January 25, 1975, the Assistant Controller declared by an order that he was unable to find any mistake in the assessment order which called for any rectification and therefore he declined to act under Sec.
61 of the Act.
Order passed by the Assistant Controller was challenged in the High Court by means of Writ Petitions.
The High Court dismissed the Writ Petitions holding that there was no error apparent on the record and therefore there was no reason for invoking Sec.
61 of the Act.
The High Court took the view that proceedings reflected a private dispute between the appellant and other members of the family.
Hence this appeal by the appellant.
235 Dismissing the appeal the Court, HELD: All the heirs other than Sivasailam had agreed that as accountable persons they would abide by the accounts rendered by Sivasailam and any information furnished by him with regard to the estate duty matter would be binding on them.
The appellant cannot be heard now to dispute the quantum of liability and the basis on which the liability was computed.
Nor is it open to her to contend that it is not Amalgamations which is liable to pay the duty, but the duty is payable by the heirs of the deceased.
The assessment had become final and no appeal against it had been attempt ed.
[239C D] The appellant acquiesced wholly and completely in the assessment to estate duty being made on Amalgamations.
[239E] The assessment was completed in 1970 and the entire estate duty has now been paid up.
It was only after the entire estate duty was paid that the appellant filed the application for rectification on January 2, 1975.
[239E F] The question whether the assessment was justified on Amalgamations or should it have been taken against the heirs of the deceased stands concluded now and upon all the facts and circumstances of the case it was not permissible for the appellant to have recourse to Sec.
61 of the Act in order to re open the case, as there was no mistake apparent on the record.
[240D E] That this litigation was woven around a private dispute among the family members.
[239G] Hari Vishnu Kamath vs Syed Ahmed Ishaque and Others, ; , 1123; Hind Trading Company vs Union of India & Anr., ; ; M.K. Venkatachalam, Income tax Officer and Another vs Bombay Dyeing and Manufacturing Co. Ltd., ; , 149 50; Commissioner of Income tax, Madras vs Mr. P. Firm Muar, ; ,822 and Thungabhadra Industries Ltd. vs The Government of Andhra Pradesh, ; , 180, referred to.
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Shri Anantharamakrishnan, a reputed industrialist died in Madras on April 18, 1964 intestate leaving behind his widow, Valli, two sons, Sivasailam and Krishnamoorthy and two daughters, Kalyani and Seetha. Some time thereafter, his son Sivasailam, being an accountable person rendered the Estate Duty account. All other heirs i.e. his mother, broth er and sisters, who were also accountable persons, being the heirs of the deceased wrote to the Assistant Controller of Estate Duty that as accountable persons they agreed to abide by the accounts rendered by Sivasailam and whatever explana tion is furnished by him would be binding on them. On September 13, 1965, the Assessing Authority wrote to Amalgamations that the deceased having transferred 80,377 shares of Simpson, as such Amalgamations was a con trolled company within the meaning of section 17 of the Estate Duty Act and thus the said company had to be regarded as one of the accountable persons in respect of the estate of the deceased. Amalgamations was therefore required to submit an account of the estate. Accordingly Amalgamations flied a return and no objection thereto was taken by any of the heirs. The principal value of the shares was determined of Rs.2,12,29,998 and the duty was computed at Rs.1,67,74,697.58, out of which provi sional duty in the sum of Rs.65,50,542.73 had been paid. The assessment order was addressed both to Amalgamations as also to Shri Sivasailam as accountable persons. No appeal was preferred against the said assessment by the accountable persons. K.S. Sundaram husband of the appellant as her agent and constituted power of attorney, on June 11, 1974 wrote to the Assistant Controller seeking certain clarifications. On 2nd January, 1975, appellant 's husband as agent filed an application under Sec. 61 of the Estate Duty Act, and it was contended by him that the assessment order was vitiated by several errors inasmuch as Rule 15 only prescribed the method of valuation of shares and debentures of the con trolled company and the rule was appendage to Sections 36 & 37 of the Act. Order passed by the Assistant Controller was challenged in the High Court by means of Writ Petitions. The High Court dismissed the Writ Petitions holding that there was no error apparent on the record and therefore there was no reason for invoking Sec. The High Court took the view that proceedings reflected a private dispute between the appellant and other members of the family. The appellant cannot be heard now to dispute the quantum of liability and the basis on which the liability was computed. Nor is it open to her to contend that it is not Amalgamations which is liable to pay the duty, but the duty is payable by the heirs of the deceased. The assessment had become final and no appeal against it had been attempt ed. [239E] The assessment was completed in 1970 and the entire estate duty has now been paid up. 61 of the Act in order to re open the case, as there was no mistake apparent on the record. [240D E] That this litigation was woven around a private dispute among the family members. [239G] Hari Vishnu Kamath vs Syed Ahmed Ishaque and Others, ; , 1123; Hind Trading Company vs Union of India & Anr., ; ; M.K. Venkatachalam, Income tax Officer and Another vs Bombay Dyeing and Manufacturing Co. Ltd., ; , 149 50; Commissioner of Income tax, Madras vs Mr. P. Firm Muar, ; ,822 and Thungabhadra Industries Ltd. vs The Government of Andhra Pradesh, ; , 180, referred to.
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ivil Appeal No. 390 of 1981.
From the Judgment and Order dated 31.8.
1979 of the Patna High Court in C.W.J.C. No. 262 of 1979 (R).
M.K. Ramamurthy, A.K. Nag and Mrs. Naresh Bakshi for the Appellants.
Jaya Narayan and Pramod Swarup for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal is directed against the judgment and order of the High Court of Patna, (Ranchi Bench) dated 3 1st August, 1979.
It involves the question of the right of ex intermedi aries to get compensation for the minerals which were not exploited by the exlandlords on the date of vesting the estate under Bihar Land Reforms Act, 1950 (hereinafter referred to as the 'Act ').
Raja Nilkanth Narayan Singh of Sawagarh estate was the exlandlord whose estate vested by virtue of the notification under the Act with effect from 4th November, 1951.
The petitioners before the High Court and the appellants herein are the successors in interest being the grandson and the daughter in law of the late Nilkanth Narayan Singh.
The estate of the ex landlord comprised, inter alia, tauzi Nos.
14 and 15 of the District Collectorate of Dhanbad within the aforesaid tauzis.
These were vast areas of mineral bearing lands owned by the ex proprietor of the estate.
Some part of the said area 227 was being worked by the lessees under the leases granted to them who paid royalty to late Nilkanth Narayan Singh, afore said, who, it might be stated, died in November, 1969 in a state of jointness with other appellants.
The case of the appellants is that compensation in respect of the coal bearing area having coal reserves i.e. minerals, has not yet been paid by the State of Bihar al though the estate had vested in it as early as in November, 195 1.
So far as the mines that were being worked out or the minerals which were the subject matter of leases granted by the ex landlord are concerned, there was no dispute.
The appellants are entitled to and have not been denied compen sation in respect thereof under the Act, and the Rules.
The controversy is only on the question whether the ex landlord or his successor in interest is entitled to compen sation for the minerals which were not the subject matter of any lease granted in favour of any lessee.
However, it appears, there is no dispute on the question that had such minerals been the subject matter of a lease, the ex interme diary would have been entitled to compensation in respect thereof in the manner provided under the Act to be computed as prescribed by the Rules.
The High Court after an exhaustive discussion of the different provisions of the Act came to the conclusion that ex intermediary is not entitled to the compensation as claimed for and as such dismissed the application under Article 226 of the Constitution.
Being aggrieved by the said decision, the appellants after obtaining a certificate under Article 133(1) of the Constitution have come up to this Court.
The expression 'mines ' used in the Act or in the Rules had a distinct connotation namely those minerals that were unworked and unexcavated reserves while excavated mines had been worked.
The question, therefore, involves, as the High Court rightly pointed out not only the mines but with miner als located beneath the earth, and neither being worked by ex intermediary on the date of vesting nor being the subject matter of lease in favour of any third party.
The fights of the parties have t.o be worked out under the provisions of the Act.
The Act in question was an Act which was passed to provide for the transference to the State of the interests of proprietors, and tenure holders in land and of the mortgages and lessees of such interests including interests in trees, forests, fisheries, 'jalkars ' ferries, 228 'hats ', 'bazars ' mines and minerals, and to provide for the constitution of a Land Commission for the State of Bihar with powers to advise the State Government on the agrarian policy to be pursued by the State Government consequent upon such transference and for other matters connected therewith.
On an analysis of the scheme of the Act, it appears that section 3 of the Act provides for the notification vesting an estate or tenure in the State.
It provides, inter alia, that the State Government may, from time to time, by notifi cation declare that the estates or tenures of a proprietor or tenure holder, specified in the notification, have passed to and become vested in the State.
There was appropriate notification passed in this case.
On issuance of the notifi cation, the estates become vested in the State.
Section 4 deals with the consequences of vesting.
It provides that notwithstanding anything contained in any other law for the time being in force or in any contract, on the publication of the notification notwithstanding anything to the con trary, certain consequences, as mentioned in section 4 would follow.
Such consequences are mentioned in clauses (a), (b), (c), (d) and (e) and other sub clauses of section 4 of the Act.
Section 9 deals with the mines worked by intermediary and it provides that with effect from the date of vesting all such mines comprised in the estate or tenure as were in operation at the commencement of the Act and were being worked directly by the intermediary shall, notwithstanding anything contained in the Act, be deemed to have been leased by the appropriate Government to the intermediary and he shall be entitled to retain possession of those mines as a lessee thereof.
The terms and conditions of the said lease would be such as would be agreed upon between the State Government and the intermediary provided that all such terms and conditions shall be in accordance with the provisions of any Central Act for the time being in force.
Section 10 deals with the consequences of subsisting leases of mines and minerals and provides for vesting of the same.
Section 23 deals with computation of net income for the purpose of preparing compensation assessment roll of the net income of the intermediary.
Section 24 deals with the rates of compen sation, and provides that after the net income had been computed under section 23, the Compensation Officer should for the purpose of preparing compensation assessment roll proceed to determine the amount of compensation to be pay able in respect of the transference to the State of the interests of each intermediary.
The table is set out in the section.
Section 2.5.
is important and deals with the compu tation of compensation payable for mines and minerals.
The relevant portion of it provides, inter alia, as follows: "25.
Computation of compensation payable for mines and minerals.
229 (1) The Compensation Officer shall prepare in the prescribed form and in the prescribed manner compensation assessment roll containing in respect of every intermediary in receipt of royalties on account of mines and minerals or directly working mines comprised in the estate or tenure (a) his gross income and net income from such royalties; (b) his gross income from mines worked directly by him and the amount deemed to be his net income from royalties in respect of such mines; (c) the amount of compensation payable to him under the provisions of this Act for mines and minerals; and (d) such other particulars as may be pre scribed." Then sub section (2) of section 25 deals with the prepara tion of compensation roll for clause (a) of sub section (1) and sub section (3) deals with the preparation of compensa tion roll for clause (b) of sub section (1).
Sub section (4) deals with the question whether after net income from royal ties have been computed under sub sections (2) and (3), the Compensation Officer should proceed to determine the amount of compensation to be payable to the intermediary in the manner and in accordance with the principles laid down therein.
While we are on the provisions of the Act and the Rules, reference may be made to Bihar Land Reforms Rules, 195 1 (hereinafter called the 'Rules '), and Rule 25 E deals with the procedure for determining the approximate amount of compensation or annuity.
It provides as follows: "25 E. Procedure for determining the approximate amount of compensation or annuity.
(1) The approximate amount of compensation in respect of the intermediary interests, other than that payable for mines and minerals, shall be the approximate net income arrived at in the manner laid down in rule 25 C multi plied by the appropriate multiple referred to in Sec.
24(1); and the approximate amount of annuity shah be equal to the approximate net income.
(2) The approximate amount of compensation or annuity payable for mines and minerals com prised in the estate or 230 tenures of an intermediary shall be worked out after considering the report to be obtained from the Mining Officer of the existing re serves in the mines or minerals and the proba ble income therefrom in the future.
(3) The approximate amount of the total com pensation or annuity payable to the intermedi ary shall be arrived at by adding the approxi mate amount of compensation or annuity payable for mines and minerals to the approximate amount of compensation or annuity in respect of his other interests: Provided that, if no such informa tion regarding the existing reserves in the mines or minerals and the probable income therefrom in the future is available, the approximate amount of compensation or annuity shall be calculated only on the basis of the net income from the intermediary interests, other than mines or minerals, in accordance with sub rule (1): Provided further that the deduction allowed under clause (c) and (cc) of Sec. 4 shall be recovered by deduction from the approximate amount of compensation payable to the intermediary under this rule.
" It is clear from the facts brought out by the High Court that all the mines comprised in the estate or tenure of ex intermediary which were worked out directly by him although vested as a result of the provisions of section 4A were deemed by legal fiction to be subsequently settled by the State Government in favour of the ex intermediary and that ex intermediary should be deemed in law to be statutory lessee under the State Government in respect of the mines which have been worked out by him.
It is clear from several provisions of the Act including section 9 that there is no section dealing with the minerals at all.
In this connection sections 9 and 10 may be borne in mind.
Section 25 of the Act envisages compensation to be payable for mines and minerals and provides that ex interme diary shall be paid for the payment to the ex intermediary who is in receipt of royalties on account of mines and minerals or directly working mines in the estate or tenure consisting of his gross income namely, income of exinterme diary, gross and net income from royalty and his gross income 231 from mines worked directly by ex intermediary and the amount deemed to be the net income from royalties of his mines; under clause (c) of sub section (1) of section 25, the amount of compensation payable to him under the provisions of the Act for mines and minerals.
On behalf of the State Government it was contended that this item under clause (c) of section 25(1) was nothing additional or extra than clause (a) plus clause (b) of sub section (1) of section 25 and he supported this submission by reference to sub sections (2), (3) and (4) of section 25.
According to the State, Rule 25 E of the Rules does not carry the matter any further.
On the other hand counsel for the appellants, Mr. Ramamurthy, submitted that where there are minerals which were not tapped and not exploited by the ex intermediary, acquisition of source of income for the intermediary would be acquisition of property and no statute should be so read as would amount to, specially in the background of the constitutional provisions prevailing in 1950 when this Act was passed, as taking away right of property without payment of compensation.
It was urged that there was no provision for compensation for this purpose.
If it is so read as contended for by the respondent for this valuable property of the appellants, such construction which would amount to exproprietary legislation should be avoided.
On the other hand, it was submitted that there was no ques tion of expropriation.
The property was not in existence.
It was acquisition of a right which might be a source of income and property if tapped but it was not an existing right.
The Rules and the sections must be harmoniously con strued.
Here the legislature was acquiring the estate of ex intermediary.
For all the existing sources of his income and which were being exploited, compensation has been pro vided for.
But for fight which might become a source of income which had not been exploited, no compensation has been provided.
Where a statute provides for the assumption and enforcement of an existing right liability, it will not be construed as extending that liability or creating a new one unless it does so in clear terms.
See in this connection Halsbury 's Laws of England, 4th Edition, Vol.
44, page 556, paragraph 904.
But here there is no question of interpreting any law which will expose the Act to constitutional infirmi ty.
The right was not existing at the time of vesting no question therefore arises of depriving ex intermediary of any right without compensation.
The basic principle of construction of every statute is to find out 232 what is clearly stated and not to speculate upon latent imponderables.
The scheme of the Act does not support the appellant.
Moreover section 25(1)(a) & (b) deal with inde pendent items and sec.
25(1)(c) is a combination of two.
The other sub sections make it quite clear.
Compensation for the acquisition of a source which when exploited might become property or income is not necessary.
Ownership is a bundle of rights for all the elements of existing ingredients of bundle of rights and for the existing bundle of rights compensation has been provided for.
The statute is not bad on that ground.
It is not for the court to provide for compensation where legislature has thought it fit not to do so.
The view which we are taking in view of the fact that compensation for existing rights has been provided for would not expose this statute to the vice of the unconstitutionality as exproprietary.
Had there been such a possibility, other considerations might have been there.
The Act has been incorporated in Item I of the 9th Schedule of the Constitu tion.
How the respondent authorities treated this question in the initial stage is irrelevant.
It is well settled that a statute must be read as a whole, fairly and reasonably.
It must be so read, if possible, and warranted by the context to give effect to the manifest intent of the framer.
So read we find that the statute does not provide for any compensa tion for the minerals not exploited.
That does not make the Act unconstitutional.
So be it.
In that view of the matter, we are of the opinion that the High Court was right and the appeal must therefore fail and is accordingly dismissed.
In the facts and circumstances of the case, however, we make no order as to costs.
P.S.S. Appeal dismissed.
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Section 3 of the Bihar Land Reforms Act, 1950 provides for vesting of an estate or tenure in the State by notifica tion.
Under section 9 from the date of such vesting all mines comprised in the estate or tenure, as were in operation at the commencement of the Act and were being worked directly by the intermediary were deemed to have been leased to the intermediary and he was entitled to retain possession there of.
Section 10 provides for vesting of subsisting leases of mines and minerals.
Section 25 provides for computation of compensation payable to the intermediary in respect of royalties on account of mines and minerals or directly working mines comprised in the estate or tenure.
Rule 25 E of the Bihar Land Reforms Rules, 1951 deals with the proce dure for determination of the amount of compensation or annuity.
The estate of the ex landlord comprising vast areas of mineral bearing lands was vested in the State by virtue of a notification under section 3 of the Act with effect from 4th November, 1951.
Some part of the said area was being worked by the lessees under the leases granted to them, who paid royalty to him.
The ex landlord died in 1969.
His successors in inter est, the appellants herein, filed writ petition before the High Court claiming compensation in respect of the coal bearing area having coal reserves vested in the State.
The High Court came to the conclusion that the ex intermediary was not entitled to the compensation as claimed, and dis missed the petition.
225 In this appeal by certificate, it was contended for the appellants that where there are minerals which were not tapped and not exploited by the ex intermediary, acquisition of the source of income for the intermediary would be acqui sition of property, that there was no provision for compen sation for this purpose in the Act, and the statute was, therefore, exproprietary in nature.
For the respondents, it was contended that there was no question of expropriation.
The property being not in existence, it was acquisition of a right which might be a source or ' income and property it ' tapped, but it was not an existing right.
Dismissing the appeal, the Court, HELD 1.
A statute must be read as a whole, fairly and reasonably.
It must be so read, if possible, and warranted by the context to give effect to the manifest intent of the framer.
So read, it cannot be said that the Bihar Land Reforms Act, 1950 provides for any compensation for the minerals not exploited.
That does not make the Act unconsti tutional.
[232D] 2.
The Rules and the sections must be harmoniously construed.
In the instant case, the legislature was acquir ing the estate of an ex intermediary.
For all the existing sources of his income and which were being exploited, com pensation has been provided for.
But for a right which might become a source of income which had not been exploited, no compensation has been provided.
Where a statute provides for the assumption and enforcement of an existing right or liability, it will not be construed as extending that li ability or creating a new one unless it does so in clear terms.
[231F] Halsbury 's Laws of England, 4th Edition, Vol.
44, page 556, paragraph 904, referred to.
In the instant case there is no question of interpreting any law which will expose the Act to constitutional infirmi ty.
The right was not existing at the time of vesting, no question therefore, arises of depriving the ex intermediary of any right without compensation.
[231G] 3.
The basic principle of construction of every statute is to find out what is clearly stated and not to speculate upon latent imponderables.
The scheme of the Act does not support the appellant that it is exproprietary in nature.
Section 25(1)(a) and (b) deal with independent items and section 25(1)(c) is a combination of the two.
The other sub sections make it quite clear.
Compensation for the acquisition of a source which 226 when exploited might become property or income is not neces sary.
Ownership is a bundle of rights and for the existing bundle of rights compensation has been provided lot.
[231 H 232B] 4.
It is not for the court to provide for compensation where legislature has thought it fit not to do so.
The fact that compensation for existing rights has been provided for would not expose the statute to the vice of unconstitution ality as exproprietary.
Had there been such a possibility, other considerations might have been there.
The Act has been incorporated in Item 1 of the 9th Schedule of the Constitu tion.] [232C]
|
ivil Appeal No. 390 of 1981.
From the Judgment and Order dated 31.8.
1979 of the Patna High Court in C.W.J.C. No. 262 of 1979 (R).
M.K. Ramamurthy, A.K. Nag and Mrs. Naresh Bakshi for the Appellants.
Jaya Narayan and Pramod Swarup for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal is directed against the judgment and order of the High Court of Patna, (Ranchi Bench) dated 3 1st August, 1979.
It involves the question of the right of ex intermedi aries to get compensation for the minerals which were not exploited by the exlandlords on the date of vesting the estate under Bihar Land Reforms Act, 1950 (hereinafter referred to as the 'Act ').
Raja Nilkanth Narayan Singh of Sawagarh estate was the exlandlord whose estate vested by virtue of the notification under the Act with effect from 4th November, 1951.
The petitioners before the High Court and the appellants herein are the successors in interest being the grandson and the daughter in law of the late Nilkanth Narayan Singh.
The estate of the ex landlord comprised, inter alia, tauzi Nos.
14 and 15 of the District Collectorate of Dhanbad within the aforesaid tauzis.
These were vast areas of mineral bearing lands owned by the ex proprietor of the estate.
Some part of the said area 227 was being worked by the lessees under the leases granted to them who paid royalty to late Nilkanth Narayan Singh, afore said, who, it might be stated, died in November, 1969 in a state of jointness with other appellants.
The case of the appellants is that compensation in respect of the coal bearing area having coal reserves i.e. minerals, has not yet been paid by the State of Bihar al though the estate had vested in it as early as in November, 195 1.
So far as the mines that were being worked out or the minerals which were the subject matter of leases granted by the ex landlord are concerned, there was no dispute.
The appellants are entitled to and have not been denied compen sation in respect thereof under the Act, and the Rules.
The controversy is only on the question whether the ex landlord or his successor in interest is entitled to compen sation for the minerals which were not the subject matter of any lease granted in favour of any lessee.
However, it appears, there is no dispute on the question that had such minerals been the subject matter of a lease, the ex interme diary would have been entitled to compensation in respect thereof in the manner provided under the Act to be computed as prescribed by the Rules.
The High Court after an exhaustive discussion of the different provisions of the Act came to the conclusion that ex intermediary is not entitled to the compensation as claimed for and as such dismissed the application under Article 226 of the Constitution.
Being aggrieved by the said decision, the appellants after obtaining a certificate under Article 133(1) of the Constitution have come up to this Court.
The expression 'mines ' used in the Act or in the Rules had a distinct connotation namely those minerals that were unworked and unexcavated reserves while excavated mines had been worked.
The question, therefore, involves, as the High Court rightly pointed out not only the mines but with miner als located beneath the earth, and neither being worked by ex intermediary on the date of vesting nor being the subject matter of lease in favour of any third party.
The fights of the parties have t.o be worked out under the provisions of the Act.
The Act in question was an Act which was passed to provide for the transference to the State of the interests of proprietors, and tenure holders in land and of the mortgages and lessees of such interests including interests in trees, forests, fisheries, 'jalkars ' ferries, 228 'hats ', 'bazars ' mines and minerals, and to provide for the constitution of a Land Commission for the State of Bihar with powers to advise the State Government on the agrarian policy to be pursued by the State Government consequent upon such transference and for other matters connected therewith.
On an analysis of the scheme of the Act, it appears that section 3 of the Act provides for the notification vesting an estate or tenure in the State.
It provides, inter alia, that the State Government may, from time to time, by notifi cation declare that the estates or tenures of a proprietor or tenure holder, specified in the notification, have passed to and become vested in the State.
There was appropriate notification passed in this case.
On issuance of the notifi cation, the estates become vested in the State.
Section 4 deals with the consequences of vesting.
It provides that notwithstanding anything contained in any other law for the time being in force or in any contract, on the publication of the notification notwithstanding anything to the con trary, certain consequences, as mentioned in section 4 would follow.
Such consequences are mentioned in clauses (a), (b), (c), (d) and (e) and other sub clauses of section 4 of the Act.
Section 9 deals with the mines worked by intermediary and it provides that with effect from the date of vesting all such mines comprised in the estate or tenure as were in operation at the commencement of the Act and were being worked directly by the intermediary shall, notwithstanding anything contained in the Act, be deemed to have been leased by the appropriate Government to the intermediary and he shall be entitled to retain possession of those mines as a lessee thereof.
The terms and conditions of the said lease would be such as would be agreed upon between the State Government and the intermediary provided that all such terms and conditions shall be in accordance with the provisions of any Central Act for the time being in force.
Section 10 deals with the consequences of subsisting leases of mines and minerals and provides for vesting of the same.
Section 23 deals with computation of net income for the purpose of preparing compensation assessment roll of the net income of the intermediary.
Section 24 deals with the rates of compen sation, and provides that after the net income had been computed under section 23, the Compensation Officer should for the purpose of preparing compensation assessment roll proceed to determine the amount of compensation to be pay able in respect of the transference to the State of the interests of each intermediary.
The table is set out in the section.
Section 2.5.
is important and deals with the compu tation of compensation payable for mines and minerals.
The relevant portion of it provides, inter alia, as follows: "25.
Computation of compensation payable for mines and minerals.
229 (1) The Compensation Officer shall prepare in the prescribed form and in the prescribed manner compensation assessment roll containing in respect of every intermediary in receipt of royalties on account of mines and minerals or directly working mines comprised in the estate or tenure (a) his gross income and net income from such royalties; (b) his gross income from mines worked directly by him and the amount deemed to be his net income from royalties in respect of such mines; (c) the amount of compensation payable to him under the provisions of this Act for mines and minerals; and (d) such other particulars as may be pre scribed." Then sub section (2) of section 25 deals with the prepara tion of compensation roll for clause (a) of sub section (1) and sub section (3) deals with the preparation of compensa tion roll for clause (b) of sub section (1).
Sub section (4) deals with the question whether after net income from royal ties have been computed under sub sections (2) and (3), the Compensation Officer should proceed to determine the amount of compensation to be payable to the intermediary in the manner and in accordance with the principles laid down therein.
While we are on the provisions of the Act and the Rules, reference may be made to Bihar Land Reforms Rules, 195 1 (hereinafter called the 'Rules '), and Rule 25 E deals with the procedure for determining the approximate amount of compensation or annuity.
It provides as follows: "25 E. Procedure for determining the approximate amount of compensation or annuity.
(1) The approximate amount of compensation in respect of the intermediary interests, other than that payable for mines and minerals, shall be the approximate net income arrived at in the manner laid down in rule 25 C multi plied by the appropriate multiple referred to in Sec.
24(1); and the approximate amount of annuity shah be equal to the approximate net income.
(2) The approximate amount of compensation or annuity payable for mines and minerals com prised in the estate or 230 tenures of an intermediary shall be worked out after considering the report to be obtained from the Mining Officer of the existing re serves in the mines or minerals and the proba ble income therefrom in the future.
(3) The approximate amount of the total com pensation or annuity payable to the intermedi ary shall be arrived at by adding the approxi mate amount of compensation or annuity payable for mines and minerals to the approximate amount of compensation or annuity in respect of his other interests: Provided that, if no such informa tion regarding the existing reserves in the mines or minerals and the probable income therefrom in the future is available, the approximate amount of compensation or annuity shall be calculated only on the basis of the net income from the intermediary interests, other than mines or minerals, in accordance with sub rule (1): Provided further that the deduction allowed under clause (c) and (cc) of Sec. 4 shall be recovered by deduction from the approximate amount of compensation payable to the intermediary under this rule.
" It is clear from the facts brought out by the High Court that all the mines comprised in the estate or tenure of ex intermediary which were worked out directly by him although vested as a result of the provisions of section 4A were deemed by legal fiction to be subsequently settled by the State Government in favour of the ex intermediary and that ex intermediary should be deemed in law to be statutory lessee under the State Government in respect of the mines which have been worked out by him.
It is clear from several provisions of the Act including section 9 that there is no section dealing with the minerals at all.
In this connection sections 9 and 10 may be borne in mind.
Section 25 of the Act envisages compensation to be payable for mines and minerals and provides that ex interme diary shall be paid for the payment to the ex intermediary who is in receipt of royalties on account of mines and minerals or directly working mines in the estate or tenure consisting of his gross income namely, income of exinterme diary, gross and net income from royalty and his gross income 231 from mines worked directly by ex intermediary and the amount deemed to be the net income from royalties of his mines; under clause (c) of sub section (1) of section 25, the amount of compensation payable to him under the provisions of the Act for mines and minerals.
On behalf of the State Government it was contended that this item under clause (c) of section 25(1) was nothing additional or extra than clause (a) plus clause (b) of sub section (1) of section 25 and he supported this submission by reference to sub sections (2), (3) and (4) of section 25.
According to the State, Rule 25 E of the Rules does not carry the matter any further.
On the other hand counsel for the appellants, Mr. Ramamurthy, submitted that where there are minerals which were not tapped and not exploited by the ex intermediary, acquisition of source of income for the intermediary would be acquisition of property and no statute should be so read as would amount to, specially in the background of the constitutional provisions prevailing in 1950 when this Act was passed, as taking away right of property without payment of compensation.
It was urged that there was no provision for compensation for this purpose.
If it is so read as contended for by the respondent for this valuable property of the appellants, such construction which would amount to exproprietary legislation should be avoided.
On the other hand, it was submitted that there was no ques tion of expropriation.
The property was not in existence.
It was acquisition of a right which might be a source of income and property if tapped but it was not an existing right.
The Rules and the sections must be harmoniously con strued.
Here the legislature was acquiring the estate of ex intermediary.
For all the existing sources of his income and which were being exploited, compensation has been pro vided for.
But for fight which might become a source of income which had not been exploited, no compensation has been provided.
Where a statute provides for the assumption and enforcement of an existing right liability, it will not be construed as extending that liability or creating a new one unless it does so in clear terms.
See in this connection Halsbury 's Laws of England, 4th Edition, Vol.
44, page 556, paragraph 904.
But here there is no question of interpreting any law which will expose the Act to constitutional infirmi ty.
The right was not existing at the time of vesting no question therefore arises of depriving ex intermediary of any right without compensation.
The basic principle of construction of every statute is to find out 232 what is clearly stated and not to speculate upon latent imponderables.
The scheme of the Act does not support the appellant.
Moreover section 25(1)(a) & (b) deal with inde pendent items and sec.
25(1)(c) is a combination of two.
The other sub sections make it quite clear.
Compensation for the acquisition of a source which when exploited might become property or income is not necessary.
Ownership is a bundle of rights for all the elements of existing ingredients of bundle of rights and for the existing bundle of rights compensation has been provided for.
The statute is not bad on that ground.
It is not for the court to provide for compensation where legislature has thought it fit not to do so.
The view which we are taking in view of the fact that compensation for existing rights has been provided for would not expose this statute to the vice of the unconstitutionality as exproprietary.
Had there been such a possibility, other considerations might have been there.
The Act has been incorporated in Item I of the 9th Schedule of the Constitu tion.
How the respondent authorities treated this question in the initial stage is irrelevant.
It is well settled that a statute must be read as a whole, fairly and reasonably.
It must be so read, if possible, and warranted by the context to give effect to the manifest intent of the framer.
So read we find that the statute does not provide for any compensa tion for the minerals not exploited.
That does not make the Act unconstitutional.
So be it.
In that view of the matter, we are of the opinion that the High Court was right and the appeal must therefore fail and is accordingly dismissed.
In the facts and circumstances of the case, however, we make no order as to costs.
P.S.S. Appeal dismissed.
|
ivil Appeal No. 390 of 1981.
From the Judgment and Order dated 31.8.
1979 of the Patna High Court in C.W.J.C. No. 262 of 1979 (R).
M.K. Ramamurthy, A.K. Nag and Mrs. Naresh Bakshi for the Appellants.
Jaya Narayan and Pramod Swarup for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal is directed against the judgment and order of the High Court of Patna, (Ranchi Bench) dated 3 1st August, 1979.
It involves the question of the right of ex intermedi aries to get compensation for the minerals which were not exploited by the exlandlords on the date of vesting the estate under Bihar Land Reforms Act, 1950 (hereinafter referred to as the 'Act ').
Raja Nilkanth Narayan Singh of Sawagarh estate was the exlandlord whose estate vested by virtue of the notification under the Act with effect from 4th November, 1951.
The petitioners before the High Court and the appellants herein are the successors in interest being the grandson and the daughter in law of the late Nilkanth Narayan Singh.
The estate of the ex landlord comprised, inter alia, tauzi Nos.
14 and 15 of the District Collectorate of Dhanbad within the aforesaid tauzis.
These were vast areas of mineral bearing lands owned by the ex proprietor of the estate.
Some part of the said area 227 was being worked by the lessees under the leases granted to them who paid royalty to late Nilkanth Narayan Singh, afore said, who, it might be stated, died in November, 1969 in a state of jointness with other appellants.
The case of the appellants is that compensation in respect of the coal bearing area having coal reserves i.e. minerals, has not yet been paid by the State of Bihar al though the estate had vested in it as early as in November, 195 1.
So far as the mines that were being worked out or the minerals which were the subject matter of leases granted by the ex landlord are concerned, there was no dispute.
The appellants are entitled to and have not been denied compen sation in respect thereof under the Act, and the Rules.
The controversy is only on the question whether the ex landlord or his successor in interest is entitled to compen sation for the minerals which were not the subject matter of any lease granted in favour of any lessee.
However, it appears, there is no dispute on the question that had such minerals been the subject matter of a lease, the ex interme diary would have been entitled to compensation in respect thereof in the manner provided under the Act to be computed as prescribed by the Rules.
The High Court after an exhaustive discussion of the different provisions of the Act came to the conclusion that ex intermediary is not entitled to the compensation as claimed for and as such dismissed the application under Article 226 of the Constitution.
Being aggrieved by the said decision, the appellants after obtaining a certificate under Article 133(1) of the Constitution have come up to this Court.
The expression 'mines ' used in the Act or in the Rules had a distinct connotation namely those minerals that were unworked and unexcavated reserves while excavated mines had been worked.
The question, therefore, involves, as the High Court rightly pointed out not only the mines but with miner als located beneath the earth, and neither being worked by ex intermediary on the date of vesting nor being the subject matter of lease in favour of any third party.
The fights of the parties have t.o be worked out under the provisions of the Act.
The Act in question was an Act which was passed to provide for the transference to the State of the interests of proprietors, and tenure holders in land and of the mortgages and lessees of such interests including interests in trees, forests, fisheries, 'jalkars ' ferries, 228 'hats ', 'bazars ' mines and minerals, and to provide for the constitution of a Land Commission for the State of Bihar with powers to advise the State Government on the agrarian policy to be pursued by the State Government consequent upon such transference and for other matters connected therewith.
On an analysis of the scheme of the Act, it appears that section 3 of the Act provides for the notification vesting an estate or tenure in the State.
It provides, inter alia, that the State Government may, from time to time, by notifi cation declare that the estates or tenures of a proprietor or tenure holder, specified in the notification, have passed to and become vested in the State.
There was appropriate notification passed in this case.
On issuance of the notifi cation, the estates become vested in the State.
Section 4 deals with the consequences of vesting.
It provides that notwithstanding anything contained in any other law for the time being in force or in any contract, on the publication of the notification notwithstanding anything to the con trary, certain consequences, as mentioned in section 4 would follow.
Such consequences are mentioned in clauses (a), (b), (c), (d) and (e) and other sub clauses of section 4 of the Act.
Section 9 deals with the mines worked by intermediary and it provides that with effect from the date of vesting all such mines comprised in the estate or tenure as were in operation at the commencement of the Act and were being worked directly by the intermediary shall, notwithstanding anything contained in the Act, be deemed to have been leased by the appropriate Government to the intermediary and he shall be entitled to retain possession of those mines as a lessee thereof.
The terms and conditions of the said lease would be such as would be agreed upon between the State Government and the intermediary provided that all such terms and conditions shall be in accordance with the provisions of any Central Act for the time being in force.
Section 10 deals with the consequences of subsisting leases of mines and minerals and provides for vesting of the same.
Section 23 deals with computation of net income for the purpose of preparing compensation assessment roll of the net income of the intermediary.
Section 24 deals with the rates of compen sation, and provides that after the net income had been computed under section 23, the Compensation Officer should for the purpose of preparing compensation assessment roll proceed to determine the amount of compensation to be pay able in respect of the transference to the State of the interests of each intermediary.
The table is set out in the section.
Section 2.5.
is important and deals with the compu tation of compensation payable for mines and minerals.
The relevant portion of it provides, inter alia, as follows: "25.
Computation of compensation payable for mines and minerals.
229 (1) The Compensation Officer shall prepare in the prescribed form and in the prescribed manner compensation assessment roll containing in respect of every intermediary in receipt of royalties on account of mines and minerals or directly working mines comprised in the estate or tenure (a) his gross income and net income from such royalties; (b) his gross income from mines worked directly by him and the amount deemed to be his net income from royalties in respect of such mines; (c) the amount of compensation payable to him under the provisions of this Act for mines and minerals; and (d) such other particulars as may be pre scribed." Then sub section (2) of section 25 deals with the prepara tion of compensation roll for clause (a) of sub section (1) and sub section (3) deals with the preparation of compensa tion roll for clause (b) of sub section (1).
Sub section (4) deals with the question whether after net income from royal ties have been computed under sub sections (2) and (3), the Compensation Officer should proceed to determine the amount of compensation to be payable to the intermediary in the manner and in accordance with the principles laid down therein.
While we are on the provisions of the Act and the Rules, reference may be made to Bihar Land Reforms Rules, 195 1 (hereinafter called the 'Rules '), and Rule 25 E deals with the procedure for determining the approximate amount of compensation or annuity.
It provides as follows: "25 E. Procedure for determining the approximate amount of compensation or annuity.
(1) The approximate amount of compensation in respect of the intermediary interests, other than that payable for mines and minerals, shall be the approximate net income arrived at in the manner laid down in rule 25 C multi plied by the appropriate multiple referred to in Sec.
24(1); and the approximate amount of annuity shah be equal to the approximate net income.
(2) The approximate amount of compensation or annuity payable for mines and minerals com prised in the estate or 230 tenures of an intermediary shall be worked out after considering the report to be obtained from the Mining Officer of the existing re serves in the mines or minerals and the proba ble income therefrom in the future.
(3) The approximate amount of the total com pensation or annuity payable to the intermedi ary shall be arrived at by adding the approxi mate amount of compensation or annuity payable for mines and minerals to the approximate amount of compensation or annuity in respect of his other interests: Provided that, if no such informa tion regarding the existing reserves in the mines or minerals and the probable income therefrom in the future is available, the approximate amount of compensation or annuity shall be calculated only on the basis of the net income from the intermediary interests, other than mines or minerals, in accordance with sub rule (1): Provided further that the deduction allowed under clause (c) and (cc) of Sec. 4 shall be recovered by deduction from the approximate amount of compensation payable to the intermediary under this rule.
" It is clear from the facts brought out by the High Court that all the mines comprised in the estate or tenure of ex intermediary which were worked out directly by him although vested as a result of the provisions of section 4A were deemed by legal fiction to be subsequently settled by the State Government in favour of the ex intermediary and that ex intermediary should be deemed in law to be statutory lessee under the State Government in respect of the mines which have been worked out by him.
It is clear from several provisions of the Act including section 9 that there is no section dealing with the minerals at all.
In this connection sections 9 and 10 may be borne in mind.
Section 25 of the Act envisages compensation to be payable for mines and minerals and provides that ex interme diary shall be paid for the payment to the ex intermediary who is in receipt of royalties on account of mines and minerals or directly working mines in the estate or tenure consisting of his gross income namely, income of exinterme diary, gross and net income from royalty and his gross income 231 from mines worked directly by ex intermediary and the amount deemed to be the net income from royalties of his mines; under clause (c) of sub section (1) of section 25, the amount of compensation payable to him under the provisions of the Act for mines and minerals.
On behalf of the State Government it was contended that this item under clause (c) of section 25(1) was nothing additional or extra than clause (a) plus clause (b) of sub section (1) of section 25 and he supported this submission by reference to sub sections (2), (3) and (4) of section 25.
According to the State, Rule 25 E of the Rules does not carry the matter any further.
On the other hand counsel for the appellants, Mr. Ramamurthy, submitted that where there are minerals which were not tapped and not exploited by the ex intermediary, acquisition of source of income for the intermediary would be acquisition of property and no statute should be so read as would amount to, specially in the background of the constitutional provisions prevailing in 1950 when this Act was passed, as taking away right of property without payment of compensation.
It was urged that there was no provision for compensation for this purpose.
If it is so read as contended for by the respondent for this valuable property of the appellants, such construction which would amount to exproprietary legislation should be avoided.
On the other hand, it was submitted that there was no ques tion of expropriation.
The property was not in existence.
It was acquisition of a right which might be a source of income and property if tapped but it was not an existing right.
The Rules and the sections must be harmoniously con strued.
Here the legislature was acquiring the estate of ex intermediary.
For all the existing sources of his income and which were being exploited, compensation has been pro vided for.
But for fight which might become a source of income which had not been exploited, no compensation has been provided.
Where a statute provides for the assumption and enforcement of an existing right liability, it will not be construed as extending that liability or creating a new one unless it does so in clear terms.
See in this connection Halsbury 's Laws of England, 4th Edition, Vol.
44, page 556, paragraph 904.
But here there is no question of interpreting any law which will expose the Act to constitutional infirmi ty.
The right was not existing at the time of vesting no question therefore arises of depriving ex intermediary of any right without compensation.
The basic principle of construction of every statute is to find out 232 what is clearly stated and not to speculate upon latent imponderables.
The scheme of the Act does not support the appellant.
Moreover section 25(1)(a) & (b) deal with inde pendent items and sec.
25(1)(c) is a combination of two.
The other sub sections make it quite clear.
Compensation for the acquisition of a source which when exploited might become property or income is not necessary.
Ownership is a bundle of rights for all the elements of existing ingredients of bundle of rights and for the existing bundle of rights compensation has been provided for.
The statute is not bad on that ground.
It is not for the court to provide for compensation where legislature has thought it fit not to do so.
The view which we are taking in view of the fact that compensation for existing rights has been provided for would not expose this statute to the vice of the unconstitutionality as exproprietary.
Had there been such a possibility, other considerations might have been there.
The Act has been incorporated in Item I of the 9th Schedule of the Constitu tion.
How the respondent authorities treated this question in the initial stage is irrelevant.
It is well settled that a statute must be read as a whole, fairly and reasonably.
It must be so read, if possible, and warranted by the context to give effect to the manifest intent of the framer.
So read we find that the statute does not provide for any compensa tion for the minerals not exploited.
That does not make the Act unconstitutional.
So be it.
In that view of the matter, we are of the opinion that the High Court was right and the appeal must therefore fail and is accordingly dismissed.
In the facts and circumstances of the case, however, we make no order as to costs.
P.S.S. Appeal dismissed.
|
Section 3 of the Bihar Land Reforms Act, 1950 provides for vesting of an estate or tenure in the State by notifica tion.
Under section 9 from the date of such vesting all mines comprised in the estate or tenure, as were in operation at the commencement of the Act and were being worked directly by the intermediary were deemed to have been leased to the intermediary and he was entitled to retain possession there of.
Section 10 provides for vesting of subsisting leases of mines and minerals.
Section 25 provides for computation of compensation payable to the intermediary in respect of royalties on account of mines and minerals or directly working mines comprised in the estate or tenure.
Rule 25 E of the Bihar Land Reforms Rules, 1951 deals with the proce dure for determination of the amount of compensation or annuity.
The estate of the ex landlord comprising vast areas of mineral bearing lands was vested in the State by virtue of a notification under section 3 of the Act with effect from 4th November, 1951.
Some part of the said area was being worked by the lessees under the leases granted to them, who paid royalty to him.
The ex landlord died in 1969.
His successors in inter est, the appellants herein, filed writ petition before the High Court claiming compensation in respect of the coal bearing area having coal reserves vested in the State.
The High Court came to the conclusion that the ex intermediary was not entitled to the compensation as claimed, and dis missed the petition.
225 In this appeal by certificate, it was contended for the appellants that where there are minerals which were not tapped and not exploited by the ex intermediary, acquisition of the source of income for the intermediary would be acqui sition of property, that there was no provision for compen sation for this purpose in the Act, and the statute was, therefore, exproprietary in nature.
For the respondents, it was contended that there was no question of expropriation.
The property being not in existence, it was acquisition of a right which might be a source or ' income and property it ' tapped, but it was not an existing right.
Dismissing the appeal, the Court, HELD 1.
A statute must be read as a whole, fairly and reasonably.
It must be so read, if possible, and warranted by the context to give effect to the manifest intent of the framer.
So read, it cannot be said that the Bihar Land Reforms Act, 1950 provides for any compensation for the minerals not exploited.
That does not make the Act unconsti tutional.
[232D] 2.
The Rules and the sections must be harmoniously construed.
In the instant case, the legislature was acquir ing the estate of an ex intermediary.
For all the existing sources of his income and which were being exploited, com pensation has been provided for.
But for a right which might become a source of income which had not been exploited, no compensation has been provided.
Where a statute provides for the assumption and enforcement of an existing right or liability, it will not be construed as extending that li ability or creating a new one unless it does so in clear terms.
[231F] Halsbury 's Laws of England, 4th Edition, Vol.
44, page 556, paragraph 904, referred to.
In the instant case there is no question of interpreting any law which will expose the Act to constitutional infirmi ty.
The right was not existing at the time of vesting, no question therefore, arises of depriving the ex intermediary of any right without compensation.
[231G] 3.
The basic principle of construction of every statute is to find out what is clearly stated and not to speculate upon latent imponderables.
The scheme of the Act does not support the appellant that it is exproprietary in nature.
Section 25(1)(a) and (b) deal with independent items and section 25(1)(c) is a combination of the two.
The other sub sections make it quite clear.
Compensation for the acquisition of a source which 226 when exploited might become property or income is not neces sary.
Ownership is a bundle of rights and for the existing bundle of rights compensation has been provided lot.
[231 H 232B] 4.
It is not for the court to provide for compensation where legislature has thought it fit not to do so.
The fact that compensation for existing rights has been provided for would not expose the statute to the vice of unconstitution ality as exproprietary.
Had there been such a possibility, other considerations might have been there.
The Act has been incorporated in Item 1 of the 9th Schedule of the Constitu tion.] [232C]
|
Section 3 of the Bihar Land Reforms Act, 1950 provides for vesting of an estate or tenure in the State by notifica tion. Under section 9 from the date of such vesting all mines comprised in the estate or tenure, as were in operation at the commencement of the Act and were being worked directly by the intermediary were deemed to have been leased to the intermediary and he was entitled to retain possession there of. Section 10 provides for vesting of subsisting leases of mines and minerals. Rule 25 E of the Bihar Land Reforms Rules, 1951 deals with the proce dure for determination of the amount of compensation or annuity. The estate of the ex landlord comprising vast areas of mineral bearing lands was vested in the State by virtue of a notification under section 3 of the Act with effect from 4th November, 1951. Some part of the said area was being worked by the lessees under the leases granted to them, who paid royalty to him. His successors in inter est, the appellants herein, filed writ petition before the High Court claiming compensation in respect of the coal bearing area having coal reserves vested in the State. 225 In this appeal by certificate, it was contended for the appellants that where there are minerals which were not tapped and not exploited by the ex intermediary, acquisition of the source of income for the intermediary would be acqui sition of property, that there was no provision for compen sation for this purpose in the Act, and the statute was, therefore, exproprietary in nature. For the respondents, it was contended that there was no question of expropriation. The property being not in existence, it was acquisition of a right which might be a source or ' income and property it ' tapped, but it was not an existing right. Dismissing the appeal, the Court, HELD 1. A statute must be read as a whole, fairly and reasonably. It must be so read, if possible, and warranted by the context to give effect to the manifest intent of the framer. That does not make the Act unconsti tutional. The Rules and the sections must be harmoniously construed. In the instant case, the legislature was acquir ing the estate of an ex intermediary. For all the existing sources of his income and which were being exploited, com pensation has been provided for. But for a right which might become a source of income which had not been exploited, no compensation has been provided. Where a statute provides for the assumption and enforcement of an existing right or liability, it will not be construed as extending that li ability or creating a new one unless it does so in clear terms. [231F] Halsbury 's Laws of England, 4th Edition, Vol. 44, page 556, paragraph 904, referred to. In the instant case there is no question of interpreting any law which will expose the Act to constitutional infirmi ty. The basic principle of construction of every statute is to find out what is clearly stated and not to speculate upon latent imponderables. The scheme of the Act does not support the appellant that it is exproprietary in nature. Section 25(1)(a) and (b) deal with independent items and section 25(1)(c) is a combination of the two. The other sub sections make it quite clear. Compensation for the acquisition of a source which 226 when exploited might become property or income is not neces sary. Ownership is a bundle of rights and for the existing bundle of rights compensation has been provided lot. It is not for the court to provide for compensation where legislature has thought it fit not to do so. The fact that compensation for existing rights has been provided for would not expose the statute to the vice of unconstitution ality as exproprietary. Had there been such a possibility, other considerations might have been there. The Act has been incorporated in Item 1 of the 9th Schedule of the Constitu tion.] [
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ivil Appeal Nos. 116117 of 1987.
309 From the Judgment and Order dated 28.11.1986 of the Bombay High Court in Civil Writ Petition Nos.
5391 And 55 15 of 1985.
F.S. Nariman, R.F. Nariman, Ashok Goel, Rajan Karanjawa la and Ejaz Mazbool for the Appellant.
H.C. Tunara, M.N. Shroff, A.G. Parekh and K.M.K. Khan for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is by the tenant from the judgment and order of the High Court of Bombay dated 28th of November, 1986.
The only question involved in this appeal is what is the period of limitation for the recovery of possession of the demised premises.
The premises in question is located on the Municipal Street No. 16 in Fanaswadi area of Bombay.
The tenant was inducted as a monthly tenant in respect of the said premises at a monthly rent of Rs. 105.60 for the purpose of conducting ice cream business which was being carried on by her husband who was the holder of the power of attorney on her behalf.
The premises consisted of the entire structure on the ground floor with a loft covering the entire area with corrugated iron sheets.
The letting was done on an agreement dated 29th of December, 1975 which was to become effective from the 1st of January, 1976.
It is the case of the landlord, the re spondent herein, that in breach of the agreement and the terms of tenancy as also in violation of.
the prohibition prescribed under section 13(1) of the Bombay Rents, Hotel & Lodging House Rates (Control) Act, 1947 (hereinafter re ferred to as the Rent Act), the tenant had indulged in several acts of commission by which not only there has been permanent alterations of major nature but the entire struc ture was completely changed so much so that even the height of the structure was increased and thus, the loft lost its initial character and became almost as a first floor which was the creation of the appellant tenant herein.
Several other breaches were alleged to have been committed in re spect of the terms of tenancy.
It was alleged that the tenant had indulged in the acts of waste and damage to the property and that further she had changed the user of the suit premises when some of the employees started residing there.
On the basis of those and other allied allegations on the 20th of September, 1978 the landlord, respondent herein, gave a notice to quit to the tenant, the appellant herein, on the ground that the tenant had (1) made alterations of permanent nature in respect of the demised premises, (2) committed 310 acts of waste and damage and (3) changed the user of the premises.
In 1979 the landlord filed R.A.E. Suit No. 1326/4557 of 1979 against the tenant in the Small Causes Court, Bombay for possession of the demised premises.
The Trial Court on 11th November.
1982 decreed the suit uphold ing, inter alia, that the tenant had made alterations of permanent nature in the demised premises and had committed acts of waste and damage.
Aggrieved by the said decision Appeal No. 667 of 1982 was filed by the tenant against the decree of the Trial court.
The same was allowed by the Appellate Bench of the Small Causes Court on 28th September, 1985 and the respondent 's suit for eviction was dismissed on the ground that the suit was barred by lapse of time under article 113 of the (hereinafter called the ).
The High Court of Bombay on 28th of November, 1986 allowed the writ petition being Writ Petition No. 5391 of 1985 filed by the landlord under Article 227 of the Constitution against the judgment of the Appellate Bench of the Small Causes Court.
The High Court allowed the said Writ Petition filed by the landlord and dismissed the Writ Petition being Writ Petition No. 5515 of 1985 filed by the tenant.
In the premises the High Court 's judgment and order dated 28th of November, 1986 impugned in this appeal re stored the judgment of the Trial Court decreeing the re spondent 's suit for possession.
All the three courts have held that the tenant, appel lant herein, had made alterations of permanent nature and had committed acts of waste and damage.
The Appellate Bench of the Small Causes Court and the High Court, however, differed on the question of limitation.
The Appellate Bench of the Small Causes Court had held that the suit was barred under article 113 of the which prescribed a period of 3 years while the High Court held that articles 66 or 67 was applicable which prescribed a period of 12 years.
According to the landlord respondent, the suit though filed after 3 years was filed within 12 years of the accrual of the cause of action.
The only question which was argued in this appeal was the question of limitation.
No factual aspect was agitated before this Court.
This appeal must therefore, decide the question which article of the Limita tion Act would be applicable, that is to say, whether arti cle 113 or either of the article 66 or 67 and what would be the date of the accrual of cause or ' action.
On behalf of the appellant, it was submitted by Mr. Nariman that on the facts of this case, article 113 of the would alone apply because according to him neither article 66 nor article 67 would have any applica tion.
It may not be inappropriate to set out article 66 and article 67 of the Schedule of the .
The said articles 311 appear in of the Schedule First Division dealing with suits relating to immovable property.
The first column gives the description of suit, the second column gives the period of limitation and the third column deals with time from which period begins to run.
Articles 66 and 67 read as follows: "66.
For possession Twelve When the forfeiture of immovable property years is incurred or the when the plaintiff condition is has become entitled broken.
to possession by reason of any forfeiture or breach of condition.
By a landlord to Twelve When the recover possession years tenancy is from a tenant.
determined.
" Article 113 on the other hand which is in dealing with suits provides that for any suit for which no period of limitation is provided elsewhere in the Schedule the period would be three years from the date when the right to sue accrues.
It was submitted by Shri Tunara, learned counsel for the respondent landlord that for any suit by a landlord against a tenant for recovery of possession under the Rent Act, the was inherently inapplicable.
We are, however, unable to accept this argument.
Recovery of possession is by a suit and there is no section in the scheme of the Limita tion Act to indicate that was inherently inapplicable.
In the scheme of the Rent Act or in the var ious contingencies contemplated under the Rent Act, there is nothing to indicate or warrant that there would be no limi tation of any period.
Article 67 of the which has been set out hereinbefore indicates that time begins to run only when the tenancy is determined.
It comprehends suit by a landlord and deals with fight to recover possession from the tenant.
Therefore, it deals with landlord and tenant.
We are therefore unable to accept the argument of the respondent that limitation was inapplicable to eject ment.
On behalf of the appellant it was however submitted that article 67 of the had no application inasmuch as time begins to run only when the tenancy is determined.
A determination of tenancy which takes place under the Trans fer of Property Act is wholly irrele 312 vant for cause of action in ejectment.
It is an act in law and not an act of law because under the scheme a determina tion of tenancy which takes place under the Transfer of Property Act, according to the appellant, is wholly irrele vant for rounding a cause of action in ejectment because the provisions of the Transfer of Property Act are superseded by the provisions of the Rent Act and according to the appel lant a cause of action for eviction is to be rounded only on one of the grounds mentioned in Section 13 of the Rent Act.
For this reliance was placed on V. Dhanpal Chettiar vs Yesodai Ammal; , where this Court held that a lease between a lessor and a lessee comes into exist ence by way of contract when the parties to the contract agree on the rent, duration of tenancy and other relevant terms.
Section 111 of the Transfer of Property Act provides various methods by which a lease of immovable property can be determined.
Under clause (h) of section 111 a lease determines on the expiry of a notice to determine the lease given by the landlord to the tenant.
But a notice is not compulsory or obligatory nor must it fulfil all the techni cal requirements of section 106 of the Transfer of Property Act, because as a result of the various State Rent Acts the liability to be evicted if incurred by the tenant, he cannot turn round and say that the contractual tenancy had not been determined.
It was further reiterated that the action of the landlord in instituting a suit for eviction on the ground mentioned in the State Rent Act would tantamount to an expression of the intention of the landlord that he does not want the tenant to continue as his lessee and the jural relationship between the lessor and the lessee would come to an end on the passing of an order or a decree for eviction.
Until then, under the extended definition of 'tenant ' under the various State Rent Acts, the tenant continued to be a tenant even though the contractual tenancy had been deter mined by giving a valid notice under section 106 of the Transfer of Property Act.
Therefore notice under section 106 of the Transfer of Property Act terminating the tenancy is no longer necessary.
At page 353 of the said report, the Court was of the view that making out a case under the Rent Act for eviction of the tenant by itself was sufficient and it was not obligatory to the proceeding on the basis of the determination of the lease by issue of a notice in accord ance with section 106 of the Transfer of Property Act.
This view was also reiterated again in Pradesh Kumar Bajpai vs Binod Behari Sarkar; , where this Court observed that once the requirements of Rent Act were satis fied, the tenant could not claim the double protection of invoking the provisions of the Transfer of Property Act or the terms of the contract.
Therefore, in the case before this Court the question of termination of lease by forfei ture did not arise on the facts of that case 313 and after the Rent Act came into force, the landlord could not avail himself of clause 12 which provided for forfei ture, in that case, even if the tenant had neglected to pay the rent for over two months and further the landlord could not enter into possession forthwith without notice.
The only remedy for him is to seek eviction under the provisions of the Rent Act.
See also in this connection the observations in Gian DeviAnandv.
Jeevan Kumar & others, [1985] 2 S.C.C. 683.
It was further submitted on behalf of the appellant that columns 1 and 3 of the Schedule of the should be read together and if a case does not fall within either column 1 or column 3 the residuary article must apply.
Reference may be made to the observations in Kripal Shah Sant Singh vs Shri Harkishan Das Narsingh Das, at 275; M/s. Swastik Agency, Madras vs The Madras Port Trust and another, A.I.R. 1966 Madras 130 at 135 and Mulla Vittil Seeti, Kutti and others vs K.M.K. Kunhi Pathum ma and others, A.I.R. 1919 Madras 972.
Mr. Nariman, learned counsel for the appellant submitted that the expression "determination" appears in section 111 of the Transfer of Property Act.
Under section 14 of the Bombay Rent Act, the same expression was used in the context of a sub tenant becoming a direct tenant of the landlord.
This expression however, according to the appellant, is not to be found in section 13.
of the Act.
This Court has held that this expression contained in section 14 of the Rent Act is different from the expression contained in section 111 of the Transfer of Property Act inasmuch as the tenancy only determines under the Rent Act for a decree only for eviction is passed, and not before.
Reliance was placed in support of this argument on the observation of this Court in Hiralal Vallabhram vs Kastorbhai Lalbhai & Ors., ; at 349 and 350.
It was further urged therefore that article 67 of the would not apply.
Article 66, according to the appellant, contemplates an immediate fight to recover possession.
Breach of a condition must lead to an immediate right to possession without more.
This would not be a determination in law according to the appellant.
Section 13 of the Rent Act contemplated, however, two conditions being fulfilled one is a ground for ejectment subsisting and the other is the Court 's satisfaction which is a condition precedent before which there is a no immedi ate right to possession.
Reliance in support of this propo sition was placed on Sharoop Dass Mondal vs Joggessur Roy Chowdhry, I.L.R. 26 Calcutta 564 at 568; Annamalai Pathar vs Sri la sri 314 Vythilinga Pandara Sannadhi A vergal and another, A.I.R. 1937 Madras 295 at 297; Mahalinga Bandappa Lakhannavar vs Venkatesh Waman Karnataki, 59 B.L.R. 227 at 233; Bahadur Singh & Anr.
vs Muni Subrat Dass & Anr., at 436; Kaushalaya Devi & Ors.
vs Shri K.L. Bansal, ; at 1050 and Ferozi Lal Jain vs Man Mal and another, at 795 and 796.
Under section 13 of the Rent Act, possession is not recoverable only for breach of a condition, and it is recoverable on fulfilment and not breach of a condition precedent to the Court 's satisfaction, according to counsel for the appellant.
It was further submitted on behalf of the appellant that section 13(1) of the Rent Act was to be contrasted with section 12(1) recovery of possession under section 13(1) was not directly upon a breach of condition of tenancy, but only upon the Court 's satisfaction that a ground for recovery of possession was made out.
Under section 12(1), however, a landlord is not entitled to recover possession so long as the tenant observed the "conditions of tenancy".
It was further submitted that section 13 is subject to sections 15 and 15A of the Rent Act if the landlord and the tenant respectively have fulfilled (not breached) according to the counsel, the provisions of these two sections, no suit for ejectment will lie.
It was urged that again showed that section 13(1) of the Rent Act contained conditions that were to be fulfilled before a landlord can recover possession for a tenant 's breach of condition.
Section 13(1) contained grounds for eviction of a tenant which need not be for breach of any condition.
According to the appellant only one article for recovery of possession is reserved under the by a landlord from a tenant, that is article 139 of the Limitation Act, 1908.
This article is the exact predecessor of article 67.
Article 66 is a general article, says the appellant, which does not apply to landlord or tenant and it was further submitted that when a specific article applied, a general article should not be applied specially when it was not free from doubt.
Some authorities were referred to in this behalf.
We accept this submission on the principle of construc tion.
It is further reiterated that a strained construction to give a more favourable limitation period is to be avoid ed considerations of equity were out of place in construing the articles under the Limitation Act.
It was submitted before us that section 12(1) of the Rent Act did not apply to the facts of the present case.
The decree for eviction was grounded upon section 13(i)(b) of the Rent Act and not on section 12(1).
It was further reiterated that the non obstante clause of section 13 made it clear that where a condition of tenancy coincided with a ground for eviction, the ground for eviction alone is to be looked at and to that 315 extent, any breach of the condition of tenancy was supersed ed by the ground for eviction.
Also in the instant case, clause 3 of the agreement dated 29th December, 1975 is inconsistent with the provisions of the Act inasmuch as even temporary structures were not allowed to be erected and there is no provision for the written consent of the land lord.
It was further submitted without prejudice to the aforesaid submission that section 12(1) of the Rent Act was a section that was designed to afford protection to a tenant if his lease was determined under the Transfer of Property Act and it was thus designed to be a shield but not a word.
It was submitted that the decision in Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, [1967] 84 Bombay LaW Report p. 122 is against the current of modern rent juris prudence.
Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, (supra) which is a decision of the Bench of three judges and as such binding on this Court held that sections 12 and 13 of the Bombay Rent Act dealt with different topics and have different objects.
It was held that section 12(1) clothed a tenant with the cloak of statutory protection against eviction so long as he performs the conditions of tenancy.
Section 13 provides that notwithstanding that protection the landlord can sue for eviction provided he established any one of the circumstances set out in that section.
This Court further observed that it was impossible to say that it was only when circumstances set out in sec tion 13 arose that a landlord could evict and that eviction on the ground of the failure to perform the conditions of tenancy would not deprive the tenant of the protection under section 12(1) of the Rent Act.
Such a reading would be contrary to the whole scheme underlying the objects of the two sections.
We accept the aforesaid legal position.
It is not against the trend of the principle behind rent legisla tion.
It affords protection to the tenant inasmuch as it says that it was only on the fulfilment of the condition stipulated in the two sections and on satisfaction of the contingencies mentioned in section 12 which would deprive the tenant of the protection that the tenant can be evicted.
Much argument was advanced to the contrary but in our opinion to prevent unreasonable eviction, in balancing and harmonising the rights of the landlords and tenant if the sections are so read as done in Haji Sulernan 's case, it would meet the ends of justice and that would be proper construction.
If that is so then on the strict grammatical meaning article 67 of the Limitation Act would be applicable.
This is indubitably a suit by the landlord against the tenant to recover possession from the tenant.
316 Therefore the suit clearly comes within article 67 of the Limitation Act.
The suit was filed because the tenancy was determined by the combined effect of the operation of sec tions 12 and 13 of the Bombay Rent Act.
In this connection, the terms of sections 12 and 13 of the Bombay Rent Act may be referred to.
At the most it would be within article 66 of the Limitation Act if we hold that forfeiture has been incurred by the appellant in view of the breach of the conditions mentioned in section 13 of the Bombay Rent Act and on lifting on the embargo against eviction of tenant in terms of section 12 of the said Act.
That being so, either of the two, article 66 or article 67 would be applicable to the facts of this case; there is no scope of the application of article 113 of the Limitation Act in any view of the matter.
Sections 12 and 13 of the Bombay Rent Act co exist and must be harmonised to effect the purpose and intent of the legislature for the purpose of eviction of the tenant.
In that view of the matter article 113 of the Limitation Act has no scope of application.
Large number of authorities were cited.
In the view we have taken on the construction of the provisions of articles 67 and 66 of the Limitation Act and the nature of the cause of action in this case in the light of sections 12 and 13 of the Bombay Rent Act, we are of the opinion that the period of limitation in this case would be 12 years.
There is no dispute that if the period of limitation be 12 years, the suit was not barred.
In that view of the matter, the appeals fail and are accordingly dismissed with costs.
N.V.K. Appeals dis missed.
|
The appellant in the appeals was the tenant of the demised premises who was inducted as a monthly tenant for the purpose of conducting the ice cream business carried on by her husband.
The letting was done on an agreement dated December 29, 1975 by the landlord respondent which was to become effective from January 1, 1976.
The landlord alleged that in breach of the agreement and the terms of the tenancy, as also in violation of the prohi bition prescribed under section 13(1) of the Bombay Rents, Hotels & Lodging House Rates (Control) Act, 1947 the tenant had indulged in several acts of commission by which not only there had been permanent alterations of major nature, but the entire structure of the demised premises was completely changed.
it was also alleged that the tenant had indulged in acts of waste and damage to the property, and that she had changed the user of the premises when some of the employees started residing there.
On the basis of the aforesaid allegations the landlord gave a notice to quit dated 20th September, 1978 to the tenant.
Thereafter in 1979 the landlord fried a suit against the tenant in the Small Causes Court for possession of the demised premises.
The Trial Court on 11th November, 1982 decreed the suit upholding the allegation that the tenant had made 307 alterations of permanent nature in the demised premises and had committed acts or waste and damage.
Aggrieved by the aforesaid decision the tenant filed an appeal before the Appellate Bench of the Small Causes Court on 28th September, 1985, and the respondent 's suit for eviction was dismissed on the ground that the suit was barred by lapse of time under Article 113 of the Limitation Act, 1973, which prescribed a period of three The landlord thereafter filed a writ petition under Article 227 which was allowed by the High Court which held that Article 66 or Article 67 was applicable which pre scribed a period of 12 years.
The writ petition filed by the tenant was however dismissed.
In the appeals by the tenant to this Court the only question for consideration was: whether Article 113 or either of Articles 66 or 67 of the Limitation Act would be applicable, and what would he the date of the accrual of the cause of action.
On behalf of the tenant appellant it was contended that on the facts of the case Article 113 of the Limitation Act alone would apply and that neither Article 66 nor Article 67 would have any application.
Article 67 of the Limitation Act had no application inasmuch as time begins to run only when the tenancy is determined and that determination of tenancy which takes place under the Transfer of Property Act is wholly irrelevant for cause of action in ejectment.
That Article 66 contemplates an immediate right to recover pos session.
Breach of a condition only leads to an immediate right to possession without more, and not a determination in law.
That Article 66 is a general article which does not apply to landlord or tenant, and that when a specific Arti cle applied the general Article should not be applied spe cially when it was not free from doubt.
On behalf of the respondent landlord it was however submitted that for any suit by a landlord against the tenant for recovery of possession under the Rent Act the Limitation Act was inherently inapplicable.
Dismissing the Appeals, HELD: 1.
Recovery of possession is by a suit and there is no section in the scheme of the Limitation Act to indicate that the Limitation Act was inherently inapplicable.
In the scheme of the Rent Act or in 308 the various contingencies contemplated under the Rent Act, there is nothing to indicate or warrant that there would be no limitation of any period.
[311E F] 2.
Sections 12 and 13 of the Bombay Rent Act co exist and must be harmonised to effect the purpose and intent of the legislature for the purpose of eviction of the tenant.
In that view of the matter Article 113 of the Limitation Act has no scope of application.
[316C D] 3.
Article 67 indicates that time begins to run only when the tenancy is determined.
It comprehends suit by a landlord and deals with the right to recover possession from the tenant.
Therefore it deals with landlord and tenant.
[31 IF G] 4.
On the strict grammatical meaning Article 67 of the Limitation Act would be applicable.
This is indubitably a suit by the landlord against the tenant to recover posses sion from the tenant.
Therefore, the suit clearly comes within Article 67 of the Limitation Act.
The suit was flied because the tenancy was determined by the combined effect of the operation of Sections 12 and 13 of the B ombay Rent Act.
At the mast it would be within Article 66 of the Limitation Act if it is held that forfeitures have been incurred by the appellant in view of the breach of the conditions mentioned in Section 13 of the Bombay Rent Act, and on lifting of the embargo against eviction of tenant in terms of section 12 of the said Act.
That being so, either of the two, Article 66 or Article 67 would be applicable to the facts of the instant case.
There is no scope for the application of Article 113 of the Limitation Act in any view of the matter.
The period of limitation in this case would therefore be 12 years.
The suit was therefore not barred.
[315H; 316A E] Dhanpal Chettiar vs Yesodai Ammal, ; ; Pradesh Kumar Bajpai vs Binod Behari Sarkar, [1980] 3 S.C.R. 93, Gian Devi Anand vs Jeevan Kumar & Other, [1985] 2 S.C.C. 683; Hiralal Vallabhram vs Kastorbhai Lalbhai & Others, ; at 349 and 350; Bahadur Singh & Anr.
vs Muni Subrat Dass & Anr., at 436, Kau shaiaya Devi & Others vs Shri K.L. Bansal, [1969] 2 S.C.R. 1048 at 1050; Ferozi LaIJain vs Man Mal and another, A.I.R. at 795 aud 796; aud Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, [1967] 84 Bombay Law Report p. 122, referred to.
|
ivil Appeal Nos. 116117 of 1987.
309 From the Judgment and Order dated 28.11.1986 of the Bombay High Court in Civil Writ Petition Nos.
5391 And 55 15 of 1985.
F.S. Nariman, R.F. Nariman, Ashok Goel, Rajan Karanjawa la and Ejaz Mazbool for the Appellant.
H.C. Tunara, M.N. Shroff, A.G. Parekh and K.M.K. Khan for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is by the tenant from the judgment and order of the High Court of Bombay dated 28th of November, 1986.
The only question involved in this appeal is what is the period of limitation for the recovery of possession of the demised premises.
The premises in question is located on the Municipal Street No. 16 in Fanaswadi area of Bombay.
The tenant was inducted as a monthly tenant in respect of the said premises at a monthly rent of Rs. 105.60 for the purpose of conducting ice cream business which was being carried on by her husband who was the holder of the power of attorney on her behalf.
The premises consisted of the entire structure on the ground floor with a loft covering the entire area with corrugated iron sheets.
The letting was done on an agreement dated 29th of December, 1975 which was to become effective from the 1st of January, 1976.
It is the case of the landlord, the re spondent herein, that in breach of the agreement and the terms of tenancy as also in violation of.
the prohibition prescribed under section 13(1) of the Bombay Rents, Hotel & Lodging House Rates (Control) Act, 1947 (hereinafter re ferred to as the Rent Act), the tenant had indulged in several acts of commission by which not only there has been permanent alterations of major nature but the entire struc ture was completely changed so much so that even the height of the structure was increased and thus, the loft lost its initial character and became almost as a first floor which was the creation of the appellant tenant herein.
Several other breaches were alleged to have been committed in re spect of the terms of tenancy.
It was alleged that the tenant had indulged in the acts of waste and damage to the property and that further she had changed the user of the suit premises when some of the employees started residing there.
On the basis of those and other allied allegations on the 20th of September, 1978 the landlord, respondent herein, gave a notice to quit to the tenant, the appellant herein, on the ground that the tenant had (1) made alterations of permanent nature in respect of the demised premises, (2) committed 310 acts of waste and damage and (3) changed the user of the premises.
In 1979 the landlord filed R.A.E. Suit No. 1326/4557 of 1979 against the tenant in the Small Causes Court, Bombay for possession of the demised premises.
The Trial Court on 11th November.
1982 decreed the suit uphold ing, inter alia, that the tenant had made alterations of permanent nature in the demised premises and had committed acts of waste and damage.
Aggrieved by the said decision Appeal No. 667 of 1982 was filed by the tenant against the decree of the Trial court.
The same was allowed by the Appellate Bench of the Small Causes Court on 28th September, 1985 and the respondent 's suit for eviction was dismissed on the ground that the suit was barred by lapse of time under article 113 of the (hereinafter called the ).
The High Court of Bombay on 28th of November, 1986 allowed the writ petition being Writ Petition No. 5391 of 1985 filed by the landlord under Article 227 of the Constitution against the judgment of the Appellate Bench of the Small Causes Court.
The High Court allowed the said Writ Petition filed by the landlord and dismissed the Writ Petition being Writ Petition No. 5515 of 1985 filed by the tenant.
In the premises the High Court 's judgment and order dated 28th of November, 1986 impugned in this appeal re stored the judgment of the Trial Court decreeing the re spondent 's suit for possession.
All the three courts have held that the tenant, appel lant herein, had made alterations of permanent nature and had committed acts of waste and damage.
The Appellate Bench of the Small Causes Court and the High Court, however, differed on the question of limitation.
The Appellate Bench of the Small Causes Court had held that the suit was barred under article 113 of the which prescribed a period of 3 years while the High Court held that articles 66 or 67 was applicable which prescribed a period of 12 years.
According to the landlord respondent, the suit though filed after 3 years was filed within 12 years of the accrual of the cause of action.
The only question which was argued in this appeal was the question of limitation.
No factual aspect was agitated before this Court.
This appeal must therefore, decide the question which article of the Limita tion Act would be applicable, that is to say, whether arti cle 113 or either of the article 66 or 67 and what would be the date of the accrual of cause or ' action.
On behalf of the appellant, it was submitted by Mr. Nariman that on the facts of this case, article 113 of the would alone apply because according to him neither article 66 nor article 67 would have any applica tion.
It may not be inappropriate to set out article 66 and article 67 of the Schedule of the .
The said articles 311 appear in of the Schedule First Division dealing with suits relating to immovable property.
The first column gives the description of suit, the second column gives the period of limitation and the third column deals with time from which period begins to run.
Articles 66 and 67 read as follows: "66.
For possession Twelve When the forfeiture of immovable property years is incurred or the when the plaintiff condition is has become entitled broken.
to possession by reason of any forfeiture or breach of condition.
By a landlord to Twelve When the recover possession years tenancy is from a tenant.
determined.
" Article 113 on the other hand which is in dealing with suits provides that for any suit for which no period of limitation is provided elsewhere in the Schedule the period would be three years from the date when the right to sue accrues.
It was submitted by Shri Tunara, learned counsel for the respondent landlord that for any suit by a landlord against a tenant for recovery of possession under the Rent Act, the was inherently inapplicable.
We are, however, unable to accept this argument.
Recovery of possession is by a suit and there is no section in the scheme of the Limita tion Act to indicate that was inherently inapplicable.
In the scheme of the Rent Act or in the var ious contingencies contemplated under the Rent Act, there is nothing to indicate or warrant that there would be no limi tation of any period.
Article 67 of the which has been set out hereinbefore indicates that time begins to run only when the tenancy is determined.
It comprehends suit by a landlord and deals with fight to recover possession from the tenant.
Therefore, it deals with landlord and tenant.
We are therefore unable to accept the argument of the respondent that limitation was inapplicable to eject ment.
On behalf of the appellant it was however submitted that article 67 of the had no application inasmuch as time begins to run only when the tenancy is determined.
A determination of tenancy which takes place under the Trans fer of Property Act is wholly irrele 312 vant for cause of action in ejectment.
It is an act in law and not an act of law because under the scheme a determina tion of tenancy which takes place under the Transfer of Property Act, according to the appellant, is wholly irrele vant for rounding a cause of action in ejectment because the provisions of the Transfer of Property Act are superseded by the provisions of the Rent Act and according to the appel lant a cause of action for eviction is to be rounded only on one of the grounds mentioned in Section 13 of the Rent Act.
For this reliance was placed on V. Dhanpal Chettiar vs Yesodai Ammal; , where this Court held that a lease between a lessor and a lessee comes into exist ence by way of contract when the parties to the contract agree on the rent, duration of tenancy and other relevant terms.
Section 111 of the Transfer of Property Act provides various methods by which a lease of immovable property can be determined.
Under clause (h) of section 111 a lease determines on the expiry of a notice to determine the lease given by the landlord to the tenant.
But a notice is not compulsory or obligatory nor must it fulfil all the techni cal requirements of section 106 of the Transfer of Property Act, because as a result of the various State Rent Acts the liability to be evicted if incurred by the tenant, he cannot turn round and say that the contractual tenancy had not been determined.
It was further reiterated that the action of the landlord in instituting a suit for eviction on the ground mentioned in the State Rent Act would tantamount to an expression of the intention of the landlord that he does not want the tenant to continue as his lessee and the jural relationship between the lessor and the lessee would come to an end on the passing of an order or a decree for eviction.
Until then, under the extended definition of 'tenant ' under the various State Rent Acts, the tenant continued to be a tenant even though the contractual tenancy had been deter mined by giving a valid notice under section 106 of the Transfer of Property Act.
Therefore notice under section 106 of the Transfer of Property Act terminating the tenancy is no longer necessary.
At page 353 of the said report, the Court was of the view that making out a case under the Rent Act for eviction of the tenant by itself was sufficient and it was not obligatory to the proceeding on the basis of the determination of the lease by issue of a notice in accord ance with section 106 of the Transfer of Property Act.
This view was also reiterated again in Pradesh Kumar Bajpai vs Binod Behari Sarkar; , where this Court observed that once the requirements of Rent Act were satis fied, the tenant could not claim the double protection of invoking the provisions of the Transfer of Property Act or the terms of the contract.
Therefore, in the case before this Court the question of termination of lease by forfei ture did not arise on the facts of that case 313 and after the Rent Act came into force, the landlord could not avail himself of clause 12 which provided for forfei ture, in that case, even if the tenant had neglected to pay the rent for over two months and further the landlord could not enter into possession forthwith without notice.
The only remedy for him is to seek eviction under the provisions of the Rent Act.
See also in this connection the observations in Gian DeviAnandv.
Jeevan Kumar & others, [1985] 2 S.C.C. 683.
It was further submitted on behalf of the appellant that columns 1 and 3 of the Schedule of the should be read together and if a case does not fall within either column 1 or column 3 the residuary article must apply.
Reference may be made to the observations in Kripal Shah Sant Singh vs Shri Harkishan Das Narsingh Das, at 275; M/s. Swastik Agency, Madras vs The Madras Port Trust and another, A.I.R. 1966 Madras 130 at 135 and Mulla Vittil Seeti, Kutti and others vs K.M.K. Kunhi Pathum ma and others, A.I.R. 1919 Madras 972.
Mr. Nariman, learned counsel for the appellant submitted that the expression "determination" appears in section 111 of the Transfer of Property Act.
Under section 14 of the Bombay Rent Act, the same expression was used in the context of a sub tenant becoming a direct tenant of the landlord.
This expression however, according to the appellant, is not to be found in section 13.
of the Act.
This Court has held that this expression contained in section 14 of the Rent Act is different from the expression contained in section 111 of the Transfer of Property Act inasmuch as the tenancy only determines under the Rent Act for a decree only for eviction is passed, and not before.
Reliance was placed in support of this argument on the observation of this Court in Hiralal Vallabhram vs Kastorbhai Lalbhai & Ors., ; at 349 and 350.
It was further urged therefore that article 67 of the would not apply.
Article 66, according to the appellant, contemplates an immediate fight to recover possession.
Breach of a condition must lead to an immediate right to possession without more.
This would not be a determination in law according to the appellant.
Section 13 of the Rent Act contemplated, however, two conditions being fulfilled one is a ground for ejectment subsisting and the other is the Court 's satisfaction which is a condition precedent before which there is a no immedi ate right to possession.
Reliance in support of this propo sition was placed on Sharoop Dass Mondal vs Joggessur Roy Chowdhry, I.L.R. 26 Calcutta 564 at 568; Annamalai Pathar vs Sri la sri 314 Vythilinga Pandara Sannadhi A vergal and another, A.I.R. 1937 Madras 295 at 297; Mahalinga Bandappa Lakhannavar vs Venkatesh Waman Karnataki, 59 B.L.R. 227 at 233; Bahadur Singh & Anr.
vs Muni Subrat Dass & Anr., at 436; Kaushalaya Devi & Ors.
vs Shri K.L. Bansal, ; at 1050 and Ferozi Lal Jain vs Man Mal and another, at 795 and 796.
Under section 13 of the Rent Act, possession is not recoverable only for breach of a condition, and it is recoverable on fulfilment and not breach of a condition precedent to the Court 's satisfaction, according to counsel for the appellant.
It was further submitted on behalf of the appellant that section 13(1) of the Rent Act was to be contrasted with section 12(1) recovery of possession under section 13(1) was not directly upon a breach of condition of tenancy, but only upon the Court 's satisfaction that a ground for recovery of possession was made out.
Under section 12(1), however, a landlord is not entitled to recover possession so long as the tenant observed the "conditions of tenancy".
It was further submitted that section 13 is subject to sections 15 and 15A of the Rent Act if the landlord and the tenant respectively have fulfilled (not breached) according to the counsel, the provisions of these two sections, no suit for ejectment will lie.
It was urged that again showed that section 13(1) of the Rent Act contained conditions that were to be fulfilled before a landlord can recover possession for a tenant 's breach of condition.
Section 13(1) contained grounds for eviction of a tenant which need not be for breach of any condition.
According to the appellant only one article for recovery of possession is reserved under the by a landlord from a tenant, that is article 139 of the Limitation Act, 1908.
This article is the exact predecessor of article 67.
Article 66 is a general article, says the appellant, which does not apply to landlord or tenant and it was further submitted that when a specific article applied, a general article should not be applied specially when it was not free from doubt.
Some authorities were referred to in this behalf.
We accept this submission on the principle of construc tion.
It is further reiterated that a strained construction to give a more favourable limitation period is to be avoid ed considerations of equity were out of place in construing the articles under the Limitation Act.
It was submitted before us that section 12(1) of the Rent Act did not apply to the facts of the present case.
The decree for eviction was grounded upon section 13(i)(b) of the Rent Act and not on section 12(1).
It was further reiterated that the non obstante clause of section 13 made it clear that where a condition of tenancy coincided with a ground for eviction, the ground for eviction alone is to be looked at and to that 315 extent, any breach of the condition of tenancy was supersed ed by the ground for eviction.
Also in the instant case, clause 3 of the agreement dated 29th December, 1975 is inconsistent with the provisions of the Act inasmuch as even temporary structures were not allowed to be erected and there is no provision for the written consent of the land lord.
It was further submitted without prejudice to the aforesaid submission that section 12(1) of the Rent Act was a section that was designed to afford protection to a tenant if his lease was determined under the Transfer of Property Act and it was thus designed to be a shield but not a word.
It was submitted that the decision in Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, [1967] 84 Bombay LaW Report p. 122 is against the current of modern rent juris prudence.
Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, (supra) which is a decision of the Bench of three judges and as such binding on this Court held that sections 12 and 13 of the Bombay Rent Act dealt with different topics and have different objects.
It was held that section 12(1) clothed a tenant with the cloak of statutory protection against eviction so long as he performs the conditions of tenancy.
Section 13 provides that notwithstanding that protection the landlord can sue for eviction provided he established any one of the circumstances set out in that section.
This Court further observed that it was impossible to say that it was only when circumstances set out in sec tion 13 arose that a landlord could evict and that eviction on the ground of the failure to perform the conditions of tenancy would not deprive the tenant of the protection under section 12(1) of the Rent Act.
Such a reading would be contrary to the whole scheme underlying the objects of the two sections.
We accept the aforesaid legal position.
It is not against the trend of the principle behind rent legisla tion.
It affords protection to the tenant inasmuch as it says that it was only on the fulfilment of the condition stipulated in the two sections and on satisfaction of the contingencies mentioned in section 12 which would deprive the tenant of the protection that the tenant can be evicted.
Much argument was advanced to the contrary but in our opinion to prevent unreasonable eviction, in balancing and harmonising the rights of the landlords and tenant if the sections are so read as done in Haji Sulernan 's case, it would meet the ends of justice and that would be proper construction.
If that is so then on the strict grammatical meaning article 67 of the Limitation Act would be applicable.
This is indubitably a suit by the landlord against the tenant to recover possession from the tenant.
316 Therefore the suit clearly comes within article 67 of the Limitation Act.
The suit was filed because the tenancy was determined by the combined effect of the operation of sec tions 12 and 13 of the Bombay Rent Act.
In this connection, the terms of sections 12 and 13 of the Bombay Rent Act may be referred to.
At the most it would be within article 66 of the Limitation Act if we hold that forfeiture has been incurred by the appellant in view of the breach of the conditions mentioned in section 13 of the Bombay Rent Act and on lifting on the embargo against eviction of tenant in terms of section 12 of the said Act.
That being so, either of the two, article 66 or article 67 would be applicable to the facts of this case; there is no scope of the application of article 113 of the Limitation Act in any view of the matter.
Sections 12 and 13 of the Bombay Rent Act co exist and must be harmonised to effect the purpose and intent of the legislature for the purpose of eviction of the tenant.
In that view of the matter article 113 of the Limitation Act has no scope of application.
Large number of authorities were cited.
In the view we have taken on the construction of the provisions of articles 67 and 66 of the Limitation Act and the nature of the cause of action in this case in the light of sections 12 and 13 of the Bombay Rent Act, we are of the opinion that the period of limitation in this case would be 12 years.
There is no dispute that if the period of limitation be 12 years, the suit was not barred.
In that view of the matter, the appeals fail and are accordingly dismissed with costs.
N.V.K. Appeals dis missed.
|
309 From the Judgment and Order dated 28.11.1986 of the Bombay High Court in Civil Writ Petition Nos. F.S. Nariman, R.F. Nariman, Ashok Goel, Rajan Karanjawa la and Ejaz Mazbool for the Appellant. H.C. Tunara, M.N. Shroff, A.G. Parekh and K.M.K. Khan for the Respondent. The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is by the tenant from the judgment and order of the High Court of Bombay dated 28th of November, 1986. The only question involved in this appeal is what is the period of limitation for the recovery of possession of the demised premises. The premises in question is located on the Municipal Street No. The tenant was inducted as a monthly tenant in respect of the said premises at a monthly rent of Rs. 105.60 for the purpose of conducting ice cream business which was being carried on by her husband who was the holder of the power of attorney on her behalf. The premises consisted of the entire structure on the ground floor with a loft covering the entire area with corrugated iron sheets. The letting was done on an agreement dated 29th of December, 1975 which was to become effective from the 1st of January, 1976. It is the case of the landlord, the re spondent herein, that in breach of the agreement and the terms of tenancy as also in violation of. Several other breaches were alleged to have been committed in re spect of the terms of tenancy. It was alleged that the tenant had indulged in the acts of waste and damage to the property and that further she had changed the user of the suit premises when some of the employees started residing there. On the basis of those and other allied allegations on the 20th of September, 1978 the landlord, respondent herein, gave a notice to quit to the tenant, the appellant herein, on the ground that the tenant had (1) made alterations of permanent nature in respect of the demised premises, (2) committed 310 acts of waste and damage and (3) changed the user of the premises. In 1979 the landlord filed R.A.E. Suit No. 1326/4557 of 1979 against the tenant in the Small Causes Court, Bombay for possession of the demised premises. 1982 decreed the suit uphold ing, inter alia, that the tenant had made alterations of permanent nature in the demised premises and had committed acts of waste and damage. Aggrieved by the said decision Appeal No. 667 of 1982 was filed by the tenant against the decree of the Trial court. The same was allowed by the Appellate Bench of the Small Causes Court on 28th September, 1985 and the respondent 's suit for eviction was dismissed on the ground that the suit was barred by lapse of time under article 113 of the (hereinafter called the ). The High Court of Bombay on 28th of November, 1986 allowed the writ petition being Writ Petition No. 5391 of 1985 filed by the landlord under Article 227 of the Constitution against the judgment of the Appellate Bench of the Small Causes Court. The High Court allowed the said Writ Petition filed by the landlord and dismissed the Writ Petition being Writ Petition No. In the premises the High Court 's judgment and order dated 28th of November, 1986 impugned in this appeal re stored the judgment of the Trial Court decreeing the re spondent 's suit for possession. All the three courts have held that the tenant, appel lant herein, had made alterations of permanent nature and had committed acts of waste and damage. The Appellate Bench of the Small Causes Court and the High Court, however, differed on the question of limitation. The Appellate Bench of the Small Causes Court had held that the suit was barred under article 113 of the which prescribed a period of 3 years while the High Court held that articles 66 or 67 was applicable which prescribed a period of 12 years. According to the landlord respondent, the suit though filed after 3 years was filed within 12 years of the accrual of the cause of action. The only question which was argued in this appeal was the question of limitation. No factual aspect was agitated before this Court. This appeal must therefore, decide the question which article of the Limita tion Act would be applicable, that is to say, whether arti cle 113 or either of the article 66 or 67 and what would be the date of the accrual of cause or ' action. On behalf of the appellant, it was submitted by Mr. Nariman that on the facts of this case, article 113 of the would alone apply because according to him neither article 66 nor article 67 would have any applica tion. It may not be inappropriate to set out article 66 and article 67 of the Schedule of the . The said articles 311 appear in of the Schedule First Division dealing with suits relating to immovable property. The first column gives the description of suit, the second column gives the period of limitation and the third column deals with time from which period begins to run. For possession Twelve When the forfeiture of immovable property years is incurred or the when the plaintiff condition is has become entitled broken. to possession by reason of any forfeiture or breach of condition. By a landlord to Twelve When the recover possession years tenancy is from a tenant. " Article 113 on the other hand which is in dealing with suits provides that for any suit for which no period of limitation is provided elsewhere in the Schedule the period would be three years from the date when the right to sue accrues. It was submitted by Shri Tunara, learned counsel for the respondent landlord that for any suit by a landlord against a tenant for recovery of possession under the Rent Act, the was inherently inapplicable. We are, however, unable to accept this argument. Recovery of possession is by a suit and there is no section in the scheme of the Limita tion Act to indicate that was inherently inapplicable. In the scheme of the Rent Act or in the var ious contingencies contemplated under the Rent Act, there is nothing to indicate or warrant that there would be no limi tation of any period. Article 67 of the which has been set out hereinbefore indicates that time begins to run only when the tenancy is determined. It comprehends suit by a landlord and deals with fight to recover possession from the tenant. Therefore, it deals with landlord and tenant. We are therefore unable to accept the argument of the respondent that limitation was inapplicable to eject ment. On behalf of the appellant it was however submitted that article 67 of the had no application inasmuch as time begins to run only when the tenancy is determined. A determination of tenancy which takes place under the Trans fer of Property Act is wholly irrele 312 vant for cause of action in ejectment. It is an act in law and not an act of law because under the scheme a determina tion of tenancy which takes place under the Transfer of Property Act, according to the appellant, is wholly irrele vant for rounding a cause of action in ejectment because the provisions of the Transfer of Property Act are superseded by the provisions of the Rent Act and according to the appel lant a cause of action for eviction is to be rounded only on one of the grounds mentioned in Section 13 of the Rent Act. For this reliance was placed on V. Dhanpal Chettiar vs Yesodai Ammal; , where this Court held that a lease between a lessor and a lessee comes into exist ence by way of contract when the parties to the contract agree on the rent, duration of tenancy and other relevant terms. Section 111 of the Transfer of Property Act provides various methods by which a lease of immovable property can be determined. Under clause (h) of section 111 a lease determines on the expiry of a notice to determine the lease given by the landlord to the tenant. Until then, under the extended definition of 'tenant ' under the various State Rent Acts, the tenant continued to be a tenant even though the contractual tenancy had been deter mined by giving a valid notice under section 106 of the Transfer of Property Act. Therefore notice under section 106 of the Transfer of Property Act terminating the tenancy is no longer necessary. Therefore, in the case before this Court the question of termination of lease by forfei ture did not arise on the facts of that case 313 and after the Rent Act came into force, the landlord could not avail himself of clause 12 which provided for forfei ture, in that case, even if the tenant had neglected to pay the rent for over two months and further the landlord could not enter into possession forthwith without notice. The only remedy for him is to seek eviction under the provisions of the Rent Act. See also in this connection the observations in Gian DeviAnandv. Jeevan Kumar & others, [1985] 2 S.C.C. 683. It was further submitted on behalf of the appellant that columns 1 and 3 of the Schedule of the should be read together and if a case does not fall within either column 1 or column 3 the residuary article must apply. Reference may be made to the observations in Kripal Shah Sant Singh vs Shri Harkishan Das Narsingh Das, at 275; M/s. Swastik Agency, Madras vs The Madras Port Trust and another, A.I.R. 1966 Madras 130 at 135 and Mulla Vittil Seeti, Kutti and others vs K.M.K. Kunhi Pathum ma and others, A.I.R. 1919 Madras 972. Mr. Nariman, learned counsel for the appellant submitted that the expression "determination" appears in section 111 of the Transfer of Property Act. Under section 14 of the Bombay Rent Act, the same expression was used in the context of a sub tenant becoming a direct tenant of the landlord. This expression however, according to the appellant, is not to be found in section 13. This Court has held that this expression contained in section 14 of the Rent Act is different from the expression contained in section 111 of the Transfer of Property Act inasmuch as the tenancy only determines under the Rent Act for a decree only for eviction is passed, and not before. Reliance was placed in support of this argument on the observation of this Court in Hiralal Vallabhram vs Kastorbhai Lalbhai & Ors., ; It was further urged therefore that article 67 of the would not apply. Article 66, according to the appellant, contemplates an immediate fight to recover possession. Breach of a condition must lead to an immediate right to possession without more. This would not be a determination in law according to the appellant. Section 13 of the Rent Act contemplated, however, two conditions being fulfilled one is a ground for ejectment subsisting and the other is the Court 's satisfaction which is a condition precedent before which there is a no immedi ate right to possession. Reliance in support of this propo sition was placed on Sharoop Dass Mondal vs Joggessur Roy Chowdhry, I.L.R. 26 Calcutta 564 at 568; Annamalai Pathar vs Sri la sri 314 Vythilinga Pandara Sannadhi A vergal and another, A.I.R. 1937 Madras 295 at 297; Mahalinga Bandappa Lakhannavar vs Venkatesh Waman Karnataki, 59 B.L.R. 227 at 233; Bahadur Singh & Anr. vs Shri K.L. Bansal, ; at 1050 and Ferozi Lal Jain vs Man Mal and another, at 795 and 796. Under section 13 of the Rent Act, possession is not recoverable only for breach of a condition, and it is recoverable on fulfilment and not breach of a condition precedent to the Court 's satisfaction, according to counsel for the appellant. It was further submitted on behalf of the appellant that section 13(1) of the Rent Act was to be contrasted with section 12(1) recovery of possession under section 13(1) was not directly upon a breach of condition of tenancy, but only upon the Court 's satisfaction that a ground for recovery of possession was made out. Under section 12(1), however, a landlord is not entitled to recover possession so long as the tenant observed the "conditions of tenancy". It was urged that again showed that section 13(1) of the Rent Act contained conditions that were to be fulfilled before a landlord can recover possession for a tenant 's breach of condition. Section 13(1) contained grounds for eviction of a tenant which need not be for breach of any condition. This article is the exact predecessor of article 67. Article 66 is a general article, says the appellant, which does not apply to landlord or tenant and it was further submitted that when a specific article applied, a general article should not be applied specially when it was not free from doubt. Some authorities were referred to in this behalf. We accept this submission on the principle of construc tion. It is further reiterated that a strained construction to give a more favourable limitation period is to be avoid ed considerations of equity were out of place in construing the articles under the Limitation Act. It was submitted before us that section 12(1) of the Rent Act did not apply to the facts of the present case. The decree for eviction was grounded upon section 13(i)(b) of the Rent Act and not on section 12(1). It was further reiterated that the non obstante clause of section 13 made it clear that where a condition of tenancy coincided with a ground for eviction, the ground for eviction alone is to be looked at and to that 315 extent, any breach of the condition of tenancy was supersed ed by the ground for eviction. Also in the instant case, clause 3 of the agreement dated 29th December, 1975 is inconsistent with the provisions of the Act inasmuch as even temporary structures were not allowed to be erected and there is no provision for the written consent of the land lord. It was submitted that the decision in Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, [1967] 84 Bombay LaW Report p. 122 is against the current of modern rent juris prudence. Section 13 provides that notwithstanding that protection the landlord can sue for eviction provided he established any one of the circumstances set out in that section. Such a reading would be contrary to the whole scheme underlying the objects of the two sections. It is not against the trend of the principle behind rent legisla tion. It affords protection to the tenant inasmuch as it says that it was only on the fulfilment of the condition stipulated in the two sections and on satisfaction of the contingencies mentioned in section 12 which would deprive the tenant of the protection that the tenant can be evicted. If that is so then on the strict grammatical meaning article 67 of the Limitation Act would be applicable. This is indubitably a suit by the landlord against the tenant to recover possession from the tenant. 316 Therefore the suit clearly comes within article 67 of the Limitation Act. The suit was filed because the tenancy was determined by the combined effect of the operation of sec tions 12 and 13 of the Bombay Rent Act. In this connection, the terms of sections 12 and 13 of the Bombay Rent Act may be referred to. At the most it would be within article 66 of the Limitation Act if we hold that forfeiture has been incurred by the appellant in view of the breach of the conditions mentioned in section 13 of the Bombay Rent Act and on lifting on the embargo against eviction of tenant in terms of section 12 of the said Act. That being so, either of the two, article 66 or article 67 would be applicable to the facts of this case; there is no scope of the application of article 113 of the Limitation Act in any view of the matter. In that view of the matter article 113 of the Limitation Act has no scope of application. There is no dispute that if the period of limitation be 12 years, the suit was not barred. In that view of the matter, the appeals fail and are accordingly dismissed with costs.
|
The appellant in the appeals was the tenant of the demised premises who was inducted as a monthly tenant for the purpose of conducting the ice cream business carried on by her husband.
The letting was done on an agreement dated December 29, 1975 by the landlord respondent which was to become effective from January 1, 1976.
The landlord alleged that in breach of the agreement and the terms of the tenancy, as also in violation of the prohi bition prescribed under section 13(1) of the Bombay Rents, Hotels & Lodging House Rates (Control) Act, 1947 the tenant had indulged in several acts of commission by which not only there had been permanent alterations of major nature, but the entire structure of the demised premises was completely changed.
it was also alleged that the tenant had indulged in acts of waste and damage to the property, and that she had changed the user of the premises when some of the employees started residing there.
On the basis of the aforesaid allegations the landlord gave a notice to quit dated 20th September, 1978 to the tenant.
Thereafter in 1979 the landlord fried a suit against the tenant in the Small Causes Court for possession of the demised premises.
The Trial Court on 11th November, 1982 decreed the suit upholding the allegation that the tenant had made 307 alterations of permanent nature in the demised premises and had committed acts or waste and damage.
Aggrieved by the aforesaid decision the tenant filed an appeal before the Appellate Bench of the Small Causes Court on 28th September, 1985, and the respondent 's suit for eviction was dismissed on the ground that the suit was barred by lapse of time under Article 113 of the Limitation Act, 1973, which prescribed a period of three The landlord thereafter filed a writ petition under Article 227 which was allowed by the High Court which held that Article 66 or Article 67 was applicable which pre scribed a period of 12 years.
The writ petition filed by the tenant was however dismissed.
In the appeals by the tenant to this Court the only question for consideration was: whether Article 113 or either of Articles 66 or 67 of the Limitation Act would be applicable, and what would he the date of the accrual of the cause of action.
On behalf of the tenant appellant it was contended that on the facts of the case Article 113 of the Limitation Act alone would apply and that neither Article 66 nor Article 67 would have any application.
Article 67 of the Limitation Act had no application inasmuch as time begins to run only when the tenancy is determined and that determination of tenancy which takes place under the Transfer of Property Act is wholly irrelevant for cause of action in ejectment.
That Article 66 contemplates an immediate right to recover pos session.
Breach of a condition only leads to an immediate right to possession without more, and not a determination in law.
That Article 66 is a general article which does not apply to landlord or tenant, and that when a specific Arti cle applied the general Article should not be applied spe cially when it was not free from doubt.
On behalf of the respondent landlord it was however submitted that for any suit by a landlord against the tenant for recovery of possession under the Rent Act the Limitation Act was inherently inapplicable.
Dismissing the Appeals, HELD: 1.
Recovery of possession is by a suit and there is no section in the scheme of the Limitation Act to indicate that the Limitation Act was inherently inapplicable.
In the scheme of the Rent Act or in 308 the various contingencies contemplated under the Rent Act, there is nothing to indicate or warrant that there would be no limitation of any period.
[311E F] 2.
Sections 12 and 13 of the Bombay Rent Act co exist and must be harmonised to effect the purpose and intent of the legislature for the purpose of eviction of the tenant.
In that view of the matter Article 113 of the Limitation Act has no scope of application.
[316C D] 3.
Article 67 indicates that time begins to run only when the tenancy is determined.
It comprehends suit by a landlord and deals with the right to recover possession from the tenant.
Therefore it deals with landlord and tenant.
[31 IF G] 4.
On the strict grammatical meaning Article 67 of the Limitation Act would be applicable.
This is indubitably a suit by the landlord against the tenant to recover posses sion from the tenant.
Therefore, the suit clearly comes within Article 67 of the Limitation Act.
The suit was flied because the tenancy was determined by the combined effect of the operation of Sections 12 and 13 of the B ombay Rent Act.
At the mast it would be within Article 66 of the Limitation Act if it is held that forfeitures have been incurred by the appellant in view of the breach of the conditions mentioned in Section 13 of the Bombay Rent Act, and on lifting of the embargo against eviction of tenant in terms of section 12 of the said Act.
That being so, either of the two, Article 66 or Article 67 would be applicable to the facts of the instant case.
There is no scope for the application of Article 113 of the Limitation Act in any view of the matter.
The period of limitation in this case would therefore be 12 years.
The suit was therefore not barred.
[315H; 316A E] Dhanpal Chettiar vs Yesodai Ammal, ; ; Pradesh Kumar Bajpai vs Binod Behari Sarkar, [1980] 3 S.C.R. 93, Gian Devi Anand vs Jeevan Kumar & Other, [1985] 2 S.C.C. 683; Hiralal Vallabhram vs Kastorbhai Lalbhai & Others, ; at 349 and 350; Bahadur Singh & Anr.
vs Muni Subrat Dass & Anr., at 436, Kau shaiaya Devi & Others vs Shri K.L. Bansal, [1969] 2 S.C.R. 1048 at 1050; Ferozi LaIJain vs Man Mal and another, A.I.R. at 795 aud 796; aud Haji Suleman Haji Ayub Bhiwandiwala vs Narayan Sadashiv Ogale, [1967] 84 Bombay Law Report p. 122, referred to.
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The appellant in the appeals was the tenant of the demised premises who was inducted as a monthly tenant for the purpose of conducting the ice cream business carried on by her husband. The letting was done on an agreement dated December 29, 1975 by the landlord respondent which was to become effective from January 1, 1976. The landlord alleged that in breach of the agreement and the terms of the tenancy, as also in violation of the prohi bition prescribed under section 13(1) of the Bombay Rents, Hotels & Lodging House Rates (Control) Act, 1947 the tenant had indulged in several acts of commission by which not only there had been permanent alterations of major nature, but the entire structure of the demised premises was completely changed. it was also alleged that the tenant had indulged in acts of waste and damage to the property, and that she had changed the user of the premises when some of the employees started residing there. On the basis of the aforesaid allegations the landlord gave a notice to quit dated 20th September, 1978 to the tenant. Thereafter in 1979 the landlord fried a suit against the tenant in the Small Causes Court for possession of the demised premises. The writ petition filed by the tenant was however dismissed. In the appeals by the tenant to this Court the only question for consideration was: whether Article 113 or either of Articles 66 or 67 of the Limitation Act would be applicable, and what would he the date of the accrual of the cause of action. Article 67 of the Limitation Act had no application inasmuch as time begins to run only when the tenancy is determined and that determination of tenancy which takes place under the Transfer of Property Act is wholly irrelevant for cause of action in ejectment. That Article 66 contemplates an immediate right to recover pos session. Breach of a condition only leads to an immediate right to possession without more, and not a determination in law. In that view of the matter Article 113 of the Limitation Act has no scope of application. Article 67 indicates that time begins to run only when the tenancy is determined. It comprehends suit by a landlord and deals with the right to recover possession from the tenant. Therefore it deals with landlord and tenant. On the strict grammatical meaning Article 67 of the Limitation Act would be applicable. This is indubitably a suit by the landlord against the tenant to recover posses sion from the tenant. Therefore, the suit clearly comes within Article 67 of the Limitation Act. The suit was flied because the tenancy was determined by the combined effect of the operation of Sections 12 and 13 of the B ombay Rent Act. That being so, either of the two, Article 66 or Article 67 would be applicable to the facts of the instant case. There is no scope for the application of Article 113 of the Limitation Act in any view of the matter. The period of limitation in this case would therefore be 12 years. [315H; 316A E] Dhanpal Chettiar vs Yesodai Ammal, ; ; Pradesh Kumar Bajpai vs Binod Behari Sarkar, [1980] 3 S.C.R. 93, Gian Devi Anand vs Jeevan Kumar & Other, [1985] 2 S.C.C. 683; Hiralal Vallabhram vs Kastorbhai Lalbhai & Others, ; at 349 and 350; Bahadur Singh & Anr.
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vil Appeal No. 195556 of 1980.
From the Judgment and Order dated 3/4th July, 1979 of the Bombay High Court in Spl.
C.A. Nos.
2052 of 1973 and 132 of 1974.
F.S. Nariman, Anil B. Diwan, P.H. Parekh, Ms. Lata Krishnamurthy and section Dutt with for the Appellants.
V.M. Tarkunde and H.G. Advani, Hira Advani Kailash Vasudev, Joel Peres and D.N. Misra for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals, by special leave, by the landlords are directed against the judgment and order of the High Court of Bombay dated 3/4th July, 1979.
Two questions arise for consideration in these appeals (i) whether the structure constructed by the tenant in the premises in question amounted to permanent structure leading to the forfeiture of the tenancy of the tenant; (ii) what is the scope and extent of the jurisdiction of the High Court under Article 227 of the Constitution on questions of facts found by the appellate bench of Small Causes Court.
In order to appreciate these questions, it is necessary to reiterate the relevant facts.
The second appellant being plaintiff No. 2 in the Original Suit leased out the premises involved herein being a godown measuring 11,500 sq.
at 156 A, Tardeo, Bombay 7.
The said pre 596 mises was given by the landlord to the tenant, the respond ent herein M/s Bright Brothers (Pvt.) Ltd. on lease vide the registered lease dated 14th April, 1947 for a period of ten years commencing from 1st September, 1946.
By 1953, the respondent company began to fall into arrears in payment of rent.
The respondent tenant filed an application before the appropriate Rent Court for fixing the standard rent.
On 14th June, 1958, the advocate of the second appellant sent a notice to the respondent tenant calling upon them to pay up the arrears for the period from September, 1956 to May, 1958 (both months inclusive), as well as for earlier arrears of rent of Rs.20,850.
On 1st December, 1958 a second notice was issued on behalf of the original plaintiff No. 1 calling upon the respondent to quit and vacate the premises in question on the grounds, inter alia, (a) unauthorised construction of permanent nature; (b) obstructing roadways; and (c) the damage to walls and floor, and further called upon them to remove the unauthorised construction and re store the suit premises to its original condition.
Inasmuch as the main factual controversy in those appeals relate to the nature of the construction alleged to have been made by the tenant, it is relevant to set out what was stated in that letter.
It was, inter alia, stated that the tenant had unauthorisedly committed several breaches of the terms and conditions of the lease inasmuch as the tenant had erected unauthorised construction of a permanent nature and carried out additions to the demised premises without the consent of the lessor or the receiver.
It was further alleged that in breach of the terms and conditions of the agreement of tenancy and without the consent of the lessor or the receiv er, the tenant had occupied portion of the land not let out to him by obstructing the lessor and the person entitled to use the same and had made construction on the roadway by obstructing and restricting the passage.
It was further alleged that the tenant had unauthorisedly and without permission dug up and mutilated the floors of the premises let out to the tenant and had constructed contrary to the provisions of section 108(0) of the .
The tenant was called upon to remove the said unauthorised structures and restore the property, and it was further notified that failing which the landlord would be compelled to take proceedings.
A reply to the said notice issued by the Court Receiver was sent on 8th December, 1958 from the respondent company 's advocate saying that the construction complained of had taken place with the consent and full knowledge of the appellant and the respondent company had spent thousands of rupees towards the improvement of the suit 597 premises.
Further in reply to the allegation of damage to the property, the respondent company had alleged that it had in fact improved the property of the appellant.
On or about 20th December, 1958, the advocate for the appellant replied to the above letter once again calling upon the respondent company to vacate the demised premises.
In 1959, the standard rent application being R.A. No. 2214 of 1954 mentioned hereinbefore was dismissed.
There upon, the respondent tenant filed a civil revision applica tion.
The appellant filed a suit being suit No. 1450/83 18 of 1959 on or about 31st July, 1959.
On or about 8th Decem ber, 1965, the appellant made an application for amendment of the plaint to include change of user as an additional ground of eviction.
The respondent also made an application for amendment to the effect that permanent structure had been made with the knowledge and consent of the appellant.
The said amendments were allowed in December, 1965.
On or about 31st March, 1967, the trial court in suit No. 1450/ 8318 of 1959, ordered eviction of the tenant on the ground of permanent construction.
Mesne profit from the date of the decree was also ordered.
There was an appeal to the appellate bench before the CoUrt of Small Causes and cross appeal being appeal nos.
323 and 629 of 1967.
By the judgment delivered on 14th June, 1973, the division bench of the Court of Small Causes confirmed the decree for eviction on the ground of permanent construction and granted eviction on change of user as well in the cross objection filed by the appellant.
It also ordered mesne profit from the date of the suit and the monetary claims to the extent of arrears.
The High Court on or about 3/4th July, 1979, by judgment and order of the High Court in SCA 2052 and 174 of 1974 under Articles 226 and 227 of the Constitution reversed the concurrent findings of the courts below and allowed the respondent company 's application.
Being aggrieved therefrom, the appellants, the landlords have come up in appeal to this Court.
It is, first necessary therefore to consider the nature of the structures made and whether these were permanent or not.
As stated hereinbefore that permanent structures were constructed was held by the two courts concurrently, namely the Judge of the Court of Small Causes as well as the Appel late Bench of the Small Causes Court; whether by such con struction there has been change of user is another question.
On the nature of the construction, it is necessary to refer to the decision of the trial court.
598 The main question, however, in these appeals is the jurisdiction of the High Court to interfere with the find ings of this nature under Article 227 of the Constitution.
The principles are well settled.
Their application, however, in particular cases sometimes present difficulties.
But the quest for certain amount of certitude must continue in this field of uncertain minds and imperfect language.
To the facts, therefore, we must now refer to appreciate the application of law involved in this case.
The premises in question was let out for use exclusively for business of manufacture of plastic articles, wood work and paints only and not for any other purpose.
it is alleged that it is no longer used for that purpose but used as an office and storage.
The trial court in this case was the Court of Small Causes, Bombay.
One of the grounds of ejectment was the erection of permanent structure and it was the case of the appellant No. 2 that such erection was against the provi sions of section 13(1)(b) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1974 (hereinafter called the 'Rent Act ').
Under clause (p) of section 108 of the , a lessee may not without the lessor 's consent erect on the property and permanent structure except for agricultural purposes.
If he does, then this becomes a ground for ejectment.
In this case the permanent structures alleged were constructions of lofts, construction of several rooms and construction of and laying of a new and permanent flooring as appears from the plaint filed in the proceedings.
It further appears that the tenant had sunk in pillars and stanchions into the flooring.
it was stated in the deposi tion that these pillars and stanchions mentioned in the plaint were only those which were the posts supporting the cabins and lofts complained of and none else.
These pillars and stanchions went along with the construction of lofts and construction of several rooms, that is cabins.
The learned trial court discussed the details and found those cabins marked A, B, C, D, E, F, G, H, I, J, K, L etc.
There were lofts marked cabins A, B, C, D, E, F, J, K, other lofts marked as F, G, H and I. The third loft over the cabin at L and the lofts over the portions M & N.
These were, according to the engineer, an architect, Shri Divecha, who was exam ined on behalf of the plaintiff, permanent structures.
The learned judge examined the plan prepared by the said archi tect and his deposition.
The learned judge was of the view that it was clear from the 599 architect 's evidence that lofts A, B, C, D, E, J, K. as well as the lofts over F, G, H and I were meant to carry weight of over 100 Ibs.
per sq.
and this statement according to the learned judge was not challenged in the cross examina tion.
The structures over A, B, C, D, E, J. and F.C.H.I cannot therefore be called only roofs or tops of cabins.
They were nothing but lofts.
The structures A, B, C, D, E, K, J. so also F, G, H, I, L & M were admitted to have been constructed by the tenant after it had taken the premises from the landlord.
The learned judge in his judgment has also noted these various facts as to their length and dimen sions.
He referred extensively to the evidence in the plan which was marked exhibit MI and the deposition of Shri Divecha.
The learned Judge taking these factors into consideration came to the conclusion that the cabin lofts and posts sup porting the same were attached to the flooring as well as the walls and columns of the main structures.
Under these circumstances, the learned judge of the Court of Small Causes was of the opinion that the structures were permanent in nature.
The learned judge, however, held that the land lord had failed to prove that the tenant had put up any permanent flooring at some part of the suit premises as alleged.
The next allegation was that the tenants had demol ished a portion of the wall in between the two rooms and prepared a door at that opening.
After discussing the facts and the evidence, the learned judge was of the view that there was no question of any waste of the plaintiff 's property on account of any demolition.
He, however, had held that so far as cabins, lofts and posts supporting the same by pillars, these were nothing but permanent structures.
So far as the digging of the flooring was concerned, after discussing the evidence the learned judge held that the plaintiffs had failed to prove digging which led to waste of the property of the landlord.
So far as the creation of the permanent structure is concerned, the same breached the terms of tenancy.
The learned judge noted that on 1st Janu ary, 1948 the defendant No. 1 wrote to the plaintiff that the height of the wooden partition they were erecting, was specified within the plan sent along with the aforesaid letter which had already been lying ready for erection.
It was contended by the defendants in their written statements that they had obtained consent in respect of the wooden cabins and partitions in the year 1948.
So far as section 13(1)(b) of the Bombay Rent Act is concerned, there cannot be any waiver operating against the plaintiffs.
It was the case that some of the permanent structures were there before 1947.
On examination of the evidence, the learned judge observed that Mr. D 'silva had stated that the tenant had requested Mahindra & Mahindra for a design of a slotted angle cabin with a loft, that the same was supplied and Mr. D 'silva was the designer who did the work.
Analysing all these evidence, the 600 learned trial judge came to the conclusion that permanent structures were carried out without the consent in writing of the landlords or either of them.
Such permanent structure was outside the tenancy and the landlord had not given any consent.
The matter on this issue went up before the appellate court and the appellate court dealt with this again and discussed these allegations.
It was pointed out by the appellate court that the allegations were that the appel lants had (a) made an opening by demolishing a part of the wall dividing the two portions of the demised premises; (b) constructed lofts in the suit premises, (c) dug upon the flooring of the premises at various places, (d) sunk in pillars and stanchions into the flooring, (e) constructed several rooms and laid new and permanent floorings in parts of the demised premises at different levels.
So far con structing lofts, it was held that these lofts had been constructed after 1st September, 1946.
And in this context the construction of cabins and putting up of pillars were considered and the evidence in this respect was taken into consideration.
It was contended that the demised premises in the lease was described as godown but it was taken in the nature of several office premises and the change in the improvement done to the same was merely for the better enjoyment of demised premises.
In the first place the cabins were made of wooden poles and planks fixed in the floor, and side walls of the building with nails, screws, nuts and bolts.
The appellate court came to the conclusion that applying the proper test, the cabins were substantial struc tures and substantial improvement to the premises.
These were durable for long and intended to be used permanently.
The appellate court also took the question of digging and other relevant allegations.
As a result of analysis of these evidence and materials, the appellate court confirmed the findings of the trial court that the tenant had erected permanent structure on the demised premises without the landlord 's consent and that was a breach of the terms of tenancy.
They also confirmed the finding of the trial court that the respondents did not waive their rights arising out of these acts.
They also upheld the finding that there was no renewal of the lease of the landlords and the tenants were not statutory tenants whose contractual tenancy had come to an end by efflux of time by the end of the period of ten years from 1st September, 1946.
They upheld the decree for possession passed by the trial court.
The High Court dealing with this matter under Article 227 of the Constitution had occasion to refer to this as pect.
The High Court 601 referred to the different authorities on this point.
We may briefly take note of some of these.
In this connection reference may be made to a decision of the Special Bench of the Calcutta High Court in the case of Surya Properties Private Ltd. and others vs Bimalendu Nath Sarkar and others.
A.I.R. 1964 Calcutta p. 1 which dealt with clause (p) of section 108 of the and held that this question was dependent on the facts of each case and no hard and fast rule can be laid down with regard to this matter.
In the absence of any relevant materials, therefore, the Full Bench found that no answer could be given.
in a slightly different context, before Calcutta High Court in the case of M/s Suraya Proper ties Private Ltd. vs Bimalendu Nath Sarkar.
A.I.R. 1965 Calcutta page 408, Chatterjee, J., one of the judges of the Division Bench observed that the phrase 'permanent struc ture ' for purposes of clause (p) of section 108 of the meant a structure which was capable of lasting till the term of the lease and which was con structed in the view of being built up as was a building.
In that context the learned judge observed that a reservoir was not, however, a permanent structure for purposes of clause (p) of section 108 of the .
Sen, J. of the same Bench was of the view that no hard and fast tests could be laid down for determining the question wheth er a particular structure by the tenant was a permanent structure for the purpose of clause (p) of section 108 of the .
The answer to the question depended on the facts of each case.
Chatterjee, J., however, took the view that where the tenant created a permanent structure in the premises leased to him, as the lease con tinued in spite of the disputed structure and the landlord continued to receive rent till the determining of the lease by notice to quit or thereafter till the passing of the decree for eviction and the fact that he accepted rent with full knowledge of the disputed structure did not disentitle him to a decree for eviction.
In Khureshi Ibrahim Ahmed vs Ahmed Haji Khanmahomad.
A.I.R. 1.965 Gujarat, 152, in connection with section 13(1)(b) of the Rent Act, Gujarat High Court held that the permanent structure must be one which was a lasting struc ture and that would depend upon the nature of structure.
The permanent or temporary character of the structure would have to be determined having regard to the nature of the struc ture and the nature of the materials used in the making of the structure and the manner in which the structure was erected and not on the basis of how long the tenant intended to make use of the structure.
As a matter of fact, the Court observed, the nature of the structure 602 itself would reflect whether the tenant intended that it should exist and be available for use for a temporary period or for an indefinite period of time.
The test provided by the Legislature was thus an objective test and not a subjec tive one and once it was shown that the structure erected by the tenant was of such a nature as to be lasting in dura tion lasting of course according to ordinary notions of mankind the tenant cannot come forward and say that it was erected for temporary purpose.
The question was again considered in the case of Ramji Virji and others vs Kadarbhai Esufali, A.I.R. 1973 Gujarat 110.
It was observed that whether the structure was a perma nent structure was a mixed question of law and fact.
It was held in that case that alterations made by a tenant like constructing loft, wooden bathroom, frame and putting up a new drain being minor alterations which were easily remova ble without causing any serious damage to the premises would not amount to permanent structure leading to the forfeiture.
There are numerous authorities dealing with the question how the structure is a permanent structure or not should be judged.
It is not necessary to deal with all these.
One must look to the nature of the structure, the purpose for which it was intended and take a whole perspective as to how it affects the enjoyment, the durability of the building etc.
and other relevant factors and come to a conclusion.
Judged in the aforesaid light on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent.
The High Court observed that in judging whether the structures were perma nent or not, the following factors should be taken into consideration referring to an unreported decision of Malvan kar J. in special civil application No. 121 of 1968.
These were (1) intention of the party who put up the structure; (2) this intention was to be gathered from the mode and degree of annexation; (3) if the structure cannot be removed without doing irrepairable damage to the demised premises then that would be certainly one of the circumstances to be considered while deciding the question of intention.
Like wise, dimensions of the structure and (4) its removability had to be taken into consideration.
But these were not the sole tests.
(5) the purpose of erecting the structure is another relevant factor.
(6) the nature of the materials used for the structure and (7) lastly the durability of the structure.
These were the broad tests.
The High Court ap plied these tests.
So had the Trial Court as well as the appellate bench of Court of Small causes.
603 All the relevant factors had been borne in mind by the learned trial judge as well as appellate bench of the Court of Small Causes.
Therefore, simply because another view is possible and on that view a different view is taken, will be interfering under jurisdiction under Article 227 of the Constitution which is unwarranted.
The High Court was im pressed by the fact that having regard to the facts and circumstances of the case and further more for efficient and complete enjoyment of the demised premises and for carrying out the business of manufacturing plastic goods, these structures had been constructed by the tenant temporarily.
According to the High Court, the nature of the materials used and the intention of the tenant were relevant and according to the High Court, these structures could be removed without doing appreciable damage to the demised premises and these indicated that these were intended to be part and parcel of the normal part of the building.
The High Court proceeded on the basis that the trial court as well as the appellate bench of the Small Causes Court had relied wholly on the basis of evidence of the admission of one Mr. Pittie who had admitted that the landlord had knowledge of these factors.
The other evidence, according to the High Court,.
of the Divecha, D 'Silva, Kirtikar and Bhansali were not at all given proper and due weight.
According to the High Court, the High Court had in such circumstances juris diction to deal with this matter and in exercise of the jurisdiction, as the High Court felt that relevant and material facts had been ignored, the High Court set aside the order of the court of Small Causes, and set aside the landlord 's decree and restored the tenant in possession.
As mentioned hereinbefore it is not necessary for our present purpose to decide whether plaintiffs ' witnesses were properly appreciated.
We find all the relevant evidence had been examined by the trial judge as well as by the appellate bench of the court of Small causes.
We find relevant refer ence to the evidence of Divecha, and others.
We find refer ence to the relevant evidence in the deposition at pages 56, 69, 71, 83, 93, to 95 by the trial court as well as in pages 133 36, 152, 167, we find reference to the deposition at p. 56 of the trial court and pages 62 to 63, as well as 65 to 71 and the Appellate Court at pages 134 and 147.
Similarly the evidence of D 'silva who was an employee of Mahindra and Mahindra as also of Shri Kirtikar, were discussed.
It is not necessary to refer in detail to these evidence.
So far as to what extent the factors are structures have been exhaustively referred to in Surya Properties Private Ltd. and others vs Bimalendu Nath Barkar and others (supra) and M/s Surya Properties 604 Private Ltd. vs Bimalendu Nath Sarkar (supra) and in our opinion these lay down correct position in law.
As a matter of fact the tenant is no longer carrying on any business there but one Messrs Quality Plastics is carrying on the business.
Therefore the original purpose is gone.
In this connection reference may be made to Annexure IV appearing at page 428 of the Paper Book which is a letter dated both July, 1964 written by the Concord of India Insurance Company Limited to the Secretary.
The Insurance Association of India where it was stated clearly that Bright Brothers Pvt. had shifted to Bhandup as from 29th April, 1963 and at the relevant time, they had only their Administrative Officer there and they were stocking finished goods in the premises in question.
Further, they have recently installed their Associate Company 's factory in the said block working under the name of M/,s.
Quality Plastics in the premises in ques tion.
Therefore, in view of the fact that large sum had been spent and considering the standard and the nature of the construction and lack of easy removability and the degree of an annexation to the enjoyment for the original purpose, we are of the opinion that the learned judge as well as appel late bench of the court of Small Causes had applied the correct principles and came to a plausible conclusion.
About the removability of the structure, the High Court was bound by the finding of the appellate authority which appears at page 341 to 344 of the Paper Book.
In a case of this nature, the High Court found that they had to enter into this ques tion to find the real position whether the proper principles had been correctly borne in mind.
It is indisputable that the finding that has to be arrived at by the court in this case is a mixed question of law and fact.
Therefore, if the basic factors, for example, there was not proper apprecia tion of the evidence, if the assumption that lofts per se were not permanent structures then the courts below might be said to have committed error apparent on record and no court instructed in law could take such a view.
But if all the relevant factors have been borne in mind and correct legal principles applied then, right or wrong, if a view has been taken by the appellate court, in our opinion, interference under Article 227 of the Constitution was unwarranted.
Interference by the High Court under Article 227 of the Constitution must be within limits.
This question has been considered by this Court from time to time and principles laid down.
This Court in Ganpat Ladha vs Sashikant Vishnu Shinde, ; expressed the view that the High Court commits a gross error in interfering with what was a just and proper exercise of discretion by the Court of 605 Small Causes, in exercise of its power under Article 227 of the Constitution.
This was unwarranted.
The High Court under Article 227 has a limited jurisdiction.
It was held in that case that a finding as to whether circumstances justified the exercise of discretion or not, unless clearly perverse and patently unreasonale, was, after all a finding of fact and it could not be interfered with either under Article 226 or 227 of the Constitution.
If a proper court has come to the conclusion on the examination of the nature of the structure, the nature of the duration of structure, the annexation and other relevant factors that the structures were permanent in nature which were violative of section 13(1)(b) of the Rent Act as well as section 108 clause (p) of and such a finding, is possible, it cannot be considered to be perverse.
In such a situation, the High Court could not have and should not have inter fered.
In India Pipe Fitting Co. vs Fakruddin M.A. Bakar and Anr., ; , this Court reiterated that the limitation of the Court while exercising power under Article 227 of the Constitution is well settled.
Power under Article 227 is one of judicial superintendence and cannot be exer cised to upset the conclusions of facts, however., erroneous these may be.
It is possible that another Court may be able to take a different view of the matter by appreciating the evidence in a different manner, if it determinedly chooses to do so.
That will not be justice administered according to law to which Courts are committed notwithstanding disserta tion in season and out of season, about philosophies.
In that case, the Court found that the High Court had arrogated to itself the powers of the appellate court.
As early in 1959, in Satyanarayan Laxminarayan Hegde and Others vs Millikarjun Bhavanappa Tirumale, [1960] 1 SCR 890, this Court found that in that case on the materials avail able before it that the High Court was wrong in thinking that the alleged error in the judgment of the Bombay Revenue Tribunal was one apparent on the face of the record so as to be capable of being corrected by a writ of certiorari and an error which had to be established by a long drawn process of reasoning on points where there may conveivably be two opinions cannot be said to be an error apparent on the face of the record.
There might have been error in the judgment of the appellate bench of the Court of Small Causes but it is not an error palpable and apparent, right or wrong they had come to that conclusion.
That was possible or plausible conclusion.
In Mrs. Labhkuwar Bhagwani Shah and Others vs Janardhan 606 Mahadeo Kalan and Another, 14, this Court reiterated that concurrent finding of facts whether relating to jurisdictional issue or otherwise were not open to inter ference by the High Court under Article 227 of the Constitu tion.
This Court in Chandavarkar Sita Ratna Rao vs Ashalata section Guram, [1986] 4 SCC p. 447 held that in exercise of juris diction under Article 227 of the Constitution, the High Court can go into the questions of facts or look into the evidence if justice so requires it.
But the High Court should decline to exercise its jurisdiction under Article 226 and 227 of the Constitution to look into the facts in the absence of clear cut down reasons where the question depends upon the appreciation of evidence.
The High Court should not interfere with a finding within the jurisdiction of the inferior tribunal or court except where the finding is perverse in law in the sense that no reasonable person properly instructed in law could have come to such a finding or there is misdirection in law or view of fact has been taken in the teeth of preponderance of evidence or the finding is not based on any material evidence or it resulted in manifest injustice.
Except to the limited extent indicat ed above, the High Court has no jurisdiction.
In this instant case the tests laid down have not been transgressed by the court of Small Causes both trial court as well as the appellate bench.
The view it took was a possible view.
A different view might have been taken out that is no ground which would justify the High Court to interfere with the findings.
In that view of the matter, we allow the appeals, set aside the judgment and order of the High Court and restore the order of the appellate bench of Court of Small Causes dated 4th June, 1973.
There will be an order for possession and mesne profits as directed by the Court of Small Causes.
The respondents will pay the cost of these appeals.
H.L.C. Appeals allowed.
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The appellants, who had let out the premises in question to the respondent Riled a suit for eviction inter alia on the ground that the tenant had erected unauthorised struc tures of a permanent nature in violation of the provisions of cl.
(p) of section 108 of the and section 13(1)(b) of the Bombay Rents.
Hotel and Lodging House Rates Control Act, 1974 and was using the premises for unauthorised purposes.
The alleged permanent structures consisted of lofts and rooms which had been constructed by sinking pillars and stanchions into the flooring and the tenant admitted that these had been constructed after it had taken the premises from the landlord.
After discussing the evidence tendered in detail, including the deposition of the architect who had prepared the plan of the constructions in question and who had deposed that the constructions consist ed of permanent structures, the Judge of the Court of Small Causes held that the structures were of a permanent nature and ordered eviction of the tenant on the ground of perma nent construction.
The respondent 's appeal was dismissed by the Appellate Bench of the Court of Small Causes which, on a detailed reappraisal of the evidence on record, not only confirmed the decree for eviction on the ground of permanent construction but granted eviction on the ground of change of user as well.
The respondent went in appeal against the order of the appellate court.
The High Court, dealing with the matter under article 227 of the Constitution, reversed the concurrent findings of the courts below and allowed the respondent 's petition.
Allowing the appeal and restoring the order of the lower appellate court, 594 HELD: 1.
(a) Interference by the High Courts under article 227 of the Constitution must be within limits.
This question has been considered by this Court from time to time and principles laid down.
The power under article 227 is one of judicial superintendence and it cannot be exercised to upset the conclusions of facts, however erroneous these may be.
It is possible that another Court may be able to take a differ ent view of the matter by appreciating the evidence in a different manner, if it determinedly chooses to do so.
That will not be justice administered according to law to which courts are committed.
[605D E] (b) In exercise of jurisdiction under article 227 ' of the Constitution, the High Court can go into questions of facts or look into the evidence if justice so requires it.
But the High Court should decline to exercise that jurisdiction to look into the facts in the absence of clear cut reasons where the question depends upon the appreciation of evi dence.
The High Court should not interfere with a finding within the jurisdiction of the inferior tribunal or court except where the finding is perverse in law, in the sense that no reasonable person properly instructed in law could have come to such a finding, or there is misdirection in law, or view of fact has been taken in the teeth of prepon derance of evidence, or the finding is not based on any material evidence or it resulted in manifest injustice.
Except to the extent indicated above the High Court has no jurisdiction.
[606B D] Satyanarayan Laxminarayan Hegde & Ors.
vs Mallikarjun Bhavanappa Tirumale, [1960] 1 S.C.R. 890; India Pipe Fitting Co. vs Fakruddin M.A. Baker & Anr., ; ; Ganpat Ladha vs Shashikant Vishnu Shinde, [1978] 3 S.C.R. 198; Mrs. Labhkuwar Bhagwani Shah & Ors.
vs Janardan Mahadeo Kalan & Anr., and Chandavarkar Sita Ratna Rao vs Ashalata section Guram, ; ; re ferred to. 2.
No hard and fast rule can be laid down for determin ing the question whether a particular structure put up by the tenant is a permanent structure for the purpose of cl.
(p) of section 108 of the as it is dependent on the facts of each case.
One must look to the nature of the structure, the purpose for which it was in tended and take a whole perspective as to how it affects the enjoyment, the durability of the building, etc.
and other relevant factors and come to a conclusion.
[601D E; 602D E] Surya Properties Private Ltd. & Ors.
vs Bimalendu Nath Sarkar & Ors., and M/s Surya Proper ties Private Ltd. 595 vs Bimalendu Nath Sarkar, A.I.R. 1965 Calcutta 408, ap proved.
Khureshi Ibrahim Ahmed vs Ahmed Haji Khanmahomad, A.I.R. 1965 Gujarat 152 and Ramji Virji & Ors.
vs Kadarbhai Esufa li, A.I.R.1973 Gujarat 110, referred to.
In this case, on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent.
All the relevant factors had been borne in mind by the learned trial Judge as well as the Appellate Bench of the Court of Small Causes.
The view taken by them was a possible view.
A different view might have been taken but that is no ground which would justify the High Court to interfere with the findings.
[600F]
|
vil Appeal No. 195556 of 1980.
From the Judgment and Order dated 3/4th July, 1979 of the Bombay High Court in Spl.
C.A. Nos.
2052 of 1973 and 132 of 1974.
F.S. Nariman, Anil B. Diwan, P.H. Parekh, Ms. Lata Krishnamurthy and section Dutt with for the Appellants.
V.M. Tarkunde and H.G. Advani, Hira Advani Kailash Vasudev, Joel Peres and D.N. Misra for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals, by special leave, by the landlords are directed against the judgment and order of the High Court of Bombay dated 3/4th July, 1979.
Two questions arise for consideration in these appeals (i) whether the structure constructed by the tenant in the premises in question amounted to permanent structure leading to the forfeiture of the tenancy of the tenant; (ii) what is the scope and extent of the jurisdiction of the High Court under Article 227 of the Constitution on questions of facts found by the appellate bench of Small Causes Court.
In order to appreciate these questions, it is necessary to reiterate the relevant facts.
The second appellant being plaintiff No. 2 in the Original Suit leased out the premises involved herein being a godown measuring 11,500 sq.
at 156 A, Tardeo, Bombay 7.
The said pre 596 mises was given by the landlord to the tenant, the respond ent herein M/s Bright Brothers (Pvt.) Ltd. on lease vide the registered lease dated 14th April, 1947 for a period of ten years commencing from 1st September, 1946.
By 1953, the respondent company began to fall into arrears in payment of rent.
The respondent tenant filed an application before the appropriate Rent Court for fixing the standard rent.
On 14th June, 1958, the advocate of the second appellant sent a notice to the respondent tenant calling upon them to pay up the arrears for the period from September, 1956 to May, 1958 (both months inclusive), as well as for earlier arrears of rent of Rs.20,850.
On 1st December, 1958 a second notice was issued on behalf of the original plaintiff No. 1 calling upon the respondent to quit and vacate the premises in question on the grounds, inter alia, (a) unauthorised construction of permanent nature; (b) obstructing roadways; and (c) the damage to walls and floor, and further called upon them to remove the unauthorised construction and re store the suit premises to its original condition.
Inasmuch as the main factual controversy in those appeals relate to the nature of the construction alleged to have been made by the tenant, it is relevant to set out what was stated in that letter.
It was, inter alia, stated that the tenant had unauthorisedly committed several breaches of the terms and conditions of the lease inasmuch as the tenant had erected unauthorised construction of a permanent nature and carried out additions to the demised premises without the consent of the lessor or the receiver.
It was further alleged that in breach of the terms and conditions of the agreement of tenancy and without the consent of the lessor or the receiv er, the tenant had occupied portion of the land not let out to him by obstructing the lessor and the person entitled to use the same and had made construction on the roadway by obstructing and restricting the passage.
It was further alleged that the tenant had unauthorisedly and without permission dug up and mutilated the floors of the premises let out to the tenant and had constructed contrary to the provisions of section 108(0) of the .
The tenant was called upon to remove the said unauthorised structures and restore the property, and it was further notified that failing which the landlord would be compelled to take proceedings.
A reply to the said notice issued by the Court Receiver was sent on 8th December, 1958 from the respondent company 's advocate saying that the construction complained of had taken place with the consent and full knowledge of the appellant and the respondent company had spent thousands of rupees towards the improvement of the suit 597 premises.
Further in reply to the allegation of damage to the property, the respondent company had alleged that it had in fact improved the property of the appellant.
On or about 20th December, 1958, the advocate for the appellant replied to the above letter once again calling upon the respondent company to vacate the demised premises.
In 1959, the standard rent application being R.A. No. 2214 of 1954 mentioned hereinbefore was dismissed.
There upon, the respondent tenant filed a civil revision applica tion.
The appellant filed a suit being suit No. 1450/83 18 of 1959 on or about 31st July, 1959.
On or about 8th Decem ber, 1965, the appellant made an application for amendment of the plaint to include change of user as an additional ground of eviction.
The respondent also made an application for amendment to the effect that permanent structure had been made with the knowledge and consent of the appellant.
The said amendments were allowed in December, 1965.
On or about 31st March, 1967, the trial court in suit No. 1450/ 8318 of 1959, ordered eviction of the tenant on the ground of permanent construction.
Mesne profit from the date of the decree was also ordered.
There was an appeal to the appellate bench before the CoUrt of Small Causes and cross appeal being appeal nos.
323 and 629 of 1967.
By the judgment delivered on 14th June, 1973, the division bench of the Court of Small Causes confirmed the decree for eviction on the ground of permanent construction and granted eviction on change of user as well in the cross objection filed by the appellant.
It also ordered mesne profit from the date of the suit and the monetary claims to the extent of arrears.
The High Court on or about 3/4th July, 1979, by judgment and order of the High Court in SCA 2052 and 174 of 1974 under Articles 226 and 227 of the Constitution reversed the concurrent findings of the courts below and allowed the respondent company 's application.
Being aggrieved therefrom, the appellants, the landlords have come up in appeal to this Court.
It is, first necessary therefore to consider the nature of the structures made and whether these were permanent or not.
As stated hereinbefore that permanent structures were constructed was held by the two courts concurrently, namely the Judge of the Court of Small Causes as well as the Appel late Bench of the Small Causes Court; whether by such con struction there has been change of user is another question.
On the nature of the construction, it is necessary to refer to the decision of the trial court.
598 The main question, however, in these appeals is the jurisdiction of the High Court to interfere with the find ings of this nature under Article 227 of the Constitution.
The principles are well settled.
Their application, however, in particular cases sometimes present difficulties.
But the quest for certain amount of certitude must continue in this field of uncertain minds and imperfect language.
To the facts, therefore, we must now refer to appreciate the application of law involved in this case.
The premises in question was let out for use exclusively for business of manufacture of plastic articles, wood work and paints only and not for any other purpose.
it is alleged that it is no longer used for that purpose but used as an office and storage.
The trial court in this case was the Court of Small Causes, Bombay.
One of the grounds of ejectment was the erection of permanent structure and it was the case of the appellant No. 2 that such erection was against the provi sions of section 13(1)(b) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1974 (hereinafter called the 'Rent Act ').
Under clause (p) of section 108 of the , a lessee may not without the lessor 's consent erect on the property and permanent structure except for agricultural purposes.
If he does, then this becomes a ground for ejectment.
In this case the permanent structures alleged were constructions of lofts, construction of several rooms and construction of and laying of a new and permanent flooring as appears from the plaint filed in the proceedings.
It further appears that the tenant had sunk in pillars and stanchions into the flooring.
it was stated in the deposi tion that these pillars and stanchions mentioned in the plaint were only those which were the posts supporting the cabins and lofts complained of and none else.
These pillars and stanchions went along with the construction of lofts and construction of several rooms, that is cabins.
The learned trial court discussed the details and found those cabins marked A, B, C, D, E, F, G, H, I, J, K, L etc.
There were lofts marked cabins A, B, C, D, E, F, J, K, other lofts marked as F, G, H and I. The third loft over the cabin at L and the lofts over the portions M & N.
These were, according to the engineer, an architect, Shri Divecha, who was exam ined on behalf of the plaintiff, permanent structures.
The learned judge examined the plan prepared by the said archi tect and his deposition.
The learned judge was of the view that it was clear from the 599 architect 's evidence that lofts A, B, C, D, E, J, K. as well as the lofts over F, G, H and I were meant to carry weight of over 100 Ibs.
per sq.
and this statement according to the learned judge was not challenged in the cross examina tion.
The structures over A, B, C, D, E, J. and F.C.H.I cannot therefore be called only roofs or tops of cabins.
They were nothing but lofts.
The structures A, B, C, D, E, K, J. so also F, G, H, I, L & M were admitted to have been constructed by the tenant after it had taken the premises from the landlord.
The learned judge in his judgment has also noted these various facts as to their length and dimen sions.
He referred extensively to the evidence in the plan which was marked exhibit MI and the deposition of Shri Divecha.
The learned Judge taking these factors into consideration came to the conclusion that the cabin lofts and posts sup porting the same were attached to the flooring as well as the walls and columns of the main structures.
Under these circumstances, the learned judge of the Court of Small Causes was of the opinion that the structures were permanent in nature.
The learned judge, however, held that the land lord had failed to prove that the tenant had put up any permanent flooring at some part of the suit premises as alleged.
The next allegation was that the tenants had demol ished a portion of the wall in between the two rooms and prepared a door at that opening.
After discussing the facts and the evidence, the learned judge was of the view that there was no question of any waste of the plaintiff 's property on account of any demolition.
He, however, had held that so far as cabins, lofts and posts supporting the same by pillars, these were nothing but permanent structures.
So far as the digging of the flooring was concerned, after discussing the evidence the learned judge held that the plaintiffs had failed to prove digging which led to waste of the property of the landlord.
So far as the creation of the permanent structure is concerned, the same breached the terms of tenancy.
The learned judge noted that on 1st Janu ary, 1948 the defendant No. 1 wrote to the plaintiff that the height of the wooden partition they were erecting, was specified within the plan sent along with the aforesaid letter which had already been lying ready for erection.
It was contended by the defendants in their written statements that they had obtained consent in respect of the wooden cabins and partitions in the year 1948.
So far as section 13(1)(b) of the Bombay Rent Act is concerned, there cannot be any waiver operating against the plaintiffs.
It was the case that some of the permanent structures were there before 1947.
On examination of the evidence, the learned judge observed that Mr. D 'silva had stated that the tenant had requested Mahindra & Mahindra for a design of a slotted angle cabin with a loft, that the same was supplied and Mr. D 'silva was the designer who did the work.
Analysing all these evidence, the 600 learned trial judge came to the conclusion that permanent structures were carried out without the consent in writing of the landlords or either of them.
Such permanent structure was outside the tenancy and the landlord had not given any consent.
The matter on this issue went up before the appellate court and the appellate court dealt with this again and discussed these allegations.
It was pointed out by the appellate court that the allegations were that the appel lants had (a) made an opening by demolishing a part of the wall dividing the two portions of the demised premises; (b) constructed lofts in the suit premises, (c) dug upon the flooring of the premises at various places, (d) sunk in pillars and stanchions into the flooring, (e) constructed several rooms and laid new and permanent floorings in parts of the demised premises at different levels.
So far con structing lofts, it was held that these lofts had been constructed after 1st September, 1946.
And in this context the construction of cabins and putting up of pillars were considered and the evidence in this respect was taken into consideration.
It was contended that the demised premises in the lease was described as godown but it was taken in the nature of several office premises and the change in the improvement done to the same was merely for the better enjoyment of demised premises.
In the first place the cabins were made of wooden poles and planks fixed in the floor, and side walls of the building with nails, screws, nuts and bolts.
The appellate court came to the conclusion that applying the proper test, the cabins were substantial struc tures and substantial improvement to the premises.
These were durable for long and intended to be used permanently.
The appellate court also took the question of digging and other relevant allegations.
As a result of analysis of these evidence and materials, the appellate court confirmed the findings of the trial court that the tenant had erected permanent structure on the demised premises without the landlord 's consent and that was a breach of the terms of tenancy.
They also confirmed the finding of the trial court that the respondents did not waive their rights arising out of these acts.
They also upheld the finding that there was no renewal of the lease of the landlords and the tenants were not statutory tenants whose contractual tenancy had come to an end by efflux of time by the end of the period of ten years from 1st September, 1946.
They upheld the decree for possession passed by the trial court.
The High Court dealing with this matter under Article 227 of the Constitution had occasion to refer to this as pect.
The High Court 601 referred to the different authorities on this point.
We may briefly take note of some of these.
In this connection reference may be made to a decision of the Special Bench of the Calcutta High Court in the case of Surya Properties Private Ltd. and others vs Bimalendu Nath Sarkar and others.
A.I.R. 1964 Calcutta p. 1 which dealt with clause (p) of section 108 of the and held that this question was dependent on the facts of each case and no hard and fast rule can be laid down with regard to this matter.
In the absence of any relevant materials, therefore, the Full Bench found that no answer could be given.
in a slightly different context, before Calcutta High Court in the case of M/s Suraya Proper ties Private Ltd. vs Bimalendu Nath Sarkar.
A.I.R. 1965 Calcutta page 408, Chatterjee, J., one of the judges of the Division Bench observed that the phrase 'permanent struc ture ' for purposes of clause (p) of section 108 of the meant a structure which was capable of lasting till the term of the lease and which was con structed in the view of being built up as was a building.
In that context the learned judge observed that a reservoir was not, however, a permanent structure for purposes of clause (p) of section 108 of the .
Sen, J. of the same Bench was of the view that no hard and fast tests could be laid down for determining the question wheth er a particular structure by the tenant was a permanent structure for the purpose of clause (p) of section 108 of the .
The answer to the question depended on the facts of each case.
Chatterjee, J., however, took the view that where the tenant created a permanent structure in the premises leased to him, as the lease con tinued in spite of the disputed structure and the landlord continued to receive rent till the determining of the lease by notice to quit or thereafter till the passing of the decree for eviction and the fact that he accepted rent with full knowledge of the disputed structure did not disentitle him to a decree for eviction.
In Khureshi Ibrahim Ahmed vs Ahmed Haji Khanmahomad.
A.I.R. 1.965 Gujarat, 152, in connection with section 13(1)(b) of the Rent Act, Gujarat High Court held that the permanent structure must be one which was a lasting struc ture and that would depend upon the nature of structure.
The permanent or temporary character of the structure would have to be determined having regard to the nature of the struc ture and the nature of the materials used in the making of the structure and the manner in which the structure was erected and not on the basis of how long the tenant intended to make use of the structure.
As a matter of fact, the Court observed, the nature of the structure 602 itself would reflect whether the tenant intended that it should exist and be available for use for a temporary period or for an indefinite period of time.
The test provided by the Legislature was thus an objective test and not a subjec tive one and once it was shown that the structure erected by the tenant was of such a nature as to be lasting in dura tion lasting of course according to ordinary notions of mankind the tenant cannot come forward and say that it was erected for temporary purpose.
The question was again considered in the case of Ramji Virji and others vs Kadarbhai Esufali, A.I.R. 1973 Gujarat 110.
It was observed that whether the structure was a perma nent structure was a mixed question of law and fact.
It was held in that case that alterations made by a tenant like constructing loft, wooden bathroom, frame and putting up a new drain being minor alterations which were easily remova ble without causing any serious damage to the premises would not amount to permanent structure leading to the forfeiture.
There are numerous authorities dealing with the question how the structure is a permanent structure or not should be judged.
It is not necessary to deal with all these.
One must look to the nature of the structure, the purpose for which it was intended and take a whole perspective as to how it affects the enjoyment, the durability of the building etc.
and other relevant factors and come to a conclusion.
Judged in the aforesaid light on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent.
The High Court observed that in judging whether the structures were perma nent or not, the following factors should be taken into consideration referring to an unreported decision of Malvan kar J. in special civil application No. 121 of 1968.
These were (1) intention of the party who put up the structure; (2) this intention was to be gathered from the mode and degree of annexation; (3) if the structure cannot be removed without doing irrepairable damage to the demised premises then that would be certainly one of the circumstances to be considered while deciding the question of intention.
Like wise, dimensions of the structure and (4) its removability had to be taken into consideration.
But these were not the sole tests.
(5) the purpose of erecting the structure is another relevant factor.
(6) the nature of the materials used for the structure and (7) lastly the durability of the structure.
These were the broad tests.
The High Court ap plied these tests.
So had the Trial Court as well as the appellate bench of Court of Small causes.
603 All the relevant factors had been borne in mind by the learned trial judge as well as appellate bench of the Court of Small Causes.
Therefore, simply because another view is possible and on that view a different view is taken, will be interfering under jurisdiction under Article 227 of the Constitution which is unwarranted.
The High Court was im pressed by the fact that having regard to the facts and circumstances of the case and further more for efficient and complete enjoyment of the demised premises and for carrying out the business of manufacturing plastic goods, these structures had been constructed by the tenant temporarily.
According to the High Court, the nature of the materials used and the intention of the tenant were relevant and according to the High Court, these structures could be removed without doing appreciable damage to the demised premises and these indicated that these were intended to be part and parcel of the normal part of the building.
The High Court proceeded on the basis that the trial court as well as the appellate bench of the Small Causes Court had relied wholly on the basis of evidence of the admission of one Mr. Pittie who had admitted that the landlord had knowledge of these factors.
The other evidence, according to the High Court,.
of the Divecha, D 'Silva, Kirtikar and Bhansali were not at all given proper and due weight.
According to the High Court, the High Court had in such circumstances juris diction to deal with this matter and in exercise of the jurisdiction, as the High Court felt that relevant and material facts had been ignored, the High Court set aside the order of the court of Small Causes, and set aside the landlord 's decree and restored the tenant in possession.
As mentioned hereinbefore it is not necessary for our present purpose to decide whether plaintiffs ' witnesses were properly appreciated.
We find all the relevant evidence had been examined by the trial judge as well as by the appellate bench of the court of Small causes.
We find relevant refer ence to the evidence of Divecha, and others.
We find refer ence to the relevant evidence in the deposition at pages 56, 69, 71, 83, 93, to 95 by the trial court as well as in pages 133 36, 152, 167, we find reference to the deposition at p. 56 of the trial court and pages 62 to 63, as well as 65 to 71 and the Appellate Court at pages 134 and 147.
Similarly the evidence of D 'silva who was an employee of Mahindra and Mahindra as also of Shri Kirtikar, were discussed.
It is not necessary to refer in detail to these evidence.
So far as to what extent the factors are structures have been exhaustively referred to in Surya Properties Private Ltd. and others vs Bimalendu Nath Barkar and others (supra) and M/s Surya Properties 604 Private Ltd. vs Bimalendu Nath Sarkar (supra) and in our opinion these lay down correct position in law.
As a matter of fact the tenant is no longer carrying on any business there but one Messrs Quality Plastics is carrying on the business.
Therefore the original purpose is gone.
In this connection reference may be made to Annexure IV appearing at page 428 of the Paper Book which is a letter dated both July, 1964 written by the Concord of India Insurance Company Limited to the Secretary.
The Insurance Association of India where it was stated clearly that Bright Brothers Pvt. had shifted to Bhandup as from 29th April, 1963 and at the relevant time, they had only their Administrative Officer there and they were stocking finished goods in the premises in question.
Further, they have recently installed their Associate Company 's factory in the said block working under the name of M/,s.
Quality Plastics in the premises in ques tion.
Therefore, in view of the fact that large sum had been spent and considering the standard and the nature of the construction and lack of easy removability and the degree of an annexation to the enjoyment for the original purpose, we are of the opinion that the learned judge as well as appel late bench of the court of Small Causes had applied the correct principles and came to a plausible conclusion.
About the removability of the structure, the High Court was bound by the finding of the appellate authority which appears at page 341 to 344 of the Paper Book.
In a case of this nature, the High Court found that they had to enter into this ques tion to find the real position whether the proper principles had been correctly borne in mind.
It is indisputable that the finding that has to be arrived at by the court in this case is a mixed question of law and fact.
Therefore, if the basic factors, for example, there was not proper apprecia tion of the evidence, if the assumption that lofts per se were not permanent structures then the courts below might be said to have committed error apparent on record and no court instructed in law could take such a view.
But if all the relevant factors have been borne in mind and correct legal principles applied then, right or wrong, if a view has been taken by the appellate court, in our opinion, interference under Article 227 of the Constitution was unwarranted.
Interference by the High Court under Article 227 of the Constitution must be within limits.
This question has been considered by this Court from time to time and principles laid down.
This Court in Ganpat Ladha vs Sashikant Vishnu Shinde, ; expressed the view that the High Court commits a gross error in interfering with what was a just and proper exercise of discretion by the Court of 605 Small Causes, in exercise of its power under Article 227 of the Constitution.
This was unwarranted.
The High Court under Article 227 has a limited jurisdiction.
It was held in that case that a finding as to whether circumstances justified the exercise of discretion or not, unless clearly perverse and patently unreasonale, was, after all a finding of fact and it could not be interfered with either under Article 226 or 227 of the Constitution.
If a proper court has come to the conclusion on the examination of the nature of the structure, the nature of the duration of structure, the annexation and other relevant factors that the structures were permanent in nature which were violative of section 13(1)(b) of the Rent Act as well as section 108 clause (p) of and such a finding, is possible, it cannot be considered to be perverse.
In such a situation, the High Court could not have and should not have inter fered.
In India Pipe Fitting Co. vs Fakruddin M.A. Bakar and Anr., ; , this Court reiterated that the limitation of the Court while exercising power under Article 227 of the Constitution is well settled.
Power under Article 227 is one of judicial superintendence and cannot be exer cised to upset the conclusions of facts, however., erroneous these may be.
It is possible that another Court may be able to take a different view of the matter by appreciating the evidence in a different manner, if it determinedly chooses to do so.
That will not be justice administered according to law to which Courts are committed notwithstanding disserta tion in season and out of season, about philosophies.
In that case, the Court found that the High Court had arrogated to itself the powers of the appellate court.
As early in 1959, in Satyanarayan Laxminarayan Hegde and Others vs Millikarjun Bhavanappa Tirumale, [1960] 1 SCR 890, this Court found that in that case on the materials avail able before it that the High Court was wrong in thinking that the alleged error in the judgment of the Bombay Revenue Tribunal was one apparent on the face of the record so as to be capable of being corrected by a writ of certiorari and an error which had to be established by a long drawn process of reasoning on points where there may conveivably be two opinions cannot be said to be an error apparent on the face of the record.
There might have been error in the judgment of the appellate bench of the Court of Small Causes but it is not an error palpable and apparent, right or wrong they had come to that conclusion.
That was possible or plausible conclusion.
In Mrs. Labhkuwar Bhagwani Shah and Others vs Janardhan 606 Mahadeo Kalan and Another, 14, this Court reiterated that concurrent finding of facts whether relating to jurisdictional issue or otherwise were not open to inter ference by the High Court under Article 227 of the Constitu tion.
This Court in Chandavarkar Sita Ratna Rao vs Ashalata section Guram, [1986] 4 SCC p. 447 held that in exercise of juris diction under Article 227 of the Constitution, the High Court can go into the questions of facts or look into the evidence if justice so requires it.
But the High Court should decline to exercise its jurisdiction under Article 226 and 227 of the Constitution to look into the facts in the absence of clear cut down reasons where the question depends upon the appreciation of evidence.
The High Court should not interfere with a finding within the jurisdiction of the inferior tribunal or court except where the finding is perverse in law in the sense that no reasonable person properly instructed in law could have come to such a finding or there is misdirection in law or view of fact has been taken in the teeth of preponderance of evidence or the finding is not based on any material evidence or it resulted in manifest injustice.
Except to the limited extent indicat ed above, the High Court has no jurisdiction.
In this instant case the tests laid down have not been transgressed by the court of Small Causes both trial court as well as the appellate bench.
The view it took was a possible view.
A different view might have been taken out that is no ground which would justify the High Court to interfere with the findings.
In that view of the matter, we allow the appeals, set aside the judgment and order of the High Court and restore the order of the appellate bench of Court of Small Causes dated 4th June, 1973.
There will be an order for possession and mesne profits as directed by the Court of Small Causes.
The respondents will pay the cost of these appeals.
H.L.C. Appeals allowed.
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From the Judgment and Order dated 3/4th July, 1979 of the Bombay High Court in Spl. F.S. Nariman, Anil B. Diwan, P.H. Parekh, Ms. Lata Krishnamurthy and section Dutt with for the Appellants. V.M. Tarkunde and H.G. Advani, Hira Advani Kailash Vasudev, Joel Peres and D.N. Misra for the Respondents. Two questions arise for consideration in these appeals (i) whether the structure constructed by the tenant in the premises in question amounted to permanent structure leading to the forfeiture of the tenancy of the tenant; (ii) what is the scope and extent of the jurisdiction of the High Court under Article 227 of the Constitution on questions of facts found by the appellate bench of Small Causes Court. In order to appreciate these questions, it is necessary to reiterate the relevant facts. The said pre 596 mises was given by the landlord to the tenant, the respond ent herein M/s Bright Brothers (Pvt.) Ltd. on lease vide the registered lease dated 14th April, 1947 for a period of ten years commencing from 1st September, 1946. The respondent tenant filed an application before the appropriate Rent Court for fixing the standard rent. On 1st December, 1958 a second notice was issued on behalf of the original plaintiff No. 1 calling upon the respondent to quit and vacate the premises in question on the grounds, inter alia, (a) unauthorised construction of permanent nature; (b) obstructing roadways; and (c) the damage to walls and floor, and further called upon them to remove the unauthorised construction and re store the suit premises to its original condition. It was further alleged that the tenant had unauthorisedly and without permission dug up and mutilated the floors of the premises let out to the tenant and had constructed contrary to the provisions of section 108(0) of the . A reply to the said notice issued by the Court Receiver was sent on 8th December, 1958 from the respondent company 's advocate saying that the construction complained of had taken place with the consent and full knowledge of the appellant and the respondent company had spent thousands of rupees towards the improvement of the suit 597 premises. 2214 of 1954 mentioned hereinbefore was dismissed. There upon, the respondent tenant filed a civil revision applica tion. The appellant filed a suit being suit No. 1450/83 18 of 1959 on or about 31st July, 1959. The said amendments were allowed in December, 1965. On or about 31st March, 1967, the trial court in suit No. Mesne profit from the date of the decree was also ordered. There was an appeal to the appellate bench before the CoUrt of Small Causes and cross appeal being appeal nos. It is, first necessary therefore to consider the nature of the structures made and whether these were permanent or not. On the nature of the construction, it is necessary to refer to the decision of the trial court. Their application, however, in particular cases sometimes present difficulties. But the quest for certain amount of certitude must continue in this field of uncertain minds and imperfect language. To the facts, therefore, we must now refer to appreciate the application of law involved in this case. The premises in question was let out for use exclusively for business of manufacture of plastic articles, wood work and paints only and not for any other purpose. it is alleged that it is no longer used for that purpose but used as an office and storage. The trial court in this case was the Court of Small Causes, Bombay. If he does, then this becomes a ground for ejectment. In this case the permanent structures alleged were constructions of lofts, construction of several rooms and construction of and laying of a new and permanent flooring as appears from the plaint filed in the proceedings. It further appears that the tenant had sunk in pillars and stanchions into the flooring. it was stated in the deposi tion that these pillars and stanchions mentioned in the plaint were only those which were the posts supporting the cabins and lofts complained of and none else. These pillars and stanchions went along with the construction of lofts and construction of several rooms, that is cabins. The learned trial court discussed the details and found those cabins marked A, B, C, D, E, F, G, H, I, J, K, L etc. The learned judge examined the plan prepared by the said archi tect and his deposition. The learned judge was of the view that it was clear from the 599 architect 's evidence that lofts A, B, C, D, E, J, K. as well as the lofts over F, G, H and I were meant to carry weight of over 100 Ibs. and this statement according to the learned judge was not challenged in the cross examina tion. The structures over A, B, C, D, E, J. and F.C.H.I cannot therefore be called only roofs or tops of cabins. The structures A, B, C, D, E, K, J. so also F, G, H, I, L & M were admitted to have been constructed by the tenant after it had taken the premises from the landlord. The learned judge in his judgment has also noted these various facts as to their length and dimen sions. He referred extensively to the evidence in the plan which was marked exhibit MI and the deposition of Shri Divecha. Under these circumstances, the learned judge of the Court of Small Causes was of the opinion that the structures were permanent in nature. After discussing the facts and the evidence, the learned judge was of the view that there was no question of any waste of the plaintiff 's property on account of any demolition. He, however, had held that so far as cabins, lofts and posts supporting the same by pillars, these were nothing but permanent structures. So far as the digging of the flooring was concerned, after discussing the evidence the learned judge held that the plaintiffs had failed to prove digging which led to waste of the property of the landlord. So far as section 13(1)(b) of the Bombay Rent Act is concerned, there cannot be any waiver operating against the plaintiffs. It was the case that some of the permanent structures were there before 1947. Analysing all these evidence, the 600 learned trial judge came to the conclusion that permanent structures were carried out without the consent in writing of the landlords or either of them. The matter on this issue went up before the appellate court and the appellate court dealt with this again and discussed these allegations. So far con structing lofts, it was held that these lofts had been constructed after 1st September, 1946. And in this context the construction of cabins and putting up of pillars were considered and the evidence in this respect was taken into consideration. It was contended that the demised premises in the lease was described as godown but it was taken in the nature of several office premises and the change in the improvement done to the same was merely for the better enjoyment of demised premises. In the first place the cabins were made of wooden poles and planks fixed in the floor, and side walls of the building with nails, screws, nuts and bolts. The appellate court came to the conclusion that applying the proper test, the cabins were substantial struc tures and substantial improvement to the premises. These were durable for long and intended to be used permanently. The appellate court also took the question of digging and other relevant allegations. They also confirmed the finding of the trial court that the respondents did not waive their rights arising out of these acts. The High Court 601 referred to the different authorities on this point. We may briefly take note of some of these. In this connection reference may be made to a decision of the Special Bench of the Calcutta High Court in the case of Surya Properties Private Ltd. and others vs Bimalendu Nath Sarkar and others. In the absence of any relevant materials, therefore, the Full Bench found that no answer could be given. In that context the learned judge observed that a reservoir was not, however, a permanent structure for purposes of clause (p) of section 108 of the . The answer to the question depended on the facts of each case. Chatterjee, J., however, took the view that where the tenant created a permanent structure in the premises leased to him, as the lease con tinued in spite of the disputed structure and the landlord continued to receive rent till the determining of the lease by notice to quit or thereafter till the passing of the decree for eviction and the fact that he accepted rent with full knowledge of the disputed structure did not disentitle him to a decree for eviction. In Khureshi Ibrahim Ahmed vs Ahmed Haji Khanmahomad. It was observed that whether the structure was a perma nent structure was a mixed question of law and fact. There are numerous authorities dealing with the question how the structure is a permanent structure or not should be judged. It is not necessary to deal with all these. and other relevant factors and come to a conclusion. Judged in the aforesaid light on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent. Like wise, dimensions of the structure and (4) its removability had to be taken into consideration. (5) the purpose of erecting the structure is another relevant factor. (6) the nature of the materials used for the structure and (7) lastly the durability of the structure. So had the Trial Court as well as the appellate bench of Court of Small causes. 603 All the relevant factors had been borne in mind by the learned trial judge as well as appellate bench of the Court of Small Causes. According to the High Court, the nature of the materials used and the intention of the tenant were relevant and according to the High Court, these structures could be removed without doing appreciable damage to the demised premises and these indicated that these were intended to be part and parcel of the normal part of the building. The other evidence, according to the High Court,. of the Divecha, D 'Silva, Kirtikar and Bhansali were not at all given proper and due weight. According to the High Court, the High Court had in such circumstances juris diction to deal with this matter and in exercise of the jurisdiction, as the High Court felt that relevant and material facts had been ignored, the High Court set aside the order of the court of Small Causes, and set aside the landlord 's decree and restored the tenant in possession. As mentioned hereinbefore it is not necessary for our present purpose to decide whether plaintiffs ' witnesses were properly appreciated. We find all the relevant evidence had been examined by the trial judge as well as by the appellate bench of the court of Small causes. We find relevant refer ence to the evidence of Divecha, and others. We find refer ence to the relevant evidence in the deposition at pages 56, 69, 71, 83, 93, to 95 by the trial court as well as in pages 133 36, 152, 167, we find reference to the deposition at p. 56 of the trial court and pages 62 to 63, as well as 65 to 71 and the Appellate Court at pages 134 and 147. Similarly the evidence of D 'silva who was an employee of Mahindra and Mahindra as also of Shri Kirtikar, were discussed. It is not necessary to refer in detail to these evidence. As a matter of fact the tenant is no longer carrying on any business there but one Messrs Quality Plastics is carrying on the business. The Insurance Association of India where it was stated clearly that Bright Brothers Pvt. Further, they have recently installed their Associate Company 's factory in the said block working under the name of M/,s. Quality Plastics in the premises in ques tion. About the removability of the structure, the High Court was bound by the finding of the appellate authority which appears at page 341 to 344 of the Paper Book. It is indisputable that the finding that has to be arrived at by the court in this case is a mixed question of law and fact. This question has been considered by this Court from time to time and principles laid down. This Court in Ganpat Ladha vs Sashikant Vishnu Shinde, ; expressed the view that the High Court commits a gross error in interfering with what was a just and proper exercise of discretion by the Court of 605 Small Causes, in exercise of its power under Article 227 of the Constitution. The High Court under Article 227 has a limited jurisdiction. If a proper court has come to the conclusion on the examination of the nature of the structure, the nature of the duration of structure, the annexation and other relevant factors that the structures were permanent in nature which were violative of section 13(1)(b) of the Rent Act as well as section 108 clause (p) of and such a finding, is possible, it cannot be considered to be perverse. In such a situation, the High Court could not have and should not have inter fered. In India Pipe Fitting Co. vs Fakruddin M.A. Bakar and Anr., ; , Power under Article 227 is one of judicial superintendence and cannot be exer cised to upset the conclusions of facts, however., That will not be justice administered according to law to which Courts are committed notwithstanding disserta tion in season and out of season, about philosophies. That was possible or plausible conclusion. In Mrs. Labhkuwar Bhagwani Shah and Others vs Janardhan 606 Mahadeo Kalan and Another, 14, this Court reiterated that concurrent finding of facts whether relating to jurisdictional issue or otherwise were not open to inter ference by the High Court under Article 227 of the Constitu tion. Except to the limited extent indicat ed above, the High Court has no jurisdiction. In this instant case the tests laid down have not been transgressed by the court of Small Causes both trial court as well as the appellate bench. A different view might have been taken out that is no ground which would justify the High Court to interfere with the findings. There will be an order for possession and mesne profits as directed by the Court of Small Causes. The respondents will pay the cost of these appeals.
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The appellants, who had let out the premises in question to the respondent Riled a suit for eviction inter alia on the ground that the tenant had erected unauthorised struc tures of a permanent nature in violation of the provisions of cl.
(p) of section 108 of the and section 13(1)(b) of the Bombay Rents.
Hotel and Lodging House Rates Control Act, 1974 and was using the premises for unauthorised purposes.
The alleged permanent structures consisted of lofts and rooms which had been constructed by sinking pillars and stanchions into the flooring and the tenant admitted that these had been constructed after it had taken the premises from the landlord.
After discussing the evidence tendered in detail, including the deposition of the architect who had prepared the plan of the constructions in question and who had deposed that the constructions consist ed of permanent structures, the Judge of the Court of Small Causes held that the structures were of a permanent nature and ordered eviction of the tenant on the ground of perma nent construction.
The respondent 's appeal was dismissed by the Appellate Bench of the Court of Small Causes which, on a detailed reappraisal of the evidence on record, not only confirmed the decree for eviction on the ground of permanent construction but granted eviction on the ground of change of user as well.
The respondent went in appeal against the order of the appellate court.
The High Court, dealing with the matter under article 227 of the Constitution, reversed the concurrent findings of the courts below and allowed the respondent 's petition.
Allowing the appeal and restoring the order of the lower appellate court, 594 HELD: 1.
(a) Interference by the High Courts under article 227 of the Constitution must be within limits.
This question has been considered by this Court from time to time and principles laid down.
The power under article 227 is one of judicial superintendence and it cannot be exercised to upset the conclusions of facts, however erroneous these may be.
It is possible that another Court may be able to take a differ ent view of the matter by appreciating the evidence in a different manner, if it determinedly chooses to do so.
That will not be justice administered according to law to which courts are committed.
[605D E] (b) In exercise of jurisdiction under article 227 ' of the Constitution, the High Court can go into questions of facts or look into the evidence if justice so requires it.
But the High Court should decline to exercise that jurisdiction to look into the facts in the absence of clear cut reasons where the question depends upon the appreciation of evi dence.
The High Court should not interfere with a finding within the jurisdiction of the inferior tribunal or court except where the finding is perverse in law, in the sense that no reasonable person properly instructed in law could have come to such a finding, or there is misdirection in law, or view of fact has been taken in the teeth of prepon derance of evidence, or the finding is not based on any material evidence or it resulted in manifest injustice.
Except to the extent indicated above the High Court has no jurisdiction.
[606B D] Satyanarayan Laxminarayan Hegde & Ors.
vs Mallikarjun Bhavanappa Tirumale, [1960] 1 S.C.R. 890; India Pipe Fitting Co. vs Fakruddin M.A. Baker & Anr., ; ; Ganpat Ladha vs Shashikant Vishnu Shinde, [1978] 3 S.C.R. 198; Mrs. Labhkuwar Bhagwani Shah & Ors.
vs Janardan Mahadeo Kalan & Anr., and Chandavarkar Sita Ratna Rao vs Ashalata section Guram, ; ; re ferred to. 2.
No hard and fast rule can be laid down for determin ing the question whether a particular structure put up by the tenant is a permanent structure for the purpose of cl.
(p) of section 108 of the as it is dependent on the facts of each case.
One must look to the nature of the structure, the purpose for which it was in tended and take a whole perspective as to how it affects the enjoyment, the durability of the building, etc.
and other relevant factors and come to a conclusion.
[601D E; 602D E] Surya Properties Private Ltd. & Ors.
vs Bimalendu Nath Sarkar & Ors., and M/s Surya Proper ties Private Ltd. 595 vs Bimalendu Nath Sarkar, A.I.R. 1965 Calcutta 408, ap proved.
Khureshi Ibrahim Ahmed vs Ahmed Haji Khanmahomad, A.I.R. 1965 Gujarat 152 and Ramji Virji & Ors.
vs Kadarbhai Esufa li, A.I.R.1973 Gujarat 110, referred to.
In this case, on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent.
All the relevant factors had been borne in mind by the learned trial Judge as well as the Appellate Bench of the Court of Small Causes.
The view taken by them was a possible view.
A different view might have been taken but that is no ground which would justify the High Court to interfere with the findings.
[600F]
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The appellants, who had let out the premises in question to the respondent Riled a suit for eviction inter alia on the ground that the tenant had erected unauthorised struc tures of a permanent nature in violation of the provisions of cl. (p) of section 108 of the and section 13(1)(b) of the Bombay Rents. Hotel and Lodging House Rates Control Act, 1974 and was using the premises for unauthorised purposes. The alleged permanent structures consisted of lofts and rooms which had been constructed by sinking pillars and stanchions into the flooring and the tenant admitted that these had been constructed after it had taken the premises from the landlord. The respondent 's appeal was dismissed by the Appellate Bench of the Court of Small Causes which, on a detailed reappraisal of the evidence on record, not only confirmed the decree for eviction on the ground of permanent construction but granted eviction on the ground of change of user as well. The respondent went in appeal against the order of the appellate court. Allowing the appeal and restoring the order of the lower appellate court, 594 HELD: 1. (a) Interference by the High Courts under article 227 of the Constitution must be within limits. This question has been considered by this Court from time to time and principles laid down. It is possible that another Court may be able to take a differ ent view of the matter by appreciating the evidence in a different manner, if it determinedly chooses to do so. That will not be justice administered according to law to which courts are committed. The High Court should not interfere with a finding within the jurisdiction of the inferior tribunal or court except where the finding is perverse in law, in the sense that no reasonable person properly instructed in law could have come to such a finding, or there is misdirection in law, or view of fact has been taken in the teeth of prepon derance of evidence, or the finding is not based on any material evidence or it resulted in manifest injustice. Except to the extent indicated above the High Court has no jurisdiction. [606B D] Satyanarayan Laxminarayan Hegde & Ors. vs Mallikarjun Bhavanappa Tirumale, [1960] 1 S.C.R. 890; India Pipe Fitting Co. vs Fakruddin M.A. Baker & Anr., ; ; Ganpat Ladha vs Shashikant Vishnu Shinde, [1978] 3 S.C.R. 198; Mrs. Labhkuwar Bhagwani Shah & Ors. and Chandavarkar Sita Ratna Rao vs Ashalata section Guram, ; ; re ferred to. No hard and fast rule can be laid down for determin ing the question whether a particular structure put up by the tenant is a permanent structure for the purpose of cl. (p) of section 108 of the as it is dependent on the facts of each case. One must look to the nature of the structure, the purpose for which it was in tended and take a whole perspective as to how it affects the enjoyment, the durability of the building, etc. and other relevant factors and come to a conclusion. [601D E; 602D E] Surya Properties Private Ltd. & Ors. Khureshi Ibrahim Ahmed vs Ahmed Haji Khanmahomad, A.I.R. 1965 Gujarat 152 and Ramji Virji & Ors. In this case, on an analysis of the evidence the trial court as well as the appellate court had held that the structures were permanent. All the relevant factors had been borne in mind by the learned trial Judge as well as the Appellate Bench of the Court of Small Causes. The view taken by them was a possible view. A different view might have been taken but that is no ground which would justify the High Court to interfere with the findings.
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No. 7338 of 1981.
(Under Article 32 of the Constitution of India).
Ram Jethmalani and Miss Rani Jethmalani for the Petitioner.
G. Ramaswamy, Additional Solicitor General, R.P. Srivastava 634 and Miss. A. Subhashini for the Respondent.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
The petitioner of this application under Article 32 of the Constitution is an engineer who was employed in the Central Public Works Department under the Ministry of Works and Housing in Government of India and was compulsorily retired by order dated 3.8.1976 with effect from 5.11.1976 made under Rule 56(j) of the Fundamental Rules.
He has assailed that order for retirement and has claimed payment of remuneration which he would have been entitled to draw upto the normal date of superannuation.
The short facts are these.
The petitioner was born on 10.2.1922 and secured his first appointment as a Section Officer under the named employer on 22.10.1947.
He was pro moted as officiating Assistant Engineer in class II service with effect from ' 25.5.
1954, and came to be confirmed as Section Officer by an order dated 8.10.1955.
On 3.7.1961, he was further promoted as officiating Executive Engineer in Class I service but on 4.9.1965, he was reverted to the post of Assistant Engineer in officiating position and was con tinuing in that post when he was compulsorily retired.
The vires of Rule 56(j) of the Fundamental Rules as also the power to compulsorily retire a public servant have been upheld by this Court and do not require to be re examined.
The basis of attack to the impugned order is as specified in Ground No. A and is to the following effect: "The impugned order is contrary to the judg ment delivered by this Hon 'ble Court on 26.2.1980, copy at Annexure C hereto.
(Union of India vs K.R. Tahiliani and Anr.) [1980] 1 SLR 847.
According to the said judgment F.R. 56 (j)(i) has no application to officiating government servants, hence can have no appli cation to the petitioner since the petitioner was an officiating government servant.
" The impugned notice ran thus: "No. 32/452/66 EC.
111 Government of India Central Public Works Department New Delhi, the 3.8.76 635 ORDER WHEREAS the Engineer in Chief is of opinion that it is in public interest to do so: NOW, THEREFORE, in exercise of the powers conferred by clause (j) of Rule 56 of the Fundamental Rules, the Engineer in Chief hereby gives notice to Shri A.L. Ahuja, As sistant Engineer (Civil), at present under suspension, that he, having already attained the age of fifty years on 10.2.1972, shall retire from service with effect from the forenoon of 3rd November, 1976, or, from the date of expiry of three months computed from the date of issue of the service of this notice on him, whichever is latter.
Sd/ (V.R .
VAISH) ENGINEER IN CHIEF To Shri A.L. Ahuja, Assistant Engineer (Civil), (Under Suspension), A11/85, Lajpat Nagar, New Delhi 110024.
" It is clear from it that the petitioner attained the age of 50 years on 10.2.1972 and, therefore, on the date of the order he had completed the age of 54 years.
Admittedly, he was holding a class II post when the impugned order was served on him.
Fundamental Rule 56(j) under which notice was given provides: "(j) Notwithstanding anything contained in this rule, the appropriate authority shall, if it is of the opinion that it is in the public interest so to do, have the absolute right to retire any Government servant by giving him notice of not less than three months in writ ing or three months ' pay and allowances in lieu of such notice; (i) if he is in Class I or Class II service or post (and had entered Government service before attaining the age 636 of thirty five years), after he has attained the age of fifty years; (ii) in any other case after he has attained the age of fifty five years; . . . . . . . . . . ." The appropriate authority is entitled to exercise power under clause (j) in the case of a Government servant in Class I or Class II service or post where he entered into service before attaining the age of 35 years after the said servant attained the age of 50 years; and in other cases after he has attained the age of 55 years.
In the instant case, the petitioner was promoted as officiating Assistant Engineer which is a Class II post on 25.5.
1954 and contin ued to hold that post when the order of compulsory retire ment was passed.
By 25.5.1954 the petitioner had not at tained the age of 35 years.
As already indicated above he had crossed the age of 50 years but had not attained the age of 55 years by the date of the impugned order.
Therefore, sub clause (1) was not contravened when the order was made.
It has been argued before us that as the petitioner was holding an officiating appointment in Class 117 he could not have been compulsorily retired under sub clause (i).
Support is claimed from the observations in the Tahilia ni 's case (supra).
The sole question that fell therein for decision before this Court was whether a Government servant officiating in Class I or Class II service or post could be retired compulsorily by exercising the power under Rule 56(j)(i) after he has attained the age of 50 years.
The two Judge Bench which decided the case held: " An officiating hand has no right to the post and is perhaps a fleeting.
bird who may have to go back to the substantive post from which he has been promoted on an officiating basis what is more to the point, a person who has been appointed de novo may begin his service on an officiating basis or on a tempo rary basis and it is obvious that he has no right to the post and cannot be strictly said to be in that service or post as a member of that service.
In short, an officiating Govern ment servant does not really belong to Class I or Class II service until he acquires a right thereon.
Even viewed closely and meticulously, the structure of the clause, namely, "if he is in Class I or Class II 637 service or post", emphasises the nature of the service or post vis a vis the Government servant concerned.
We need not go into the semantic shapes, lexical niceties or linguis tic nuance but only go through the meaning and purpose of the provision.
When a Government servant belonging to a Class I or Class II service or post on regular basis has to be retired compulsorily, Rule 56(j)(i) comes to the rescue of the Government.
But if he is only a temporary hand, he has no right to the post and can always be reverted to the post, if any, on which he has a lien.
Similar is the position of an officiating hand.
Thus we have reached an inevitable conclusion that Rule 56(j) is meant to cover only those who are in a post on a regular basis, i.e. in a substan tive capacity, and not on an officiating basis only.
" Strong reliance was placed by counsel for the petitioner on the reasons extracted above.
It is clear that sub clause (ii) is the general rule applicable to all Government servants and sub clause (i) carves out a class of Government servants into a category and makes a special provision.
We have already indicated that sub clause (ii) did not apply to the facts of this case as the petitioner had not attained the age of 55 years by the date of the order.
The observations made in Tahiliani 's case indisputably support the petitioner.
But the correct ness thereof is disputed by learned Additional Solicitor General appearing for the Union of India and that is why this writ petition was directed to be heard by a larger Bench.
There is no reference to officiating service in sub clause (i).
The relevant words used in sub clause (i) are "if he is in Class I or Class II service or post".
A person can be in Class I or Class II service or post even when he hold a post of either class substantively or temporarily or on officiating basis.
Instances are abundant where officers are promoted to Class I or Class II service or post of such class on officiating basis and such officiation lasts for a number of years.
Officiating promotion certainly does not confer a right to the post and at any time the Government servant may be sent back to his substantive post.
There is, however, no reasons why sub clause (i) should be confined to service or post held on substantive basis.
Learned counsel for the petitioner does not dispute the position that a person who is in Class I or Class II service or post is in such service or post as covered by sub clause (i).
The possibility of such incumbent being sent back to the 638 substantive post is not at all relevant in the matter of exercising powers of compulsory retirement.
If the officia tion is not brought to an end by reverting the Government servant to his substantive post before the power of compul sory retirement is exercised, the Government servant con cerned must be taken to be in Class I or Class II service or post at the relevant time and would come within the ambit of sub clause (i).
There is no warrant for the conclusion that officiating Government servants in Class I or Class II service or post are outside the purview of sub clause (i).
The possibility of a reversion to the substantive post is not germane to the exercise of power contained in F.R. 56.
The purpose of Fundamental Rules 56(j) is to confer power on the appropriate authority to compulsorily retire Government servant in the public interest and the classification of Government servants into two categories covered by sub clauses (i) and (ii) has a purpose behind it.
If the condi tion indicated in sub clause (i) is satisfied, namely, the Government servant is in Class I or Class II service or post and he had entered into service before attaining the age of 35 years, and has attained the age of fifty, the further condition that he must substantively belong to the two classes of service or post cannot be introduced into the scheme.
The purpose of the sub clauses is to classify Gov ernment servants into two categories and sub clause (i) takes within its sweep those Government servants who at the relevant time are in Class I or Class II service or post, whether substantively, temporarily or on officiating basis.
We would accordingly hold that the ratio of the decision in Tahiliani 's case is not correct and sub clause (i) of Rule 56(j) applies to Government servants in Class I or Class II service or post on substantive, temporary or offi ciating basis.
On this conclusion the writ petition is liable to be dismissed.
It has been represented to us by counsel for the petitioner that the similarly placed persons had gone before the Delhi High Court challenging the orders of compulsory retirement and the Delhi High Court relying upon Tahiliani 's case give them relief.
Such judgments have become final and Union of India has given effect to the decisions of the Delhi High Court.
When this was put to learned Additional Solicitor General he agreed that the Union of India will have no objection to treat the petitioner alike and would be prepared to give the same relief to the petitioner.
The petitioner would have superannuated from service on 29.2.1980 if he had not been compulsorily retired with effect from 639 5.11. 1976.
Even if the writ petition is allowed and the order of compulsory retirement is set aside the petitioner cannot go back to service.
But he would be entitled to pecuniary benefit of salary and allowances admissible under the rules.
Accordingly, we allow the.writ petition and direct the respondent to pay to the petitioner the salary and other allowances which would have been payable for the period between 5.11.
1976 and 29.2.
Such payment be made within two months from today.
There will be no order for costs.
WRIT PETITION NOS.
6251 & 8189 OF 1981 Each of the petitioners in these two writ applications under Article 32 of the Constitution was employed in the Central Public Works Department in the Ministry of Works and Housing of Government of India and has been compulsorily retired under Fundamental Rule 56(j).
The facts of each of these applications are more or less similar to those in Writ Petition No. 7338 of 1981 which we have disposed of today.
For the reasons given therein we allow each of the writ petitions and quash the order of compulsory retirement made against each of the petitioners.
By now both the petitioners would have retired from service and, therefore, they cannot be resorted in service.
They would, however, be entitled to salary and other service allowances payable to them from the date of compulsory retirement till the date of their normal superannuation.
There will be no order for costs.
H.L.C. Petition allowed.
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Fundamental Rule 56(j) confers power on the appropriate authority to compulsorily retire a Government servant, if it is in the public interest to do so, by giving 3 months ' notice or 3 months ' pay and allowances in lieu of such notice; while sub cl.
(i) thereof states that a public servant in class I or class II service or post who had entered service before attaining the age of 35 years can be retired after he has attained the age of 50 years, sub cl.
(ii) thereof states that any other public servant can be retired after he has attained the age of 55 years.
In Union of India vs K.R. Tahiliani & Anr., this Court had held that F.R. 56(j) is meant to cover only those who are in a post on a regular basis, i.e., in a substantive capacity, and not on an officiating basis only.
Basing his case on this decision, the petitioner, who had been compulsorily retired while working in a class II post In an officiating capacity, challenged the order of his compulsory retirement.
Overruling the decision in Union of India vs K.R. Tahi liani & Anr., but, allowing the petition on the ground that the Delhi High Court, relying upon that decision, had grant ed relief to persons similarly placed as the petitioner, and, directing payment of his salary and allowances upto the date of his normal superannuation, HELD: Sub clause (1) of r. 56(j) of the Fundamental Rules applies to Government servants in Class I or Class II service or post on substantive, temporary or officiating basis.
[638E F] There is no reference to officiating service in sub cl.
The relevant words used in sub cl.
(i) are "if he is in CIasa I or CIasa II service or post.
" A person can be in Class I or CIasa II service or post even when he holds a post of either ciasa substantively or temporarily or on officiating basis.
Instances are abundant where officers are promoted to CIasa I or Class II service or post of such class on officiating basis and 633 such officiation lasts for a number of years.
Officiating promotion certainly does not confer a right to the post and at any time the Government servant may be sent back to his substantive post.
There is, however, no reason why sub cl.
(i) should be confined to service or post held on substan tive basis.
It is not disputed that a person who is in Class I or Class II service or post is in such service or post as covered by sub cl.
The possibility of such incumbent being sent back to the substantive post is not at all rele vant in the matter of exercising powers of compulsory re tirement.
If the officiation is not brought to an end by reverting the Government servant to his substantive post before the power of compulsory retirement is exercised, the Government servant concerned must be taken to be in Class I or Class II service or post at the relevant time and would come within the ambit of sub cl.
There is no warrant for the conclusion that officiating Government servants in Class I or Class II service or post are outside the purview of sub cl.
The possibility of a reversion to the sub stantive post is not germane to the exercise of power con tained in F.R. 56.
[637F H; 638A C] The purpose of F.R. 56(j) is to confer power on the appropriate authority to compulsorily retire a Government servant in the public interest and the classification of Government servants into two categories covered by sub cls.
(i) and (ii) has a purpose behind it.
If the condition indicated in sub cl.
(i) is satisfied, namely, the Govern ment servant is in Class I or Class II service or post and he had entered into service before attaining the age of 35 years, and has attained the age of fifty, the further condi tion that he must substantively belong to the two classes of service or post cannot be introduced into the scheme.
The purpose of the sub clauses is to classify Government serv ants into two categories and sub cl.
(i) takes within its sweep those Government servants who at the relevant time are in Class I or Class II service or post, whether substantive ly, temporarily or on officiating basis.
[638C E] Union of India vs K.R. Tahiliani & Ant., , over rulled.
|
No. 7338 of 1981.
(Under Article 32 of the Constitution of India).
Ram Jethmalani and Miss Rani Jethmalani for the Petitioner.
G. Ramaswamy, Additional Solicitor General, R.P. Srivastava 634 and Miss. A. Subhashini for the Respondent.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
The petitioner of this application under Article 32 of the Constitution is an engineer who was employed in the Central Public Works Department under the Ministry of Works and Housing in Government of India and was compulsorily retired by order dated 3.8.1976 with effect from 5.11.1976 made under Rule 56(j) of the Fundamental Rules.
He has assailed that order for retirement and has claimed payment of remuneration which he would have been entitled to draw upto the normal date of superannuation.
The short facts are these.
The petitioner was born on 10.2.1922 and secured his first appointment as a Section Officer under the named employer on 22.10.1947.
He was pro moted as officiating Assistant Engineer in class II service with effect from ' 25.5.
1954, and came to be confirmed as Section Officer by an order dated 8.10.1955.
On 3.7.1961, he was further promoted as officiating Executive Engineer in Class I service but on 4.9.1965, he was reverted to the post of Assistant Engineer in officiating position and was con tinuing in that post when he was compulsorily retired.
The vires of Rule 56(j) of the Fundamental Rules as also the power to compulsorily retire a public servant have been upheld by this Court and do not require to be re examined.
The basis of attack to the impugned order is as specified in Ground No. A and is to the following effect: "The impugned order is contrary to the judg ment delivered by this Hon 'ble Court on 26.2.1980, copy at Annexure C hereto.
(Union of India vs K.R. Tahiliani and Anr.) [1980] 1 SLR 847.
According to the said judgment F.R. 56 (j)(i) has no application to officiating government servants, hence can have no appli cation to the petitioner since the petitioner was an officiating government servant.
" The impugned notice ran thus: "No. 32/452/66 EC.
111 Government of India Central Public Works Department New Delhi, the 3.8.76 635 ORDER WHEREAS the Engineer in Chief is of opinion that it is in public interest to do so: NOW, THEREFORE, in exercise of the powers conferred by clause (j) of Rule 56 of the Fundamental Rules, the Engineer in Chief hereby gives notice to Shri A.L. Ahuja, As sistant Engineer (Civil), at present under suspension, that he, having already attained the age of fifty years on 10.2.1972, shall retire from service with effect from the forenoon of 3rd November, 1976, or, from the date of expiry of three months computed from the date of issue of the service of this notice on him, whichever is latter.
Sd/ (V.R .
VAISH) ENGINEER IN CHIEF To Shri A.L. Ahuja, Assistant Engineer (Civil), (Under Suspension), A11/85, Lajpat Nagar, New Delhi 110024.
" It is clear from it that the petitioner attained the age of 50 years on 10.2.1972 and, therefore, on the date of the order he had completed the age of 54 years.
Admittedly, he was holding a class II post when the impugned order was served on him.
Fundamental Rule 56(j) under which notice was given provides: "(j) Notwithstanding anything contained in this rule, the appropriate authority shall, if it is of the opinion that it is in the public interest so to do, have the absolute right to retire any Government servant by giving him notice of not less than three months in writ ing or three months ' pay and allowances in lieu of such notice; (i) if he is in Class I or Class II service or post (and had entered Government service before attaining the age 636 of thirty five years), after he has attained the age of fifty years; (ii) in any other case after he has attained the age of fifty five years; . . . . . . . . . . ." The appropriate authority is entitled to exercise power under clause (j) in the case of a Government servant in Class I or Class II service or post where he entered into service before attaining the age of 35 years after the said servant attained the age of 50 years; and in other cases after he has attained the age of 55 years.
In the instant case, the petitioner was promoted as officiating Assistant Engineer which is a Class II post on 25.5.
1954 and contin ued to hold that post when the order of compulsory retire ment was passed.
By 25.5.1954 the petitioner had not at tained the age of 35 years.
As already indicated above he had crossed the age of 50 years but had not attained the age of 55 years by the date of the impugned order.
Therefore, sub clause (1) was not contravened when the order was made.
It has been argued before us that as the petitioner was holding an officiating appointment in Class 117 he could not have been compulsorily retired under sub clause (i).
Support is claimed from the observations in the Tahilia ni 's case (supra).
The sole question that fell therein for decision before this Court was whether a Government servant officiating in Class I or Class II service or post could be retired compulsorily by exercising the power under Rule 56(j)(i) after he has attained the age of 50 years.
The two Judge Bench which decided the case held: " An officiating hand has no right to the post and is perhaps a fleeting.
bird who may have to go back to the substantive post from which he has been promoted on an officiating basis what is more to the point, a person who has been appointed de novo may begin his service on an officiating basis or on a tempo rary basis and it is obvious that he has no right to the post and cannot be strictly said to be in that service or post as a member of that service.
In short, an officiating Govern ment servant does not really belong to Class I or Class II service until he acquires a right thereon.
Even viewed closely and meticulously, the structure of the clause, namely, "if he is in Class I or Class II 637 service or post", emphasises the nature of the service or post vis a vis the Government servant concerned.
We need not go into the semantic shapes, lexical niceties or linguis tic nuance but only go through the meaning and purpose of the provision.
When a Government servant belonging to a Class I or Class II service or post on regular basis has to be retired compulsorily, Rule 56(j)(i) comes to the rescue of the Government.
But if he is only a temporary hand, he has no right to the post and can always be reverted to the post, if any, on which he has a lien.
Similar is the position of an officiating hand.
Thus we have reached an inevitable conclusion that Rule 56(j) is meant to cover only those who are in a post on a regular basis, i.e. in a substan tive capacity, and not on an officiating basis only.
" Strong reliance was placed by counsel for the petitioner on the reasons extracted above.
It is clear that sub clause (ii) is the general rule applicable to all Government servants and sub clause (i) carves out a class of Government servants into a category and makes a special provision.
We have already indicated that sub clause (ii) did not apply to the facts of this case as the petitioner had not attained the age of 55 years by the date of the order.
The observations made in Tahiliani 's case indisputably support the petitioner.
But the correct ness thereof is disputed by learned Additional Solicitor General appearing for the Union of India and that is why this writ petition was directed to be heard by a larger Bench.
There is no reference to officiating service in sub clause (i).
The relevant words used in sub clause (i) are "if he is in Class I or Class II service or post".
A person can be in Class I or Class II service or post even when he hold a post of either class substantively or temporarily or on officiating basis.
Instances are abundant where officers are promoted to Class I or Class II service or post of such class on officiating basis and such officiation lasts for a number of years.
Officiating promotion certainly does not confer a right to the post and at any time the Government servant may be sent back to his substantive post.
There is, however, no reasons why sub clause (i) should be confined to service or post held on substantive basis.
Learned counsel for the petitioner does not dispute the position that a person who is in Class I or Class II service or post is in such service or post as covered by sub clause (i).
The possibility of such incumbent being sent back to the 638 substantive post is not at all relevant in the matter of exercising powers of compulsory retirement.
If the officia tion is not brought to an end by reverting the Government servant to his substantive post before the power of compul sory retirement is exercised, the Government servant con cerned must be taken to be in Class I or Class II service or post at the relevant time and would come within the ambit of sub clause (i).
There is no warrant for the conclusion that officiating Government servants in Class I or Class II service or post are outside the purview of sub clause (i).
The possibility of a reversion to the substantive post is not germane to the exercise of power contained in F.R. 56.
The purpose of Fundamental Rules 56(j) is to confer power on the appropriate authority to compulsorily retire Government servant in the public interest and the classification of Government servants into two categories covered by sub clauses (i) and (ii) has a purpose behind it.
If the condi tion indicated in sub clause (i) is satisfied, namely, the Government servant is in Class I or Class II service or post and he had entered into service before attaining the age of 35 years, and has attained the age of fifty, the further condition that he must substantively belong to the two classes of service or post cannot be introduced into the scheme.
The purpose of the sub clauses is to classify Gov ernment servants into two categories and sub clause (i) takes within its sweep those Government servants who at the relevant time are in Class I or Class II service or post, whether substantively, temporarily or on officiating basis.
We would accordingly hold that the ratio of the decision in Tahiliani 's case is not correct and sub clause (i) of Rule 56(j) applies to Government servants in Class I or Class II service or post on substantive, temporary or offi ciating basis.
On this conclusion the writ petition is liable to be dismissed.
It has been represented to us by counsel for the petitioner that the similarly placed persons had gone before the Delhi High Court challenging the orders of compulsory retirement and the Delhi High Court relying upon Tahiliani 's case give them relief.
Such judgments have become final and Union of India has given effect to the decisions of the Delhi High Court.
When this was put to learned Additional Solicitor General he agreed that the Union of India will have no objection to treat the petitioner alike and would be prepared to give the same relief to the petitioner.
The petitioner would have superannuated from service on 29.2.1980 if he had not been compulsorily retired with effect from 639 5.11. 1976.
Even if the writ petition is allowed and the order of compulsory retirement is set aside the petitioner cannot go back to service.
But he would be entitled to pecuniary benefit of salary and allowances admissible under the rules.
Accordingly, we allow the.writ petition and direct the respondent to pay to the petitioner the salary and other allowances which would have been payable for the period between 5.11.
1976 and 29.2.
Such payment be made within two months from today.
There will be no order for costs.
WRIT PETITION NOS.
6251 & 8189 OF 1981 Each of the petitioners in these two writ applications under Article 32 of the Constitution was employed in the Central Public Works Department in the Ministry of Works and Housing of Government of India and has been compulsorily retired under Fundamental Rule 56(j).
The facts of each of these applications are more or less similar to those in Writ Petition No. 7338 of 1981 which we have disposed of today.
For the reasons given therein we allow each of the writ petitions and quash the order of compulsory retirement made against each of the petitioners.
By now both the petitioners would have retired from service and, therefore, they cannot be resorted in service.
They would, however, be entitled to salary and other service allowances payable to them from the date of compulsory retirement till the date of their normal superannuation.
There will be no order for costs.
H.L.C. Petition allowed.
|
No. 7338 of 1981.
(Under Article 32 of the Constitution of India).
Ram Jethmalani and Miss Rani Jethmalani for the Petitioner.
G. Ramaswamy, Additional Solicitor General, R.P. Srivastava 634 and Miss. A. Subhashini for the Respondent.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
The petitioner of this application under Article 32 of the Constitution is an engineer who was employed in the Central Public Works Department under the Ministry of Works and Housing in Government of India and was compulsorily retired by order dated 3.8.1976 with effect from 5.11.1976 made under Rule 56(j) of the Fundamental Rules.
He has assailed that order for retirement and has claimed payment of remuneration which he would have been entitled to draw upto the normal date of superannuation.
The short facts are these.
The petitioner was born on 10.2.1922 and secured his first appointment as a Section Officer under the named employer on 22.10.1947.
He was pro moted as officiating Assistant Engineer in class II service with effect from ' 25.5.
1954, and came to be confirmed as Section Officer by an order dated 8.10.1955.
On 3.7.1961, he was further promoted as officiating Executive Engineer in Class I service but on 4.9.1965, he was reverted to the post of Assistant Engineer in officiating position and was con tinuing in that post when he was compulsorily retired.
The vires of Rule 56(j) of the Fundamental Rules as also the power to compulsorily retire a public servant have been upheld by this Court and do not require to be re examined.
The basis of attack to the impugned order is as specified in Ground No. A and is to the following effect: "The impugned order is contrary to the judg ment delivered by this Hon 'ble Court on 26.2.1980, copy at Annexure C hereto.
(Union of India vs K.R. Tahiliani and Anr.) [1980] 1 SLR 847.
According to the said judgment F.R. 56 (j)(i) has no application to officiating government servants, hence can have no appli cation to the petitioner since the petitioner was an officiating government servant.
" The impugned notice ran thus: "No. 32/452/66 EC.
111 Government of India Central Public Works Department New Delhi, the 3.8.76 635 ORDER WHEREAS the Engineer in Chief is of opinion that it is in public interest to do so: NOW, THEREFORE, in exercise of the powers conferred by clause (j) of Rule 56 of the Fundamental Rules, the Engineer in Chief hereby gives notice to Shri A.L. Ahuja, As sistant Engineer (Civil), at present under suspension, that he, having already attained the age of fifty years on 10.2.1972, shall retire from service with effect from the forenoon of 3rd November, 1976, or, from the date of expiry of three months computed from the date of issue of the service of this notice on him, whichever is latter.
Sd/ (V.R .
VAISH) ENGINEER IN CHIEF To Shri A.L. Ahuja, Assistant Engineer (Civil), (Under Suspension), A11/85, Lajpat Nagar, New Delhi 110024.
" It is clear from it that the petitioner attained the age of 50 years on 10.2.1972 and, therefore, on the date of the order he had completed the age of 54 years.
Admittedly, he was holding a class II post when the impugned order was served on him.
Fundamental Rule 56(j) under which notice was given provides: "(j) Notwithstanding anything contained in this rule, the appropriate authority shall, if it is of the opinion that it is in the public interest so to do, have the absolute right to retire any Government servant by giving him notice of not less than three months in writ ing or three months ' pay and allowances in lieu of such notice; (i) if he is in Class I or Class II service or post (and had entered Government service before attaining the age 636 of thirty five years), after he has attained the age of fifty years; (ii) in any other case after he has attained the age of fifty five years; . . . . . . . . . . ." The appropriate authority is entitled to exercise power under clause (j) in the case of a Government servant in Class I or Class II service or post where he entered into service before attaining the age of 35 years after the said servant attained the age of 50 years; and in other cases after he has attained the age of 55 years.
In the instant case, the petitioner was promoted as officiating Assistant Engineer which is a Class II post on 25.5.
1954 and contin ued to hold that post when the order of compulsory retire ment was passed.
By 25.5.1954 the petitioner had not at tained the age of 35 years.
As already indicated above he had crossed the age of 50 years but had not attained the age of 55 years by the date of the impugned order.
Therefore, sub clause (1) was not contravened when the order was made.
It has been argued before us that as the petitioner was holding an officiating appointment in Class 117 he could not have been compulsorily retired under sub clause (i).
Support is claimed from the observations in the Tahilia ni 's case (supra).
The sole question that fell therein for decision before this Court was whether a Government servant officiating in Class I or Class II service or post could be retired compulsorily by exercising the power under Rule 56(j)(i) after he has attained the age of 50 years.
The two Judge Bench which decided the case held: " An officiating hand has no right to the post and is perhaps a fleeting.
bird who may have to go back to the substantive post from which he has been promoted on an officiating basis what is more to the point, a person who has been appointed de novo may begin his service on an officiating basis or on a tempo rary basis and it is obvious that he has no right to the post and cannot be strictly said to be in that service or post as a member of that service.
In short, an officiating Govern ment servant does not really belong to Class I or Class II service until he acquires a right thereon.
Even viewed closely and meticulously, the structure of the clause, namely, "if he is in Class I or Class II 637 service or post", emphasises the nature of the service or post vis a vis the Government servant concerned.
We need not go into the semantic shapes, lexical niceties or linguis tic nuance but only go through the meaning and purpose of the provision.
When a Government servant belonging to a Class I or Class II service or post on regular basis has to be retired compulsorily, Rule 56(j)(i) comes to the rescue of the Government.
But if he is only a temporary hand, he has no right to the post and can always be reverted to the post, if any, on which he has a lien.
Similar is the position of an officiating hand.
Thus we have reached an inevitable conclusion that Rule 56(j) is meant to cover only those who are in a post on a regular basis, i.e. in a substan tive capacity, and not on an officiating basis only.
" Strong reliance was placed by counsel for the petitioner on the reasons extracted above.
It is clear that sub clause (ii) is the general rule applicable to all Government servants and sub clause (i) carves out a class of Government servants into a category and makes a special provision.
We have already indicated that sub clause (ii) did not apply to the facts of this case as the petitioner had not attained the age of 55 years by the date of the order.
The observations made in Tahiliani 's case indisputably support the petitioner.
But the correct ness thereof is disputed by learned Additional Solicitor General appearing for the Union of India and that is why this writ petition was directed to be heard by a larger Bench.
There is no reference to officiating service in sub clause (i).
The relevant words used in sub clause (i) are "if he is in Class I or Class II service or post".
A person can be in Class I or Class II service or post even when he hold a post of either class substantively or temporarily or on officiating basis.
Instances are abundant where officers are promoted to Class I or Class II service or post of such class on officiating basis and such officiation lasts for a number of years.
Officiating promotion certainly does not confer a right to the post and at any time the Government servant may be sent back to his substantive post.
There is, however, no reasons why sub clause (i) should be confined to service or post held on substantive basis.
Learned counsel for the petitioner does not dispute the position that a person who is in Class I or Class II service or post is in such service or post as covered by sub clause (i).
The possibility of such incumbent being sent back to the 638 substantive post is not at all relevant in the matter of exercising powers of compulsory retirement.
If the officia tion is not brought to an end by reverting the Government servant to his substantive post before the power of compul sory retirement is exercised, the Government servant con cerned must be taken to be in Class I or Class II service or post at the relevant time and would come within the ambit of sub clause (i).
There is no warrant for the conclusion that officiating Government servants in Class I or Class II service or post are outside the purview of sub clause (i).
The possibility of a reversion to the substantive post is not germane to the exercise of power contained in F.R. 56.
The purpose of Fundamental Rules 56(j) is to confer power on the appropriate authority to compulsorily retire Government servant in the public interest and the classification of Government servants into two categories covered by sub clauses (i) and (ii) has a purpose behind it.
If the condi tion indicated in sub clause (i) is satisfied, namely, the Government servant is in Class I or Class II service or post and he had entered into service before attaining the age of 35 years, and has attained the age of fifty, the further condition that he must substantively belong to the two classes of service or post cannot be introduced into the scheme.
The purpose of the sub clauses is to classify Gov ernment servants into two categories and sub clause (i) takes within its sweep those Government servants who at the relevant time are in Class I or Class II service or post, whether substantively, temporarily or on officiating basis.
We would accordingly hold that the ratio of the decision in Tahiliani 's case is not correct and sub clause (i) of Rule 56(j) applies to Government servants in Class I or Class II service or post on substantive, temporary or offi ciating basis.
On this conclusion the writ petition is liable to be dismissed.
It has been represented to us by counsel for the petitioner that the similarly placed persons had gone before the Delhi High Court challenging the orders of compulsory retirement and the Delhi High Court relying upon Tahiliani 's case give them relief.
Such judgments have become final and Union of India has given effect to the decisions of the Delhi High Court.
When this was put to learned Additional Solicitor General he agreed that the Union of India will have no objection to treat the petitioner alike and would be prepared to give the same relief to the petitioner.
The petitioner would have superannuated from service on 29.2.1980 if he had not been compulsorily retired with effect from 639 5.11. 1976.
Even if the writ petition is allowed and the order of compulsory retirement is set aside the petitioner cannot go back to service.
But he would be entitled to pecuniary benefit of salary and allowances admissible under the rules.
Accordingly, we allow the.writ petition and direct the respondent to pay to the petitioner the salary and other allowances which would have been payable for the period between 5.11.
1976 and 29.2.
Such payment be made within two months from today.
There will be no order for costs.
WRIT PETITION NOS.
6251 & 8189 OF 1981 Each of the petitioners in these two writ applications under Article 32 of the Constitution was employed in the Central Public Works Department in the Ministry of Works and Housing of Government of India and has been compulsorily retired under Fundamental Rule 56(j).
The facts of each of these applications are more or less similar to those in Writ Petition No. 7338 of 1981 which we have disposed of today.
For the reasons given therein we allow each of the writ petitions and quash the order of compulsory retirement made against each of the petitioners.
By now both the petitioners would have retired from service and, therefore, they cannot be resorted in service.
They would, however, be entitled to salary and other service allowances payable to them from the date of compulsory retirement till the date of their normal superannuation.
There will be no order for costs.
H.L.C. Petition allowed.
|
Fundamental Rule 56(j) confers power on the appropriate authority to compulsorily retire a Government servant, if it is in the public interest to do so, by giving 3 months ' notice or 3 months ' pay and allowances in lieu of such notice; while sub cl.
(i) thereof states that a public servant in class I or class II service or post who had entered service before attaining the age of 35 years can be retired after he has attained the age of 50 years, sub cl.
(ii) thereof states that any other public servant can be retired after he has attained the age of 55 years.
In Union of India vs K.R. Tahiliani & Anr., this Court had held that F.R. 56(j) is meant to cover only those who are in a post on a regular basis, i.e., in a substantive capacity, and not on an officiating basis only.
Basing his case on this decision, the petitioner, who had been compulsorily retired while working in a class II post In an officiating capacity, challenged the order of his compulsory retirement.
Overruling the decision in Union of India vs K.R. Tahi liani & Anr., but, allowing the petition on the ground that the Delhi High Court, relying upon that decision, had grant ed relief to persons similarly placed as the petitioner, and, directing payment of his salary and allowances upto the date of his normal superannuation, HELD: Sub clause (1) of r. 56(j) of the Fundamental Rules applies to Government servants in Class I or Class II service or post on substantive, temporary or officiating basis.
[638E F] There is no reference to officiating service in sub cl.
The relevant words used in sub cl.
(i) are "if he is in CIasa I or CIasa II service or post.
" A person can be in Class I or CIasa II service or post even when he holds a post of either ciasa substantively or temporarily or on officiating basis.
Instances are abundant where officers are promoted to CIasa I or Class II service or post of such class on officiating basis and 633 such officiation lasts for a number of years.
Officiating promotion certainly does not confer a right to the post and at any time the Government servant may be sent back to his substantive post.
There is, however, no reason why sub cl.
(i) should be confined to service or post held on substan tive basis.
It is not disputed that a person who is in Class I or Class II service or post is in such service or post as covered by sub cl.
The possibility of such incumbent being sent back to the substantive post is not at all rele vant in the matter of exercising powers of compulsory re tirement.
If the officiation is not brought to an end by reverting the Government servant to his substantive post before the power of compulsory retirement is exercised, the Government servant concerned must be taken to be in Class I or Class II service or post at the relevant time and would come within the ambit of sub cl.
There is no warrant for the conclusion that officiating Government servants in Class I or Class II service or post are outside the purview of sub cl.
The possibility of a reversion to the sub stantive post is not germane to the exercise of power con tained in F.R. 56.
[637F H; 638A C] The purpose of F.R. 56(j) is to confer power on the appropriate authority to compulsorily retire a Government servant in the public interest and the classification of Government servants into two categories covered by sub cls.
(i) and (ii) has a purpose behind it.
If the condition indicated in sub cl.
(i) is satisfied, namely, the Govern ment servant is in Class I or Class II service or post and he had entered into service before attaining the age of 35 years, and has attained the age of fifty, the further condi tion that he must substantively belong to the two classes of service or post cannot be introduced into the scheme.
The purpose of the sub clauses is to classify Government serv ants into two categories and sub cl.
(i) takes within its sweep those Government servants who at the relevant time are in Class I or Class II service or post, whether substantive ly, temporarily or on officiating basis.
[638C E] Union of India vs K.R. Tahiliani & Ant., , over rulled.
|
Fundamental Rule 56(j) confers power on the appropriate authority to compulsorily retire a Government servant, if it is in the public interest to do so, by giving 3 months ' notice or 3 months ' pay and allowances in lieu of such notice; while sub cl.
(i) thereof states that a public servant in class I or class II service or post who had entered service before attaining the age of 35 years can be retired after he has attained the age of 50 years, sub cl.
(ii) thereof states that any other public servant can be retired after he has attained the age of 55 years.
In Union of India vs K.R. Tahiliani & Anr., this Court had held that F.R. 56(j) is meant to cover only those who are in a post on a regular basis, i.e., in a substantive capacity, and not on an officiating basis only.
Basing his case on this decision, the petitioner, who had been compulsorily retired while working in a class II post In an officiating capacity, challenged the order of his compulsory retirement.
Overruling the decision in Union of India vs K.R. Tahi liani & Anr., but, allowing the petition on the ground that the Delhi High Court, relying upon that decision, had grant ed relief to persons similarly placed as the petitioner, and, directing payment of his salary and allowances upto the date of his normal superannuation, HELD: Sub clause (1) of r. 56(j) of the Fundamental Rules applies to Government servants in Class I or Class II service or post on substantive, temporary or officiating basis.
[638E F] There is no reference to officiating service in sub cl.
The relevant words used in sub cl.
(i) are "if he is in CIasa I or CIasa II service or post.
" A person can be in Class I or CIasa II service or post even when he holds a post of either ciasa substantively or temporarily or on officiating basis.
Instances are abundant where officers are promoted to CIasa I or Class II service or post of such class on officiating basis and 633 such officiation lasts for a number of years.
Officiating promotion certainly does not confer a right to the post and at any time the Government servant may be sent back to his substantive post.
There is, however, no reason why sub cl.
(i) should be confined to service or post held on substan tive basis.
It is not disputed that a person who is in Class I or Class II service or post is in such service or post as covered by sub cl.
The possibility of such incumbent being sent back to the substantive post is not at all rele vant in the matter of exercising powers of compulsory re tirement.
If the officiation is not brought to an end by reverting the Government servant to his substantive post before the power of compulsory retirement is exercised, the Government servant concerned must be taken to be in Class I or Class II service or post at the relevant time and would come within the ambit of sub cl.
There is no warrant for the conclusion that officiating Government servants in Class I or Class II service or post are outside the purview of sub cl.
The possibility of a reversion to the sub stantive post is not germane to the exercise of power con tained in F.R. 56.
[637F H; 638A C] The purpose of F.R. 56(j) is to confer power on the appropriate authority to compulsorily retire a Government servant in the public interest and the classification of Government servants into two categories covered by sub cls.
(i) and (ii) has a purpose behind it.
If the condition indicated in sub cl.
(i) is satisfied, namely, the Govern ment servant is in Class I or Class II service or post and he had entered into service before attaining the age of 35 years, and has attained the age of fifty, the further condi tion that he must substantively belong to the two classes of service or post cannot be introduced into the scheme.
The purpose of the sub clauses is to classify Government serv ants into two categories and sub cl.
(i) takes within its sweep those Government servants who at the relevant time are in Class I or Class II service or post, whether substantive ly, temporarily or on officiating basis.
[638C E] Union of India vs K.R. Tahiliani & Ant., , over rulled.
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Civil Appeal No. 468 of 1987.
768 From the Judgment and Order dated 19.7.
1985 of the Delhi High Court in Second Appeal No. 374 of 1980.
Madan Bhatia, N.D.B. Raju and Vineet Kumar for the Appellant.
Dr. L.M. Singhvi, K.B. Rohtagi, Praveen Jain and Baldev Atreya for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is from the judgment and order of the High Court of Delhi dated 19th of July, 1985.
The appellant had.
made an application on or about 15th of July, 1976 before the Rent Controller to let out the premises for a period of two years under section 21 of the Delhi Rent Control Act, 1958 (hereinafter called 'the Rent Act ').
The Rent Controller after recording the statements of the appellant and the respondent made an order permitting creation of limited tenancy only for a period of two years for residential purposes to which the respondent had agreed upon.
It may be material to refer to the fact that the appellant in his application under section 21 of the Rent Act had stated as follows: "1 do not require the premises for a period of two years from 15.7.76.
The purpose of letting shall be residential only and the premises are shown in the site plan exhibit A 1.
The proposed agreement is exhibit A 2.
Limited tenancy under section 21 of the Act may be allowed to be created for the said period.
" The respondent agreed to the aforesaid statement and stated as follows: "I have heard the statement of the petitioner and I accept it as correct.
I have no objec tion.
I shall vacate the premises after the expiry of two years from 15.7.76.
The purpose of letting shall be residential only".
Upon this the Rent Controller passed the following order: "This is an application filed under section 21 of the Act for permission to create limited tenancy for a period of two years from 15.7.76.
The purpose of letting shall be 769 residential only and the premises is shown in the site plan exhibit A 1.
The proposed agreement is exhibit A 2.
From the perusal of the statements of the parties I am satisfied that as at present the petitioner does not require the premises.
Therefore, limited tenancy is al lowed to be created for a period of two years from 15.7.76.
" The appellant filed an application on 6th November, 1978 for eviction of the respondent as the respondent had refused to vacate the premises in spite of his statement made before the Rent Controller.
The appellant filed an application on the said date under section 21 of the Rent Act on behalf of himself and his family members claiming possession of the premises for their bona fide need and use.
The appellant contended that he (the appellant) was a retired official and was living in a rented house while the respondent was a rich man doing business in jewellery and was also owning a house in Delhi.
In the application made under section 21 of the Rent Act the appellant had stated that the appellant owned a newly built house in the New Friends Colony comprising of dining, drawing, three bed rooms with attached bath rooms, a study room, family lounge and a garage.
The appellant had further stated that he did not require the premises for the personal residence for a period of two years.
The appellant had also stated in that application, that the appellant had agreed to let it out to the respondent for the first time on the terms and conditions set out in the proposed lease deed for a period of two years.
It was stated that the respondent had heard the statement and recorded that he had no objec tion and would vacate the premises after expiry of two years.
Subsequently, when the second appeal was pending in the Delhi High Court, the appellant had filed an application for early hearing in which he had stated that when the construction of the house in question was completed the appellant 's father R.B. Nanak Chand, advocate, was old and alone (the appellant 's mother had died earlier and other brother and sister being away from Delhi) and in view of his father 's ailing health the appellant was living with him in the rented premises at 4 Flag Staff Road, Delhi to look after his old and ailing father.
It was in those circum stances that the appellant had decided to let out the suit premises for a limited period of two years only.
It may be mentioned that the appellant 's father died two months after the Rent Controller had granted permission.
The Rent Controller after hearing both the parties on the 4th of January, 1980 held, rejecting the contention of the respondent, that section 21 of the Rent Act was not ultra vires.
Furthermore, he was 770 satisfied that a limited tenancy had been created and as such he granted permission for eviction.
Aggrieved by the aforesaid order the respondent preferred an appeal to the Rent Control Appellate Tribunal.
The Rent Control Appellate Tribunal upheld the eviction order.
On or about the 19th of July, 1985, being further ag grieved, the respondent preferred a second appeal before the High Court of Delhi.
The High Court of Delhi by the impugned judgment allowed the appeal on the ground that there was no ground stated in the application under section 21 of the Rent Act as to why a limited tenancy was intended to be made.
The High Court held that the order under section 21 of the Rent Act was a mindless order inasmuch as the respondent before it had not disclosed as to how the demised premises were being dealt with before creating the said alleged tenancy and why the respondent before it did not require the demised premises for the alleged period of two years and as to why the same would be required by him after the period of two years.
The High Court relying on the decision in the case of S.B. Noronah vs Prem Kumari Khanna, ; , held that the order in question in this case was a mindless order and in that view of the matter the order passed under section 21 of the Rent Act was not valid.
The High Court was of the view that there was no inquiry for the Controller to come to the conclusion on the basis of the material that the premises for which the permission was sought for creating a limited tenancy was in fact available for being let for a limited period only and in the absence of that, this was a mindless order.
The appellant has come up in appeal before this Court from the said decision.
The question, therefore, that arises for consideration of this Court is whether in view of the requirements of section 21 of the Rent Act, was the permission invalid? The main points upon which the High Court has relied are: first ly, on the materials put forward before the Rent Controller for sanction under section 21 of the Rent Act, no reason had been stated as to why the premises in question was not required for a limited period; secondly, it was not stated as to how the premises in question was dealt with; thirdly, the High Court was of the view that there was no writing and no lease registered after the permission was granted.
So far as the second ground, namely, as to how the premises in question was dealt with prior to the letting out in the 771 instant case the High Court was obviously and factually incorrect.
It was stated in the application for permission that it was agreed to be let out 'for the first time ' and secondly, it was stated that the appellant owned 'newly built house '.
Therefore two facts were clearly stated name ly, this was a 'newly built ' premises and further that there was no prior letting.
In the aforesaid facts and circum stances of the case therefore, it cannot be denied that how the premises in question was dealt with before the letting out had been clearly stated.
It is true however, that why the premises in question was stated by the appellant not to be required for a limited period had not been 'specifically ' stated at the time of seeking permission under section 21 by the appellant.
The appellant had stated that he did not require the premises in question for a period of two years.
He had not stated as to why he did not require the said premises for the said limit ed period of two years.
The question therefore is was it necessary to seek a valid order under section 21 to state that reason and if permission was granted on satisfaction of the Rent Controller on other conditions without being satis fied as to why the landlord did not require the premises in dispute for a limited period, the order would suffer from the vice of being a mindless order.
Such an order if other wise the conditions are satisfied would not be an invalid order.
In order to determine that question it is necessary to bear in mind the parameters and the purposes of section 21 of the Rent Act.
The Delhi Rent Control Act like other Rent Control Legislations had been passed to provide for the control of rent and eviction.
The Rent Acts all over the country came in the Wake of partition and explosion of population in metropolitan and new urban cities.
There are acute shortages of accommodation.
Very often these shortages and the demand for accommodation led to rack renting as well as unreasonable eviction of the tenants.
To meet that situa tion and to facilitate proper letting the Rent Acts were passed all over the country ensuring fair return to the landlords and giving the landlords the right of eviction for limited purposes and at the same time protecting the tenant from unreasonable eviction by the landlords.
This led to a series of litigations leading to long delays resulting specially in metropolitan cities like Delhi, Calcutta and Bombay in reluctance of many landowners who had vacant premises for letting out only for limited period either because of the family conditions or official commitments as they did not require the premises immediately and at the same time who were reluctant to part with the said premises on rent because of the long delay and the procedure that had to be followed to recover possession of those premises.
772 Section 21 of the Rent Act was an attempt to meet that reluctance.
Section 14 of the Rent Act controls the eviction of tenants and gives protection to the tenants against eviction.
It stipulates that notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant unless certain specified conditions were fulfilled.
Those conditions were laid down in different sections and provisos thereof.
It is not necessary to set these out in detail.
As mentioned hereinbefore that led to a good deal of reluctance on the part of the landlords to part with the possession of the premises in their occupation because of the time and expenses consuming process involved for recovery of possession.
In order, therefore, to induce reluctant/potential landlords to create tenancies, section 21 was enacted for the benefit of the capital city of Delhi.
This is a new provision the unique provision made for the metropolitan city of Delhi.
Section 21 of the Rent Act reads as follows: "21.
Where a landlord does not require the whole or any part of any premises for a par ticular period, and the landlord, after ob taining the permission of the Controller in the prescribed manner, lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not, on the expiry of the said period, vacate such premises, then notwith standing anything contained in section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord within such time as may be pre scribed, place the landlord in vacant posses sion of the premises or part thereof by evict ing the tenant and every other person who may be in occupation of such premises.
" An analysis of this section makes it clear that in order to attract section 21, the first condition is that the landlord does not require the whole or part of any premises for a particular period.
If that condition is fulfilled then the said landlord after obtaining the permission of the Controller in the prescribed manner lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not on the expiry of the said period, vacate such premises, then notwithstanding anything contained in section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord 773 within such time as may be prescribed, order the eviction of the tenant.
Therefore the first condition must be that the landlord must not require the premises either in whole or part of any premises for a particular period.
Secondly, the landlord must obtain the permission of the Controller in the prescribed manner.
Thirdly, letting of the whole or part of the premises must be for residence.
Fourthly, such letting out must be for such period as may be agreed in writing.
Therefore, there must be an agreement in writing, there must be a permission of the Controller for letting out for a limited period, the landlord must not require the premises for a particular period and letting of the premises must be as a residence.
These and these alone are the conditions which are required to be fulfilled.
In Nagindas Ramdass vs Dalpatram Ichharam, ; ,the question was whether a compromise decree for evic tion could be passed because the Rent Act enjoined the eviction only on the satisfaction of the court.
The respond ent landlord in that case instituted a suit under the Bombay Rent Act, 1947 for possession against the tenant on two grounds, namely, arrears in payment of rent and bona fide requirement of the premises for personal use and occupation.
A compromise decree was passed.1 When the appellant applied for execution of the decree the tenant contended that the compromise decree had been passed by the Rent Court without satisfying itself as to the existence of grounds of eviction under the Act and hence being a nullity was not executable.
It was held by this Court that the public policy permeating this Act was the protection of tenants against unreasonable eviction.
Construing the provisions of sections 12, 13 and 28 of the Act in the light of the said policy, it should be held that the Rent Court under the Act was not competent to pass a decree for possession either in invitum or with the consent of the parties on a ground which was de hors the Act or ultra vires the Act.
The existence of one of the statut ory grounds mentioned in sections 12 and 13 was a sine qua non to the exercise of jurisdiction by the Rent Court.
Par ties by their consent could not confer jurisdiction on the Rent Court to do something which, according to the legisla tive mandate, it could not do.
But if at the time of the passing of the decree there was some material before the Court on the basis of which the Court could prima facie be satisfied about the existence of a statutory ground for eviction, it would be presumed that the court was so satis fied and the decree for eviction,though passed on the basis of the compromise would be valid.
Such material may be in the form of evidence recorded or produced or it may partly or wholly be in the shape of express or implied admissions made in the compromise agreement.
Sarkaria, J. speaking for the 774 Court held that admissions if true and clear were by far the best proof of the facts admitted especially when these were judicial admissions admissible under section 58 of the Evidence Act.
In that case the Court found because of the admission to pay the arrears of rent and mesne profits at the 'contractual rate and the withdrawing of his application for fixation of standard rent, that there was no dispute with regard to the amount of standard rent and there was an admission that the rent was in arrears.
The Court observed at pages 552 to 553 of the report as follows: "From a conspectus of the cases cited at the bar, the principle that emerges is, that if at the time of the passing of the decree, there was some material before the Court, on the basis of which, the Court could be prima facie satisfied, about the existence of a statutory ground for eviction, it will be presumed that the Court was so satisfied and the decree for eviction, though apparently passed on the basis of a compromise, would be valid.
Such material may take the shape either of evidence recorded or produced in the case, or, it may partly or wholly be in the shape of an express or implied admissiOn made in the compromise agreement, itself.
Admissions if true and clear are by far the best proof of the facts admitted.
Admissions in pleadings or judicial admissions, admissible under section 58 of the Evidence Act, made by the parties or their agents at or before the hearing of the case, stand on a higher footing than evidentiary admissions.
The former class of admissions are fully binding on the party that makes them and constitute a waiver of proof.
They by them selves can be made the foundation of the rights of the parties.
On the other hand, evidentiary admissions which are receivable at the trial as evidence, are by themselves, not conclusive.
They can be shown to be wrong." The aforesaid principle must be borne in mind in order to judge the invalidity of the order passed under section 21 of the Act which was based on the statements made by the appellant and the respondent.
The facts of the case upon which great deal of reliance was placed by the High Court in the judgment under appeal and upon which the appellant relied very heavily are mentioned in the case of S.B. Noro nah vs Prem Kumari Khanna (supra).
There this Court reiter ated that section 21 of the Rent Act carved out a category for special treatment.
While no landlord could evict without compliance with sections 775 14, 19 and 20 of the Act, a liberal eviction policy could not be said to under lie in section 21.
The Court observed that the Parliament was 'presumably keen on maximising accommodation available for letting, realising the scarcity crisis.
One source of such spare accommodation which is usually shy is potentially vacant building or part thereof which the landlord is able to let out for a strictly limited period provided he had some credible assurance that when he needed it he would get it back.
The law sought to persuade the owner of the premises available for letting for a par ticular period by giving him a special assurance that at the expiry of that period the appointed agency would place the landlord in vacant possession.
Section 21 confined the special remedy to letting for residential uses only.
Parlia ment had the wholesome fear that if the section were not controlled by many conditions it might open the floodgates for wholesale circumvention of the rent control legislations by ingenious landlords exploiting the agonising need of houseless denizens.
Section 21 of the Act over rides section 14 precisely because it was otherwise hedged in with drastic limitations and safe guarded itself against landlords ' abuses.
The first condition was that the landlord did not require the demised premises 'for a particular period ' only.
That meant that he must indicate to the authority before which sanction was sought for letting what was the particular period for which he could spare the accommodation.
The Controller exercised an important regulatory function on behalf of the community.
The fact that a landlord and a potential tenant together apply, setting out the formal ingredients of section 21, did not relieve the Controller from being vigilant to inquire and satisfy himself about the requisites of the landlord 's non requirement 'for a particular period ' and the letting itself being 'as a resident '.
A fraud on the statute could not be permitted especially because of the grave mischief that might be perpetrated in such event.
The Court highlighted that it would be a terrible blow to the rent control law if section 21 were freely permitted to subvert the scheme of section 14.
Every landlord would insist on a tenant going through the formal exercise of section 21, making ideal averments in terms of that section.
The consequence would be that both the Civil Procedure Code which prescribed suits for recovery of possession and the Delhi Rent Control Act which prescribed grounds for eviction would be eclipsed by the pervasive operation of section 21.
Neither grounds for eviction nor suits for eviction would thereafter be needed, and if the landlord moved the Court for a mere warrant to place the landlord, through the Court process, in vacant possession of the premises, he 776 would get it.
No court fee, no decree, no execution peti tion, no termination of tenancy wish for possession and the Court was at your command.
The Court observed that such a horrendous situation would be the negation of the rule of law in this area.
When the application under Section 21 is filed by the landlord and/or tenant the Controller must satisfy himself by such inquiry as he may make, about the compulsive re quirements of that provision.
If he makes a mindless order, the Court.
when challenged at the time of execution will go into the question as to whether the twin conditions for sanction have really been fulfilled.
Of course, there will be a presumption in favour of the sanction being regular, but it will still be open to a party to make out his case that in fact and in truth the conditions which make for a valid sanction were not present.
The sanction granted under section 21, if it has been procured by fraud and collusion cannot withstand invalidity because, otherwise, high public policy will be given as hostage to successful collusion.
The doctrine of estoppel cannot be invoked to render valid a proceeding which the legislature, has on grounds, of public policy subjected to mandatory conditions which are shown to be absent.
As be tween unequals the law steps in and as against statutes there is no estoppel, especially where collusion and fraud are made out and high purpose is involved.
Law that non performs stultifies the rule of law and hence the need for strict compliance.
Or else, the sanction is non est.
Collusion between the strong and the weak cannot confer validity where the mandatory prescriptions of the law are breached or betrayed.
An analysis of this judgment which has been applied in the various cases would indicate that section 21 only gives sanction if the landlord makes a statement to the satisfac tion of the court and the tenant accepts that the landlord does not require the premises for a limited period; this statement of the landlord must be bona fide.
The purpose must be residence.
There must not be any fraud or collusion.
There is a presumption of regularity.
But it is open in particular facts and circumstances of the case to prove to the satisfaction of the executing court that there was collusion or conspiracy between the landlord and the tenant and the landlord did not mean what he said or that it was a fraud or that the tenant agreed because the tenant was wholly unequal to the landlord.
In the instant case none of these conditions were fulfilled.
There is no evidence in this case that when the landlord 777 stated that he did not require the premises in question for a particular period, he did not mean what he stated or that he made a false statement.
There was no evidence in this case at any stage that the tenant did not understand what the landlord was stating or that he did not accept what the landlord stated.
There was no evidence that either the tenant was in collusion or perpetrating any fraud with the landlord or the tenant was unequal to the landlord in bar gaining powers.
It is manifest that there is no evidence to show that the Controller did not apply his mind.
If that is so then on the principle enunciated by this Court in Noro nah 's case, this sanction cannot be challenged.
It is not necessary to state under section 21 the reasons why the landlord did not require the premises in question for any particular period.
Nor is there any presumption that in all cases the tenants are the weaker sections.
The presumption is, on the contrary, in favour of sanction, it is he who challenges the statement and the admission of.
the landlord or the tenant who has to establish facts as indicated in Nagindas 's case.
In V.S. Rahi and another vs Smt.
Ram Chambeli; , , this Court on the facts found that the permission under section 21 of the Act had been obtained by her on the basis of wrong statement, but for which the permission would not have been accorded.
These statements which were in the nature of half truths were apparently made in order to make good the plea that there was only a temporary necessity to lease out the building for a short period and that there was a bona fide anticipation that there would be a pressing necessity to reoccupy the premises at the end of the period.
which were the two crucial factors governing an order under section 21 of the Act.
It was stated that the appellants, in that case, who were the weaker of the two parties did not question the truth of the statements made by the respondent ,when the permission was granted.
But such collusion, if any, between the two unequal parties did not confer any sanctity on the transaction in question.
The observations of this Court in that case must be understood in the light of the facts mentioned by this Court.
It was found in Rahi 's case that there were wrong statements made by the appellant when he approached the Rent Controller.
It was admitted before this Court that it was a wrong statement.
These were mentioned in pages 295 296 of the Report.
What was urged was that the appellants being the tenants had colluded with the respondent.
It was reiterated by this Court, it is always open to the weaker of the two parties to establish that the transaction was only a camouflage used to cover its true nature.
When one party could dominate over the will of the other, it would not be a case of collusion but one of com pulsion.
The Court relied on the observations of Lord Ellen borough in Smith vs Cuff, 778 ; at 165 that it can never be predicted as pari delicto where one holds the rod and the other bows to it.
See the observations of this Court at pages 297 and 298 of the Report.
There is no evidence in this case that there was any wrong or incorrect statement made by the landlord nor is there any evidence that the tenant respondent herein was the weaker side of the bargain.
In that view of the matter the respondent cannot get much assistance from this decision of this Court.
This question was again considered by this Court in J.B. Vohra vs India Export House Pvt. Ltd. and another; , where Tulzapurkar, J. referring to Noronah 's case observed that section 21 carved out tenancies of particular category for special treatment and provided a special proce dure that would ensure to the landlord vacant possession of the leased premises forthwith at the expiry of the fixed period of tenancy, evicting whoever be in actual possession.
Such being the avowed object of prescribing the special procedure, service of a prior notice on the tenant upon receipt of the landlord 's application for recovery of pos session and inviting his objections followed by an elaborate inquiry in which evidence might have to be recorded would really frustrate that object.
It will be vitiated because it is procured by fraud practised by landlord for creating a limited tenancy.
If it is found that the initial order granting permission to create limited tenancy was vitiated by fraud practised by the appellant inasmuch as he had suppressed the fact that an earlier application for such permission had been declined on the ground that premises had been let out for commercial cum residential purposes and then there would be no executable order pursuant to which any warrant for possession could be issued under section 21 of the Act.
In the instant case, there is no such collusion and therefore, the principle of Noronah 's case would not be applicable.
The ratio of that decision must be understood in its proper light.
Section 21 of the Rent Act was examined by this Court in Smt.
Dhanwanti vs D.D. Gupta, [1986] 3 S.C.C. 1.
There was observed by Pathak, J. as the learned Chief Justice then was, that it was possible for the owner of a premises, on looking to the immediate future, to find that for certain reasons he was unable to occupy the premises forthwith himself but that he may do so later in the not very distant future.
The mere fact that the owner has let out the prem ises after obtaining permission under section 21 of the Act for a limited period, and thereafter on the expiry of that period has found it necessary to obtain permission to let out the premises again for another limited 779 period cannot necessarily lead to the inference that from the very beginning the premises were available for letting out indefinitely.
The Rent Controller and the Rent Control Tribunal should have examined the circumstances prevailing on each occasion when an application was made under section 21.
It was observed that assumption would not be justified where there is no positive material to indicate ' that from the very beginning there was never any intention on the part of the landlord to occupy the premises himself.
There was no such material in that case.
On the contrary there was mate rial showing that the landlady had expectation that her son and his family would be in Delhi after two years ' period of tenancy.
This is significant for the present issue.
There is nothing to show that the permission of the Rent Controller Was obtained by practising fraud or that it could be regard ed as a nullity or that material facts were concealed.
The principle of that decision will apply much more in this case.
It is observed in that decision that it seems to have been ignored altogether that it is perfectly possible for the owner of a premises, on looking to the immediate future, to find that for certain reasons, he is unable to occupy the premises forthwith himself but that he may do so later in the not very distant future.
It is not always that a man can plan his life ahead with any degree of definiteness.
Pre vailing uncertainty in the circumstances surrounding him may not permit clear sighted vision into the future.
The circum stances might justify his envisioning his need for the premises two or three years later, and therefore applying for permission under section 21 of the Act to let out the premises accordingly.
The facts are more stronger and clearer in support of the instant case.
Here there was no permission previously.
This was first letting out.
There was nothing which indicat ed that any statement was made which was incorrect.
We are of the opinion that sanction under section 21 in the instant case was not a nullity.
The onus was on the tenant to show that it was so.
He did not make any attempt to dislodge the presumption in favour of the permission.
Learned counsel for the appellant also stressed before us that section 21 of the Rent Act was a complete code by itself.
The order was under section 21 of the Rent Act.
No further question of lease or registered lease arose thereaf ter.
This question has been settled by series of decisions of the Delhi High Court upon which people have.
acted for long.
See the decision in Kasturi Lal vs Shiv Charan Das Mathur, [1976] Rent Control Reporter Vol.
8703 where at pages 708 709, Misra, J. of the Delhi High Court 780 had clearly indicated numerous cases where it was held that section 21 was a code by itself.
The order of the permission is itself an authority; no lease was necessary and if that is the state of law in Delhi, it is too late in the day to hold otherwise.
See the observations of this Court in Raj Narain Pandey and others vs Sant Prasad Tewari & others; , , where this Court observed that in the matter of the interpretation of a local statute, the view taken by the High Court over a number of years should nor mally be adhered to and not to be disturbed.
A different view would not only introduce an element of uncertainly and confusion but it would also have the effect of unsettling transactions which might have been entered into on the faith of those decisions.
In Delhi transactions have been complet ed on the basis of permission and it was never doubted that there was any requirement of any lease or any agreement subsequent to the order and the same required registration.
It must be observed that in Noronah 's case there was no admission on oath nor was there any question of registered lease.
Numerous other decisions were cited before us but in the view we have taken on the two basic points that the permis sion was valid and the order permitting limited tenancy was not a mindless order but one passed after application of the mind taking the two relevant facts under section 21 of the Act into consideration, it is not necessary to discuss these decisions any further.
In view of the fact that section 21 is a code by itself, there was no question of any further agreement in writing which has to be registered arises.
There is no merit in the contention of the respondent.
There is another aspect of the matter which has to be borne in mind.
The tenant not only failed to establish any fact impeaching the order, he waited for the full term to take this point and did not contest when the permission was obtained on a misrepresentation.
It was submitted by Shri Bhatia that in Delhi most of the transactions have been done under section 21 on the assumption that after order of the court no further or separate document or lease was required to be executed or that such document or lease had to be registered.
It was submitted that numerous transactions have taken place on that basis.
It was urged that if it is now found that is not the correct position and the correct position in law is that there should be a lease containing the terms of the lease being for 11 months, such enunciation of law should only be made applicable prospectively.
Counsel for the appellant contended that otherwise it would have disastrous conse 781 quences of unsettling numerous decisions and unsettling many settled transactions between the parties.
He drew our atten tion to the decision of this Court in 1.
C. Golak Nath & others vs State of Punjab and another; , If we had any doubt on the scope and ambit of section 21, we might have considered this submission urged on behalf of the appellant provided we were sure, factually that large number of transactions had been completed on the assumption that no further lease was required after the permission under sec tion 21.
Our attention was also drawn to the decision of the Privy Council and the observation of Lord Blanesburgh in the case of Dhanna Mal and others vs Rai Bahadur Lala Moti Sagar, A.I.R. 1927 Privy Council 102.
If we were inclined to the view that section 21 was not a code by itself but re quired separate lease to follow it up then perhaps we might have considered the effect of the aforesaid decision and observations.
In aid of the submission that in order to be entitled to eviction under section 14 of the Rent Act, the court had to be satisfied itself that the statutory ground for eviction existed and that application of satisfaction of the court could not be by passed and circumvented by a compromise decree, reliance was placed on certain observations on a decision in Ferozi Lal Jain vs Man Mal and another, In view of the facts of the particular case, we are of the opinion that it is not necessary to discuss the said decision in detail.
Numerous decisions of the Delhi High Court were placed before us in support of or in respect of contentions of the parties specially in support of con tention that the Delhi Rent Act required a separate lease.
The scope and ambit of the Delhi Rent Act after the decision of Noronah 's case came up for consideration before a divi sion bench of the Delhi High Court in Vijay Kumar Bajaj vs Inder Sain Minocha, [1982] 2 Rent Control Reporter 392.
In that decision, in the light of section 21, the following questions were posed: (1) Whether the permission under section 21 of the Act is invalid in view of Supreme Court judgment in S.B. Noro nah 's case (supra), if reasons for not requiring the prem ises by the landlord for a particular period are not dis closed in his application or his statement before the Con troller? (2) Whether before or after permission execution of any agreement in writing to let the premises for the fixed period is necessary, if so, whether such a document requires registration? (3) Whether the proposed agreement of tenancy in writing sub 782 mitted along with the application under Section 21 of the Act, in this appeal required registration? The questions were answered by the High Court as follows: (1) Not necessarily.
The landlord or the tenant may be able to show that cogent reasons did exist or were within the knowledge of the parties as to why the landlord did not require the whole or a part of his premises for a specified period.
(2) No registration is necessary.
The agreement in writing may be entered into either before or after grant of permission.
(3) An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement.
It comes into effect only after the grant of permission under section 21 of the Act.
It does not require registration.
We are in agreement with the views of the Delhi High Court.
Large number of decisions of this Court were cited in support of the contention that eviction decree passed in contravention of the statutory conditions or passed without consideration whether the statutory conditions are fulfilled or not are not binding and cannot be enforced.
See Bahadur Singh and another vs Muni Subrat Dass and another, and Kaushalya Devi and others vs Shri K.L. Ban sal; , We are, however, of the opinion that in view of the facts found in the instant appeal before us, these decisions are not of any relevance.
Similarly, our attention was drawn to the observations of this Court in Mansaram vs S.P. Pathak and others; , and State of Maharashtra vs Narsingrao Gangaram Pimple, 1, In the view we have taken and the real controversy in this case, this contention is no longer open.
On the unregistered lease question, our attention was drawn to a decision of the Delhi High Court in Jagat Taran Berry vs Sardar Sant Singh, A.I.R. 1980 Delhi 7.
As we have held that section 21 was a code by itself and no further document was required, it is not necessary to pursue the matter any further.
783 Similarly, our attention was drawn to a division bench judgment of the Calcutta High Court in the case of Ram Abatar Mahato vs Smt.
Shanta Bala Dasi and others, A.I.R. 1954 Calcutta 207 on the question of the terms and extent of section 107 of the Transfer of Property Act and whether a document in performance of an agreement had to be registered or not.
As mentioned hereinbefore in the view we have taken, it is not necessary for us to pursue this aspect any further as to the question whether oral evidence should be intro duced to explain the terms of a document embodied in writ ing.
Our attention was drawn to certain observations of this Court in State of Uttar Pradesh vs Singhara Singh and oth ers, [19641 4 S.C.R. 485 but the same are not relevant for our consideration in the present controversy in the light in which we have understood it.
Equally same is the decision in respect of the observations of Fazal Ali, J. of the Jammu and Kashmir High Court in Ishwar Dutt and another vs Sunder Singh and others, and the observa tions of this Court in Sri 5 Sita Maharani and others vs Chhedi Mahto and others, A.I.R. [1955] S.C. 328.
In the aforesaid light we are of the opinion that the High Court was in error in the view it took in setting aside the decision in the second appeal.
The appeal is, therefore, allowed and the order and judgment of the High Court of Delhi dated 19th of July, 1985 are set aside and the order and judgment of Rent Control Tribunal dated 28th of August, 1980 are restored.
The appellant is entitled to the costs of this appeal.
P.S.S. Appeal allowed.
|
The appellant made an application before the Rent Con troller on or about July 15, 1976 to let out the premises to the respondent for residential purposes for a period of two years under section 21 of the Delhi Rent Control Act, 1958 as he did not require the premises for that period.
The respondent agreed before the Rent Controller to the above statement of the appellant and undertook to vacate the premises after the expiry of two years from July 15, 1976.
Accordingly, the Rent Controller made an order allowing creation of a limited tenancy for a period of two years from July 15, 1976.
The respondent having refused to vacate the premises after two years, the appellant filed an application under section 21 on behalf of himself and his family members claiming possession of the premises for their bona fide need and use.
The Rent Controller passed an eviction order and the Appellate Tribu nal upheld the same.
The High Court allowing the appeal of the tenant re spondent held that the order under section 21 of the Act was a mindless order inasmuch as no reason had been stated as to why the premises in question was not required for a limited period, that it was not stated as to how the premises in question was dealt with before creating the said tenancy and that there was no writing and no lease registered after the permission was granted.
Allowing the appeal by special leave, 766 HELD: 1.1 The permission granted by the Rent Controller under section 21 of the Delhi Rent Control Act was valid.
The order permitting limited tenancy was not a mindless order but one passed by him after taking the relevant facts into consideration.
[780D] 1.2 In order to attract section 21 of the Act, it is necessary firstly that the landlord must not require the premises either in whole or part for a particular period; secondly, the landlord must obtain the permission of the Controller in the prescribed manner; thirdly, letting of the whole or part of the premises must be for residence, and fourthly such letting out must be for such period as may be agreed in writing.
These and these alone are the conditions which are required to be fulfilled.
[772G 773B] 1.3 Section 21 only gives sanction if the landlord makes a statement to the satisfaction of the Court and the tenant accepts that the landlord does not require the premises for a limited period.
This statement of the landlord must be bona fide.
The purpose must be residence.
There must not be any fraud or collusion.
There is a presumption of regulari ty.
But it is open in particular facts and circumstances of the case to prove to the satisfaction of the executing court that there was collusion or conspiracy between the landlord and the tenant and the landlord did not mean what he said or that it was a fraud or that the tenant agreed because he was wholly unequal to the landlord.
[776F H] 1.4 In the instant case there was no permission previ ously.
This was the first letting.
There was no evidence that when the landlord stated that he did not require the premises in question for a particular period, he did not mean what he said or that he made a false statement.
There was no evidence at any stage that the tenant did not under stand what the landlord was stating or that he did not accept what the landlord stated.
There was no evidence that either the tenant was in collusion or perpetrating any fraud with the landlord or the tenant was unequal to the landlord in bargaining powers.
There was thus no evidence to show that the Controller did not apply his mind.
[779F, 776H 777B] S.B. Noronah vs Prem Kumari Khanna, ; ; Nagindas Ramdass vs Dalpatram Ichharam, ; ; V.S. Rahi and another vs Smt.
Ram Chambeli; , ; J.R. Vohra vs India Export House Pvt. Ltd. and another; , and Smt.
Dhanwanti vs D.D. Gupta, [1986] 3 SCC 1, referred to 2.
It is not necessary to state under section 21 the reasons why the 767 landlord did not require the premises in question for.
any particular period.
The landlord or the tenant may be able to show that cogent reasons did exist or were within the knowl edge of the parties as to why the landlord did not require the whole or a part of his premises for a specified period.
[777BC, 782B] 3.
There is no presumption that in all cases the tenants are the weaker sections.
The presumption is, on the con trary, in favour of sanction.
It is he who challenges the statement and the admission of the landlord or the tenant who has to establish facts.
In the instant case the onus was on the tenant to show that the sanction under section 21 was a nullity.
He did not make any attempt to dislodge the pre sumption in favour of the permission.
[777C, 779F] 4.1 An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement.
It comes into effect only after the grant of permission.
It does not require registration.
[782CD] S.B. Noronah vs Prem Kumari Khanna, , referred to.
Vijay Kumar Bajaj vs Inder Sain Minocha, [1982] 2 Rent Control Reporter 392, approved.
4.2 It has been consistently held by the Delhi High Court that section 21 is a code by itself, that the order of permission is itself an authority and that no lease was necessary.
This view has been acted upon for long and trans actions have been completed in the Union Territory on the basis of permission and it was never doubted that there was any requirement of any lease or any agreement subsequent to the order and the same required registration.
The view taken by the High Court over a number of years should normally be adhered to and not to be disturbed.
A different view would not only introduce an element of uncertainty and confusion but it would also have the effect of unsettling transactions which might have been entered into on the faith of those decisions.
[780A C] Raj Narain Pandey and others vs Sant Prasad Tewari & others; , and Kasturi Lal vs Shiv Charan Das Mathur, [1976] 8 Rent Control Reporter 703, referred to.
|
Civil Appeal No. 468 of 1987.
768 From the Judgment and Order dated 19.7.
1985 of the Delhi High Court in Second Appeal No. 374 of 1980.
Madan Bhatia, N.D.B. Raju and Vineet Kumar for the Appellant.
Dr. L.M. Singhvi, K.B. Rohtagi, Praveen Jain and Baldev Atreya for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is from the judgment and order of the High Court of Delhi dated 19th of July, 1985.
The appellant had.
made an application on or about 15th of July, 1976 before the Rent Controller to let out the premises for a period of two years under section 21 of the Delhi Rent Control Act, 1958 (hereinafter called 'the Rent Act ').
The Rent Controller after recording the statements of the appellant and the respondent made an order permitting creation of limited tenancy only for a period of two years for residential purposes to which the respondent had agreed upon.
It may be material to refer to the fact that the appellant in his application under section 21 of the Rent Act had stated as follows: "1 do not require the premises for a period of two years from 15.7.76.
The purpose of letting shall be residential only and the premises are shown in the site plan exhibit A 1.
The proposed agreement is exhibit A 2.
Limited tenancy under section 21 of the Act may be allowed to be created for the said period.
" The respondent agreed to the aforesaid statement and stated as follows: "I have heard the statement of the petitioner and I accept it as correct.
I have no objec tion.
I shall vacate the premises after the expiry of two years from 15.7.76.
The purpose of letting shall be residential only".
Upon this the Rent Controller passed the following order: "This is an application filed under section 21 of the Act for permission to create limited tenancy for a period of two years from 15.7.76.
The purpose of letting shall be 769 residential only and the premises is shown in the site plan exhibit A 1.
The proposed agreement is exhibit A 2.
From the perusal of the statements of the parties I am satisfied that as at present the petitioner does not require the premises.
Therefore, limited tenancy is al lowed to be created for a period of two years from 15.7.76.
" The appellant filed an application on 6th November, 1978 for eviction of the respondent as the respondent had refused to vacate the premises in spite of his statement made before the Rent Controller.
The appellant filed an application on the said date under section 21 of the Rent Act on behalf of himself and his family members claiming possession of the premises for their bona fide need and use.
The appellant contended that he (the appellant) was a retired official and was living in a rented house while the respondent was a rich man doing business in jewellery and was also owning a house in Delhi.
In the application made under section 21 of the Rent Act the appellant had stated that the appellant owned a newly built house in the New Friends Colony comprising of dining, drawing, three bed rooms with attached bath rooms, a study room, family lounge and a garage.
The appellant had further stated that he did not require the premises for the personal residence for a period of two years.
The appellant had also stated in that application, that the appellant had agreed to let it out to the respondent for the first time on the terms and conditions set out in the proposed lease deed for a period of two years.
It was stated that the respondent had heard the statement and recorded that he had no objec tion and would vacate the premises after expiry of two years.
Subsequently, when the second appeal was pending in the Delhi High Court, the appellant had filed an application for early hearing in which he had stated that when the construction of the house in question was completed the appellant 's father R.B. Nanak Chand, advocate, was old and alone (the appellant 's mother had died earlier and other brother and sister being away from Delhi) and in view of his father 's ailing health the appellant was living with him in the rented premises at 4 Flag Staff Road, Delhi to look after his old and ailing father.
It was in those circum stances that the appellant had decided to let out the suit premises for a limited period of two years only.
It may be mentioned that the appellant 's father died two months after the Rent Controller had granted permission.
The Rent Controller after hearing both the parties on the 4th of January, 1980 held, rejecting the contention of the respondent, that section 21 of the Rent Act was not ultra vires.
Furthermore, he was 770 satisfied that a limited tenancy had been created and as such he granted permission for eviction.
Aggrieved by the aforesaid order the respondent preferred an appeal to the Rent Control Appellate Tribunal.
The Rent Control Appellate Tribunal upheld the eviction order.
On or about the 19th of July, 1985, being further ag grieved, the respondent preferred a second appeal before the High Court of Delhi.
The High Court of Delhi by the impugned judgment allowed the appeal on the ground that there was no ground stated in the application under section 21 of the Rent Act as to why a limited tenancy was intended to be made.
The High Court held that the order under section 21 of the Rent Act was a mindless order inasmuch as the respondent before it had not disclosed as to how the demised premises were being dealt with before creating the said alleged tenancy and why the respondent before it did not require the demised premises for the alleged period of two years and as to why the same would be required by him after the period of two years.
The High Court relying on the decision in the case of S.B. Noronah vs Prem Kumari Khanna, ; , held that the order in question in this case was a mindless order and in that view of the matter the order passed under section 21 of the Rent Act was not valid.
The High Court was of the view that there was no inquiry for the Controller to come to the conclusion on the basis of the material that the premises for which the permission was sought for creating a limited tenancy was in fact available for being let for a limited period only and in the absence of that, this was a mindless order.
The appellant has come up in appeal before this Court from the said decision.
The question, therefore, that arises for consideration of this Court is whether in view of the requirements of section 21 of the Rent Act, was the permission invalid? The main points upon which the High Court has relied are: first ly, on the materials put forward before the Rent Controller for sanction under section 21 of the Rent Act, no reason had been stated as to why the premises in question was not required for a limited period; secondly, it was not stated as to how the premises in question was dealt with; thirdly, the High Court was of the view that there was no writing and no lease registered after the permission was granted.
So far as the second ground, namely, as to how the premises in question was dealt with prior to the letting out in the 771 instant case the High Court was obviously and factually incorrect.
It was stated in the application for permission that it was agreed to be let out 'for the first time ' and secondly, it was stated that the appellant owned 'newly built house '.
Therefore two facts were clearly stated name ly, this was a 'newly built ' premises and further that there was no prior letting.
In the aforesaid facts and circum stances of the case therefore, it cannot be denied that how the premises in question was dealt with before the letting out had been clearly stated.
It is true however, that why the premises in question was stated by the appellant not to be required for a limited period had not been 'specifically ' stated at the time of seeking permission under section 21 by the appellant.
The appellant had stated that he did not require the premises in question for a period of two years.
He had not stated as to why he did not require the said premises for the said limit ed period of two years.
The question therefore is was it necessary to seek a valid order under section 21 to state that reason and if permission was granted on satisfaction of the Rent Controller on other conditions without being satis fied as to why the landlord did not require the premises in dispute for a limited period, the order would suffer from the vice of being a mindless order.
Such an order if other wise the conditions are satisfied would not be an invalid order.
In order to determine that question it is necessary to bear in mind the parameters and the purposes of section 21 of the Rent Act.
The Delhi Rent Control Act like other Rent Control Legislations had been passed to provide for the control of rent and eviction.
The Rent Acts all over the country came in the Wake of partition and explosion of population in metropolitan and new urban cities.
There are acute shortages of accommodation.
Very often these shortages and the demand for accommodation led to rack renting as well as unreasonable eviction of the tenants.
To meet that situa tion and to facilitate proper letting the Rent Acts were passed all over the country ensuring fair return to the landlords and giving the landlords the right of eviction for limited purposes and at the same time protecting the tenant from unreasonable eviction by the landlords.
This led to a series of litigations leading to long delays resulting specially in metropolitan cities like Delhi, Calcutta and Bombay in reluctance of many landowners who had vacant premises for letting out only for limited period either because of the family conditions or official commitments as they did not require the premises immediately and at the same time who were reluctant to part with the said premises on rent because of the long delay and the procedure that had to be followed to recover possession of those premises.
772 Section 21 of the Rent Act was an attempt to meet that reluctance.
Section 14 of the Rent Act controls the eviction of tenants and gives protection to the tenants against eviction.
It stipulates that notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant unless certain specified conditions were fulfilled.
Those conditions were laid down in different sections and provisos thereof.
It is not necessary to set these out in detail.
As mentioned hereinbefore that led to a good deal of reluctance on the part of the landlords to part with the possession of the premises in their occupation because of the time and expenses consuming process involved for recovery of possession.
In order, therefore, to induce reluctant/potential landlords to create tenancies, section 21 was enacted for the benefit of the capital city of Delhi.
This is a new provision the unique provision made for the metropolitan city of Delhi.
Section 21 of the Rent Act reads as follows: "21.
Where a landlord does not require the whole or any part of any premises for a par ticular period, and the landlord, after ob taining the permission of the Controller in the prescribed manner, lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not, on the expiry of the said period, vacate such premises, then notwith standing anything contained in section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord within such time as may be pre scribed, place the landlord in vacant posses sion of the premises or part thereof by evict ing the tenant and every other person who may be in occupation of such premises.
" An analysis of this section makes it clear that in order to attract section 21, the first condition is that the landlord does not require the whole or part of any premises for a particular period.
If that condition is fulfilled then the said landlord after obtaining the permission of the Controller in the prescribed manner lets the whole of the premises or part thereof as a residence for such period as may be agreed to in writing between the landlord and the tenant and the tenant does not on the expiry of the said period, vacate such premises, then notwithstanding anything contained in section 14 or in any other law, the Controller may, on an application made to him in this behalf by the landlord 773 within such time as may be prescribed, order the eviction of the tenant.
Therefore the first condition must be that the landlord must not require the premises either in whole or part of any premises for a particular period.
Secondly, the landlord must obtain the permission of the Controller in the prescribed manner.
Thirdly, letting of the whole or part of the premises must be for residence.
Fourthly, such letting out must be for such period as may be agreed in writing.
Therefore, there must be an agreement in writing, there must be a permission of the Controller for letting out for a limited period, the landlord must not require the premises for a particular period and letting of the premises must be as a residence.
These and these alone are the conditions which are required to be fulfilled.
In Nagindas Ramdass vs Dalpatram Ichharam, ; ,the question was whether a compromise decree for evic tion could be passed because the Rent Act enjoined the eviction only on the satisfaction of the court.
The respond ent landlord in that case instituted a suit under the Bombay Rent Act, 1947 for possession against the tenant on two grounds, namely, arrears in payment of rent and bona fide requirement of the premises for personal use and occupation.
A compromise decree was passed.1 When the appellant applied for execution of the decree the tenant contended that the compromise decree had been passed by the Rent Court without satisfying itself as to the existence of grounds of eviction under the Act and hence being a nullity was not executable.
It was held by this Court that the public policy permeating this Act was the protection of tenants against unreasonable eviction.
Construing the provisions of sections 12, 13 and 28 of the Act in the light of the said policy, it should be held that the Rent Court under the Act was not competent to pass a decree for possession either in invitum or with the consent of the parties on a ground which was de hors the Act or ultra vires the Act.
The existence of one of the statut ory grounds mentioned in sections 12 and 13 was a sine qua non to the exercise of jurisdiction by the Rent Court.
Par ties by their consent could not confer jurisdiction on the Rent Court to do something which, according to the legisla tive mandate, it could not do.
But if at the time of the passing of the decree there was some material before the Court on the basis of which the Court could prima facie be satisfied about the existence of a statutory ground for eviction, it would be presumed that the court was so satis fied and the decree for eviction,though passed on the basis of the compromise would be valid.
Such material may be in the form of evidence recorded or produced or it may partly or wholly be in the shape of express or implied admissions made in the compromise agreement.
Sarkaria, J. speaking for the 774 Court held that admissions if true and clear were by far the best proof of the facts admitted especially when these were judicial admissions admissible under section 58 of the Evidence Act.
In that case the Court found because of the admission to pay the arrears of rent and mesne profits at the 'contractual rate and the withdrawing of his application for fixation of standard rent, that there was no dispute with regard to the amount of standard rent and there was an admission that the rent was in arrears.
The Court observed at pages 552 to 553 of the report as follows: "From a conspectus of the cases cited at the bar, the principle that emerges is, that if at the time of the passing of the decree, there was some material before the Court, on the basis of which, the Court could be prima facie satisfied, about the existence of a statutory ground for eviction, it will be presumed that the Court was so satisfied and the decree for eviction, though apparently passed on the basis of a compromise, would be valid.
Such material may take the shape either of evidence recorded or produced in the case, or, it may partly or wholly be in the shape of an express or implied admissiOn made in the compromise agreement, itself.
Admissions if true and clear are by far the best proof of the facts admitted.
Admissions in pleadings or judicial admissions, admissible under section 58 of the Evidence Act, made by the parties or their agents at or before the hearing of the case, stand on a higher footing than evidentiary admissions.
The former class of admissions are fully binding on the party that makes them and constitute a waiver of proof.
They by them selves can be made the foundation of the rights of the parties.
On the other hand, evidentiary admissions which are receivable at the trial as evidence, are by themselves, not conclusive.
They can be shown to be wrong." The aforesaid principle must be borne in mind in order to judge the invalidity of the order passed under section 21 of the Act which was based on the statements made by the appellant and the respondent.
The facts of the case upon which great deal of reliance was placed by the High Court in the judgment under appeal and upon which the appellant relied very heavily are mentioned in the case of S.B. Noro nah vs Prem Kumari Khanna (supra).
There this Court reiter ated that section 21 of the Rent Act carved out a category for special treatment.
While no landlord could evict without compliance with sections 775 14, 19 and 20 of the Act, a liberal eviction policy could not be said to under lie in section 21.
The Court observed that the Parliament was 'presumably keen on maximising accommodation available for letting, realising the scarcity crisis.
One source of such spare accommodation which is usually shy is potentially vacant building or part thereof which the landlord is able to let out for a strictly limited period provided he had some credible assurance that when he needed it he would get it back.
The law sought to persuade the owner of the premises available for letting for a par ticular period by giving him a special assurance that at the expiry of that period the appointed agency would place the landlord in vacant possession.
Section 21 confined the special remedy to letting for residential uses only.
Parlia ment had the wholesome fear that if the section were not controlled by many conditions it might open the floodgates for wholesale circumvention of the rent control legislations by ingenious landlords exploiting the agonising need of houseless denizens.
Section 21 of the Act over rides section 14 precisely because it was otherwise hedged in with drastic limitations and safe guarded itself against landlords ' abuses.
The first condition was that the landlord did not require the demised premises 'for a particular period ' only.
That meant that he must indicate to the authority before which sanction was sought for letting what was the particular period for which he could spare the accommodation.
The Controller exercised an important regulatory function on behalf of the community.
The fact that a landlord and a potential tenant together apply, setting out the formal ingredients of section 21, did not relieve the Controller from being vigilant to inquire and satisfy himself about the requisites of the landlord 's non requirement 'for a particular period ' and the letting itself being 'as a resident '.
A fraud on the statute could not be permitted especially because of the grave mischief that might be perpetrated in such event.
The Court highlighted that it would be a terrible blow to the rent control law if section 21 were freely permitted to subvert the scheme of section 14.
Every landlord would insist on a tenant going through the formal exercise of section 21, making ideal averments in terms of that section.
The consequence would be that both the Civil Procedure Code which prescribed suits for recovery of possession and the Delhi Rent Control Act which prescribed grounds for eviction would be eclipsed by the pervasive operation of section 21.
Neither grounds for eviction nor suits for eviction would thereafter be needed, and if the landlord moved the Court for a mere warrant to place the landlord, through the Court process, in vacant possession of the premises, he 776 would get it.
No court fee, no decree, no execution peti tion, no termination of tenancy wish for possession and the Court was at your command.
The Court observed that such a horrendous situation would be the negation of the rule of law in this area.
When the application under Section 21 is filed by the landlord and/or tenant the Controller must satisfy himself by such inquiry as he may make, about the compulsive re quirements of that provision.
If he makes a mindless order, the Court.
when challenged at the time of execution will go into the question as to whether the twin conditions for sanction have really been fulfilled.
Of course, there will be a presumption in favour of the sanction being regular, but it will still be open to a party to make out his case that in fact and in truth the conditions which make for a valid sanction were not present.
The sanction granted under section 21, if it has been procured by fraud and collusion cannot withstand invalidity because, otherwise, high public policy will be given as hostage to successful collusion.
The doctrine of estoppel cannot be invoked to render valid a proceeding which the legislature, has on grounds, of public policy subjected to mandatory conditions which are shown to be absent.
As be tween unequals the law steps in and as against statutes there is no estoppel, especially where collusion and fraud are made out and high purpose is involved.
Law that non performs stultifies the rule of law and hence the need for strict compliance.
Or else, the sanction is non est.
Collusion between the strong and the weak cannot confer validity where the mandatory prescriptions of the law are breached or betrayed.
An analysis of this judgment which has been applied in the various cases would indicate that section 21 only gives sanction if the landlord makes a statement to the satisfac tion of the court and the tenant accepts that the landlord does not require the premises for a limited period; this statement of the landlord must be bona fide.
The purpose must be residence.
There must not be any fraud or collusion.
There is a presumption of regularity.
But it is open in particular facts and circumstances of the case to prove to the satisfaction of the executing court that there was collusion or conspiracy between the landlord and the tenant and the landlord did not mean what he said or that it was a fraud or that the tenant agreed because the tenant was wholly unequal to the landlord.
In the instant case none of these conditions were fulfilled.
There is no evidence in this case that when the landlord 777 stated that he did not require the premises in question for a particular period, he did not mean what he stated or that he made a false statement.
There was no evidence in this case at any stage that the tenant did not understand what the landlord was stating or that he did not accept what the landlord stated.
There was no evidence that either the tenant was in collusion or perpetrating any fraud with the landlord or the tenant was unequal to the landlord in bar gaining powers.
It is manifest that there is no evidence to show that the Controller did not apply his mind.
If that is so then on the principle enunciated by this Court in Noro nah 's case, this sanction cannot be challenged.
It is not necessary to state under section 21 the reasons why the landlord did not require the premises in question for any particular period.
Nor is there any presumption that in all cases the tenants are the weaker sections.
The presumption is, on the contrary, in favour of sanction, it is he who challenges the statement and the admission of.
the landlord or the tenant who has to establish facts as indicated in Nagindas 's case.
In V.S. Rahi and another vs Smt.
Ram Chambeli; , , this Court on the facts found that the permission under section 21 of the Act had been obtained by her on the basis of wrong statement, but for which the permission would not have been accorded.
These statements which were in the nature of half truths were apparently made in order to make good the plea that there was only a temporary necessity to lease out the building for a short period and that there was a bona fide anticipation that there would be a pressing necessity to reoccupy the premises at the end of the period.
which were the two crucial factors governing an order under section 21 of the Act.
It was stated that the appellants, in that case, who were the weaker of the two parties did not question the truth of the statements made by the respondent ,when the permission was granted.
But such collusion, if any, between the two unequal parties did not confer any sanctity on the transaction in question.
The observations of this Court in that case must be understood in the light of the facts mentioned by this Court.
It was found in Rahi 's case that there were wrong statements made by the appellant when he approached the Rent Controller.
It was admitted before this Court that it was a wrong statement.
These were mentioned in pages 295 296 of the Report.
What was urged was that the appellants being the tenants had colluded with the respondent.
It was reiterated by this Court, it is always open to the weaker of the two parties to establish that the transaction was only a camouflage used to cover its true nature.
When one party could dominate over the will of the other, it would not be a case of collusion but one of com pulsion.
The Court relied on the observations of Lord Ellen borough in Smith vs Cuff, 778 ; at 165 that it can never be predicted as pari delicto where one holds the rod and the other bows to it.
See the observations of this Court at pages 297 and 298 of the Report.
There is no evidence in this case that there was any wrong or incorrect statement made by the landlord nor is there any evidence that the tenant respondent herein was the weaker side of the bargain.
In that view of the matter the respondent cannot get much assistance from this decision of this Court.
This question was again considered by this Court in J.B. Vohra vs India Export House Pvt. Ltd. and another; , where Tulzapurkar, J. referring to Noronah 's case observed that section 21 carved out tenancies of particular category for special treatment and provided a special proce dure that would ensure to the landlord vacant possession of the leased premises forthwith at the expiry of the fixed period of tenancy, evicting whoever be in actual possession.
Such being the avowed object of prescribing the special procedure, service of a prior notice on the tenant upon receipt of the landlord 's application for recovery of pos session and inviting his objections followed by an elaborate inquiry in which evidence might have to be recorded would really frustrate that object.
It will be vitiated because it is procured by fraud practised by landlord for creating a limited tenancy.
If it is found that the initial order granting permission to create limited tenancy was vitiated by fraud practised by the appellant inasmuch as he had suppressed the fact that an earlier application for such permission had been declined on the ground that premises had been let out for commercial cum residential purposes and then there would be no executable order pursuant to which any warrant for possession could be issued under section 21 of the Act.
In the instant case, there is no such collusion and therefore, the principle of Noronah 's case would not be applicable.
The ratio of that decision must be understood in its proper light.
Section 21 of the Rent Act was examined by this Court in Smt.
Dhanwanti vs D.D. Gupta, [1986] 3 S.C.C. 1.
There was observed by Pathak, J. as the learned Chief Justice then was, that it was possible for the owner of a premises, on looking to the immediate future, to find that for certain reasons he was unable to occupy the premises forthwith himself but that he may do so later in the not very distant future.
The mere fact that the owner has let out the prem ises after obtaining permission under section 21 of the Act for a limited period, and thereafter on the expiry of that period has found it necessary to obtain permission to let out the premises again for another limited 779 period cannot necessarily lead to the inference that from the very beginning the premises were available for letting out indefinitely.
The Rent Controller and the Rent Control Tribunal should have examined the circumstances prevailing on each occasion when an application was made under section 21.
It was observed that assumption would not be justified where there is no positive material to indicate ' that from the very beginning there was never any intention on the part of the landlord to occupy the premises himself.
There was no such material in that case.
On the contrary there was mate rial showing that the landlady had expectation that her son and his family would be in Delhi after two years ' period of tenancy.
This is significant for the present issue.
There is nothing to show that the permission of the Rent Controller Was obtained by practising fraud or that it could be regard ed as a nullity or that material facts were concealed.
The principle of that decision will apply much more in this case.
It is observed in that decision that it seems to have been ignored altogether that it is perfectly possible for the owner of a premises, on looking to the immediate future, to find that for certain reasons, he is unable to occupy the premises forthwith himself but that he may do so later in the not very distant future.
It is not always that a man can plan his life ahead with any degree of definiteness.
Pre vailing uncertainty in the circumstances surrounding him may not permit clear sighted vision into the future.
The circum stances might justify his envisioning his need for the premises two or three years later, and therefore applying for permission under section 21 of the Act to let out the premises accordingly.
The facts are more stronger and clearer in support of the instant case.
Here there was no permission previously.
This was first letting out.
There was nothing which indicat ed that any statement was made which was incorrect.
We are of the opinion that sanction under section 21 in the instant case was not a nullity.
The onus was on the tenant to show that it was so.
He did not make any attempt to dislodge the presumption in favour of the permission.
Learned counsel for the appellant also stressed before us that section 21 of the Rent Act was a complete code by itself.
The order was under section 21 of the Rent Act.
No further question of lease or registered lease arose thereaf ter.
This question has been settled by series of decisions of the Delhi High Court upon which people have.
acted for long.
See the decision in Kasturi Lal vs Shiv Charan Das Mathur, [1976] Rent Control Reporter Vol.
8703 where at pages 708 709, Misra, J. of the Delhi High Court 780 had clearly indicated numerous cases where it was held that section 21 was a code by itself.
The order of the permission is itself an authority; no lease was necessary and if that is the state of law in Delhi, it is too late in the day to hold otherwise.
See the observations of this Court in Raj Narain Pandey and others vs Sant Prasad Tewari & others; , , where this Court observed that in the matter of the interpretation of a local statute, the view taken by the High Court over a number of years should nor mally be adhered to and not to be disturbed.
A different view would not only introduce an element of uncertainly and confusion but it would also have the effect of unsettling transactions which might have been entered into on the faith of those decisions.
In Delhi transactions have been complet ed on the basis of permission and it was never doubted that there was any requirement of any lease or any agreement subsequent to the order and the same required registration.
It must be observed that in Noronah 's case there was no admission on oath nor was there any question of registered lease.
Numerous other decisions were cited before us but in the view we have taken on the two basic points that the permis sion was valid and the order permitting limited tenancy was not a mindless order but one passed after application of the mind taking the two relevant facts under section 21 of the Act into consideration, it is not necessary to discuss these decisions any further.
In view of the fact that section 21 is a code by itself, there was no question of any further agreement in writing which has to be registered arises.
There is no merit in the contention of the respondent.
There is another aspect of the matter which has to be borne in mind.
The tenant not only failed to establish any fact impeaching the order, he waited for the full term to take this point and did not contest when the permission was obtained on a misrepresentation.
It was submitted by Shri Bhatia that in Delhi most of the transactions have been done under section 21 on the assumption that after order of the court no further or separate document or lease was required to be executed or that such document or lease had to be registered.
It was submitted that numerous transactions have taken place on that basis.
It was urged that if it is now found that is not the correct position and the correct position in law is that there should be a lease containing the terms of the lease being for 11 months, such enunciation of law should only be made applicable prospectively.
Counsel for the appellant contended that otherwise it would have disastrous conse 781 quences of unsettling numerous decisions and unsettling many settled transactions between the parties.
He drew our atten tion to the decision of this Court in 1.
C. Golak Nath & others vs State of Punjab and another; , If we had any doubt on the scope and ambit of section 21, we might have considered this submission urged on behalf of the appellant provided we were sure, factually that large number of transactions had been completed on the assumption that no further lease was required after the permission under sec tion 21.
Our attention was also drawn to the decision of the Privy Council and the observation of Lord Blanesburgh in the case of Dhanna Mal and others vs Rai Bahadur Lala Moti Sagar, A.I.R. 1927 Privy Council 102.
If we were inclined to the view that section 21 was not a code by itself but re quired separate lease to follow it up then perhaps we might have considered the effect of the aforesaid decision and observations.
In aid of the submission that in order to be entitled to eviction under section 14 of the Rent Act, the court had to be satisfied itself that the statutory ground for eviction existed and that application of satisfaction of the court could not be by passed and circumvented by a compromise decree, reliance was placed on certain observations on a decision in Ferozi Lal Jain vs Man Mal and another, In view of the facts of the particular case, we are of the opinion that it is not necessary to discuss the said decision in detail.
Numerous decisions of the Delhi High Court were placed before us in support of or in respect of contentions of the parties specially in support of con tention that the Delhi Rent Act required a separate lease.
The scope and ambit of the Delhi Rent Act after the decision of Noronah 's case came up for consideration before a divi sion bench of the Delhi High Court in Vijay Kumar Bajaj vs Inder Sain Minocha, [1982] 2 Rent Control Reporter 392.
In that decision, in the light of section 21, the following questions were posed: (1) Whether the permission under section 21 of the Act is invalid in view of Supreme Court judgment in S.B. Noro nah 's case (supra), if reasons for not requiring the prem ises by the landlord for a particular period are not dis closed in his application or his statement before the Con troller? (2) Whether before or after permission execution of any agreement in writing to let the premises for the fixed period is necessary, if so, whether such a document requires registration? (3) Whether the proposed agreement of tenancy in writing sub 782 mitted along with the application under Section 21 of the Act, in this appeal required registration? The questions were answered by the High Court as follows: (1) Not necessarily.
The landlord or the tenant may be able to show that cogent reasons did exist or were within the knowledge of the parties as to why the landlord did not require the whole or a part of his premises for a specified period.
(2) No registration is necessary.
The agreement in writing may be entered into either before or after grant of permission.
(3) An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement.
It comes into effect only after the grant of permission under section 21 of the Act.
It does not require registration.
We are in agreement with the views of the Delhi High Court.
Large number of decisions of this Court were cited in support of the contention that eviction decree passed in contravention of the statutory conditions or passed without consideration whether the statutory conditions are fulfilled or not are not binding and cannot be enforced.
See Bahadur Singh and another vs Muni Subrat Dass and another, and Kaushalya Devi and others vs Shri K.L. Ban sal; , We are, however, of the opinion that in view of the facts found in the instant appeal before us, these decisions are not of any relevance.
Similarly, our attention was drawn to the observations of this Court in Mansaram vs S.P. Pathak and others; , and State of Maharashtra vs Narsingrao Gangaram Pimple, 1, In the view we have taken and the real controversy in this case, this contention is no longer open.
On the unregistered lease question, our attention was drawn to a decision of the Delhi High Court in Jagat Taran Berry vs Sardar Sant Singh, A.I.R. 1980 Delhi 7.
As we have held that section 21 was a code by itself and no further document was required, it is not necessary to pursue the matter any further.
783 Similarly, our attention was drawn to a division bench judgment of the Calcutta High Court in the case of Ram Abatar Mahato vs Smt.
Shanta Bala Dasi and others, A.I.R. 1954 Calcutta 207 on the question of the terms and extent of section 107 of the Transfer of Property Act and whether a document in performance of an agreement had to be registered or not.
As mentioned hereinbefore in the view we have taken, it is not necessary for us to pursue this aspect any further as to the question whether oral evidence should be intro duced to explain the terms of a document embodied in writ ing.
Our attention was drawn to certain observations of this Court in State of Uttar Pradesh vs Singhara Singh and oth ers, [19641 4 S.C.R. 485 but the same are not relevant for our consideration in the present controversy in the light in which we have understood it.
Equally same is the decision in respect of the observations of Fazal Ali, J. of the Jammu and Kashmir High Court in Ishwar Dutt and another vs Sunder Singh and others, and the observa tions of this Court in Sri 5 Sita Maharani and others vs Chhedi Mahto and others, A.I.R. [1955] S.C. 328.
In the aforesaid light we are of the opinion that the High Court was in error in the view it took in setting aside the decision in the second appeal.
The appeal is, therefore, allowed and the order and judgment of the High Court of Delhi dated 19th of July, 1985 are set aside and the order and judgment of Rent Control Tribunal dated 28th of August, 1980 are restored.
The appellant is entitled to the costs of this appeal.
P.S.S. Appeal allowed.
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768 From the Judgment and Order dated 19.7. 1985 of the Delhi High Court in Second Appeal No. Dr. L.M. Singhvi, K.B. Rohtagi, Praveen Jain and Baldev Atreya for the Respondent. It may be material to refer to the fact that the appellant in his application under section 21 of the Rent Act had stated as follows: "1 do not require the premises for a period of two years from 15.7.76. The purpose of letting shall be residential only and the premises are shown in the site plan exhibit A 1. " The respondent agreed to the aforesaid statement and stated as follows: "I have heard the statement of the petitioner and I accept it as correct. The purpose of letting shall be residential only". Upon this the Rent Controller passed the following order: "This is an application filed under section 21 of the Act for permission to create limited tenancy for a period of two years from 15.7.76. Subsequently, when the second appeal was pending in the Delhi High Court, the appellant had filed an application for early hearing in which he had stated that when the construction of the house in question was completed the appellant 's father R.B. Nanak Chand, advocate, was old and alone (the appellant 's mother had died earlier and other brother and sister being away from Delhi) and in view of his father 's ailing health the appellant was living with him in the rented premises at 4 Flag Staff Road, Delhi to look after his old and ailing father. Aggrieved by the aforesaid order the respondent preferred an appeal to the Rent Control Appellate Tribunal. The Rent Control Appellate Tribunal upheld the eviction order. The High Court of Delhi by the impugned judgment allowed the appeal on the ground that there was no ground stated in the application under section 21 of the Rent Act as to why a limited tenancy was intended to be made. The appellant has come up in appeal before this Court from the said decision. The main points upon which the High Court has relied are: first ly, on the materials put forward before the Rent Controller for sanction under section 21 of the Rent Act, no reason had been stated as to why the premises in question was not required for a limited period; secondly, it was not stated as to how the premises in question was dealt with; thirdly, the High Court was of the view that there was no writing and no lease registered after the permission was granted. Therefore two facts were clearly stated name ly, this was a 'newly built ' premises and further that there was no prior letting. The appellant had stated that he did not require the premises in question for a period of two years. Such an order if other wise the conditions are satisfied would not be an invalid order. The Rent Acts all over the country came in the Wake of partition and explosion of population in metropolitan and new urban cities. There are acute shortages of accommodation. 772 Section 21 of the Rent Act was an attempt to meet that reluctance. Section 14 of the Rent Act controls the eviction of tenants and gives protection to the tenants against eviction. Those conditions were laid down in different sections and provisos thereof. It is not necessary to set these out in detail. In order, therefore, to induce reluctant/potential landlords to create tenancies, section 21 was enacted for the benefit of the capital city of Delhi. This is a new provision the unique provision made for the metropolitan city of Delhi. " An analysis of this section makes it clear that in order to attract section 21, the first condition is that the landlord does not require the whole or part of any premises for a particular period. Therefore the first condition must be that the landlord must not require the premises either in whole or part of any premises for a particular period. Secondly, the landlord must obtain the permission of the Controller in the prescribed manner. Fourthly, such letting out must be for such period as may be agreed in writing. Therefore, there must be an agreement in writing, there must be a permission of the Controller for letting out for a limited period, the landlord must not require the premises for a particular period and letting of the premises must be as a residence. These and these alone are the conditions which are required to be fulfilled. The respond ent landlord in that case instituted a suit under the Bombay Rent Act, 1947 for possession against the tenant on two grounds, namely, arrears in payment of rent and bona fide requirement of the premises for personal use and occupation. Construing the provisions of sections 12, 13 and 28 of the Act in the light of the said policy, it should be held that the Rent Court under the Act was not competent to pass a decree for possession either in invitum or with the consent of the parties on a ground which was de hors the Act or ultra vires the Act. Such material may be in the form of evidence recorded or produced or it may partly or wholly be in the shape of express or implied admissions made in the compromise agreement. Such material may take the shape either of evidence recorded or produced in the case, or, it may partly or wholly be in the shape of an express or implied admissiOn made in the compromise agreement, itself. Admissions if true and clear are by far the best proof of the facts admitted. The former class of admissions are fully binding on the party that makes them and constitute a waiver of proof. They by them selves can be made the foundation of the rights of the parties. On the other hand, evidentiary admissions which are receivable at the trial as evidence, are by themselves, not conclusive. While no landlord could evict without compliance with sections 775 14, 19 and 20 of the Act, a liberal eviction policy could not be said to under lie in section 21. The Court observed that the Parliament was 'presumably keen on maximising accommodation available for letting, realising the scarcity crisis. One source of such spare accommodation which is usually shy is potentially vacant building or part thereof which the landlord is able to let out for a strictly limited period provided he had some credible assurance that when he needed it he would get it back. Section 21 confined the special remedy to letting for residential uses only. Parlia ment had the wholesome fear that if the section were not controlled by many conditions it might open the floodgates for wholesale circumvention of the rent control legislations by ingenious landlords exploiting the agonising need of houseless denizens. Section 21 of the Act over rides section 14 precisely because it was otherwise hedged in with drastic limitations and safe guarded itself against landlords ' abuses. The first condition was that the landlord did not require the demised premises 'for a particular period ' only. That meant that he must indicate to the authority before which sanction was sought for letting what was the particular period for which he could spare the accommodation. The Controller exercised an important regulatory function on behalf of the community. Every landlord would insist on a tenant going through the formal exercise of section 21, making ideal averments in terms of that section. The consequence would be that both the Civil Procedure Code which prescribed suits for recovery of possession and the Delhi Rent Control Act which prescribed grounds for eviction would be eclipsed by the pervasive operation of section 21. When the application under Section 21 is filed by the landlord and/or tenant the Controller must satisfy himself by such inquiry as he may make, about the compulsive re quirements of that provision. Law that non performs stultifies the rule of law and hence the need for strict compliance. There must not be any fraud or collusion. In the instant case none of these conditions were fulfilled. There is no evidence in this case that when the landlord 777 stated that he did not require the premises in question for a particular period, he did not mean what he stated or that he made a false statement. There was no evidence in this case at any stage that the tenant did not understand what the landlord was stating or that he did not accept what the landlord stated. Nor is there any presumption that in all cases the tenants are the weaker sections. The presumption is, on the contrary, in favour of sanction, it is he who challenges the statement and the admission of. Ram Chambeli; , , this Court on the facts found that the permission under section 21 of the Act had been obtained by her on the basis of wrong statement, but for which the permission would not have been accorded. These statements which were in the nature of half truths were apparently made in order to make good the plea that there was only a temporary necessity to lease out the building for a short period and that there was a bona fide anticipation that there would be a pressing necessity to reoccupy the premises at the end of the period. It was stated that the appellants, in that case, who were the weaker of the two parties did not question the truth of the statements made by the respondent ,when the permission was granted. The observations of this Court in that case must be understood in the light of the facts mentioned by this Court. It was admitted before this Court that it was a wrong statement. These were mentioned in pages 295 296 of the Report. It was reiterated by this Court, it is always open to the weaker of the two parties to establish that the transaction was only a camouflage used to cover its true nature. When one party could dominate over the will of the other, it would not be a case of collusion but one of com pulsion. See the observations of this Court at pages 297 and 298 of the Report. This question was again considered by this Court in J.B. Vohra vs India Export House Pvt. Ltd. and another; , where Tulzapurkar, J. referring to Noronah 's case observed that section 21 carved out tenancies of particular category for special treatment and provided a special proce dure that would ensure to the landlord vacant possession of the leased premises forthwith at the expiry of the fixed period of tenancy, evicting whoever be in actual possession. In the instant case, there is no such collusion and therefore, the principle of Noronah 's case would not be applicable. The ratio of that decision must be understood in its proper light. Dhanwanti vs D.D. Gupta, [1986] 3 S.C.C. 1. There was observed by Pathak, J. as the learned Chief Justice then was, that it was possible for the owner of a premises, on looking to the immediate future, to find that for certain reasons he was unable to occupy the premises forthwith himself but that he may do so later in the not very distant future. This is significant for the present issue. The principle of that decision will apply much more in this case. It is observed in that decision that it seems to have been ignored altogether that it is perfectly possible for the owner of a premises, on looking to the immediate future, to find that for certain reasons, he is unable to occupy the premises forthwith himself but that he may do so later in the not very distant future. It is not always that a man can plan his life ahead with any degree of definiteness. Pre vailing uncertainty in the circumstances surrounding him may not permit clear sighted vision into the future. The facts are more stronger and clearer in support of the instant case. There was nothing which indicat ed that any statement was made which was incorrect. We are of the opinion that sanction under section 21 in the instant case was not a nullity. The onus was on the tenant to show that it was so. He did not make any attempt to dislodge the presumption in favour of the permission. No further question of lease or registered lease arose thereaf ter. See the decision in Kasturi Lal vs Shiv Charan Das Mathur, [1976] Rent Control Reporter Vol. The order of the permission is itself an authority; no lease was necessary and if that is the state of law in Delhi, it is too late in the day to hold otherwise. In Delhi transactions have been complet ed on the basis of permission and it was never doubted that there was any requirement of any lease or any agreement subsequent to the order and the same required registration. It must be observed that in Noronah 's case there was no admission on oath nor was there any question of registered lease. There is another aspect of the matter which has to be borne in mind. It was submitted that numerous transactions have taken place on that basis. He drew our atten tion to the decision of this Court in 1. Our attention was also drawn to the decision of the Privy Council and the observation of Lord Blanesburgh in the case of Dhanna Mal and others vs Rai Bahadur Lala Moti Sagar, A.I.R. 1927 Privy Council 102. The questions were answered by the High Court as follows: (1) Not necessarily. The agreement in writing may be entered into either before or after grant of permission. (3) An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement. It comes into effect only after the grant of permission under section 21 of the Act. We are in agreement with the views of the Delhi High Court. Similarly, our attention was drawn to the observations of this Court in Mansaram vs S.P. Pathak and others; , and State of Maharashtra vs Narsingrao Gangaram Pimple, 1, In the view we have taken and the real controversy in this case, this contention is no longer open. As we have held that section 21 was a code by itself and no further document was required, it is not necessary to pursue the matter any further. Shanta Bala Dasi and others, A.I.R. 1954 Calcutta 207 on the question of the terms and extent of section 107 of the Transfer of Property Act and whether a document in performance of an agreement had to be registered or not. Equally same is the decision in respect of the observations of Fazal Ali, J. of the Jammu and Kashmir High Court in Ishwar Dutt and another vs Sunder Singh and others, and the observa tions of this Court in Sri 5 Sita Maharani and others vs Chhedi Mahto and others, A.I.R. [1955] S.C. 328. In the aforesaid light we are of the opinion that the High Court was in error in the view it took in setting aside the decision in the second appeal. The appellant is entitled to the costs of this appeal.
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The appellant made an application before the Rent Con troller on or about July 15, 1976 to let out the premises to the respondent for residential purposes for a period of two years under section 21 of the Delhi Rent Control Act, 1958 as he did not require the premises for that period.
The respondent agreed before the Rent Controller to the above statement of the appellant and undertook to vacate the premises after the expiry of two years from July 15, 1976.
Accordingly, the Rent Controller made an order allowing creation of a limited tenancy for a period of two years from July 15, 1976.
The respondent having refused to vacate the premises after two years, the appellant filed an application under section 21 on behalf of himself and his family members claiming possession of the premises for their bona fide need and use.
The Rent Controller passed an eviction order and the Appellate Tribu nal upheld the same.
The High Court allowing the appeal of the tenant re spondent held that the order under section 21 of the Act was a mindless order inasmuch as no reason had been stated as to why the premises in question was not required for a limited period, that it was not stated as to how the premises in question was dealt with before creating the said tenancy and that there was no writing and no lease registered after the permission was granted.
Allowing the appeal by special leave, 766 HELD: 1.1 The permission granted by the Rent Controller under section 21 of the Delhi Rent Control Act was valid.
The order permitting limited tenancy was not a mindless order but one passed by him after taking the relevant facts into consideration.
[780D] 1.2 In order to attract section 21 of the Act, it is necessary firstly that the landlord must not require the premises either in whole or part for a particular period; secondly, the landlord must obtain the permission of the Controller in the prescribed manner; thirdly, letting of the whole or part of the premises must be for residence, and fourthly such letting out must be for such period as may be agreed in writing.
These and these alone are the conditions which are required to be fulfilled.
[772G 773B] 1.3 Section 21 only gives sanction if the landlord makes a statement to the satisfaction of the Court and the tenant accepts that the landlord does not require the premises for a limited period.
This statement of the landlord must be bona fide.
The purpose must be residence.
There must not be any fraud or collusion.
There is a presumption of regulari ty.
But it is open in particular facts and circumstances of the case to prove to the satisfaction of the executing court that there was collusion or conspiracy between the landlord and the tenant and the landlord did not mean what he said or that it was a fraud or that the tenant agreed because he was wholly unequal to the landlord.
[776F H] 1.4 In the instant case there was no permission previ ously.
This was the first letting.
There was no evidence that when the landlord stated that he did not require the premises in question for a particular period, he did not mean what he said or that he made a false statement.
There was no evidence at any stage that the tenant did not under stand what the landlord was stating or that he did not accept what the landlord stated.
There was no evidence that either the tenant was in collusion or perpetrating any fraud with the landlord or the tenant was unequal to the landlord in bargaining powers.
There was thus no evidence to show that the Controller did not apply his mind.
[779F, 776H 777B] S.B. Noronah vs Prem Kumari Khanna, ; ; Nagindas Ramdass vs Dalpatram Ichharam, ; ; V.S. Rahi and another vs Smt.
Ram Chambeli; , ; J.R. Vohra vs India Export House Pvt. Ltd. and another; , and Smt.
Dhanwanti vs D.D. Gupta, [1986] 3 SCC 1, referred to 2.
It is not necessary to state under section 21 the reasons why the 767 landlord did not require the premises in question for.
any particular period.
The landlord or the tenant may be able to show that cogent reasons did exist or were within the knowl edge of the parties as to why the landlord did not require the whole or a part of his premises for a specified period.
[777BC, 782B] 3.
There is no presumption that in all cases the tenants are the weaker sections.
The presumption is, on the con trary, in favour of sanction.
It is he who challenges the statement and the admission of the landlord or the tenant who has to establish facts.
In the instant case the onus was on the tenant to show that the sanction under section 21 was a nullity.
He did not make any attempt to dislodge the pre sumption in favour of the permission.
[777C, 779F] 4.1 An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement.
It comes into effect only after the grant of permission.
It does not require registration.
[782CD] S.B. Noronah vs Prem Kumari Khanna, , referred to.
Vijay Kumar Bajaj vs Inder Sain Minocha, [1982] 2 Rent Control Reporter 392, approved.
4.2 It has been consistently held by the Delhi High Court that section 21 is a code by itself, that the order of permission is itself an authority and that no lease was necessary.
This view has been acted upon for long and trans actions have been completed in the Union Territory on the basis of permission and it was never doubted that there was any requirement of any lease or any agreement subsequent to the order and the same required registration.
The view taken by the High Court over a number of years should normally be adhered to and not to be disturbed.
A different view would not only introduce an element of uncertainty and confusion but it would also have the effect of unsettling transactions which might have been entered into on the faith of those decisions.
[780A C] Raj Narain Pandey and others vs Sant Prasad Tewari & others; , and Kasturi Lal vs Shiv Charan Das Mathur, [1976] 8 Rent Control Reporter 703, referred to.
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The appellant made an application before the Rent Con troller on or about July 15, 1976 to let out the premises to the respondent for residential purposes for a period of two years under section 21 of the Delhi Rent Control Act, 1958 as he did not require the premises for that period. The respondent agreed before the Rent Controller to the above statement of the appellant and undertook to vacate the premises after the expiry of two years from July 15, 1976. The Rent Controller passed an eviction order and the Appellate Tribu nal upheld the same. These and these alone are the conditions which are required to be fulfilled. This statement of the landlord must be bona fide. There must not be any fraud or collusion. [776F H] 1.4 In the instant case there was no permission previ ously. There was no evidence that when the landlord stated that he did not require the premises in question for a particular period, he did not mean what he said or that he made a false statement. There was no evidence at any stage that the tenant did not under stand what the landlord was stating or that he did not accept what the landlord stated. There was thus no evidence to show that the Controller did not apply his mind. [779F, 776H 777B] S.B. Noronah vs Prem Kumari Khanna, ; ; Nagindas Ramdass vs Dalpatram Ichharam, ; ; V.S. Rahi and another vs Smt. Ram Chambeli; , ; J.R. Vohra vs India Export House Pvt. Dhanwanti vs D.D. Gupta, [1986] 3 SCC 1, referred to 2. The landlord or the tenant may be able to show that cogent reasons did exist or were within the knowl edge of the parties as to why the landlord did not require the whole or a part of his premises for a specified period. There is no presumption that in all cases the tenants are the weaker sections. The presumption is, on the con trary, in favour of sanction. It is he who challenges the statement and the admission of the landlord or the tenant who has to establish facts. In the instant case the onus was on the tenant to show that the sanction under section 21 was a nullity. He did not make any attempt to dislodge the pre sumption in favour of the permission. [777C, 779F] 4.1 An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement. It comes into effect only after the grant of permission. [782CD] S.B. Noronah vs Prem Kumari Khanna, , referred to. Vijay Kumar Bajaj vs Inder Sain Minocha, [1982] 2 Rent Control Reporter 392, approved. 4.2 It has been consistently held by the Delhi High Court that section 21 is a code by itself, that the order of permission is itself an authority and that no lease was necessary. The view taken by the High Court over a number of years should normally be adhered to and not to be disturbed. A different view would not only introduce an element of uncertainty and confusion but it would also have the effect of unsettling transactions which might have been entered into on the faith of those decisions.
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Appeal No. 20 of 62.
Appeal by special leave from the award dated September 29, 1960, of the Industrial Tribunal Punjab, Patiala in reference No. 13 of 1960.
C.K. Daphtary, Solicitor General of India, Bhagirath Das and B. P. Maheshewari, for the appellants.
M. K. Ramamurthi, B. K. Gary, D. P. Singh and section C. Aggarwal, for the respondent No. 2(i).
September 7.
The Judgment of Gajendragadkar and Das Gupta, JJ., was delivered by Gajendragadkar, J. Mudholkar J. delivered a dissenting judgment.
GAJENDRAGADKAR, J.
This appeal by special leave arises out of an industrial dispute in relation to a comparatively minor demand made against the appellants by the respondents their employees but in challenging the validity of the award passed by the Industrial Tribunal in favour of the 933 respondents on that demand the learned Solicitor General has raised a general question before us.
He contends that in granting the demand made by the respondents, the award has illegitimately and unjustifiably trespassed on the appellants ' freedom of contract.
The appellants as employers, are entitled tofix the terms of employment on which they would be willing to employ workmen and it is open to the workmen either to accept those terms or not; industrial adjudication should not interfere in such a matter.
That is the nature of the general contention which has been raised before us in the present appeal.
The facts leading to the dispute are few and they lie within a very narrow compass.
The appellants are the Trustees of the Tribune Press and paper and the Trust is being worked in accordance with the terms of the will executed by Dyal Singh Majithia on June 15, 1895.
In carrying out the policy of the Trust, the five appellants have executed a power of Attorney in favour of Mr. R. R. Sharma and the Press is managed and the paper is conducted to carry out the policy laid down by the will.
It appears that before July 1, 1956, for the purposes of leave, the appellants had divided their employees into two categories (1) the Linooperators and (2) the rest of the workmen in the Press Section; and Rule 57 made provision for leave on the basis of the said classification.
The effect of the said rule was that no Press worker other than the lino operator was entitled to any kind of paid leave although he was given the right to claim 30 days ' wages plus dearness allowance payable in January every year if he had worked for 11 Months.
In addition, the said press worker was entitled to Quarantine leave on the terms mentioned in Rule 53.
934 This position was substantially altered on the July 12 1956, when the appellants framed a new Rule in respect of earned leave.
This rule abolished the two categories of workers on which the earlier rule 57 was based and divided the workers into two categories (i) workers who were employed on or before 1.7.1956 and (ii) those who were employed after 1.7. 1956.
In respect of the former category of workmen, the new Rule made the following provision: "Subject to the provisions of the Indian , every workman in the service of the Tribune on the 1st July, 1956, will be entitled to 30 days ' leave with wages after having worked for a period of 11 months.
This leave shall cease to be earned, when it amounts to 60 days" In regard to the workmen falling under the latter category, earned leave was to be governed by the provisions of section 79 of the Indian .
It is common ground that the provision for earned leave made by the said section is a provision for minimum earned leave which the employer is bound to give: whether or not additional leave should be granted by way of earned leave is a matter within the discretion of the employer.
As a result of the new rule, the position was that the employees who had joined the service of the appellants on or before July 1, 1956, were entitled to 30 days ' earned leave with wages, whereas those who joined after the said date became entitled to the statutory minimum of 21 days of earned leave.
At the time when this rule came into force there were 94 old employees to whom the rule applied and 27 new employees to them by virtue of the new Rule, section 79 of the was made 935 applicable.
Gradually, new hands have also been employed and to all such new employees section 79 is applicable.
It appears that by its resolution passed on January 8, 1960, the Tribune employees union sent to the Management a charter embodying about 20 demands.
Attempts at conciliation were made but they failed and so, on April 4, 1960, eight of the said demands were referred by the Punjab Government to the Industrial Tribunal for its adjudication under section 10 of the Industrial Disputes Act.
One of these demands was in rela tion to earned leave.
The demand was that the employees in the Press Section should be allowed 30 days ' earned leave with full wages for every months ' service without any discrimination.
The Tribunal has allowed this demand and it bad held that all workmen of the Press are entitled to 30 days ' earned leave without making any distinction a between workmen who joined before July 1, 1956, and those who joined subsequently.
It is the validity of this award which is questioned before us by the appellants.
The broad and general question raised by the learned Solicitor General on the basis of the employer 's freedom of contract has been frequently raised in industrial adjudication, and it has consistently been held that the said right is now subject to certain principles which have been evolved by industrial adjudication in advancing the cause of social justice.
It will be recalled that as early as 1949, it was urged before the Federal Court in Western India Automobile Association vs The Industrial Tribunal Bombay(1) that the industrial Tribunal had no jurisdiction to direct an employer to reinstate his dismissed employees and the plea made was that such a direction was contrary to the known principles which govern the relationship between master and servant.
This contention was negatived by the Federal Court.
(1) ,120.
936 Speaking for the Court, Mahajan J. as he then was, observed that the award of the Tribunal may contain provisions for the settlement of a dispute which no Court could order if it was bound by ordinary law, but the Tribunal is not fettered in any way by these limitations.
The same plea was again raised before this Court in The Bharat Bank Ltd., Delhi.
vs The.
Employees of The Bharat Bank Ltd., Delhi (1) and Mukherjea J. as he then was, emphatically rejected it.
"Insettling the disputes between the employers and the workmen", observed the learned Judge, "the function of the Tribunal is not confined to administration of justice in accordance with law.
It can confer rights and privileges on either party which it considers reasonable and proper, though they may not be within the terms of any, existing agreement.
It has not merely to interpret or to give effect to the contractual rights and obligations of the parties.
It can create new rights and obligations between them which it considers essential for keeping industrial peace.
" This view has been consistently accepted by industrial adjudication since 1949.
The doctrine of the absolute freedom of contract has thus to yield to the higher claims for social justice.
Take, for instance, the case where an employer wants to exercise his right to employ industrial labour on any wages he likes.
It is not unlikely that in an economically under developed country where unemployment looms very large.
for Industrial work, employees may be found willing to take employment on terms which do not amount to a minimum basic wage.
Industrial adjudication does not recognise the employer 's right to employ labour on terms below the terms of minimum basic wage.
This, no doubt, is an interference with the employer 's (1) ; , 513.
937 right to hire labour, but social justice requires that the right should be controlled.
Similarly the right to dismiss an employee is also controlled subject to well reorganised limits in order to guarantee security of tenure to industrial employees.
In the matter of earned leave, s.79 of the prescribes a minimum in regard to establishments to which the Act applies.
In the matter of bonus which is not regarded as an item of deferred wages, industrial adjudication has evolved a formula by the working of which employees are entitled to claim bonus, We have referred to these illustration to show bow under the impact of the demand of social justice, the doctrine of absolute freedom of contract has been regulated.
It is, however, necessary to add that the general question about the employer 's right to manage his own affairs in the best way he chooses cannot be answered in the abstract without reference to the facts and circumstances in regard to which the question is raised.
If a general question is posed and an answer must be given to it, the answer would be both yes and No. The right would be recognised and industrial adjudication would not be permitted or would be reluctant to trespass on that right or on the field of management functions unless compelled by over riding consi derations of social justice.
The right would not be recognised and would be controlled if social justice and industrial peace require such regulation.
That is why we think industrial adjudication always attempts not to answer questions in the abstract in order to evolve any general or inflexible principles.
The eat course to adopt in dealing with industrial disputes is to consider the facts of the case, the nature of the demand made by employees, the nature of the defence raised by 938 the employer and decide the dispute without unduly enlarging the scope of the enquiry.
If in the decision of the dispute, some principles have to be followed or evolved, that must be done: but care must be taken not to evolve larger principles which would tend to prejudge issues not directly raised in the case before the Industrial Tribunal.
That is why we think we would not be justified in giving any general answer to the broad contention raised by the learned Solicitor General before us in the present appeal.
The development and growth of industrial law during the last decade presents a close analogy to the development and growth of constitutional law during the same period.
In some respects, itis well know that article 19 of the Constitutionhag guaranteed fundamental rights to individualcitizens and at the same time, has provided forthe regulation of the said fundamental rights subject to the provisions of cls.
(2) to (6) of the said Article.
Where a conflict arises between the citizen 's fundamental right to hold property and a restriction sought to be imposed upon that right in the interest of the general public, courts take the precaution of confining their decision to the points raised before them and not to lay down unduly broad and generaI propositions.
As in the decision of constitutional questions of this kind, so in industrial adjudication it is always a matter of making a reasonable adjustment between two competing claims.
The fundamental right of the individual citizen is guaranteed and its reasonable restriction is permissible in the interest of the general public, so, the claims of the interest of the general public have to be weighed and balanced against the claims of the individual citizen in regard to his fundamental right.
So too, in the case of industrial adjudication 939 the claims of the employer based on the freedom of contract have to be adjusted with the claims of industrial employees for social justice.
The process of making a reasonable adjustment is not always easy, and so, in reaching conclusions in such a matter, it is essential not to decide more than ' is necessary.
If industrial adjudication pur ports to lay down broad general principles, it is likely ;to make its approach in future case#; inflexible and that must always be avoided.
In order that industrial adjudication should be completely free from the tyranny of dogmas or the sub conscious pressure of pro conceived notion, it is of utmost 'importance that the temptation to lay down broad principles should be avoided.
In these matters, there are no absolutes and no formula can be evolved which would invariably give an answer to different problems which may be posed in different cases on different facts.
Let us, therefore, revert to the facts of this case and decide whether the appellant 's attack against the validity of the propriety of the award can be sustained.
In dealing with the narrow dispute presented by this appeal, it is necessary to remember that all the employees of the appellants are governed by the same terms and conditions of ,service, except in regard to earned leave.
It is only in respect of this term and condition of service that a distinction is made between workmen employed on or before 1.7.
56 and those employed after that date.
Generally, in the matter of providing leave rules, industrial adjudication prefers to have similar conditions of service in the same industry situated in the same region.
There is no evidence adduced in this case in regard to the condition of earned leave prevailing in the comparable industry in this region.
But we cannot ignore the fact that this 940 very concern provides for better facilities of earned leave to a section of its employees when other terms and conditions of service are the same in respect of both the categories of employees.
It is not difficult to imagine that the continuance of these two different provisions in the same concern is likely to lead to dissatisfaction and frustration amongst the new employees.
It cannot be denied that the existence of industrial peace and harmony and the continuance of the said peace and harmony are relevant factors, but their importance should not be unduly exaggerated.
If a frivolous demand is made by the employees and it is accompanied by a threat that non compliance with the demand would lead to industrial disharmony or absence of peace, it would be unreasonable to treat the thrust as relevant in deciding the merits of the demand.
In this connection, it is necessary to remember that the continuance of harmonious relations between the employer and his employees is treated as relevant by industrial adjudication, because it leads to more production and thereby has a healthy impact on national economy, and so it is necessary that in dealing with several industrial disputes, industrial adjudication has to bear in mind the effect of its decisions on national economy.
In their zest to fight for their respective claims, the parties may choose to ignore the demand of national economy, but industrial adjudication cannot.
If the demand is plainly frivolous, it has to be rejected whatever the consequences may be.
In the present case, the argument that the continuance of two different provisions would lead to disharmony cannot, however, be treated as frivolous.
It is difficult to understand on what principle the discrimination is based.
The only argument urged in support of the discrimination is the employer 's right to provide for new terms of service to the new entrants in service.
In our 941 opinion, the validity of this argument cannot be accepted in the circumstances of this case.
Take the case of the wages or dearness allowance which the Appellants paid to their employees.
Would the appellants be justified in assertion of their right of freedom of contract to offer less favourable terms of wages or dearness allowance to employees who would be employed after a certain date ? If the general point raised by the learned Solicitor General is upheld without any qualifications, then it would be open to the employer to fix different wages for different sets of workmen who are doing the same kind of work in his concern.
We have rarely come across A case where such a claim has either been made or has been upheld.
It is well known that both industrial legislation and industrial adjudication seek to attain similarity or uniformity of terms of service in the same industry existing in the same region, as far as it may be practicable or possible, without doing injustice or farm to any particular employer or a group of employers That being so, we do not think the Tribunal was in error in holding that in the matter of earned leave, there should be uniformity of conditions of service governing all the employees in the service of the appellants.
There is another aspect of this question to which reference must be made.
This is not a case in which the financial liability imposed on the employer by the award when it directed the employer to grant the earned leave of 30 days to all the employees, is very heavy; and so, having regard to the fact that the appellants have been conducting their business in a profitable way and their financial position is distinctly good, no attempt has been made before us and rightly, to suggest that the burden imposed by the award is beyond their means.
it is not disputed that the total annual liability which 942 may accrue as a result of the award may not exceed Rs. 1,000/ , and it is also common ground that the appellants are a flourishing concern and their not profits which were in the neighbourhood of a lac of rupees in 1949, have shown an upward tendency and have reached almost rupees eight lacs in 1959.
That is another factor which has to be borne in mind in dealing with the present dispute.
It is not suggested by the appellants that the provision made by them for earned leave in respect of old employees is unduly generous of extravagant and so, it has become necessary to invoke the provisions of section 79 of the in respect of new employees.
On the other hand, earned leave provided by section 79 is the minimum statutory leave to which employees are entitled and if the appellants thought it necessary to provide for additional earned leave to their old employees, there is no reason why they should not make a similar provision in respect of the new employeesas well.
We ought to add to that on the record, it does appear that the appellants are good employees and they are treating their employees in a liberal manner.
It, however, appears that they have brought the present dispute to this Court more for asserting the general principle of the employer 's right to fix conditions of service with his new employees than for vindicating any real or substantial grievance against the award which would prejudicially affect their interest.
In our opinion, having regard to the nature of the dispute raised in the present appeal and the other relevant facts and circumstances, it cannot be said that the Industrial Tribunal erred in law in directing the appellants to provide for the same uniform rule as to earned leave for all their employees.
We are satisfied that the award under appeal cannot be set aside only on the academic or abstract point of law raised by the appellants.
943 The result is, the appeal fails and is dismissed with costs.
MUDHOLKAR, J. This is an appeal by special leave from the award of the Industrial Tribunal, Punjab.
The appellants before us are the trustees of 'The Tribune ' Ambala Cantt.
and the opposite party to the appeal consists of the workmen of the Tribune through their two unions, one the Tribune Employees ' Union and the other the Tribune Workers ' Union.
The Trust was founded in Lahore by the late Sardar Dayal Singh Majithia on February 1, 1881.
It publishes the newspaper "Tribune".
By the will of the founder dated June 15, 1895 the Management of the Tribune was vested in a public trust in September, 1898.
After the partition of India the offices of the newspaper had to be shifted from Lahore and they are now located at Ambala.
The Trust naturally had to leave the entire machinery and other equipment of the Tribune Trust along with its immovable property in Lahore.
The value of that property is stated by the appellants to be Rs. 25 lakhs or so.
The Trust was however, able to transfer its bank accounts and Government securities to India a few days before the partition.
With the help of these assets it reestablished the Tribune Press and office at Ambala and established new machinery at a cost of Rs. 15 lakhs or so.
Gradually the Trust has been able to rehabilitate its fortunes.
It is not disputed before us that despite the heavy loss entailed by the Trust by reason of being uprooted from Pakistan, the employees quite a number of whom are old employees who were able to migrate to India, have been treated with a great deal of consideration.
After the Tribune started making profits the employees are being given bonus every year.
Moreover even before the Employees Provident Fund scheme applicable to newspaper 944 industry and even before the scheme of gratuity for all categories of employees were enforced by statute be Tribune had provided for both provident fund and gratuity to its employees.
In addition to this it has provided free housing accommodation to its workmen in two colonies, one built in 1955 with the help of subsidy from the Government of India and the other in the year 1958 at a cost of Rs. 6 lakhs.
The quarters in the two colonies are provided with modern sanitation Besides that, there are extensive recreation grounds, lawns etc., in these colonies.
Even electricity is supplied free to the employees.
Several other amenities are also provided by the Trust.
It would thus appear that the welfare of the employees has been kept prominently in mind by the trustees.
Even so, some disputes arose between the management and the employees.
Ultimately eight demands made by the employees were referred by the Government of Punjab for adjudication under section 10(1) of the industrial Disputes Act, 1947 (14 of 1947) to the Industrial Tribunal, Punjab, Patiala constituted under s.7A of the Act.
Four demands were rejected by the Tribunal as having been withdrawn, one was settled amicably and on the remaining three the Tribunal has made its award.
One of those three demands is : "Whether the employees in the Press Section should be allowed 30 days ' earned leave with full wages for every 11 months ' service without discrimination ?" The Tribunal hold in favour of the workmen and it is only against this part of the award of the Tribunal that the trustees have come up in appeal before us.
Certain facts have to be stated in connection with this demand.
The Trust had framed certain rules governing the conditions of service of 945 its employees.
Rule 57 of those rules deals with leave and reads thus : "The Lino Operators shall be entitled to 30 days ' leave of all description (luring the course of a calendar year, which will be with pay plus all allowances.
Press employees, other than the Lino operators may be granted leave by the competent authority from time to time as the authority may determine.
Such leave shall be without pay or allowance.
They shall, however, be entitled to in the month of January every year to receive a sum amounting to the leave pay plus ordinary dearness allowance for the preceding month of December for the period of II months ' service or to a proportionate amount for a lesser period.
In addition, Press workers will be entitled to quarantine leave on the terms mentioned in Rule 53".
On July 1, 1956 a new rule was framed which reads as follows : "(1) Subject to the provisions of the Indian , every workman in the service of the Tribune on the 1st July, 1956, will be entitled to 31 days ' leave with wages,, after having worked for a period of II months.
This leave shall cease to be earned, when it amounts to 60 days.
(2) A workman joining the service of the Tribune after the 1st July, 1956 will be entitled to leave, in accordance with the provisions of section 79 of the Indian .
" Under the old rule the Lino Operators in the press section were allowed 30 days ' leave on full wages 946 including dearness allowance.
The other workers in the press section were, however, allowed not leave with pay, but 30 days ' wages in the month of January calculated on the basis of the full wages drawn in the preceding month provided that an employee had served for a period of II months till the beginning of the month of January.
If he had served for a lesser period he was to be paid propor tionately less amount.
Bearing in mind the fact that in industries leave, vacation and holidays with pay are regarded as supplemental pay practices (see Collective Bargaining principles and Cases by John T. Dunlop and James J. Healy, revised edn., p. 433), in substance even the employees in the press section other than lino operators got the same money equivalent of the leave allowed to lino operators.
It may be mentioned that these other press section employees were also entitled to take leave but the rule provided that they will Dot be paid any pay and allowances for such leave.
That was perfectly reasonable because they got pay in lieu of paid leave for an additional period in the month of January.
However, even this slight distinction in the mode of conferring benefits on the two categories of employees was abolished by the new rule which came into force on July 1, 1956, and all employees in the press section upto that date were made eligible for the grant of 30 days ' leave with wages after having worked for a period of 11 months.
It 'May be mentioned here that the of 1948 provided in a. 79 that every worker who has worked for a period of 240 days or more in a calendar year shall be given at least one days ' leave for every 20 days of service.
No doubt this was the minimum provided by the Act but since the press section is governed by the it was open to the Trust to modify its rules with regard to all employees of this section and grant leave according to the provisions of this 947 section.
There is no prohibition in law against doing so but still it did not wish to revise unfavourably its rules regarding the quantum of leave to its existing employees.
It, however, felt that in view of the statutory provision there was no obligation upon it to provide for a longer leave than that laid down in section 79 of the .
It was for this reason that it provided that all employees engaged on or after July 1, 1956, will be granted leave according to the provisions of section 79 of the , the idea being that eventually all employees should be governed by the rules.
Apparantly, to forestall this consequence the employees contend that the new rule has introduced discrimination.
That is why they raised a dispute relating to this matter and it was referred to the Tribunal along with the other disputes they had raised.
The Tribunal, dealing with this matter, has observed as follows : "It may be of some importance to note that till 1st July, 1956 the workmen who had entered service before that date and those who had been employed thereafter were in the matter of leave compensation, treated alike.
It was on 1st July, 1956 for the first time that the workmen who had been in service before that date were given 30 days ' paid leave but for now entrants the number of days of that leave was reduced to that permitted by section 79 of the .
The Union 's contention is that to allow 3 days ' earned leave with full wages in an year to a certain group of workmen in Press Section and to deny that benefit to the rest of the workmen of that section simply on the score of their having entered service after 1st July, 1956, is to acknowledge the prominent element of discrimination which has been res 948 ponsible for the heart burning, resentment and dissatisfaction of the workmen.
It is further urged with emphasis that all workers for the Press Section should in the matter of earned leave be treated equally.
For the long space of seven years even after the had come into force the management had continued to treat all workmen of the Press Section alike irrespective of the date of their employment.
There is no reason why a distinction of a discriminatory nature and effect be made between the two artificially created sets of workmen belonging to the same section.
" It seems to me that the Tribunal 's ultimate finding is vitiated by a misconception entertained by it.
The first sentence in the above quotation would show that the Tribunal thought that those persons who were employed after July 1, 1956 were treated in the matter of leave on par with those employed before July 1, 1956, ,till July 1, 1956" but were sought to be discriminated against only thereafter.
It is difficult to understand how persons who were employed after July 1, 1956, could possibly be treated before July 1, 1956, equally with employees who were in service on that day.
Apparently it is this confusion in the mind of the Tribunal which has influenced its ultimate conclusion.
That apart, it is quite clear that what the Trust has done is to put in one category persons who enjoyed in substance the same kind of benefit uptil July 1, 1956 and permit them to enjoy the benefit they bad hitherto enjoyed.
Then it put in a separate category those persons who could never possibly lay any claim to have enjoyed a similar benefit because they were not its employees till July 1, 1956, and decided that they will get leave only as provided in section 79 of the .
All persons in each category are intended to be alike and, therefore the 949 question of discrimination does not in fact arise.
It was, in my opinion, open to the management to offer to the new entrants now terms.
When the new entrants entered service accepting the new terms and knowing fully well that one of those terms i. e., the one relating to annual leave was different and less beneficial from the one which obtained in the case of the old employees, it is not reasonable for them now to say that they are being discriminated against.
The Tribunal, however, thinks otherwise.
It has held that the Trust, by treating the now entrants less favourably in the matter of leave than its old employees has practiced discrimination and that this discrimination has caused heart burning.
Presumably, therefore, the Tribunal felt impelled to interfere and direct that the new entrants should be treated ' in the matter of leave on par with the old employees in ' order to avoid industrial unrest which may result 'from ' heart burning amongst the new entrants.
What we must first consider is whether the existing of heart burning has at all been established in this case.
It is said that the continuance of different provisions in the same concern has caused heart burning, dissatisfaction and frustration among the new employees and this would lead to unrest in the industry.
For one thing, there is no evidence before us to show that the new employees are making a very serious grievance of the fact that they would get a few days less of leave than the old employees.
All that Mr. Ramamurti could point out to us was the statement in the evidence of Som Nath, A. W. 7.
that he should also be given 30 days, privilege leave in a year.
Merely saying that he should be given privilege leave does not mean that he is harbouring bitterness in his mind.
Apart from that it would be extremely unreasonable to take notice of bitterness, if any, in the minds of 950 these new employees in regard to this matter because.
as already stated, they voluntarily took up employment knowing that they would got less leave than the old employees.
Som Nath 's statement is no evidence of the fact that there is any heart burning.
To say that the very fact that two sets of people are governed by different rules will necessarily lead to heartburning, without establishing anything more, such as inadequacy of the benefit enjoyed by one set will be to ignore that such differences are a matter of common occurrence and no reasonable person is expected to magnify their consequences.
It seems to me, further, that the workers as a body did not think much of the distinction between the extent of leave enjoyed by old and new employees because during all the four years while the rule has been in force they raised no protests.
No doubt they did ultimately make a protest in the year 1960 when the dispute was referred to the Tribunal.
But then, this was not the sole dispute but was one of eight disputes, at least four of which were withdrawn by the Unions, apparently after realising that there was no substance in them.
The mere fact that they did not withdraw this dispute would not of itself indicate that they regarded it as of great importance.
It may well be that they did not withdraw it in an erroneous belief that anything which is characterised as discrimination will at once earn the sympathy of Industrial Tribunals and the Courts.
Even assuming that is creating heartburning amongst the employees the question arises whether they have a real grievance.
They say that the Trust has discriminated against the new entrants and this is their grievance.
In this connection it may be observed that the more refusal or failure of an employer to treat equally all its employees doing a particular kind of work would not necessarily amount to discrimination.
The subject of is d 951 crimination has come up for consideration before this Court in a largo number of cases in which a complaint has been made that the equality clause of the Constitution, article 14, has been violated.
This Court has held that It is open to the State to make reasonable classification both as regards persons and as regards things (see in particular Budhan vs State of Bihar(1) ; Khandige Sham Bhatt vs Agricultural Income tax Officer (2); This Court has laid down that a classification made by the, State will be reasonable provided that (1) it is founded on an intelligible differentia which distinguishes persons or things that are grouped together from other left out of the group; and (2) that the differentia has a rational relation to the object sought to be achieved by the statute.
In the State of Madhya Pradesh vs Gwalior Sugar Co. Ltd. (4); it has been held that it is permissible to make classification on historical grounds, by putting in one class one set of persons or things and in 'other all those left out from the first class Court.
In Ramjilal vs Income tax Officer, Mohindargarh(5) this Court has held that a taxing law may provide that a law imposing a new rate shall not apply to pending proceedings.
In other words this Court has upheld the law where one rate of income tax shall be applicable to persons whose cases were pending for assessment and another rate to persons whose cases were not so pending.
Thus, this Court has hold as reasonable classification made by reference to difference in time.
In Sardar Inder Singh vs The State of Rajasthan (6) this Court has held that it is open to the legislature to decide the date from which a law should be given operation and that the law made by it cannot be challenged as discriminatory because it (1) ; (2) ; (3) C A. Nos. 98 & 98 of 1959 decided on November 30, 1960.
(4) ; (5) ; 952 does not apply to prior transactions.
Thus in this case also classification made on the basis of difference in time has been upheld.
Finally in Hathising Mfg. Co. vs Union of (India (1) this Court has held that there is no discrimination if the law applies generally to all persons who come within its ambit as from the date on which it is made operative.
This case likewise accepts that it will not amount to discrimination if one set of persons is treated differently from another by reference to a point of time.
It would follow from these decisions that if the State as an employer provided that persons entering its service after a certain date will be governed by a set of condition which will be different and, may be less favourable than those governing the existing entrants that law will not be open to attack under article 14 of the Constitution on the ground that it discriminates between one set of employees and another.
In my judgment the principle laid down by this Court that reasonable classification does not amount to discrimination is of general application.
Therefore, when an employer 's action is challenged before an Industrial Tribunal as discriminatory, the Tribunal will also have to bear it in mind.
For if an action cannot be regarded as discriminatory and violative of article 14 of the Constitution because it is based on a reasonable classification an identical action of a private employer affecting his employees can also not be regarded as discriminatory.
The content and meaning of 'discrimination ', wherever the term is used, must necessarily be the same and we cannot adopt one standard for judging whether an action when it emanates from the State, is discriminatory or not and another standard for judging an identical action, when it emanates from a private citizen.
Looked at this way, I have no doubt that the Trust has not practised what can in law be regarded as discrimination against its now entrants (1) A.I.R. 1960 S.C. 931. 953 by allowing them lesser leave than it has allowed to its old entrants.
I may point out that it is not an unusual thing even in Government service to find new entrants being treated differently in the matter of leave, emoluments etc., from the old entrants.
It is a well know fact that in most of the provinces of India in the year 1932 or 1933 pay scales in various categories of Government service were revised and new scales less favourable than the old ones were introduced.
Therefore, a largo body of men were performing the same duties as other large body of men but were getting lesser pay than the latter.
That happens often, is happening today in several of the recently reorganised States and may happen hereafter also.
But merely because new terms of service are less favourable than the old ones, would it be correct to say that there is discrimination between the new entrants and the old entrants? As already pointed out, it is open to the employer to offer different and even less favourable terms to new entrants and if the new entrants entered service with their eyes wide open they cannot reasonably complain of being discriminated against.
Mr. Ramamurthi who appears for the employees, however, contends that it is open to an employee to take up employment on the existing conditions of service and immediately start clamouring for improving his conditions of service.
It is sufficient to say that without establishing that there was a change in circumstances subsequent to the time when a workman accepted service a demand for improvement in the conditions of service cannot, with justice, be entertained unless of course the original conditions of service were plainly unfair.
Mr. Ramamurthi does not say that the term regarding leave in the rule applicable to the new entrants is unfair in the sense that the 954 leave allowed is inadequate.
But, Mr. Ramamurthi said that where a service condition causes heartburning amongst two sections of employees discontent and unrest would be its natural outcome and so it is open to the Tribunal to revise the condition and thus eliminate that discontent.
I am unable to accept the argument.
No doubt, the provisions of the Industrial Disputes Act are wide enough, like those of other legislative enactments placed on the statute book, for promoting the welfare of the employees to permit an Industrial Tribunal to override the contract between an employer and his employees governing conditions of service of the employees.
But it does not follow from this that no sooner a reference of a dispute is made to a Tribunal for adjudication than the contract of service ceases to have any force.
The power to interfere with a contract of service can only be resorted to in certain limited circumstances.
As has been pointed out by this Court in State of Madras vs C. P. Sarathy(1), the adjudication by a Tribunal is only an alternative form of settlement of disputes on a fair and just basis, having regard to the prevailing conditions of the industry.
Bearing in mind this principle, it would follow that it is only for securing a fair and just settlement of an industrial dispute that the Tribunal can over ride the contract between the parties.
For deciding what is fair and just, it is not enough for the Tribunal to say that a particular demand be granted for doing social justice.
What it must ascertain is whether the grievance is a real one and whether it is of a type of which the employees can justly complain.
In Muir Mills Co., Ltd. vs Suti Mills Mazdoor Union, Kanpur (2) it has been pointed out social justice is a very vague and indeterminate expression and no clear cut definition can be laid down which will cover all the situations and that the fancy of an (1) (2) ; 955 individual adjudicator is not social justice.
But, of course.
, that does not mean that social justice has no place in the settlement of industrial disputes.
It is indeed a relevant consideration but it is well to bear in mind that doing social justice in an industrial dispute is not merely doing justice between the employer and the employee.
The question of doing anything in the interest of social justice comes in when the State has a social interest in a situation or in an activity because of its repercussions on the community at large.
Therefore, when the social interest of the community is involved in a situation or an activity, the interests of all parties who are affected by it have to be borne in mind, the parties being not merely the employers and the employees but also the community at large which includes also the consumers.
So, where a direction in an award is sought to be sustained on the ground that it was made with the intention of promoting social justice it must be shown that the adjudicator had borne in mind also the interests of the community.
This aspect of the matter has not been borne in mind by the Tribunal and, therefore, the relevant direction in its award cannot be sustained on the ground that it is actuated by the need of promoting social justice.
The ground given by the Tribunal, as already stated, is that there is discrimination and the existence of the discrimination will be a perpetual source of unrest.
Granting, again, that there is discrimination it is difficult to appreciate now it can be a perpetual source of bitterness for.
with the efflux of time, the old employees will gradually be fading out till at last there will be left only that category of workers to which the provisions of is.
79 of the apply.
956 Nor again.
do I think the fact that a dispute a comparatively of minor character and that the financial burden entailed on the employer is inconsiderable, a matter which would entitle the Tribunal to alter a contract between an employer and his employees.
In fact these factors are not relevant for consideration.
If the leave terms offered to new employees were on their face unfair, the mere fact that the employer did not have the capacity to pay would not have been allowed to influence the determination of the issue.
I would go further and say that since the Trust has provided for its new entrants such leave facilities as are recognised by the itself as fair, it was not open to the Tribunal to revise the relevant term of the contract,.
For all these reasons I am of opinion that the appeal must succeed and the award of the Tribunal should beset aside in so far as it refers to the demand made by the employees for grant of the same leave to new entrants as is being granted to old employees.
By COURT.
In accordance with the opinion, of the majority, the appeal fails and is dismissed with costs.
|
On July 1, 1956, the appellants made a rule that every workman employed on or before that date would be entitled to 30 days leave with wages after working for II months and workmen employed after that date would be entitled to earned leave in accordance with the provisions of s.79 of the Indian .
The State Government referred for adjudication to the Industrial Tribunal the question whether all the employees should be allowed 30 days earned leave with full wages for every II months ' service without discrimination.
The Tribunal held that ail the workmen were entitled to 30 days earned leave without making any distinc tion between workmen who joined before July 1, 1956, and those who joined subsequently.
The appellants contended that they were entitled to fix the terms of employment on which they would employ the workmen and it was open to the workmen to accept those terms or not and the tribunal was not justified in interfering in such a matter.
Held, per Gajendragadkar and Das Gupta, JJ., that the Tribunal was justified in directing the appellants to provide for the same uniform rule as to earned leave for all their employees.
The doctrine of absolute freedom of contract had to yield to the higher claims for social justice and had to be regulated.
In industrial adjudication no attempt should be made to answer questions in the abstract for evolving any general or inflexible principles.
Each dispute has to be decided on its own facts without enlarging the scope of the enquiry.
If some principles have to be followed or evolved, care has to be taken not to evolve larger 931 principles.
In order that industrial adjudication should be free from the tyranny of dogmas or the sub conscious pressure of preconceived notions it is important that the temptation to lay down broad principles should be avoided.
Accordingly it is not necessary to decide the broad contention whether industrial adjudication can interfere with the contract between the employers and the employees.
In the present case, all the workmen were governed b the same terms and conditions of service, except in regard to earned leave.
The discrimination was not based upon any principle and was bound to lead to disaffection amongst the new employees.
The financial burden imposed by the award on the employers was slight.
The provisions for earned leave in respect of old employees were not unduly generous or extravagant.
Earned leave provided for by s.79 was the minimum statutory leave.
If the appellants thought it necessary to provide for additional earned leave for their old employees, there was no reason why they should not make a similar provision in respect of new employees as well.
Western Indian Automobile Association vs Industrial Tribunal, Bombay, and Bharat Bank Ltd. vs The Employees of Bharat Bank Ltd. , referred to.
Per Mudholkar, J. The Tribunal was not justified in interfering with the rule made by the appellants.
It was open to the appellants to grant leave according to s.79 , to all the employees but still they did not wish to reduce the leave of 30 days which they were already giving to the old employees.
The appellants have put into one category persons who enjoyed the same kind of benefits until July 1, 1956, and have put in another category persons who did not enjoy such benefits.
All persons in each category were treated alike, and the question of dis crimination did not in fact arise.
If the State had pro vided that persons entering its service after a certain date would be governed by a set of conditions which were different and less favorable than those governing the existing servants its action would not be open to an attack under article 14 of the Constitution.
An identical action of a private employer could also not be regarded as discriminatory.
An award made with the intention of promoting social justice must take into consideration the interests of the community.
Even if there was discrimination it could not be a perpetual source of bitterness as gradually the old employees would fade out 932 till only one category of workers would remain.
The facts that the dispute was comparatively of a minor character and that the financial burden imposed on the appellants was small did not entitle the tribunal to alter the contract between the employer and employees.
Since the appellant had provided for its new entrants such leave facilities as were recognised by the itself as fair, it was not open to the Tribunal to revise the relevant term of the contract.
Budhan vs State of Bihar, A.I.R. 1956 section C. 191, Khandige Sham Bhat vs Agricultural Income Tax Officer [1963] 3 S.C.R. 809, State of M.P. vs Gwalior Sugar Co. Ltd. C.A. Nos. 98 & 99 of 1959, dated 30.1 1.60, Ramjilal vs Income tax Officer, Mohindargarh, ; , Sardar Inder Singh vs The State, of Rajasthan, ; and Hathisingh .Mfg.
Co. vs Union of India, A.1 R. 1960S. C. 931 referred to.
|
Appeal No. 20 of 62.
Appeal by special leave from the award dated September 29, 1960, of the Industrial Tribunal Punjab, Patiala in reference No. 13 of 1960.
C.K. Daphtary, Solicitor General of India, Bhagirath Das and B. P. Maheshewari, for the appellants.
M. K. Ramamurthi, B. K. Gary, D. P. Singh and section C. Aggarwal, for the respondent No. 2(i).
September 7.
The Judgment of Gajendragadkar and Das Gupta, JJ., was delivered by Gajendragadkar, J. Mudholkar J. delivered a dissenting judgment.
GAJENDRAGADKAR, J.
This appeal by special leave arises out of an industrial dispute in relation to a comparatively minor demand made against the appellants by the respondents their employees but in challenging the validity of the award passed by the Industrial Tribunal in favour of the 933 respondents on that demand the learned Solicitor General has raised a general question before us.
He contends that in granting the demand made by the respondents, the award has illegitimately and unjustifiably trespassed on the appellants ' freedom of contract.
The appellants as employers, are entitled tofix the terms of employment on which they would be willing to employ workmen and it is open to the workmen either to accept those terms or not; industrial adjudication should not interfere in such a matter.
That is the nature of the general contention which has been raised before us in the present appeal.
The facts leading to the dispute are few and they lie within a very narrow compass.
The appellants are the Trustees of the Tribune Press and paper and the Trust is being worked in accordance with the terms of the will executed by Dyal Singh Majithia on June 15, 1895.
In carrying out the policy of the Trust, the five appellants have executed a power of Attorney in favour of Mr. R. R. Sharma and the Press is managed and the paper is conducted to carry out the policy laid down by the will.
It appears that before July 1, 1956, for the purposes of leave, the appellants had divided their employees into two categories (1) the Linooperators and (2) the rest of the workmen in the Press Section; and Rule 57 made provision for leave on the basis of the said classification.
The effect of the said rule was that no Press worker other than the lino operator was entitled to any kind of paid leave although he was given the right to claim 30 days ' wages plus dearness allowance payable in January every year if he had worked for 11 Months.
In addition, the said press worker was entitled to Quarantine leave on the terms mentioned in Rule 53.
934 This position was substantially altered on the July 12 1956, when the appellants framed a new Rule in respect of earned leave.
This rule abolished the two categories of workers on which the earlier rule 57 was based and divided the workers into two categories (i) workers who were employed on or before 1.7.1956 and (ii) those who were employed after 1.7. 1956.
In respect of the former category of workmen, the new Rule made the following provision: "Subject to the provisions of the Indian , every workman in the service of the Tribune on the 1st July, 1956, will be entitled to 30 days ' leave with wages after having worked for a period of 11 months.
This leave shall cease to be earned, when it amounts to 60 days" In regard to the workmen falling under the latter category, earned leave was to be governed by the provisions of section 79 of the Indian .
It is common ground that the provision for earned leave made by the said section is a provision for minimum earned leave which the employer is bound to give: whether or not additional leave should be granted by way of earned leave is a matter within the discretion of the employer.
As a result of the new rule, the position was that the employees who had joined the service of the appellants on or before July 1, 1956, were entitled to 30 days ' earned leave with wages, whereas those who joined after the said date became entitled to the statutory minimum of 21 days of earned leave.
At the time when this rule came into force there were 94 old employees to whom the rule applied and 27 new employees to them by virtue of the new Rule, section 79 of the was made 935 applicable.
Gradually, new hands have also been employed and to all such new employees section 79 is applicable.
It appears that by its resolution passed on January 8, 1960, the Tribune employees union sent to the Management a charter embodying about 20 demands.
Attempts at conciliation were made but they failed and so, on April 4, 1960, eight of the said demands were referred by the Punjab Government to the Industrial Tribunal for its adjudication under section 10 of the Industrial Disputes Act.
One of these demands was in rela tion to earned leave.
The demand was that the employees in the Press Section should be allowed 30 days ' earned leave with full wages for every months ' service without any discrimination.
The Tribunal has allowed this demand and it bad held that all workmen of the Press are entitled to 30 days ' earned leave without making any distinction a between workmen who joined before July 1, 1956, and those who joined subsequently.
It is the validity of this award which is questioned before us by the appellants.
The broad and general question raised by the learned Solicitor General on the basis of the employer 's freedom of contract has been frequently raised in industrial adjudication, and it has consistently been held that the said right is now subject to certain principles which have been evolved by industrial adjudication in advancing the cause of social justice.
It will be recalled that as early as 1949, it was urged before the Federal Court in Western India Automobile Association vs The Industrial Tribunal Bombay(1) that the industrial Tribunal had no jurisdiction to direct an employer to reinstate his dismissed employees and the plea made was that such a direction was contrary to the known principles which govern the relationship between master and servant.
This contention was negatived by the Federal Court.
(1) ,120.
936 Speaking for the Court, Mahajan J. as he then was, observed that the award of the Tribunal may contain provisions for the settlement of a dispute which no Court could order if it was bound by ordinary law, but the Tribunal is not fettered in any way by these limitations.
The same plea was again raised before this Court in The Bharat Bank Ltd., Delhi.
vs The.
Employees of The Bharat Bank Ltd., Delhi (1) and Mukherjea J. as he then was, emphatically rejected it.
"Insettling the disputes between the employers and the workmen", observed the learned Judge, "the function of the Tribunal is not confined to administration of justice in accordance with law.
It can confer rights and privileges on either party which it considers reasonable and proper, though they may not be within the terms of any, existing agreement.
It has not merely to interpret or to give effect to the contractual rights and obligations of the parties.
It can create new rights and obligations between them which it considers essential for keeping industrial peace.
" This view has been consistently accepted by industrial adjudication since 1949.
The doctrine of the absolute freedom of contract has thus to yield to the higher claims for social justice.
Take, for instance, the case where an employer wants to exercise his right to employ industrial labour on any wages he likes.
It is not unlikely that in an economically under developed country where unemployment looms very large.
for Industrial work, employees may be found willing to take employment on terms which do not amount to a minimum basic wage.
Industrial adjudication does not recognise the employer 's right to employ labour on terms below the terms of minimum basic wage.
This, no doubt, is an interference with the employer 's (1) ; , 513.
937 right to hire labour, but social justice requires that the right should be controlled.
Similarly the right to dismiss an employee is also controlled subject to well reorganised limits in order to guarantee security of tenure to industrial employees.
In the matter of earned leave, s.79 of the prescribes a minimum in regard to establishments to which the Act applies.
In the matter of bonus which is not regarded as an item of deferred wages, industrial adjudication has evolved a formula by the working of which employees are entitled to claim bonus, We have referred to these illustration to show bow under the impact of the demand of social justice, the doctrine of absolute freedom of contract has been regulated.
It is, however, necessary to add that the general question about the employer 's right to manage his own affairs in the best way he chooses cannot be answered in the abstract without reference to the facts and circumstances in regard to which the question is raised.
If a general question is posed and an answer must be given to it, the answer would be both yes and No. The right would be recognised and industrial adjudication would not be permitted or would be reluctant to trespass on that right or on the field of management functions unless compelled by over riding consi derations of social justice.
The right would not be recognised and would be controlled if social justice and industrial peace require such regulation.
That is why we think industrial adjudication always attempts not to answer questions in the abstract in order to evolve any general or inflexible principles.
The eat course to adopt in dealing with industrial disputes is to consider the facts of the case, the nature of the demand made by employees, the nature of the defence raised by 938 the employer and decide the dispute without unduly enlarging the scope of the enquiry.
If in the decision of the dispute, some principles have to be followed or evolved, that must be done: but care must be taken not to evolve larger principles which would tend to prejudge issues not directly raised in the case before the Industrial Tribunal.
That is why we think we would not be justified in giving any general answer to the broad contention raised by the learned Solicitor General before us in the present appeal.
The development and growth of industrial law during the last decade presents a close analogy to the development and growth of constitutional law during the same period.
In some respects, itis well know that article 19 of the Constitutionhag guaranteed fundamental rights to individualcitizens and at the same time, has provided forthe regulation of the said fundamental rights subject to the provisions of cls.
(2) to (6) of the said Article.
Where a conflict arises between the citizen 's fundamental right to hold property and a restriction sought to be imposed upon that right in the interest of the general public, courts take the precaution of confining their decision to the points raised before them and not to lay down unduly broad and generaI propositions.
As in the decision of constitutional questions of this kind, so in industrial adjudication it is always a matter of making a reasonable adjustment between two competing claims.
The fundamental right of the individual citizen is guaranteed and its reasonable restriction is permissible in the interest of the general public, so, the claims of the interest of the general public have to be weighed and balanced against the claims of the individual citizen in regard to his fundamental right.
So too, in the case of industrial adjudication 939 the claims of the employer based on the freedom of contract have to be adjusted with the claims of industrial employees for social justice.
The process of making a reasonable adjustment is not always easy, and so, in reaching conclusions in such a matter, it is essential not to decide more than ' is necessary.
If industrial adjudication pur ports to lay down broad general principles, it is likely ;to make its approach in future case#; inflexible and that must always be avoided.
In order that industrial adjudication should be completely free from the tyranny of dogmas or the sub conscious pressure of pro conceived notion, it is of utmost 'importance that the temptation to lay down broad principles should be avoided.
In these matters, there are no absolutes and no formula can be evolved which would invariably give an answer to different problems which may be posed in different cases on different facts.
Let us, therefore, revert to the facts of this case and decide whether the appellant 's attack against the validity of the propriety of the award can be sustained.
In dealing with the narrow dispute presented by this appeal, it is necessary to remember that all the employees of the appellants are governed by the same terms and conditions of ,service, except in regard to earned leave.
It is only in respect of this term and condition of service that a distinction is made between workmen employed on or before 1.7.
56 and those employed after that date.
Generally, in the matter of providing leave rules, industrial adjudication prefers to have similar conditions of service in the same industry situated in the same region.
There is no evidence adduced in this case in regard to the condition of earned leave prevailing in the comparable industry in this region.
But we cannot ignore the fact that this 940 very concern provides for better facilities of earned leave to a section of its employees when other terms and conditions of service are the same in respect of both the categories of employees.
It is not difficult to imagine that the continuance of these two different provisions in the same concern is likely to lead to dissatisfaction and frustration amongst the new employees.
It cannot be denied that the existence of industrial peace and harmony and the continuance of the said peace and harmony are relevant factors, but their importance should not be unduly exaggerated.
If a frivolous demand is made by the employees and it is accompanied by a threat that non compliance with the demand would lead to industrial disharmony or absence of peace, it would be unreasonable to treat the thrust as relevant in deciding the merits of the demand.
In this connection, it is necessary to remember that the continuance of harmonious relations between the employer and his employees is treated as relevant by industrial adjudication, because it leads to more production and thereby has a healthy impact on national economy, and so it is necessary that in dealing with several industrial disputes, industrial adjudication has to bear in mind the effect of its decisions on national economy.
In their zest to fight for their respective claims, the parties may choose to ignore the demand of national economy, but industrial adjudication cannot.
If the demand is plainly frivolous, it has to be rejected whatever the consequences may be.
In the present case, the argument that the continuance of two different provisions would lead to disharmony cannot, however, be treated as frivolous.
It is difficult to understand on what principle the discrimination is based.
The only argument urged in support of the discrimination is the employer 's right to provide for new terms of service to the new entrants in service.
In our 941 opinion, the validity of this argument cannot be accepted in the circumstances of this case.
Take the case of the wages or dearness allowance which the Appellants paid to their employees.
Would the appellants be justified in assertion of their right of freedom of contract to offer less favourable terms of wages or dearness allowance to employees who would be employed after a certain date ? If the general point raised by the learned Solicitor General is upheld without any qualifications, then it would be open to the employer to fix different wages for different sets of workmen who are doing the same kind of work in his concern.
We have rarely come across A case where such a claim has either been made or has been upheld.
It is well known that both industrial legislation and industrial adjudication seek to attain similarity or uniformity of terms of service in the same industry existing in the same region, as far as it may be practicable or possible, without doing injustice or farm to any particular employer or a group of employers That being so, we do not think the Tribunal was in error in holding that in the matter of earned leave, there should be uniformity of conditions of service governing all the employees in the service of the appellants.
There is another aspect of this question to which reference must be made.
This is not a case in which the financial liability imposed on the employer by the award when it directed the employer to grant the earned leave of 30 days to all the employees, is very heavy; and so, having regard to the fact that the appellants have been conducting their business in a profitable way and their financial position is distinctly good, no attempt has been made before us and rightly, to suggest that the burden imposed by the award is beyond their means.
it is not disputed that the total annual liability which 942 may accrue as a result of the award may not exceed Rs. 1,000/ , and it is also common ground that the appellants are a flourishing concern and their not profits which were in the neighbourhood of a lac of rupees in 1949, have shown an upward tendency and have reached almost rupees eight lacs in 1959.
That is another factor which has to be borne in mind in dealing with the present dispute.
It is not suggested by the appellants that the provision made by them for earned leave in respect of old employees is unduly generous of extravagant and so, it has become necessary to invoke the provisions of section 79 of the in respect of new employees.
On the other hand, earned leave provided by section 79 is the minimum statutory leave to which employees are entitled and if the appellants thought it necessary to provide for additional earned leave to their old employees, there is no reason why they should not make a similar provision in respect of the new employeesas well.
We ought to add to that on the record, it does appear that the appellants are good employees and they are treating their employees in a liberal manner.
It, however, appears that they have brought the present dispute to this Court more for asserting the general principle of the employer 's right to fix conditions of service with his new employees than for vindicating any real or substantial grievance against the award which would prejudicially affect their interest.
In our opinion, having regard to the nature of the dispute raised in the present appeal and the other relevant facts and circumstances, it cannot be said that the Industrial Tribunal erred in law in directing the appellants to provide for the same uniform rule as to earned leave for all their employees.
We are satisfied that the award under appeal cannot be set aside only on the academic or abstract point of law raised by the appellants.
943 The result is, the appeal fails and is dismissed with costs.
MUDHOLKAR, J. This is an appeal by special leave from the award of the Industrial Tribunal, Punjab.
The appellants before us are the trustees of 'The Tribune ' Ambala Cantt.
and the opposite party to the appeal consists of the workmen of the Tribune through their two unions, one the Tribune Employees ' Union and the other the Tribune Workers ' Union.
The Trust was founded in Lahore by the late Sardar Dayal Singh Majithia on February 1, 1881.
It publishes the newspaper "Tribune".
By the will of the founder dated June 15, 1895 the Management of the Tribune was vested in a public trust in September, 1898.
After the partition of India the offices of the newspaper had to be shifted from Lahore and they are now located at Ambala.
The Trust naturally had to leave the entire machinery and other equipment of the Tribune Trust along with its immovable property in Lahore.
The value of that property is stated by the appellants to be Rs. 25 lakhs or so.
The Trust was however, able to transfer its bank accounts and Government securities to India a few days before the partition.
With the help of these assets it reestablished the Tribune Press and office at Ambala and established new machinery at a cost of Rs. 15 lakhs or so.
Gradually the Trust has been able to rehabilitate its fortunes.
It is not disputed before us that despite the heavy loss entailed by the Trust by reason of being uprooted from Pakistan, the employees quite a number of whom are old employees who were able to migrate to India, have been treated with a great deal of consideration.
After the Tribune started making profits the employees are being given bonus every year.
Moreover even before the Employees Provident Fund scheme applicable to newspaper 944 industry and even before the scheme of gratuity for all categories of employees were enforced by statute be Tribune had provided for both provident fund and gratuity to its employees.
In addition to this it has provided free housing accommodation to its workmen in two colonies, one built in 1955 with the help of subsidy from the Government of India and the other in the year 1958 at a cost of Rs. 6 lakhs.
The quarters in the two colonies are provided with modern sanitation Besides that, there are extensive recreation grounds, lawns etc., in these colonies.
Even electricity is supplied free to the employees.
Several other amenities are also provided by the Trust.
It would thus appear that the welfare of the employees has been kept prominently in mind by the trustees.
Even so, some disputes arose between the management and the employees.
Ultimately eight demands made by the employees were referred by the Government of Punjab for adjudication under section 10(1) of the industrial Disputes Act, 1947 (14 of 1947) to the Industrial Tribunal, Punjab, Patiala constituted under s.7A of the Act.
Four demands were rejected by the Tribunal as having been withdrawn, one was settled amicably and on the remaining three the Tribunal has made its award.
One of those three demands is : "Whether the employees in the Press Section should be allowed 30 days ' earned leave with full wages for every 11 months ' service without discrimination ?" The Tribunal hold in favour of the workmen and it is only against this part of the award of the Tribunal that the trustees have come up in appeal before us.
Certain facts have to be stated in connection with this demand.
The Trust had framed certain rules governing the conditions of service of 945 its employees.
Rule 57 of those rules deals with leave and reads thus : "The Lino Operators shall be entitled to 30 days ' leave of all description (luring the course of a calendar year, which will be with pay plus all allowances.
Press employees, other than the Lino operators may be granted leave by the competent authority from time to time as the authority may determine.
Such leave shall be without pay or allowance.
They shall, however, be entitled to in the month of January every year to receive a sum amounting to the leave pay plus ordinary dearness allowance for the preceding month of December for the period of II months ' service or to a proportionate amount for a lesser period.
In addition, Press workers will be entitled to quarantine leave on the terms mentioned in Rule 53".
On July 1, 1956 a new rule was framed which reads as follows : "(1) Subject to the provisions of the Indian , every workman in the service of the Tribune on the 1st July, 1956, will be entitled to 31 days ' leave with wages,, after having worked for a period of II months.
This leave shall cease to be earned, when it amounts to 60 days.
(2) A workman joining the service of the Tribune after the 1st July, 1956 will be entitled to leave, in accordance with the provisions of section 79 of the Indian .
" Under the old rule the Lino Operators in the press section were allowed 30 days ' leave on full wages 946 including dearness allowance.
The other workers in the press section were, however, allowed not leave with pay, but 30 days ' wages in the month of January calculated on the basis of the full wages drawn in the preceding month provided that an employee had served for a period of II months till the beginning of the month of January.
If he had served for a lesser period he was to be paid propor tionately less amount.
Bearing in mind the fact that in industries leave, vacation and holidays with pay are regarded as supplemental pay practices (see Collective Bargaining principles and Cases by John T. Dunlop and James J. Healy, revised edn., p. 433), in substance even the employees in the press section other than lino operators got the same money equivalent of the leave allowed to lino operators.
It may be mentioned that these other press section employees were also entitled to take leave but the rule provided that they will Dot be paid any pay and allowances for such leave.
That was perfectly reasonable because they got pay in lieu of paid leave for an additional period in the month of January.
However, even this slight distinction in the mode of conferring benefits on the two categories of employees was abolished by the new rule which came into force on July 1, 1956, and all employees in the press section upto that date were made eligible for the grant of 30 days ' leave with wages after having worked for a period of 11 months.
It 'May be mentioned here that the of 1948 provided in a. 79 that every worker who has worked for a period of 240 days or more in a calendar year shall be given at least one days ' leave for every 20 days of service.
No doubt this was the minimum provided by the Act but since the press section is governed by the it was open to the Trust to modify its rules with regard to all employees of this section and grant leave according to the provisions of this 947 section.
There is no prohibition in law against doing so but still it did not wish to revise unfavourably its rules regarding the quantum of leave to its existing employees.
It, however, felt that in view of the statutory provision there was no obligation upon it to provide for a longer leave than that laid down in section 79 of the .
It was for this reason that it provided that all employees engaged on or after July 1, 1956, will be granted leave according to the provisions of section 79 of the , the idea being that eventually all employees should be governed by the rules.
Apparantly, to forestall this consequence the employees contend that the new rule has introduced discrimination.
That is why they raised a dispute relating to this matter and it was referred to the Tribunal along with the other disputes they had raised.
The Tribunal, dealing with this matter, has observed as follows : "It may be of some importance to note that till 1st July, 1956 the workmen who had entered service before that date and those who had been employed thereafter were in the matter of leave compensation, treated alike.
It was on 1st July, 1956 for the first time that the workmen who had been in service before that date were given 30 days ' paid leave but for now entrants the number of days of that leave was reduced to that permitted by section 79 of the .
The Union 's contention is that to allow 3 days ' earned leave with full wages in an year to a certain group of workmen in Press Section and to deny that benefit to the rest of the workmen of that section simply on the score of their having entered service after 1st July, 1956, is to acknowledge the prominent element of discrimination which has been res 948 ponsible for the heart burning, resentment and dissatisfaction of the workmen.
It is further urged with emphasis that all workers for the Press Section should in the matter of earned leave be treated equally.
For the long space of seven years even after the had come into force the management had continued to treat all workmen of the Press Section alike irrespective of the date of their employment.
There is no reason why a distinction of a discriminatory nature and effect be made between the two artificially created sets of workmen belonging to the same section.
" It seems to me that the Tribunal 's ultimate finding is vitiated by a misconception entertained by it.
The first sentence in the above quotation would show that the Tribunal thought that those persons who were employed after July 1, 1956 were treated in the matter of leave on par with those employed before July 1, 1956, ,till July 1, 1956" but were sought to be discriminated against only thereafter.
It is difficult to understand how persons who were employed after July 1, 1956, could possibly be treated before July 1, 1956, equally with employees who were in service on that day.
Apparently it is this confusion in the mind of the Tribunal which has influenced its ultimate conclusion.
That apart, it is quite clear that what the Trust has done is to put in one category persons who enjoyed in substance the same kind of benefit uptil July 1, 1956 and permit them to enjoy the benefit they bad hitherto enjoyed.
Then it put in a separate category those persons who could never possibly lay any claim to have enjoyed a similar benefit because they were not its employees till July 1, 1956, and decided that they will get leave only as provided in section 79 of the .
All persons in each category are intended to be alike and, therefore the 949 question of discrimination does not in fact arise.
It was, in my opinion, open to the management to offer to the new entrants now terms.
When the new entrants entered service accepting the new terms and knowing fully well that one of those terms i. e., the one relating to annual leave was different and less beneficial from the one which obtained in the case of the old employees, it is not reasonable for them now to say that they are being discriminated against.
The Tribunal, however, thinks otherwise.
It has held that the Trust, by treating the now entrants less favourably in the matter of leave than its old employees has practiced discrimination and that this discrimination has caused heart burning.
Presumably, therefore, the Tribunal felt impelled to interfere and direct that the new entrants should be treated ' in the matter of leave on par with the old employees in ' order to avoid industrial unrest which may result 'from ' heart burning amongst the new entrants.
What we must first consider is whether the existing of heart burning has at all been established in this case.
It is said that the continuance of different provisions in the same concern has caused heart burning, dissatisfaction and frustration among the new employees and this would lead to unrest in the industry.
For one thing, there is no evidence before us to show that the new employees are making a very serious grievance of the fact that they would get a few days less of leave than the old employees.
All that Mr. Ramamurti could point out to us was the statement in the evidence of Som Nath, A. W. 7.
that he should also be given 30 days, privilege leave in a year.
Merely saying that he should be given privilege leave does not mean that he is harbouring bitterness in his mind.
Apart from that it would be extremely unreasonable to take notice of bitterness, if any, in the minds of 950 these new employees in regard to this matter because.
as already stated, they voluntarily took up employment knowing that they would got less leave than the old employees.
Som Nath 's statement is no evidence of the fact that there is any heart burning.
To say that the very fact that two sets of people are governed by different rules will necessarily lead to heartburning, without establishing anything more, such as inadequacy of the benefit enjoyed by one set will be to ignore that such differences are a matter of common occurrence and no reasonable person is expected to magnify their consequences.
It seems to me, further, that the workers as a body did not think much of the distinction between the extent of leave enjoyed by old and new employees because during all the four years while the rule has been in force they raised no protests.
No doubt they did ultimately make a protest in the year 1960 when the dispute was referred to the Tribunal.
But then, this was not the sole dispute but was one of eight disputes, at least four of which were withdrawn by the Unions, apparently after realising that there was no substance in them.
The mere fact that they did not withdraw this dispute would not of itself indicate that they regarded it as of great importance.
It may well be that they did not withdraw it in an erroneous belief that anything which is characterised as discrimination will at once earn the sympathy of Industrial Tribunals and the Courts.
Even assuming that is creating heartburning amongst the employees the question arises whether they have a real grievance.
They say that the Trust has discriminated against the new entrants and this is their grievance.
In this connection it may be observed that the more refusal or failure of an employer to treat equally all its employees doing a particular kind of work would not necessarily amount to discrimination.
The subject of is d 951 crimination has come up for consideration before this Court in a largo number of cases in which a complaint has been made that the equality clause of the Constitution, article 14, has been violated.
This Court has held that It is open to the State to make reasonable classification both as regards persons and as regards things (see in particular Budhan vs State of Bihar(1) ; Khandige Sham Bhatt vs Agricultural Income tax Officer (2); This Court has laid down that a classification made by the, State will be reasonable provided that (1) it is founded on an intelligible differentia which distinguishes persons or things that are grouped together from other left out of the group; and (2) that the differentia has a rational relation to the object sought to be achieved by the statute.
In the State of Madhya Pradesh vs Gwalior Sugar Co. Ltd. (4); it has been held that it is permissible to make classification on historical grounds, by putting in one class one set of persons or things and in 'other all those left out from the first class Court.
In Ramjilal vs Income tax Officer, Mohindargarh(5) this Court has held that a taxing law may provide that a law imposing a new rate shall not apply to pending proceedings.
In other words this Court has upheld the law where one rate of income tax shall be applicable to persons whose cases were pending for assessment and another rate to persons whose cases were not so pending.
Thus, this Court has hold as reasonable classification made by reference to difference in time.
In Sardar Inder Singh vs The State of Rajasthan (6) this Court has held that it is open to the legislature to decide the date from which a law should be given operation and that the law made by it cannot be challenged as discriminatory because it (1) ; (2) ; (3) C A. Nos. 98 & 98 of 1959 decided on November 30, 1960.
(4) ; (5) ; 952 does not apply to prior transactions.
Thus in this case also classification made on the basis of difference in time has been upheld.
Finally in Hathising Mfg. Co. vs Union of (India (1) this Court has held that there is no discrimination if the law applies generally to all persons who come within its ambit as from the date on which it is made operative.
This case likewise accepts that it will not amount to discrimination if one set of persons is treated differently from another by reference to a point of time.
It would follow from these decisions that if the State as an employer provided that persons entering its service after a certain date will be governed by a set of condition which will be different and, may be less favourable than those governing the existing entrants that law will not be open to attack under article 14 of the Constitution on the ground that it discriminates between one set of employees and another.
In my judgment the principle laid down by this Court that reasonable classification does not amount to discrimination is of general application.
Therefore, when an employer 's action is challenged before an Industrial Tribunal as discriminatory, the Tribunal will also have to bear it in mind.
For if an action cannot be regarded as discriminatory and violative of article 14 of the Constitution because it is based on a reasonable classification an identical action of a private employer affecting his employees can also not be regarded as discriminatory.
The content and meaning of 'discrimination ', wherever the term is used, must necessarily be the same and we cannot adopt one standard for judging whether an action when it emanates from the State, is discriminatory or not and another standard for judging an identical action, when it emanates from a private citizen.
Looked at this way, I have no doubt that the Trust has not practised what can in law be regarded as discrimination against its now entrants (1) A.I.R. 1960 S.C. 931. 953 by allowing them lesser leave than it has allowed to its old entrants.
I may point out that it is not an unusual thing even in Government service to find new entrants being treated differently in the matter of leave, emoluments etc., from the old entrants.
It is a well know fact that in most of the provinces of India in the year 1932 or 1933 pay scales in various categories of Government service were revised and new scales less favourable than the old ones were introduced.
Therefore, a largo body of men were performing the same duties as other large body of men but were getting lesser pay than the latter.
That happens often, is happening today in several of the recently reorganised States and may happen hereafter also.
But merely because new terms of service are less favourable than the old ones, would it be correct to say that there is discrimination between the new entrants and the old entrants? As already pointed out, it is open to the employer to offer different and even less favourable terms to new entrants and if the new entrants entered service with their eyes wide open they cannot reasonably complain of being discriminated against.
Mr. Ramamurthi who appears for the employees, however, contends that it is open to an employee to take up employment on the existing conditions of service and immediately start clamouring for improving his conditions of service.
It is sufficient to say that without establishing that there was a change in circumstances subsequent to the time when a workman accepted service a demand for improvement in the conditions of service cannot, with justice, be entertained unless of course the original conditions of service were plainly unfair.
Mr. Ramamurthi does not say that the term regarding leave in the rule applicable to the new entrants is unfair in the sense that the 954 leave allowed is inadequate.
But, Mr. Ramamurthi said that where a service condition causes heartburning amongst two sections of employees discontent and unrest would be its natural outcome and so it is open to the Tribunal to revise the condition and thus eliminate that discontent.
I am unable to accept the argument.
No doubt, the provisions of the Industrial Disputes Act are wide enough, like those of other legislative enactments placed on the statute book, for promoting the welfare of the employees to permit an Industrial Tribunal to override the contract between an employer and his employees governing conditions of service of the employees.
But it does not follow from this that no sooner a reference of a dispute is made to a Tribunal for adjudication than the contract of service ceases to have any force.
The power to interfere with a contract of service can only be resorted to in certain limited circumstances.
As has been pointed out by this Court in State of Madras vs C. P. Sarathy(1), the adjudication by a Tribunal is only an alternative form of settlement of disputes on a fair and just basis, having regard to the prevailing conditions of the industry.
Bearing in mind this principle, it would follow that it is only for securing a fair and just settlement of an industrial dispute that the Tribunal can over ride the contract between the parties.
For deciding what is fair and just, it is not enough for the Tribunal to say that a particular demand be granted for doing social justice.
What it must ascertain is whether the grievance is a real one and whether it is of a type of which the employees can justly complain.
In Muir Mills Co., Ltd. vs Suti Mills Mazdoor Union, Kanpur (2) it has been pointed out social justice is a very vague and indeterminate expression and no clear cut definition can be laid down which will cover all the situations and that the fancy of an (1) (2) ; 955 individual adjudicator is not social justice.
But, of course.
, that does not mean that social justice has no place in the settlement of industrial disputes.
It is indeed a relevant consideration but it is well to bear in mind that doing social justice in an industrial dispute is not merely doing justice between the employer and the employee.
The question of doing anything in the interest of social justice comes in when the State has a social interest in a situation or in an activity because of its repercussions on the community at large.
Therefore, when the social interest of the community is involved in a situation or an activity, the interests of all parties who are affected by it have to be borne in mind, the parties being not merely the employers and the employees but also the community at large which includes also the consumers.
So, where a direction in an award is sought to be sustained on the ground that it was made with the intention of promoting social justice it must be shown that the adjudicator had borne in mind also the interests of the community.
This aspect of the matter has not been borne in mind by the Tribunal and, therefore, the relevant direction in its award cannot be sustained on the ground that it is actuated by the need of promoting social justice.
The ground given by the Tribunal, as already stated, is that there is discrimination and the existence of the discrimination will be a perpetual source of unrest.
Granting, again, that there is discrimination it is difficult to appreciate now it can be a perpetual source of bitterness for.
with the efflux of time, the old employees will gradually be fading out till at last there will be left only that category of workers to which the provisions of is.
79 of the apply.
956 Nor again.
do I think the fact that a dispute a comparatively of minor character and that the financial burden entailed on the employer is inconsiderable, a matter which would entitle the Tribunal to alter a contract between an employer and his employees.
In fact these factors are not relevant for consideration.
If the leave terms offered to new employees were on their face unfair, the mere fact that the employer did not have the capacity to pay would not have been allowed to influence the determination of the issue.
I would go further and say that since the Trust has provided for its new entrants such leave facilities as are recognised by the itself as fair, it was not open to the Tribunal to revise the relevant term of the contract,.
For all these reasons I am of opinion that the appeal must succeed and the award of the Tribunal should beset aside in so far as it refers to the demand made by the employees for grant of the same leave to new entrants as is being granted to old employees.
By COURT.
In accordance with the opinion, of the majority, the appeal fails and is dismissed with costs.
|
Appeal by special leave from the award dated September 29, 1960, of the Industrial Tribunal Punjab, Patiala in reference No. C.K. Daphtary, Solicitor General of India, Bhagirath Das and B. P. Maheshewari, for the appellants. M. K. Ramamurthi, B. K. Gary, D. P. Singh and section C. Aggarwal, for the respondent No. The Judgment of Gajendragadkar and Das Gupta, JJ., GAJENDRAGADKAR, J.
This appeal by special leave arises out of an industrial dispute in relation to a comparatively minor demand made against the appellants by the respondents their employees but in challenging the validity of the award passed by the Industrial Tribunal in favour of the 933 respondents on that demand the learned Solicitor General has raised a general question before us. That is the nature of the general contention which has been raised before us in the present appeal. The facts leading to the dispute are few and they lie within a very narrow compass. In addition, the said press worker was entitled to Quarantine leave on the terms mentioned in Rule 53. This rule abolished the two categories of workers on which the earlier rule 57 was based and divided the workers into two categories (i) workers who were employed on or before 1.7.1956 and (ii) those who were employed after 1.7. In respect of the former category of workmen, the new Rule made the following provision: "Subject to the provisions of the Indian , every workman in the service of the Tribune on the 1st July, 1956, will be entitled to 30 days ' leave with wages after having worked for a period of 11 months. This leave shall cease to be earned, when it amounts to 60 days" In regard to the workmen falling under the latter category, earned leave was to be governed by the provisions of section 79 of the Indian . Gradually, new hands have also been employed and to all such new employees section 79 is applicable. One of these demands was in rela tion to earned leave. The demand was that the employees in the Press Section should be allowed 30 days ' earned leave with full wages for every months ' service without any discrimination. The Tribunal has allowed this demand and it bad held that all workmen of the Press are entitled to 30 days ' earned leave without making any distinction a between workmen who joined before July 1, 1956, and those who joined subsequently. It will be recalled that as early as 1949, it was urged before the Federal Court in Western India Automobile Association vs The Industrial Tribunal Bombay(1) that the industrial Tribunal had no jurisdiction to direct an employer to reinstate his dismissed employees and the plea made was that such a direction was contrary to the known principles which govern the relationship between master and servant. This contention was negatived by the Federal Court. The same plea was again raised before this Court in The Bharat Bank Ltd., Delhi. Employees of The Bharat Bank Ltd., Delhi (1) and Mukherjea J. as he then was, emphatically rejected it. It can confer rights and privileges on either party which it considers reasonable and proper, though they may not be within the terms of any, existing agreement. It has not merely to interpret or to give effect to the contractual rights and obligations of the parties. " This view has been consistently accepted by industrial adjudication since 1949. The doctrine of the absolute freedom of contract has thus to yield to the higher claims for social justice. Take, for instance, the case where an employer wants to exercise his right to employ industrial labour on any wages he likes. It is not unlikely that in an economically under developed country where unemployment looms very large. 937 right to hire labour, but social justice requires that the right should be controlled. Similarly the right to dismiss an employee is also controlled subject to well reorganised limits in order to guarantee security of tenure to industrial employees. In the matter of bonus which is not regarded as an item of deferred wages, industrial adjudication has evolved a formula by the working of which employees are entitled to claim bonus, We have referred to these illustration to show bow under the impact of the demand of social justice, the doctrine of absolute freedom of contract has been regulated. It is, however, necessary to add that the general question about the employer 's right to manage his own affairs in the best way he chooses cannot be answered in the abstract without reference to the facts and circumstances in regard to which the question is raised. If a general question is posed and an answer must be given to it, the answer would be both yes and No. The right would not be recognised and would be controlled if social justice and industrial peace require such regulation. The development and growth of industrial law during the last decade presents a close analogy to the development and growth of constitutional law during the same period. In order that industrial adjudication should be completely free from the tyranny of dogmas or the sub conscious pressure of pro conceived notion, it is of utmost 'importance that the temptation to lay down broad principles should be avoided. In these matters, there are no absolutes and no formula can be evolved which would invariably give an answer to different problems which may be posed in different cases on different facts. If the demand is plainly frivolous, it has to be rejected whatever the consequences may be. It is difficult to understand on what principle the discrimination is based. The only argument urged in support of the discrimination is the employer 's right to provide for new terms of service to the new entrants in service. In our 941 opinion, the validity of this argument cannot be accepted in the circumstances of this case. Take the case of the wages or dearness allowance which the Appellants paid to their employees. Would the appellants be justified in assertion of their right of freedom of contract to offer less favourable terms of wages or dearness allowance to employees who would be employed after a certain date ? If the general point raised by the learned Solicitor General is upheld without any qualifications, then it would be open to the employer to fix different wages for different sets of workmen who are doing the same kind of work in his concern. We have rarely come across A case where such a claim has either been made or has been upheld. It is well known that both industrial legislation and industrial adjudication seek to attain similarity or uniformity of terms of service in the same industry existing in the same region, as far as it may be practicable or possible, without doing injustice or farm to any particular employer or a group of employers That being so, we do not think the Tribunal was in error in holding that in the matter of earned leave, there should be uniformity of conditions of service governing all the employees in the service of the appellants. There is another aspect of this question to which reference must be made. That is another factor which has to be borne in mind in dealing with the present dispute. 943 The result is, the appeal fails and is dismissed with costs. The appellants before us are the trustees of 'The Tribune ' Ambala Cantt. and the opposite party to the appeal consists of the workmen of the Tribune through their two unions, one the Tribune Employees ' Union and the other the Tribune Workers ' Union. The Trust was founded in Lahore by the late Sardar Dayal Singh Majithia on February 1, 1881. After the partition of India the offices of the newspaper had to be shifted from Lahore and they are now located at Ambala. The Trust naturally had to leave the entire machinery and other equipment of the Tribune Trust along with its immovable property in Lahore. The value of that property is stated by the appellants to be Rs. With the help of these assets it reestablished the Tribune Press and office at Ambala and established new machinery at a cost of Rs. After the Tribune started making profits the employees are being given bonus every year. Moreover even before the Employees Provident Fund scheme applicable to newspaper 944 industry and even before the scheme of gratuity for all categories of employees were enforced by statute be Tribune had provided for both provident fund and gratuity to its employees. Even electricity is supplied free to the employees. Several other amenities are also provided by the Trust. Even so, some disputes arose between the management and the employees. Certain facts have to be stated in connection with this demand. Press employees, other than the Lino operators may be granted leave by the competent authority from time to time as the authority may determine. Such leave shall be without pay or allowance. In addition, Press workers will be entitled to quarantine leave on the terms mentioned in Rule 53". This leave shall cease to be earned, when it amounts to 60 days. " Under the old rule the Lino Operators in the press section were allowed 30 days ' leave on full wages 946 including dearness allowance. If he had served for a lesser period he was to be paid propor tionately less amount. That was perfectly reasonable because they got pay in lieu of paid leave for an additional period in the month of January. It 'May be mentioned here that the of 1948 provided in a. 79 that every worker who has worked for a period of 240 days or more in a calendar year shall be given at least one days ' leave for every 20 days of service. It was for this reason that it provided that all employees engaged on or after July 1, 1956, will be granted leave according to the provisions of section 79 of the , the idea being that eventually all employees should be governed by the rules. That is why they raised a dispute relating to this matter and it was referred to the Tribunal along with the other disputes they had raised. It is further urged with emphasis that all workers for the Press Section should in the matter of earned leave be treated equally. For the long space of seven years even after the had come into force the management had continued to treat all workmen of the Press Section alike irrespective of the date of their employment. It is difficult to understand how persons who were employed after July 1, 1956, could possibly be treated before July 1, 1956, equally with employees who were in service on that day. All persons in each category are intended to be alike and, therefore the 949 question of discrimination does not in fact arise. It was, in my opinion, open to the management to offer to the new entrants now terms. When the new entrants entered service accepting the new terms and knowing fully well that one of those terms i. e., the one relating to annual leave was different and less beneficial from the one which obtained in the case of the old employees, it is not reasonable for them now to say that they are being discriminated against. Presumably, therefore, the Tribunal felt impelled to interfere and direct that the new entrants should be treated ' in the matter of leave on par with the old employees in ' order to avoid industrial unrest which may result 'from ' heart burning amongst the new entrants. What we must first consider is whether the existing of heart burning has at all been established in this case. that he should also be given 30 days, privilege leave in a year. Merely saying that he should be given privilege leave does not mean that he is harbouring bitterness in his mind. But then, this was not the sole dispute but was one of eight disputes, at least four of which were withdrawn by the Unions, apparently after realising that there was no substance in them. The mere fact that they did not withdraw this dispute would not of itself indicate that they regarded it as of great importance. They say that the Trust has discriminated against the new entrants and this is their grievance. In this connection it may be observed that the more refusal or failure of an employer to treat equally all its employees doing a particular kind of work would not necessarily amount to discrimination. The subject of is d 951 crimination has come up for consideration before this Court in a largo number of cases in which a complaint has been made that the equality clause of the Constitution, article 14, has been violated. Thus, this Court has hold as reasonable classification made by reference to difference in time. 98 & 98 of 1959 decided on November 30, 1960. (4) ; (5) ; 952 does not apply to prior transactions. Thus in this case also classification made on the basis of difference in time has been upheld. In my judgment the principle laid down by this Court that reasonable classification does not amount to discrimination is of general application. The content and meaning of 'discrimination ', wherever the term is used, must necessarily be the same and we cannot adopt one standard for judging whether an action when it emanates from the State, is discriminatory or not and another standard for judging an identical action, when it emanates from a private citizen. Therefore, a largo body of men were performing the same duties as other large body of men but were getting lesser pay than the latter. That happens often, is happening today in several of the recently reorganised States and may happen hereafter also. Mr. Ramamurthi does not say that the term regarding leave in the rule applicable to the new entrants is unfair in the sense that the 954 leave allowed is inadequate. But, Mr. Ramamurthi said that where a service condition causes heartburning amongst two sections of employees discontent and unrest would be its natural outcome and so it is open to the Tribunal to revise the condition and thus eliminate that discontent. The power to interfere with a contract of service can only be resorted to in certain limited circumstances. For deciding what is fair and just, it is not enough for the Tribunal to say that a particular demand be granted for doing social justice. What it must ascertain is whether the grievance is a real one and whether it is of a type of which the employees can justly complain. , that does not mean that social justice has no place in the settlement of industrial disputes. It is indeed a relevant consideration but it is well to bear in mind that doing social justice in an industrial dispute is not merely doing justice between the employer and the employee. Therefore, when the social interest of the community is involved in a situation or an activity, the interests of all parties who are affected by it have to be borne in mind, the parties being not merely the employers and the employees but also the community at large which includes also the consumers. The ground given by the Tribunal, as already stated, is that there is discrimination and the existence of the discrimination will be a perpetual source of unrest. In fact these factors are not relevant for consideration. For all these reasons I am of opinion that the appeal must succeed and the award of the Tribunal should beset aside in so far as it refers to the demand made by the employees for grant of the same leave to new entrants as is being granted to old employees. In accordance with the opinion, of the majority, the appeal fails and is dismissed with costs.
|
On July 1, 1956, the appellants made a rule that every workman employed on or before that date would be entitled to 30 days leave with wages after working for II months and workmen employed after that date would be entitled to earned leave in accordance with the provisions of s.79 of the Indian .
The State Government referred for adjudication to the Industrial Tribunal the question whether all the employees should be allowed 30 days earned leave with full wages for every II months ' service without discrimination.
The Tribunal held that ail the workmen were entitled to 30 days earned leave without making any distinc tion between workmen who joined before July 1, 1956, and those who joined subsequently.
The appellants contended that they were entitled to fix the terms of employment on which they would employ the workmen and it was open to the workmen to accept those terms or not and the tribunal was not justified in interfering in such a matter.
Held, per Gajendragadkar and Das Gupta, JJ., that the Tribunal was justified in directing the appellants to provide for the same uniform rule as to earned leave for all their employees.
The doctrine of absolute freedom of contract had to yield to the higher claims for social justice and had to be regulated.
In industrial adjudication no attempt should be made to answer questions in the abstract for evolving any general or inflexible principles.
Each dispute has to be decided on its own facts without enlarging the scope of the enquiry.
If some principles have to be followed or evolved, care has to be taken not to evolve larger 931 principles.
In order that industrial adjudication should be free from the tyranny of dogmas or the sub conscious pressure of preconceived notions it is important that the temptation to lay down broad principles should be avoided.
Accordingly it is not necessary to decide the broad contention whether industrial adjudication can interfere with the contract between the employers and the employees.
In the present case, all the workmen were governed b the same terms and conditions of service, except in regard to earned leave.
The discrimination was not based upon any principle and was bound to lead to disaffection amongst the new employees.
The financial burden imposed by the award on the employers was slight.
The provisions for earned leave in respect of old employees were not unduly generous or extravagant.
Earned leave provided for by s.79 was the minimum statutory leave.
If the appellants thought it necessary to provide for additional earned leave for their old employees, there was no reason why they should not make a similar provision in respect of new employees as well.
Western Indian Automobile Association vs Industrial Tribunal, Bombay, and Bharat Bank Ltd. vs The Employees of Bharat Bank Ltd. , referred to.
Per Mudholkar, J. The Tribunal was not justified in interfering with the rule made by the appellants.
It was open to the appellants to grant leave according to s.79 , to all the employees but still they did not wish to reduce the leave of 30 days which they were already giving to the old employees.
The appellants have put into one category persons who enjoyed the same kind of benefits until July 1, 1956, and have put in another category persons who did not enjoy such benefits.
All persons in each category were treated alike, and the question of dis crimination did not in fact arise.
If the State had pro vided that persons entering its service after a certain date would be governed by a set of conditions which were different and less favorable than those governing the existing servants its action would not be open to an attack under article 14 of the Constitution.
An identical action of a private employer could also not be regarded as discriminatory.
An award made with the intention of promoting social justice must take into consideration the interests of the community.
Even if there was discrimination it could not be a perpetual source of bitterness as gradually the old employees would fade out 932 till only one category of workers would remain.
The facts that the dispute was comparatively of a minor character and that the financial burden imposed on the appellants was small did not entitle the tribunal to alter the contract between the employer and employees.
Since the appellant had provided for its new entrants such leave facilities as were recognised by the itself as fair, it was not open to the Tribunal to revise the relevant term of the contract.
Budhan vs State of Bihar, A.I.R. 1956 section C. 191, Khandige Sham Bhat vs Agricultural Income Tax Officer [1963] 3 S.C.R. 809, State of M.P. vs Gwalior Sugar Co. Ltd. C.A. Nos. 98 & 99 of 1959, dated 30.1 1.60, Ramjilal vs Income tax Officer, Mohindargarh, ; , Sardar Inder Singh vs The State, of Rajasthan, ; and Hathisingh .Mfg.
Co. vs Union of India, A.1 R. 1960S. C. 931 referred to.
|
On July 1, 1956, the appellants made a rule that every workman employed on or before that date would be entitled to 30 days leave with wages after working for II months and workmen employed after that date would be entitled to earned leave in accordance with the provisions of s.79 of the Indian . The Tribunal held that ail the workmen were entitled to 30 days earned leave without making any distinc tion between workmen who joined before July 1, 1956, and those who joined subsequently. The appellants contended that they were entitled to fix the terms of employment on which they would employ the workmen and it was open to the workmen to accept those terms or not and the tribunal was not justified in interfering in such a matter. Held, per Gajendragadkar and Das Gupta, JJ., that the Tribunal was justified in directing the appellants to provide for the same uniform rule as to earned leave for all their employees. The doctrine of absolute freedom of contract had to yield to the higher claims for social justice and had to be regulated. In industrial adjudication no attempt should be made to answer questions in the abstract for evolving any general or inflexible principles. Each dispute has to be decided on its own facts without enlarging the scope of the enquiry. If some principles have to be followed or evolved, care has to be taken not to evolve larger 931 principles. In order that industrial adjudication should be free from the tyranny of dogmas or the sub conscious pressure of preconceived notions it is important that the temptation to lay down broad principles should be avoided. Accordingly it is not necessary to decide the broad contention whether industrial adjudication can interfere with the contract between the employers and the employees. In the present case, all the workmen were governed b the same terms and conditions of service, except in regard to earned leave. The discrimination was not based upon any principle and was bound to lead to disaffection amongst the new employees. The financial burden imposed by the award on the employers was slight. The provisions for earned leave in respect of old employees were not unduly generous or extravagant. Earned leave provided for by s.79 was the minimum statutory leave. If the appellants thought it necessary to provide for additional earned leave for their old employees, there was no reason why they should not make a similar provision in respect of new employees as well. Western Indian Automobile Association vs Industrial Tribunal, Bombay, and Bharat Bank Ltd. vs The Employees of Bharat Bank Ltd. , referred to. The appellants have put into one category persons who enjoyed the same kind of benefits until July 1, 1956, and have put in another category persons who did not enjoy such benefits. All persons in each category were treated alike, and the question of dis crimination did not in fact arise. If the State had pro vided that persons entering its service after a certain date would be governed by a set of conditions which were different and less favorable than those governing the existing servants its action would not be open to an attack under article 14 of the Constitution. An identical action of a private employer could also not be regarded as discriminatory. An award made with the intention of promoting social justice must take into consideration the interests of the community. Even if there was discrimination it could not be a perpetual source of bitterness as gradually the old employees would fade out 932 till only one category of workers would remain. Since the appellant had provided for its new entrants such leave facilities as were recognised by the itself as fair, it was not open to the Tribunal to revise the relevant term of the contract. Budhan vs State of Bihar, A.I.R. 1956 section C. 191, Khandige Sham Bhat vs Agricultural Income Tax Officer [1963] 3 S.C.R. 809, State of M.P. vs Gwalior Sugar Co. Ltd. C.A. Nos. Co. vs Union of India, A.1 R. 1960S. C. 931 referred to.
| 0.15081
| 0.517521
| 0.792235
| 0.9015
|
ivil Appeal No. 859 of 1987.
Shankar Ghosh and L.P.Aggarwal for the Appellants From the Judgment and order dated 8.8.
1985 of the Calcutta High Court in Appeal No. 329 of 1982.
V.C. Mahajan, B. Parthasarhti and C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is confined solely to the question of interest.
In other words, the entitlement of interest on the amount awarded by Arbi trator for the requisition of the premises under the Requi sitioning and Acquisition of Immovable Property Act 1952 is the issue.
The principles upon which the compensation on this aspect is payable are by now well settled.
In Satinder Singh & Ors.
vs Amrao Singh & Ors., ; this Court reiterated the principles at page 694 of the report as follows: "In Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission it was held by the Privy Council that "upon the expropriation of land under statuto ry power, whether for the purpose of private gain or of good to the public at large, the owner is entitled to interest upon the princi pal sum awarded from the date when possession was taken, unless the statute clearly shows a contrary intention. ": Dealing with the argu ment that the expropriation with which the Privy Council was concerned was not effected for private gain, but for the good of the public at large, it observed "but for all that, the owner is 1047 deprived of his property in this case as much as in the other, and the rule has long been accepted in the interpretation of statutes that they are not to be held to deprive indi viduals of property without compensation unless the intention to do so is made quite clear.
The right to receive the interest takes the place of the right to retain posses sion and is within the rule".
It would thus be noticed that the claim for interest proceeds on the assumption that when the owner of immovable property loses possession of it, he is entitled to claim interest in place of right to retain possession.
The question which we have to consider is whether the application of this rule is intended to be excluded by the Act of 1948, and as we have already observed, the mere fact that section 5(3) of the Act makes section 23(1) of the Land Acquisition Act, 1894 applicable we cannot reasonably infer that the Act intends to exclude the applica tion of this general rule in the matter of the payment of interest.
That is the view which the Punjab High Court has taken in Surjan Singh vs The East Punjab Government, (AIR 1957 Punj.
265) and we think rightly.
" The same principle was reaffirmed not in the context of Acquisition of Immovable Property, which Mr. Mahajan, learned counsel for the respondents tried to make a point before us, was highlighted in National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India, [1963] Supp. 2 SCR 971.
at 992 where speaking for the court Mr. Justice Hidayatullah, as learned Chief Justice of India then was observed: "The reason of the rule was stated a long time ago by Lord St. Leonard L.C. Birch vs Joy, [1852] III H.L.C. 565:10 E.R. 222 as follows: "The parties change characters, the property remains at law just where it was, the purchas er has the money in his pocket, and the seller still has the estate vested in him; but they exchange characters in a Court of Equity, the seller becomes the owner of the money and the purchaser becomes the owner of the estate." On entering possession the purchaser becomes entitled to the rents but if he has not paid the price, interest in equity is deemed pay able by him on the purchase price which 1048 belongs to the seller.
This principle was applied by the House of Lords in cases of compulsory purchases.
In Swift & Co. vs Board of Trade, Viscount Cave L.C. gave the reason that the practice rests upon the principle that the taking of possession is an implied agreement to pay interest which was stated by Sir William Grant M.R. in Fludyer vs Cocker; , This principle was further extended by the Privy Council to the compulsory taking over of a business as a going concern in International Railway Co. vs Niagara Parks Commission, [1944] A.C. 328.
It was noted by Justice Hidayatullah that this principle has also been accepted by this Court in Satinder Singh vs Amrao Singh (supra).
The principle stated was followed in Hirachand Kothari (dead) through Lrs.
vs State of Rajasthan & Anr., [1985] Suppl.
1 SCR 644 where this court noted the principle at page 655 of the report.
In the light of the aforesaid decision we are of the opinion that the appellants herein are entitled to the interest for the period from March 1975 to 31st July, 1987 when principal amount of compensation had been paid and or when the premises in question had been de requisitioned and handed back to the owner, on the amount awarded.
As to how the interest would vary, but the right of interest was well avered and also should have been considered in the light of the observations of Privy Council in Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission, AIR 1928 Privy Council 287.
We are of the opinion that from the period from March 7, 1975 to February 28, 1985 being the date on which the judgment of the High Court was pronounced in this case the appellants are entitled to the interest on the amount awarded at the rate of 6% per annum and from the period from August 87 1985 to July 31, 1987 and for that period only at the rate of 12% per annum.
Interest will be payable only on the balance amount which remained to be payable to the appellants i.e. the amount due minus what has been paid from the respective dates.
The appellants are entitled to the costs of this appeal.
The amount is directed to be paid within three months from this date by the respondents.
In case, there is any difficulty in calculating the amount, the parties will be at liberty to apply to the High Court of Calcutta.
The appel lants are entitled to costs of this appeal.
The appeal is thus disposed of.
S.L. Appeal dis posed of.
|
This appeal by special leave was confined solely to the question of entitlement of interest on the amount awarded by the Arbitrator for the requisition of the premises under the .
Disposing of the appeal, the Court, HELD: The principles upon which the compensation on this aspect is payable are by now well settled.
This Court reit erated the principles in Satinder Singh and Ors.
vs Amrao Singh and Ors., ; at 694; National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India [1963] Supp.
2 SCR 971 at 992 and Hirachand Kothari (dead) through Lrs.
vs State of Rajasthan & Anr., [1985] Suppl.1 SCR 644 at 655.
[1046F; 1048C] In the light of the aforesaid decisions, the Court was of the opinion that the appellants herein were entitled to the interest for the period from March 1975 to the 31st July, 1987, when the principal amount of compensation had been paid and/or when the premises in question had been de requisitioned and handed back to the owner, on the amount awarded.
The Court was of the opinion that for the period from March 7, 1975 to February 28, 1985 being the date on which the judgment of the High Court was pronounced in this case, the appellants were entitled to the interest on the amount awarded at the rate of 6 per cent per annum, and for the period from August 8, 1985 to July 31, 1987 for that period only at the rate of 12 per cent per annum.
The interest would be payable only on the balance amount which remained to be paid to the appellants i.e. the amount due minus what had been paid from the respective dates.
The Court directed that the amount be paid by the respondents within three months from the date of this judgment, and that in case there was any difficulty in calculating the amount, the 1046 parties would be at liberty to apply to the High Court.
[1048C H] Satinder Singh & Ors.
vs Amrao Singh & Ors., ; ; National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India, [1963] Supp. 2 S.C.R. 971 at 992; Hirachand Kothari (dead) through Lrs. vs State of Rajasthan & Ors., [1985] Supp. 1 S.C.R. 644 and Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission, A.I.R. 1928 Privy Council 287, referred tO.
|
ivil Appeal No. 859 of 1987.
Shankar Ghosh and L.P.Aggarwal for the Appellants From the Judgment and order dated 8.8.
1985 of the Calcutta High Court in Appeal No. 329 of 1982.
V.C. Mahajan, B. Parthasarhti and C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is confined solely to the question of interest.
In other words, the entitlement of interest on the amount awarded by Arbi trator for the requisition of the premises under the Requi sitioning and Acquisition of Immovable Property Act 1952 is the issue.
The principles upon which the compensation on this aspect is payable are by now well settled.
In Satinder Singh & Ors.
vs Amrao Singh & Ors., ; this Court reiterated the principles at page 694 of the report as follows: "In Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission it was held by the Privy Council that "upon the expropriation of land under statuto ry power, whether for the purpose of private gain or of good to the public at large, the owner is entitled to interest upon the princi pal sum awarded from the date when possession was taken, unless the statute clearly shows a contrary intention. ": Dealing with the argu ment that the expropriation with which the Privy Council was concerned was not effected for private gain, but for the good of the public at large, it observed "but for all that, the owner is 1047 deprived of his property in this case as much as in the other, and the rule has long been accepted in the interpretation of statutes that they are not to be held to deprive indi viduals of property without compensation unless the intention to do so is made quite clear.
The right to receive the interest takes the place of the right to retain posses sion and is within the rule".
It would thus be noticed that the claim for interest proceeds on the assumption that when the owner of immovable property loses possession of it, he is entitled to claim interest in place of right to retain possession.
The question which we have to consider is whether the application of this rule is intended to be excluded by the Act of 1948, and as we have already observed, the mere fact that section 5(3) of the Act makes section 23(1) of the Land Acquisition Act, 1894 applicable we cannot reasonably infer that the Act intends to exclude the applica tion of this general rule in the matter of the payment of interest.
That is the view which the Punjab High Court has taken in Surjan Singh vs The East Punjab Government, (AIR 1957 Punj.
265) and we think rightly.
" The same principle was reaffirmed not in the context of Acquisition of Immovable Property, which Mr. Mahajan, learned counsel for the respondents tried to make a point before us, was highlighted in National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India, [1963] Supp. 2 SCR 971.
at 992 where speaking for the court Mr. Justice Hidayatullah, as learned Chief Justice of India then was observed: "The reason of the rule was stated a long time ago by Lord St. Leonard L.C. Birch vs Joy, [1852] III H.L.C. 565:10 E.R. 222 as follows: "The parties change characters, the property remains at law just where it was, the purchas er has the money in his pocket, and the seller still has the estate vested in him; but they exchange characters in a Court of Equity, the seller becomes the owner of the money and the purchaser becomes the owner of the estate." On entering possession the purchaser becomes entitled to the rents but if he has not paid the price, interest in equity is deemed pay able by him on the purchase price which 1048 belongs to the seller.
This principle was applied by the House of Lords in cases of compulsory purchases.
In Swift & Co. vs Board of Trade, Viscount Cave L.C. gave the reason that the practice rests upon the principle that the taking of possession is an implied agreement to pay interest which was stated by Sir William Grant M.R. in Fludyer vs Cocker; , This principle was further extended by the Privy Council to the compulsory taking over of a business as a going concern in International Railway Co. vs Niagara Parks Commission, [1944] A.C. 328.
It was noted by Justice Hidayatullah that this principle has also been accepted by this Court in Satinder Singh vs Amrao Singh (supra).
The principle stated was followed in Hirachand Kothari (dead) through Lrs.
vs State of Rajasthan & Anr., [1985] Suppl.
1 SCR 644 where this court noted the principle at page 655 of the report.
In the light of the aforesaid decision we are of the opinion that the appellants herein are entitled to the interest for the period from March 1975 to 31st July, 1987 when principal amount of compensation had been paid and or when the premises in question had been de requisitioned and handed back to the owner, on the amount awarded.
As to how the interest would vary, but the right of interest was well avered and also should have been considered in the light of the observations of Privy Council in Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission, AIR 1928 Privy Council 287.
We are of the opinion that from the period from March 7, 1975 to February 28, 1985 being the date on which the judgment of the High Court was pronounced in this case the appellants are entitled to the interest on the amount awarded at the rate of 6% per annum and from the period from August 87 1985 to July 31, 1987 and for that period only at the rate of 12% per annum.
Interest will be payable only on the balance amount which remained to be payable to the appellants i.e. the amount due minus what has been paid from the respective dates.
The appellants are entitled to the costs of this appeal.
The amount is directed to be paid within three months from this date by the respondents.
In case, there is any difficulty in calculating the amount, the parties will be at liberty to apply to the High Court of Calcutta.
The appel lants are entitled to costs of this appeal.
The appeal is thus disposed of.
S.L. Appeal dis posed of.
|
ivil Appeal No. 859 of 1987.
Shankar Ghosh and L.P.Aggarwal for the Appellants From the Judgment and order dated 8.8.
1985 of the Calcutta High Court in Appeal No. 329 of 1982.
V.C. Mahajan, B. Parthasarhti and C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is confined solely to the question of interest.
In other words, the entitlement of interest on the amount awarded by Arbi trator for the requisition of the premises under the Requi sitioning and Acquisition of Immovable Property Act 1952 is the issue.
The principles upon which the compensation on this aspect is payable are by now well settled.
In Satinder Singh & Ors.
vs Amrao Singh & Ors., ; this Court reiterated the principles at page 694 of the report as follows: "In Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission it was held by the Privy Council that "upon the expropriation of land under statuto ry power, whether for the purpose of private gain or of good to the public at large, the owner is entitled to interest upon the princi pal sum awarded from the date when possession was taken, unless the statute clearly shows a contrary intention. ": Dealing with the argu ment that the expropriation with which the Privy Council was concerned was not effected for private gain, but for the good of the public at large, it observed "but for all that, the owner is 1047 deprived of his property in this case as much as in the other, and the rule has long been accepted in the interpretation of statutes that they are not to be held to deprive indi viduals of property without compensation unless the intention to do so is made quite clear.
The right to receive the interest takes the place of the right to retain posses sion and is within the rule".
It would thus be noticed that the claim for interest proceeds on the assumption that when the owner of immovable property loses possession of it, he is entitled to claim interest in place of right to retain possession.
The question which we have to consider is whether the application of this rule is intended to be excluded by the Act of 1948, and as we have already observed, the mere fact that section 5(3) of the Act makes section 23(1) of the Land Acquisition Act, 1894 applicable we cannot reasonably infer that the Act intends to exclude the applica tion of this general rule in the matter of the payment of interest.
That is the view which the Punjab High Court has taken in Surjan Singh vs The East Punjab Government, (AIR 1957 Punj.
265) and we think rightly.
" The same principle was reaffirmed not in the context of Acquisition of Immovable Property, which Mr. Mahajan, learned counsel for the respondents tried to make a point before us, was highlighted in National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India, [1963] Supp. 2 SCR 971.
at 992 where speaking for the court Mr. Justice Hidayatullah, as learned Chief Justice of India then was observed: "The reason of the rule was stated a long time ago by Lord St. Leonard L.C. Birch vs Joy, [1852] III H.L.C. 565:10 E.R. 222 as follows: "The parties change characters, the property remains at law just where it was, the purchas er has the money in his pocket, and the seller still has the estate vested in him; but they exchange characters in a Court of Equity, the seller becomes the owner of the money and the purchaser becomes the owner of the estate." On entering possession the purchaser becomes entitled to the rents but if he has not paid the price, interest in equity is deemed pay able by him on the purchase price which 1048 belongs to the seller.
This principle was applied by the House of Lords in cases of compulsory purchases.
In Swift & Co. vs Board of Trade, Viscount Cave L.C. gave the reason that the practice rests upon the principle that the taking of possession is an implied agreement to pay interest which was stated by Sir William Grant M.R. in Fludyer vs Cocker; , This principle was further extended by the Privy Council to the compulsory taking over of a business as a going concern in International Railway Co. vs Niagara Parks Commission, [1944] A.C. 328.
It was noted by Justice Hidayatullah that this principle has also been accepted by this Court in Satinder Singh vs Amrao Singh (supra).
The principle stated was followed in Hirachand Kothari (dead) through Lrs.
vs State of Rajasthan & Anr., [1985] Suppl.
1 SCR 644 where this court noted the principle at page 655 of the report.
In the light of the aforesaid decision we are of the opinion that the appellants herein are entitled to the interest for the period from March 1975 to 31st July, 1987 when principal amount of compensation had been paid and or when the premises in question had been de requisitioned and handed back to the owner, on the amount awarded.
As to how the interest would vary, but the right of interest was well avered and also should have been considered in the light of the observations of Privy Council in Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission, AIR 1928 Privy Council 287.
We are of the opinion that from the period from March 7, 1975 to February 28, 1985 being the date on which the judgment of the High Court was pronounced in this case the appellants are entitled to the interest on the amount awarded at the rate of 6% per annum and from the period from August 87 1985 to July 31, 1987 and for that period only at the rate of 12% per annum.
Interest will be payable only on the balance amount which remained to be payable to the appellants i.e. the amount due minus what has been paid from the respective dates.
The appellants are entitled to the costs of this appeal.
The amount is directed to be paid within three months from this date by the respondents.
In case, there is any difficulty in calculating the amount, the parties will be at liberty to apply to the High Court of Calcutta.
The appel lants are entitled to costs of this appeal.
The appeal is thus disposed of.
S.L. Appeal dis posed of.
|
This appeal by special leave was confined solely to the question of entitlement of interest on the amount awarded by the Arbitrator for the requisition of the premises under the .
Disposing of the appeal, the Court, HELD: The principles upon which the compensation on this aspect is payable are by now well settled.
This Court reit erated the principles in Satinder Singh and Ors.
vs Amrao Singh and Ors., ; at 694; National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India [1963] Supp.
2 SCR 971 at 992 and Hirachand Kothari (dead) through Lrs.
vs State of Rajasthan & Anr., [1985] Suppl.1 SCR 644 at 655.
[1046F; 1048C] In the light of the aforesaid decisions, the Court was of the opinion that the appellants herein were entitled to the interest for the period from March 1975 to the 31st July, 1987, when the principal amount of compensation had been paid and/or when the premises in question had been de requisitioned and handed back to the owner, on the amount awarded.
The Court was of the opinion that for the period from March 7, 1975 to February 28, 1985 being the date on which the judgment of the High Court was pronounced in this case, the appellants were entitled to the interest on the amount awarded at the rate of 6 per cent per annum, and for the period from August 8, 1985 to July 31, 1987 for that period only at the rate of 12 per cent per annum.
The interest would be payable only on the balance amount which remained to be paid to the appellants i.e. the amount due minus what had been paid from the respective dates.
The Court directed that the amount be paid by the respondents within three months from the date of this judgment, and that in case there was any difficulty in calculating the amount, the 1046 parties would be at liberty to apply to the High Court.
[1048C H] Satinder Singh & Ors.
vs Amrao Singh & Ors., ; ; National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India, [1963] Supp. 2 S.C.R. 971 at 992; Hirachand Kothari (dead) through Lrs. vs State of Rajasthan & Ors., [1985] Supp. 1 S.C.R. 644 and Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission, A.I.R. 1928 Privy Council 287, referred tO.
|
This appeal by special leave was confined solely to the question of entitlement of interest on the amount awarded by the Arbitrator for the requisition of the premises under the .
Disposing of the appeal, the Court, HELD: The principles upon which the compensation on this aspect is payable are by now well settled.
This Court reit erated the principles in Satinder Singh and Ors.
vs Amrao Singh and Ors., ; at 694; National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India [1963] Supp.
2 SCR 971 at 992 and Hirachand Kothari (dead) through Lrs.
vs State of Rajasthan & Anr., [1985] Suppl.1 SCR 644 at 655.
[1046F; 1048C] In the light of the aforesaid decisions, the Court was of the opinion that the appellants herein were entitled to the interest for the period from March 1975 to the 31st July, 1987, when the principal amount of compensation had been paid and/or when the premises in question had been de requisitioned and handed back to the owner, on the amount awarded.
The Court was of the opinion that for the period from March 7, 1975 to February 28, 1985 being the date on which the judgment of the High Court was pronounced in this case, the appellants were entitled to the interest on the amount awarded at the rate of 6 per cent per annum, and for the period from August 8, 1985 to July 31, 1987 for that period only at the rate of 12 per cent per annum.
The interest would be payable only on the balance amount which remained to be paid to the appellants i.e. the amount due minus what had been paid from the respective dates.
The Court directed that the amount be paid by the respondents within three months from the date of this judgment, and that in case there was any difficulty in calculating the amount, the 1046 parties would be at liberty to apply to the High Court.
[1048C H] Satinder Singh & Ors.
vs Amrao Singh & Ors., ; ; National Insurance Co. Ltd. Calcutta vs Life Insurance Corporation of India, [1963] Supp. 2 S.C.R. 971 at 992; Hirachand Kothari (dead) through Lrs. vs State of Rajasthan & Ors., [1985] Supp. 1 S.C.R. 644 and Inglewood Pulp and Paper Co. Ltd. vs New Burnswick Electric Power Commission, A.I.R. 1928 Privy Council 287, referred tO.
| 1
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| 1
| 1
|
ition Nos. 9222 to 9226 of 1981.
(Under Article 32 of the Constitution of India).
N.N. Keshwani, R.N. Keshwani and Raj Kumar Gupta for the Petitioners in W.P. Nos.
9222 25 of 1981.
Petitioner in person (Inder Mohan Lal Tandon) in W.P. No. 9226 of 1981.
V.C. Mahajan, G.L. Sanghi, C.V.S. Rao, Kitty Kumaraman glam, Randhir Jain and S.K. Bhattacharya for the Respond ents.
The Judgment of the Court was delivered by SINGH, J.
By means of these petitions under Article 32 of the Constitution the petitioners claim relief for quash ing Railway Board 's circular/letter No. E (NG) 1/69/PMI 180 dated 2nd July, 1970 and No. E (NG) I 80 SR6 39 dated 28th November, 1981.
They further claim relief for the issue of writ in the nature of mandamus restraining the respondent, Railway Authorities, from altering or issuing seniority list in pursuance of the Railway Board 's circular dated 28th November, 1023 1981 and to maintain the previous seniority list issued in 1968 for the purpose of promotions, confirmation and further advancement.
In the Indian Railways, initial recruitment of Train Examiners, used to be made in the entry Grade D in the pay scale of Rs. 100 185.
Prior to 1st April, 1966 recruitment to Grade D of Train Examiners was made from two sources (1) by promotion of skilled artisans working in the lower grade, (2) by direct recruitment of apprentices having completed prescribed four years ' training.
50 per cent of the vacan cies were filled by apprentices while the remaining 50% of the vacancies used to be filled by promotion of skilled artisans.
Promotion from entry Grade D was made to next higher Grade C of Train Examiners in the pay scale of Rs. 150 225 and later these grades were revised and the scale of D grade was raised to Rs. 180 240 and that of C Grade to Rs.205280.
Promotion to Grade C used to be made on the basis of senioritycum suitability without any distinction of promotee or direct recruits.
Because there was increase in the work load of Train Examiners the Railway Board took steps to re organise the cadre of Train Examiners.
With that end in view, it issued a notification on 27.10.1965 which directed that vacancies in the entry grade of Train Examin ers in the scale of Rs. 120 140 should not be filled from apprentice Train Examiners upto 50 per cent as hitherto, but should exclusively be, filled by promotion of skilled arti sans.
It further provided that vacancies in the next higher grade C (in the scale of Rs.205 280) should be filled from amongst the Train Examiners working in the grade of Rs. 180 240 to the extent of 20%.
The remaining 80 per cent vacancies were to be filled by direct recruitment of appren tice Train Examiners who may have successfully completed prescribed training.
Paragraph 2 of the notification provid ed .that the apprentice Train Examiners recruited on or from 1.4.1966 shall be given training for a period of 5 years and from the same date artisans recruited in the lower grade as apprentice Train Examiners shall be given 'in service ' training for a period of three years.
The circular upgraded 50% of the existing posts of Train Examiners from Grade D to Grade C in the scale of Rs.205 280 which were earlier ear marked for Apprentice Train Examiners.
The notification further directed that with effect from 1.4.1966 all the apprentice Train Examiners on successful completion of their training should be straightaway brought to the scale Rs.205 280 instead of being first absorbed in the scale of Rs. 180 240 as was being done prior to the issue of the notification.
Apprentice Train Examiners who were undergoing training on the date of the issue of notification, were directed to be brought to the working posts before 1.4.1966 and they were allowed stipend in the scale of Rs. 180 240 during the period of their training 1024 and their period of training was increased from four years to five years.
On the completion of the training they were straightaway posted in Grade C in the scale of Rs.205 280.
Those apprentice Train Examiners who had already been or may be absorbed in the scale of Rs. 180 240 upto 31.3.1966 were directed to be accommodated first in the scale of Rs.205 280 in Grade C against the quota of 80% vacancies reserved for them, and they were not required to undergo selection before being absorbed in that grade.
The effect of the Railway Board 's circular dated October 27, 1965 was that the existing apprentice Train Examiners who had already been absorbed in Grade D by March 31, 1966 were first accommodated in Grade C against 80% of the vacan cies reserved for them without undergoing any selection, while 20% of the vacancies reserved for the departmental Train Examiners, were to be filled by artisan promotees by selection and not on the basis of seniority cum suitability.
Although apprentices as well as artisan promotees constitut ed one integrated class in Grade D but promotee artisans ,were treated differently for promotion to Grade C. Roshan Lal Tandon who was promoted from artisan class to Grade D, filed a writ petition in 'this Court challenging the validi ty of the notification dated 27 10 1965 on the ground that a part of the notification which gave favourable treatment to apprentice Train Examiners was violative of Articles 14 and 16 of the Constitution.
In that writ petition a Consti tution Bench of this Court on August 14, 1967 in Roshan Lal Tandon vs Union of India, ; held that artisans and apprentices recruited from two sources to Grade D were integrated into one class and no discrimination could thereafter be made in favour of recruits from one source as against the recruits from the other source in the matter of promotion to Grade C. Apprentice Train Examiners who were recruited directly to Grade D as Train Examiners formed one common class with the skilled artisans who were promoted to Grade D as Train Examiners and thereafter no favoured treat ment could be given to the apprentice Train Examiners merely because they were directly recruited as Train Examiners, no discrimination could be made against the latter merely because they were promotees.
The Court emphasised that once the direct recruits and promotees are absorbed into one cadre, they formed one class and they could not be discrimi nated for the purpose of further promotion to higher Grade C.
On these findings the Court allowed the writ petition and issued a mandamus directing the Railway Board not to give effect to the impugned part of the circular which was as under: 1025 "The Apprentice T.X. Rs. who have already been or will be absorbed in scale Rs. 180 240 upto 31.3.
1966 should first be accommodated in scale Rs.205 280 against the quota of 80% vacancies reserved for them.
Such staff should not be required to undergo a 'Selection ' before being absorbed in that grade.
The upgraded vacancies in scale Rs.205 280 left over after earmarking those for the appren tices under training on 2.4.66 should be filled by promotion of T.X. Rs. in scale Rs. 180 240 on a selection basis.
While computing the number of posts available for promotion of T.X. Rs. in scale of Rs. 180 240 the vacancies likely to occur during the period of appren ticeship of the apprentices under training as on 1.4.1966 should also be taken into account.
In other words, it would be necessary to keep in reserve only the number of posts equal to the number of apprentices under training as on 1.4.1966, who cannot be absorbed in the antic ipated vacancies which will arise by the time they qualify.
" The Railway Board with a view to implement the decision of this Court and to remove the anomaly which had been pointed out by this Court issued circular/letter No. N (NG) 65 PMI/86 dated 13.9.1968 annexures III to the affidavit filed on behalf of Respondent Railway Administration.
Para graph 1 of the letter refers to this Court 's judgment in Roshan Lal Tandon 's case and also to that portion of the Railway Board 's circular dated October 27, 1965 which had been struck down by the Court and the interim orders issued by the Court restraining the Railway authorities from imple menting the Circular dated October 27, 1965 during the pendency of the writ petition.
Paragraph 2 and 3 of the Circular dated September 13, 1968 stated that in view of the judgment of the Supreme Court the Board have decided that vacancies in the grade of Rs.205 280 (after taking into account the upgrading of 50 per cent of posts in the scale of Rs. 180 240 to 205 280 less the number of posts required for absorbing Apprentice Train Examiners undergoing the enhanced period of training of five years on April 1, 1966, should be filled by selection from amongst Train Examiners in the scale Rs. 180 240 as on March 31, 1966 irrespective of whether they were initially recruited as Apprentice Train Examiners or were promoted from lower grades.
The Board desired that Railway Administrations should take immediate steps to ensure that proper selections are held for which all TXRs in scale of Rs. 180 240 are considered.
It had come to Board 's notice that prior to the issue of the stay order, persons originally recruited as Apprentice Train Examiners who were in the 1026 scale of Rs. 180 240 have been promoted to the grade Rs.205 280 in pursuance of Board 's letter dated 27.10.
The Board decided that in view of the Supreme Court 's judg ment, such promotions should be treated as null and void and the vacancies should be properly filled as mentioned in para 2 of the circular.
The Railway Board issued another circular No. E.(NG)i/69/PMI180 dated 2nd July 1970 laying down procedure for filling of posts of Train Examiners and upgradation of posts.
It directed that vacancies arising in Grade C after 1.4.1966 to the extent of 50% shall be maintained in that grade and the remaining 50% shall be down graded to the scale of Rs. 180 240 to be filled by promotion of skilled artisans.
It further directed that 50% of the vacancies in Grade C should be filled by direct recruitment of apprentice Train Examiners with five years ' training to the extent of 80% thereof and the remaining 20% by promotees from Grade D as laid down in paragraph 1 of the Railway Board 's circular dated 27.10.1965.
This procedure was directed to be followed till the cadre position was normalised ' and the excess in the Grade of Rs.205 280 were eliminated.
Paragraph 2 of the circular further directed that those promoted to Grade C in the scale of Rs.205280 as on April 1, 1966 will be assigned seniority amongst themselves in the order of their inter se seniority in Grade of Rs. 180 240 for the purposes of con firmation in that grade and also for further advancement and they will rank senior to those recruited as apprentice Train Examiners with five years training and appointed after 1.4.1966 in the Grade of Rs. 205 280.
The result of the circular was that all those promotees who had been appointed to Grade D prior to 1.4.
1966 stood absorbed in Grade C and they were granted seniority in that Grade with retrospective effect viz. with effect from April 1, 1966.
Later the Railway Board took a policy decision to abol ish the entry Grade D of Train Examiners in the pay scale of Rs. 180 240, and in order to implement that decision it issued circular/letter No. PC 69 PS 5 TR 1, New Delhi dated 30th October, 1972, abolishing the entry Grade D of Train Examiners and placing the incumbents of that Grade en masse in Grade C in the scale of Rs.205 280 with effect from 1.11.1972.
Paragraph 2 of the circular directed that the pay of the staff brought from Grade D (Rs. 180~240) to Grade C (205 280) will be fixed under Rule 2017 A(III) read with Rule 2019 II.
As all the incumbents of Grade D in the scale of Rs. 180 240 were placed en masse in the higher grade C in the scale of Rs.205 280, a provisional seniority list of Grade C Train Examiners working in Delhi Division was pre pared on 16th November 1981.
In that seniority list peti tioners 1027 were shown senior to some of the respondents as the seniori ty was not determined in accordance with Rule 302 of the Railway Establishment Manual.
This seniority list was not prepared in accordance with the prescribed criteria as had been done in other divisions.
The Railway Board issued a circular No. E(NG) 1 80 SR6 39 dated 28.11.
1981 directing that Delhi Division should also fall in line with other divisions of Northern Railway and the seniority of the Train Examiners appointed between 1.4.1966 to 1.11.1972 should be prepared in accordance with the existing practice viz. on the basis of the date of appointment in particular grade.
In pursuance to that direction seniority of Train Examiners of Grade C placed in that Grade between 1.4.
1966 to 1.11.
1972 was published in 1981 by the authorities of the Delhi Divi sion of Northern Railway.
After inviting objections, the seniority list was finally published in December, 1982.
In that seniority list the petitioners were shown junior to Respondents Nos.
5 to 10, who were placed above the peti tioners.
Aggrieved the petitioners have challenged the validity of the seniority list also by raising additional grounds in the writ petitions.
Before we consider the submissions made on behalf of petitioners it would be appropriate to refer to comparative position of petitioners and the respondents Nos.
5 to 10 with regard to their date of entry in service as Train Examiners in Grade D and Grade C.
The relevant position is as under: Name Date of entry Grade D Grade C Rs. 180 240 Rs.205 280 1.
Yashbir Singh, Petitioner.
29.4.1986 1.11.
1972 2.
I.M. Lal Tandon, Petitioner.
19.6.1966 1.11.
1972 3.
Hira Lal Kapoor, Petitioner.
29.4.1966 1.11.
1972 4.
Harbhaj an Singh, Petitioner.
16.8.1966 1.11.1972 5.
Som Dutt Sharma, Petitioner.
29.4.1966 1.11.1972 6.
A.K. Sharma, Respondent 5, 5.
9.1967 7.
V.K. Chandhok, Respondent 6, 25.
2.1968 8.
R.N. Verma, Respondent 7, 10.
8.1968 9.
Maglani, Respondent 8, 22.
4.1969 10.
Dev Raj Sharma, Respondent 9, 21.
5. 1970 11.
K.N.Sharma, Respondent 10, 9. 2.1971 The above chart shows that Respondents Nos.
5 to 10 who be 1028 long to group of apprentice Train Examiners were directly placed to working posts in Grade C after completion of five years training in accordance with the Railway Board 's circu lar dated 2nd July, 1970, on the respective dates shown in Column 3, which indicates that each one of them had been placed in Grade C prior to 1.11.
1972, while the petitioners were placed in Grade C with effect from 1.11.
1972, in pursuance of the Railway Board 's circular dated 30.10.
Since the Respondents Nos. 5 to 10 were appointed to Grade C earlier in time and as the petitioners were placed in Grade C later, they. were shown junior to the Respondents in the seniority list.
No valid objection can be raised against respondents ' seniority.
Further in the seniority list all those promotees who had been placed in Grade C with effect from April 1, 1966 under the Railway Board 's circular dated July 2, 1970 were shown senior to the petitioners.
Since the petitioners were not granted seniority with retrospective effect in Grade C as was done in the case of those who were promoted under the Circular dated July 2, 1970 they have assailed the Constitutional validity of Railway Board 's circular dated July 2, 1970.
Learned counsel for the petitioners contended that the Railway Board 's circular dated July 2, 1970 was illegal and unconstitutional for variety of reasons.
Firstly, the Rail way Board had no authority in law to grant seniority with retrospective effect to all those promotees who had been placed in Grade C with effect from April 1, 1966 in pursu ance of the circular dated July 2, 1970.
Secondly, the Railway Board practised discrimination between the promotees forming the same class of Grade D with regard to seniority in Grade C.
He contended that under the circular dated July 2, 1970 promotees belonging to Grade D (like the petition ers) were granted seniority in Grade C on their promotion to that grade with retrospective effect from the date of their appointment in Grade D and not from the date of their ap pointment or placement in Grade C whereas the petitioners who form the same class have not been granted the same benefit, instead their seniority has been determined with effect from the date of their entry in Grade C.
The peti tioners and all those who had been appointed in Grade D prior to April 1, 1966 and promoted to Grade C formed the same class and yet they have been treated differently with out any rational basis.
The petitioners were also recruited in 1966 and they all had completed service of more than 4 years approximately as Train Examiners in Grade D on Novem ber 30, 1972 when the circular was issued but they have not been given seniority in Grade C with retrospective effect as was done under the circular dated July 2, 1970.
1029 We have given our anxious consideration to these submis sions but we do not find any merit in the same.
The peti tioners have challenged validity of the Railway Board 's circular dated July 2, 1970 in 198 1 after 11 years.
All the petitioners were in service on the date that circular was issued and they were aware that their colleagues (promotees belonging to Grade D) were placed in Grade C and they had been granted seniority with retrospective effect but none of them challenged the validity of the circular.
Now petition ers cannot be permitted to challenge the validity of that circular after 11 years.
If the petitioners were aggrieved by the Railway Board 's circular dated July 2, 1970 they should have challenged the same within a reasonable period of time which they did not do so.
It is well settled that anyone who may feel aggrieved with an administrative order or decision affecting his right should act with due dili gence and promptitude and not sleep over the matter.
Raking of old matters after a long time is likely to result in administrative complications and difficulties and it would create insecurity and instability in the service which would affect its efficiency.
The petitioners are therefore not entitled to challenge the validity of the Railway Board 's circular dated July 2, 1970 after 11 years and their chal lenge is bound to fail on this ground alone.
We have considered the merit of the submission also but we find no legal or constitutional infirmity in the Circular dated July 2, 1970.
There was increase in the work of car riage and wagons examination, as more complicated type of rolling stock was available with the Indian Railways.
In order to reorganise the cadre of Train Examiners and to cope with the increased work load the Railway Board by its noti fication dated 27th October, 1965 reorganised the cadre.
It directed that vacancies in Grade D were to be exclusively filled by promotion from amongst skilled artisans and direct recruits were to be appointed straightaway to Grade C after completion of training of five years.
Validity of the noti fication was challenged before this Court in Roshan Lal Tandon 's case and the implementation of the circular was stayed.
This Court struck down only a portion of the notifi cation which has been extracted in the earlier part of this judgment but the rest of the directions contained in the notification remained unaffected, including the direction that with effect from April 1, 1966 all the Train Examiners on successful completion of their training should be straightaway brought on to the scale of Rs.205 280 instead of being first absorbed in Grade D. Similarly further direc tion that those apprentices who were undergoing training on April 1, 1966 shall undergo five years ' training instead of four years and during their training they would receive 1030 stipend in the scale of Rs. 180 2 10 and after completion of their training they will straightaway be appointed to Grade C. After the judgment of this Court, the Railway Board reconsidered the matter and with a view to implement the decision of this Court and to further carry out its policy of reorganisation as initiated under its circular dated October 27, 1965 it issued directions under its circular dated July 2, 1970, which is as under: "GOVERNMENT OF INDIA MINISTRY OF RAILWAY (RAILWAY BOARD) No. E(NG) i/69/PMI 180 New Delhi Dated 2nd July 1970 The GMs.
All India Railways.
Sub: Procedure for filling up posts of TXRs upgra dation of.
Boards letter No. E (NG) 165 PMI 86 dated 27.10.1965 and 13.9.1968.
The Board have been receiving representations from the staff working in the category of TXRs in scale Rs. 180 240 (AS) against the procedure prescribed for filling vacancies arising out of upgradation of 50% of posts in scale Rs. 180 240 (AS) to Rs.205280 w.e.f.
1.4.1966.
It has been decided in modification of previous orders that all the TXRs working in Grade 180240 consisting of both App.
of 4 years Trg.
and promotees from ranks as on 1.4.1966 should be promoted en masse to the grade Rs.205 280 irrespective of the quota of vacancies reserved for promotees, the excess to the permissible re organised cadre strength in the grade Rs.205 280 being worked off gradually by wastage such as retirement etc.
in grade Rs.205 280 (AS).
After 1.4.1966 50% of the vacancies arising in grade Rs.205 280 should be main tained in that grade and the remaining 50% will be down graded to the scale of Rs. 190240 to be filled by promotion of skilled artisans.
The 50% of the vacancies in grade Rs.205 280 (AS) should be filled by direct recruitment of App.
TXRs with 5 years training to the extent of 80% thereof and the remaining 20% by pro 1031 motees from grade Rs. 180 240 as laid down in paragraph 1 (ii)(a) of Board 's letter No. E(NG) 165 PMI 86 dated 27.10.1965.
This proce dure will continue to be followed till the cadre position is normalised and the excess in the grade of Rs. 205 280 eliminated.
(2) The staff promoted to the grade Rs.205 280 as on 1.4.1966 will be assigned seniority amongst themselves in the order of their inter se seniority in the grade Rs. 180 240 for the purpose of confirmation in that grade and also for further advancement.
They will all rank senior to those recruited as App.
TXRs with 5 years Trg.
and appointed after 1.4.1966 to the grade Rs.205 280.
(3) The above instructions may please be implemented immediately and a report submitted to the Board in due course.
receipt Sd (O.D.S harma) Asstt.
Director(E) Rly Board" The circular issued three directions, firstly, it directed that all the Train Examiners working in Grade 180 240 con sisting of both apprentice Train Examiners and promotees from rank as on April 1, 1966 should be promoted en masse to Grade C irrespective of quota reserved for promotees.
Sec ondly, it directed that after April 1, 1966 vacancies in Grade C to the extent of 50 per cent should be maintained in that Grade while the remaining 50 per cant should be down graded to Grade D to be exclusively filled by promotion of skilled artisans, it further directed that 50 per cent of the vacancies in Grade C should be filled up by direct recruitment of apprentices with five years training to the extent of 80 per cent thereof and remaining 20 per cent of vacancies from Grade D. Thirdly, it issued direction with regard to assigning seniority to the staff promoted to Grade C on April 1, 1966.
They were to carry their inter se sen iority in Grade D for the confirmation and also for further advancement.
It further directed that the promotees will rank senior to the direct recruits in Grade C appointed after April 1, 1966.
These directions were issued with the object and purpose of achieving the reorganisation which had been initiated by Railway 1032 Board under its circular dated October 27, 1965.
The scheme of reorganisation of cadre as contemplated by the circular dated October 27, 1965 was to be carried out with effect from April 1, 1966 and that date was followed by the Railway Board in its circular dated January 2, 1970.
The petition ers ' submission that the date April 1, 1966 was fixed in arbitrary manner without any basis is untenable.
The promo tees who were placed in the higher Grade C with effect from April 1, 1966 were undoubtedly senior to the petitioners in Grade D, none of the petitioners ' rights were affected by their promotion.
The reorganisation of the cadre of Train Examiners and the promotion to Grade C could not be complet ed on account of the pendency of Roshan Lal Tandon 's case in this Court and the stay orders issued therein.
After the decision of this Court the Railway Board implemented the scheme and it made promotion with retrospective effect.
As the promotion to Grade C had been stayed, during the penden cy of the writ petition in this Court the Railway Board was justified in granting promotion with effect from April 1, 1966 as initially reorganisation was proposed to be imple mented with effect from that date as is clear from Railway Board 's notification dated October 27, 1965.
The Railway Board promoted the staff with retrospective effect because on account of stay orders issued by the Court those entitled to be promoted with effect from April 1, 1966 could not be promoted.
The petitioners cannot claim parity with those who had been promoted to Grade C under the Railway Board 's circular dated July 2, 1970 as they do not belong to that class.
Equality can be claimed among equals and not with unequals.
Those persons who had acquired right of promotion under the Railway Board 's notification dated October 27, 1965 could not be promoted on account of litigation, they formed a distinct class and the petitioners cannot equate themselves with them as they were not entitled to promotion under the notification dated October 27, 1965.
The petition ers have no right in law to claim similar treatment.
There is therefore no merit in the petitioners ' plea of discrimi nation.
Validity of the Railway Board 's circular dated July 2, 1970 on the ground of it being discriminatory was raised before the Delhi High Court in writ petition No. 1147 of 1971, Chaman Lal and others vs Union of India and others decided on May 20, 1980.
A Division Bench of that Court upheld its validity.
In another writ petition No. 2834 of 198 1 Kewal Krishan vs Union of India and others again the validity of Railway Board 's circular dated July 2, 1970 as well as the validity of Railway Board 's circular dated January 28, 1981 was upheld by a Division Bench of the Delhi High Court on December 15, 1981.
Learned counsel for the petitioners challenged the validity of the 1033 Railway Board 's circular dated November 1, 1981 which di rected the.
Delhi Division to fall in line with other divi sions of Northern Railways for determining the seniority of Train Examiners.
It appears that seniority of Train Examin ers in Grade C working in other Divisions of Northern Rail way was determined, from the date of appointment in that Grade, in accordance with Rule 302 of the Railway Establish ment Manual but in Delhi Division that practice was not followed.
The Railway Board directed the Delhi Division to fall in line with other divisions in determining the senior ity of Train Examiners.
Learned counsel for the petitioners urged that since under the Railway Board 's circular dated October 30, 1972 the petitioners were placed en masse in Grade C in the scale of Rs.205 280 they are entitled to seniority with effect from the date of their appointment in Grade D and if that be so, they would rank senior to Re spondents Nos. 5 to 10 who were appointed later in time.
At this stage it would be profitable to have a glance at Rail way Board 's circular dated October 30, 1972 which is as under: "GOVERNMENT OF INDIA MINISTRY OF RAILWAYS (RAILWAY BOARD) No. PC 69/PS 5/TR 1 New Delhi dated 30.10.
1972 The General Managers, All India Railways.
Sub: Upgrading of the initial scale of pay of Train Examiners on Railways.
Ref: Board 's letters No. (1) E(NG) 65 PMI '86 dated 27.10.
(ii) No. E (NG) 165 PMI 86 dated 13.9.
(iii) No. E(NG) 1 69 .PM/ 1/130 dated 2.7.
The Board have considered the commu nications received from the National Federa tion of Indian Railwaymen and the All India Railwaymen 's Federation regarding the proce dure prescribed for filling and maintenance of vacancies in the Train Examiners ' cadre as envisaged in the above mentioned letters and more particularly their demand for abolition of the grade of Rs. 180 240.
It has now been decided in modification of existing orders that the 1034 initial grade of TXRs, viz. Rs. 180 240 should be abolished and all the TXRs working in that grade should be placed en masse in the grade Rs.205 280 w.e.f. 1.11.
It has been decided that vacancies in grade Rs.205 280 should hereafter be filled in the following manner: (i) 40% of vacancies to be filled by promotion or Artisans; (ii) 20% of vacancies to be reserved for existing Artisans going as Apprentice TXRs, with age relaxation upto 35 years; and (iii) 40% of vacancies to be filled by direct recruitment of Apprentices TXRs from the open market through Railway Service Com missions.
Pay of the staff brought on from grade Rs. 180 240 (AS) to Grade Rs.205 280(AS) will be fixed under Rule 2017(a)(ii) read with rule 2019 PII.
This has the approval of the President.
Sd/ (R.S. Bharal) Dy.
Director, Establishment (P & A) Railway Board No. PC 69/PS 5/TP 1 New Delhi dated 30.10.72 Copy of the FA & CAOS, and Chief Auditors of All Indian Railways.
Sd/ (R.S. Bharal) Dy.
Director, Establishment (P & A) Railway Board.
" By the aforesaid circular the entry grade of Train Examiners in the scald of Rs. 180 240 was abolished and all the Train Examiners working in that Grade were placed in the scale of Rs.205 280 with effect from November 1, 1972.
In pursuance to that decision, petitioners were included in Grade C with effect from November 1, 1972 and 1035 therefore they are entitled to seniority with effect from that date in Grade C.
In the absence of any statutory rule or directions petitioners are, not entitled to claim senior ity in Grade C with reference to the date of their appoint ment in Grade D.
The chart indicating respective dates of entry of petitioners and the Respondents 5 to 10 in Grade C. as extracted in the earlier part of the judgment would show that Respondents Nos. 5 to 10 were appointed in Grade C earlier in time than the petitioners, therefore they are entitled to be senior to the petitioners.
It is not disputed that Rule 302 of the Railway Establishment Manual lays down a general rule for determining seniority from the date of appointment in a particular grade and the petitioners have not placed any rule or instruction before us to support their case.
Seniority ordinarily reflects length of service in a particular cadre or grade.
It is generally regulated by service rules or in the absence of Rules by executive in structions.
By and large, such rules provide for determining seniority with reference to the date of appointment but there are instances where rules provide for determining seniority with reference to date of confirmation.
Normally, when a person is promoted or placed in a higher grade his seniority is determined with reference to the date of such promotion or placement unless the relevant rules provide to the contrary.
Seniority in the lower grade has no meaning for determining seniority in the higher grade except for determining inter se seniority of promotees.
Rule 302 con tains a general Rule and there is no exception to it.
In the absence of any contrary provision in the Rules, the general rule of seniority as laid down by Rule 302 must prevail.
Learned counsel then urged that the seniority list of Grade D had been prepared in 1968 and in that seniority list petitioners were shown senior to some of the respondents and that seniority could not legally be disturbed.
It appears that in the seniority list prepared in 1968 the names of some of the respondents was shown in Grade D on the assump tion that they held posts of Train Examiners in that Grade.
It was done on a wrong assumption.
Admittedly, the Respond ents Nos. 5 to 10 were apprentices who were undergoing training, and in accordance with the directions contained in the Railway Board notification dated October 27, 1965 they were entitled to appointment in Grade C straightaway on completion of their training.
They were no doubt drawing stipend at the rate of Rs. 180 240 which was the scale prescribed for Grade D but nonetheless they did not belong to Grade D as they were not appointed to any of the posts in that Grade.
Their names therefore could not be included in the seniority list of Grade D. Petitioners cannot draw any advantage from the mistake committed in 1036 including the Respondents name in the seniority list of 1968.
Learned counsel then urged that Hira Lal Kapoor, one of the petitioners was promoted on June 23, 1981 on the basis of his seniority in Grade D, therefore, other petitioners are also entitled to their seniority with effect from the date of their appointment in Grade D.
In the written submis sion filed on behalf of Respondents it is stated that the Deputy Regional Manager of Delhi had granted promotion to H.L. Kapoor on June 2, 1981 on ad hoc and temporary basis.
On receipt of representations and.
protests from Respondent No. 5 Ashok Kumar Sharma and the General Secretary.
Northern Railway Men 's Union, order of promotion issued in favour of H.L. Kapoor was cancelled and Sh.
A.K. Sharma, Respondent No. 5 was promoted.
Since the petitioners were placed in higher Grade C with effect from November 1, 1972 they are entitled to seniority with reference to date of their place ment in that Grade and they have no legal right to claim seniority in that Grade against those who were appointed to that Grade before November 1, 1972.
Learned counsel for the petitioners referred to Lok Sabha questions asked by Sh.
Suraj Bhan, M.P. and the an swers given to those questions with regard to seniority of direct recruits and promotees, (Annexures K of the petition).
The petitioners have asserted that in reply to the Lok Sabha questions, it was clearly stated by the Rail way Administration that direct recruit Train Examiners posted on working posts before November 1, 1972 in Grade C in the scale of Rs.205 280 will not be treated senior to the Train Examiners promoted en masse with effect from November 1, 1972.
In the counter affidavit filed by the respondents it is stated that the reply to the Lok Sabha questions as contained in Annexure K to the petition is of no relevance as the said questions were not admitted at all and no reply was given by the Railway Board.
It appears that the General Manager had prepared a draft reply to the Lok Sabha ques tions but the reply had not been finalised by the Railway Board which is the competent authority.
The Railway Board could have modified the draft of the reply as prepared by the General Manager but since the question was not admitted no reply was sent to the Lok Sabha.
The petitioner can therefore draw no support from Annexure K to the petition.
Learned counsel for the petitioners then urged that the petitioners were not promoted to Grade C instead they were placed en masse in Grade C on the abolition of Grade D therefore the date of their seniority should not be deter mined from the date of their placement in 1037 Grade C instead they are entitled to their seniority with reference to the date of their appointment in Grade D. He placed reliance on the directions, contained in paragraph 2 of the Railway Board 's circular dated October 30, 1972 that the petitioners ' salary in Grade C shall be fixed in accord ance with Rule 2017 R II read with rule 2019 II.
He urged that if the petitioners were treated to have been promoted to Grade C with effect from November 1, 1972 in that case their salary could have been fixed in accordance with Rule 2018 (R II) (PR 22/C).
It is true that the petitioners were not promoted from Grade D to Grade C instead Grade D was abolished and the petitioners and all other incumbents holding posts in Grade D were placed en masse in Grade C and the Railway Board issued directions that their salary shall be fixed in accordance with the Rule 2017 read with Rule 2018 (R II) (PR 22/C).
Whether petitioners were promoted to Grade C or whether they were placed en masse in that Grade does not make any difference so far as their entry to Grade C is concerned, in either case, they entered Grade C with effect from November 1, 1972.
Reference to a particular rule for determining their pay in the higher grade cannot change the criteria for determining seniority.
The Railway Board had never issued any direction for determining the petition ers seniority with reference to their date of appointment in the initial entry grade.
The petitioners have failed to show that any person junior to them has been made senior to them.
Their grievance is without any substance.
In view of the above discussion we find no merit in the petitions.
We accordingly dismiss the same with costs.
All interim orders stand discharged.
S.L. Petitions dismissed.
|
The petitioners were railway employees.
The Railway Board issued a circular dated July 2, 1970, laying down procedure for filling up posts of train examiners and upgra dation of posts.
It directed that vacancies arising in Grade C after 1.4.1966 to the extent of 50 per cent would be maintained in that grade and the remaining 50 per cent would be down graded to be filled by promotion of skilled arti sans.
It further directed that 50 per cent of the vacancies in Grade C should be filled by direct recruitment of appren tice Train Examiners with five years ' training to the extent of 80 per cent thereof and the remaining 20 per cent by promotees from Grade D as laid down in paragraph 1 of the Circular dated 27.10.1965 of the Board.
This procedure was directed to be followed till the cadre position was norma lised and the excess in the Grade of Rs.205 280 were elimi nated.
Paragraph 2 of the circular further directed that those promoted to Grade C in the scale of Rs.205280 as on April 1, 1966 would be assigned seniority amongst themselves in the order of their inter se seniority in the Grade of Rs. 180 240 for the purposes of confirmation, etc., in that grade and they would rank senior to those recruited as apprentice train examiners with five years ' training and appointed after 1.4.66 in the grade of Rs.205 280.
The result of the circular was that all those promotees, who had been appointed to Grade D prior to 1.4.66 stood absorbed in Grade C and they were granted seniority in that grade with retrospective effect, that is, with effect from April 1, 1966.
The Railway Board later took a policy decision to abol ish the entry grade D of train examiners in the pay scale of Rs. 180 240, and in order to implement that decision issued a circular dated October 30, 1972, abolishing the entry Grade D of the train examiners and placing the incumbents of that grade en masse in grade C in the scale of Rs.205280 with effect from 1.11.72.
Paragraph 2 of the circular di rected that the pay of the staff brought from Grade D (Rs.180 240) to grade C 1019 (Rs.205 280) would be fixed under Rule 2017 A (III) read with rule 2019 II.
As all the incumbents of grade D in the scale of Rs. 180 240 were placed en masse in the higher grade C in the scale of Rs.205 280, a provisional seniority list of grade C Train Examiners working in Delhi Division was prepared on November 16, 1981.
In that seniority list, the petitioners were shown senior to some of the respondents as the seniority was not determined in accordance with Rule 302 of the Railway Establishment Manual.
This seniority list was not prepared in accordance with the prescribed criteria, as had been done in the other Divisions.
The Board issued a circular dated 28.11.81, directing that the Delhi Division should also fail in line with the other Divisions of the Northern Railway, and the seniority of the train examiners appointed between 1.4.66 and 1.11.72 should be prepared in accordance with the existing practice.
viz. on the basis of the date of appointment in the particular grade.
In pursuance of that direction, seniority of the train examiners of grade C placed in that grade between 1.4.66 and 1.11.72, was published in 1981 by the authorities of the Delhi Division of the Northern Railway.
After inviting objections, the seniority list was finally published in December, 1982.
In that seniority list, the petitioners were shown junior to respondents 5 to 10.
Aggrieved, the peti tioners moved this Court by writ petitions, challenging the validity of the seniority list and for quashing the circu lars dated July 2, 1970 and November 28, 1981 of the Railway Board, and restraining the respondent Railway authorities from altering or issuing the seniority list in pursuance of the circular dated November 28, 1981 of the Railway Board and for maintaining the seniority list issued in 1968.
Dismissing the petitions, the Court, HELD: The Respondents Nos.
5 to 10, who belonged to the group of apprentice train examiners were directly placed to working posts in grade C after completion of 5 years ' train ing in accordance with the circular dated July 2, 1970 of the Railway Board, and each one of them had been placed in grade C prior to 1.11.72, while the petitioners were placed in grade C with effect from 1.11.72, in pursuance of the circular dated 30.10.72 of the Railway Board.
Since the respondents 5 to 10 were appointed to grade C earlier and the petitioners were placed in that grade later, the peti tioners were shown in the seniority list junior to the respondents concerned.
No valid objection can be raised against respondents ' seniority.
[1027H; 1028A C] 1020 The petitioners challenged the validity of the Railway Board 's circular dated July 12, 1970, in 1981 after 11 years.
All the petitioners were in service on the date that circular was issued and they were aware that their col leagues (promotees belonging to grade D) were placed in grade C and they had been granted seniority with retrospec tive effect, but none of them challenged the validity of the circular.
Now, the petitioners cannot be permitted to chal lenge the validity of that circular after 11 years.
The petitioners should have challenged the circular within a reasonable period of time which they did not do.
It is wellsettled that anyone, who may feel aggrieved by an admin istrative order or decision affecting his right, should act with due diligence and promptitude and not sleep over the matter.
Taking up old matters after a long time is likely to result in administrative complications and difficulties and would create insecurity and instability in the service which would affect its efficiency.
The petitioners are, therefore, not entitled to challenge the validity of the Railway Board 's circular dated July 2, 1970, after 11 years.
Even otherwise, on merits.
there is no legal and constitutional infirmity in the circular.
In order to reorganise the cadre of the train examiners to cope with the increased work load, the Railway Board issued a Notification dated October 27, 1965, reorganising the cadre.
The validity of the notifica tion was challenged before this Court in Roshan Lal Tandon 's case.
The Court struck down only a portion of the notifica tion and the rest of the directions contained in the notifi cation remained unaffected.
After the judgment of the Court, the Railway Board reconsidered the matter, and, with a view to implementing the decision of this Court and further carrying out its policy of reorganisation as initiated under its circular dated October 27, 1965, issued the circular dated July 2, 1970 [1029A H; 1030A B] The scheme of reorganisation of the cadre as contemplat ed by the circular dated October 27, 1965, was to be opera tive with effect from April 1, 1966.
The Petitioners ' sub mission that the date April 1, 1966, was fixed in an arbi trary manner without any basis, is untenable.
The promotees, who were placed in the higher grade C with effect from April 1, 1966, were undoubtedly senior to the petitioners in grade D, and none of the petitioners ' rights were affected by their promotions.
The Railway Board implemented the reorgan isation scheme after the decision of this Court in Roshan Lal Tandon 's case.
As promotion to grade C had been stayed during the pendency of Tandon 's case in this Court, the Railway Board was justified in granting promotion with retrospective effect from April 1, 1966, as initially, the reorganisation was proposed to be implemented from that date, which could not be done on account of stay orders issued by this Court.
The petitioners 1021 cannot claim parity with those who had been promoted to grade C under the Railway Board 's circular dated July 2, 1970, as they do not belong to that class.
Equality can be claimed amongst equals and not with unequals.
The persons, who had acquired the right of promotion under the Railway Board 's notification dated October 27, 1965, but could not be promoted on account of litigation, formed a separate class, and the petitioners could not equate themselves with them, as they were not entitled to promotion under the notification dated October 27, 1965.
There is no merit in the petitioners ' plea of discrimination.
[103AF H] The validity of the Railway Board 's circular dated July 2, 1970, was challenged by a writ petition before the Delhi High Court, which upheld the same.
Again, the validity of that circular as well as the circular dated January 28, 1981 of the Railway Board was challenged by a writ petition before the Delhi High Court, which upheld the same.
[1032F H] By the Circular dated October 30, 1972, of the Railway Board, the entry grade of train examiners in the scale of Rs. 180 240, was abolished and all the train examiners in that grade were placed in the scale of Rs.205 280 with effect from November 1, 1972.
The petitioners were included in grade C with effect from November 1, 1972, and, there fore, they are entitled to seniority with effect from that date in Grade C.
The petitioners are not entitled to claim seniority in grade C with reference to the date of their appointment in grade D. The respondents 5 to 10 were ap pointed in grade C earlier than the petitioners and, there fore, they are senior to the petitioners.
Rule 302 of the Railway Establishment Manual lays down a general rule for determining seniority from the date of appointment in a particular grade when a person is promoted to or placed in a higher grade, his seniority is determined with reference to the date of such promotion or placement unless the relevant rules provide to the contrary.
Seniority in lower grade has no meaning for determining seniority in the higher grade except for determining inter se seniority of the promotees.
In the absence of any contrary provision in the Rules, the general rule of seniority laid down by Rule 302 must pre vail.
[1034G H; 1035A E] It appears that in the seniority list prepared in 1968, the names of some of the respondents were shown in grade D on a wrong assumption.
The respondents 5 to 10 were appren tices undergoing training, and in accordance with the direc tions contained in the Railway Board 's notification dated October 27, 1965.
they were entitled to appointment 1022 straightaway on completion of their training.
They were drawing stipend at a rate which was the scale prescribed for grade D, but they did not belong to grade D and could not be included in the seniority list of grade D.
The petitioners cannot draw advantage from the mistake committed in includ ing the names of the respondents in the seniority list of 1968.
[1035F H; 1036A] The petitioners were placed in higher grade C with effect from November 1, 1972, and they are entitled to seniority with reference to their placement in that grade and they have no legal right to claim seniority in that grade as against those who were appointed to that grade before November 1, 1972.
[1036C D] Whether the petitioners were promoted to grade C or were placed en masse in that grade, does not make any difference in so far their entry to grade C is concerned; in either case, they entered grade C with effect from November 1, 1972.
The petitioners have failed to show that any person junior to them has been made senior to them.
Their grievance is without any substance.
[1037C E]
|
ition Nos. 9222 to 9226 of 1981.
(Under Article 32 of the Constitution of India).
N.N. Keshwani, R.N. Keshwani and Raj Kumar Gupta for the Petitioners in W.P. Nos.
9222 25 of 1981.
Petitioner in person (Inder Mohan Lal Tandon) in W.P. No. 9226 of 1981.
V.C. Mahajan, G.L. Sanghi, C.V.S. Rao, Kitty Kumaraman glam, Randhir Jain and S.K. Bhattacharya for the Respond ents.
The Judgment of the Court was delivered by SINGH, J.
By means of these petitions under Article 32 of the Constitution the petitioners claim relief for quash ing Railway Board 's circular/letter No. E (NG) 1/69/PMI 180 dated 2nd July, 1970 and No. E (NG) I 80 SR6 39 dated 28th November, 1981.
They further claim relief for the issue of writ in the nature of mandamus restraining the respondent, Railway Authorities, from altering or issuing seniority list in pursuance of the Railway Board 's circular dated 28th November, 1023 1981 and to maintain the previous seniority list issued in 1968 for the purpose of promotions, confirmation and further advancement.
In the Indian Railways, initial recruitment of Train Examiners, used to be made in the entry Grade D in the pay scale of Rs. 100 185.
Prior to 1st April, 1966 recruitment to Grade D of Train Examiners was made from two sources (1) by promotion of skilled artisans working in the lower grade, (2) by direct recruitment of apprentices having completed prescribed four years ' training.
50 per cent of the vacan cies were filled by apprentices while the remaining 50% of the vacancies used to be filled by promotion of skilled artisans.
Promotion from entry Grade D was made to next higher Grade C of Train Examiners in the pay scale of Rs. 150 225 and later these grades were revised and the scale of D grade was raised to Rs. 180 240 and that of C Grade to Rs.205280.
Promotion to Grade C used to be made on the basis of senioritycum suitability without any distinction of promotee or direct recruits.
Because there was increase in the work load of Train Examiners the Railway Board took steps to re organise the cadre of Train Examiners.
With that end in view, it issued a notification on 27.10.1965 which directed that vacancies in the entry grade of Train Examin ers in the scale of Rs. 120 140 should not be filled from apprentice Train Examiners upto 50 per cent as hitherto, but should exclusively be, filled by promotion of skilled arti sans.
It further provided that vacancies in the next higher grade C (in the scale of Rs.205 280) should be filled from amongst the Train Examiners working in the grade of Rs. 180 240 to the extent of 20%.
The remaining 80 per cent vacancies were to be filled by direct recruitment of appren tice Train Examiners who may have successfully completed prescribed training.
Paragraph 2 of the notification provid ed .that the apprentice Train Examiners recruited on or from 1.4.1966 shall be given training for a period of 5 years and from the same date artisans recruited in the lower grade as apprentice Train Examiners shall be given 'in service ' training for a period of three years.
The circular upgraded 50% of the existing posts of Train Examiners from Grade D to Grade C in the scale of Rs.205 280 which were earlier ear marked for Apprentice Train Examiners.
The notification further directed that with effect from 1.4.1966 all the apprentice Train Examiners on successful completion of their training should be straightaway brought to the scale Rs.205 280 instead of being first absorbed in the scale of Rs. 180 240 as was being done prior to the issue of the notification.
Apprentice Train Examiners who were undergoing training on the date of the issue of notification, were directed to be brought to the working posts before 1.4.1966 and they were allowed stipend in the scale of Rs. 180 240 during the period of their training 1024 and their period of training was increased from four years to five years.
On the completion of the training they were straightaway posted in Grade C in the scale of Rs.205 280.
Those apprentice Train Examiners who had already been or may be absorbed in the scale of Rs. 180 240 upto 31.3.1966 were directed to be accommodated first in the scale of Rs.205 280 in Grade C against the quota of 80% vacancies reserved for them, and they were not required to undergo selection before being absorbed in that grade.
The effect of the Railway Board 's circular dated October 27, 1965 was that the existing apprentice Train Examiners who had already been absorbed in Grade D by March 31, 1966 were first accommodated in Grade C against 80% of the vacan cies reserved for them without undergoing any selection, while 20% of the vacancies reserved for the departmental Train Examiners, were to be filled by artisan promotees by selection and not on the basis of seniority cum suitability.
Although apprentices as well as artisan promotees constitut ed one integrated class in Grade D but promotee artisans ,were treated differently for promotion to Grade C. Roshan Lal Tandon who was promoted from artisan class to Grade D, filed a writ petition in 'this Court challenging the validi ty of the notification dated 27 10 1965 on the ground that a part of the notification which gave favourable treatment to apprentice Train Examiners was violative of Articles 14 and 16 of the Constitution.
In that writ petition a Consti tution Bench of this Court on August 14, 1967 in Roshan Lal Tandon vs Union of India, ; held that artisans and apprentices recruited from two sources to Grade D were integrated into one class and no discrimination could thereafter be made in favour of recruits from one source as against the recruits from the other source in the matter of promotion to Grade C. Apprentice Train Examiners who were recruited directly to Grade D as Train Examiners formed one common class with the skilled artisans who were promoted to Grade D as Train Examiners and thereafter no favoured treat ment could be given to the apprentice Train Examiners merely because they were directly recruited as Train Examiners, no discrimination could be made against the latter merely because they were promotees.
The Court emphasised that once the direct recruits and promotees are absorbed into one cadre, they formed one class and they could not be discrimi nated for the purpose of further promotion to higher Grade C.
On these findings the Court allowed the writ petition and issued a mandamus directing the Railway Board not to give effect to the impugned part of the circular which was as under: 1025 "The Apprentice T.X. Rs. who have already been or will be absorbed in scale Rs. 180 240 upto 31.3.
1966 should first be accommodated in scale Rs.205 280 against the quota of 80% vacancies reserved for them.
Such staff should not be required to undergo a 'Selection ' before being absorbed in that grade.
The upgraded vacancies in scale Rs.205 280 left over after earmarking those for the appren tices under training on 2.4.66 should be filled by promotion of T.X. Rs. in scale Rs. 180 240 on a selection basis.
While computing the number of posts available for promotion of T.X. Rs. in scale of Rs. 180 240 the vacancies likely to occur during the period of appren ticeship of the apprentices under training as on 1.4.1966 should also be taken into account.
In other words, it would be necessary to keep in reserve only the number of posts equal to the number of apprentices under training as on 1.4.1966, who cannot be absorbed in the antic ipated vacancies which will arise by the time they qualify.
" The Railway Board with a view to implement the decision of this Court and to remove the anomaly which had been pointed out by this Court issued circular/letter No. N (NG) 65 PMI/86 dated 13.9.1968 annexures III to the affidavit filed on behalf of Respondent Railway Administration.
Para graph 1 of the letter refers to this Court 's judgment in Roshan Lal Tandon 's case and also to that portion of the Railway Board 's circular dated October 27, 1965 which had been struck down by the Court and the interim orders issued by the Court restraining the Railway authorities from imple menting the Circular dated October 27, 1965 during the pendency of the writ petition.
Paragraph 2 and 3 of the Circular dated September 13, 1968 stated that in view of the judgment of the Supreme Court the Board have decided that vacancies in the grade of Rs.205 280 (after taking into account the upgrading of 50 per cent of posts in the scale of Rs. 180 240 to 205 280 less the number of posts required for absorbing Apprentice Train Examiners undergoing the enhanced period of training of five years on April 1, 1966, should be filled by selection from amongst Train Examiners in the scale Rs. 180 240 as on March 31, 1966 irrespective of whether they were initially recruited as Apprentice Train Examiners or were promoted from lower grades.
The Board desired that Railway Administrations should take immediate steps to ensure that proper selections are held for which all TXRs in scale of Rs. 180 240 are considered.
It had come to Board 's notice that prior to the issue of the stay order, persons originally recruited as Apprentice Train Examiners who were in the 1026 scale of Rs. 180 240 have been promoted to the grade Rs.205 280 in pursuance of Board 's letter dated 27.10.
The Board decided that in view of the Supreme Court 's judg ment, such promotions should be treated as null and void and the vacancies should be properly filled as mentioned in para 2 of the circular.
The Railway Board issued another circular No. E.(NG)i/69/PMI180 dated 2nd July 1970 laying down procedure for filling of posts of Train Examiners and upgradation of posts.
It directed that vacancies arising in Grade C after 1.4.1966 to the extent of 50% shall be maintained in that grade and the remaining 50% shall be down graded to the scale of Rs. 180 240 to be filled by promotion of skilled artisans.
It further directed that 50% of the vacancies in Grade C should be filled by direct recruitment of apprentice Train Examiners with five years ' training to the extent of 80% thereof and the remaining 20% by promotees from Grade D as laid down in paragraph 1 of the Railway Board 's circular dated 27.10.1965.
This procedure was directed to be followed till the cadre position was normalised ' and the excess in the Grade of Rs.205 280 were eliminated.
Paragraph 2 of the circular further directed that those promoted to Grade C in the scale of Rs.205280 as on April 1, 1966 will be assigned seniority amongst themselves in the order of their inter se seniority in Grade of Rs. 180 240 for the purposes of con firmation in that grade and also for further advancement and they will rank senior to those recruited as apprentice Train Examiners with five years training and appointed after 1.4.1966 in the Grade of Rs. 205 280.
The result of the circular was that all those promotees who had been appointed to Grade D prior to 1.4.
1966 stood absorbed in Grade C and they were granted seniority in that Grade with retrospective effect viz. with effect from April 1, 1966.
Later the Railway Board took a policy decision to abol ish the entry Grade D of Train Examiners in the pay scale of Rs. 180 240, and in order to implement that decision it issued circular/letter No. PC 69 PS 5 TR 1, New Delhi dated 30th October, 1972, abolishing the entry Grade D of Train Examiners and placing the incumbents of that Grade en masse in Grade C in the scale of Rs.205 280 with effect from 1.11.1972.
Paragraph 2 of the circular directed that the pay of the staff brought from Grade D (Rs. 180~240) to Grade C (205 280) will be fixed under Rule 2017 A(III) read with Rule 2019 II.
As all the incumbents of Grade D in the scale of Rs. 180 240 were placed en masse in the higher grade C in the scale of Rs.205 280, a provisional seniority list of Grade C Train Examiners working in Delhi Division was pre pared on 16th November 1981.
In that seniority list peti tioners 1027 were shown senior to some of the respondents as the seniori ty was not determined in accordance with Rule 302 of the Railway Establishment Manual.
This seniority list was not prepared in accordance with the prescribed criteria as had been done in other divisions.
The Railway Board issued a circular No. E(NG) 1 80 SR6 39 dated 28.11.
1981 directing that Delhi Division should also fall in line with other divisions of Northern Railway and the seniority of the Train Examiners appointed between 1.4.1966 to 1.11.1972 should be prepared in accordance with the existing practice viz. on the basis of the date of appointment in particular grade.
In pursuance to that direction seniority of Train Examiners of Grade C placed in that Grade between 1.4.
1966 to 1.11.
1972 was published in 1981 by the authorities of the Delhi Divi sion of Northern Railway.
After inviting objections, the seniority list was finally published in December, 1982.
In that seniority list the petitioners were shown junior to Respondents Nos.
5 to 10, who were placed above the peti tioners.
Aggrieved the petitioners have challenged the validity of the seniority list also by raising additional grounds in the writ petitions.
Before we consider the submissions made on behalf of petitioners it would be appropriate to refer to comparative position of petitioners and the respondents Nos.
5 to 10 with regard to their date of entry in service as Train Examiners in Grade D and Grade C.
The relevant position is as under: Name Date of entry Grade D Grade C Rs. 180 240 Rs.205 280 1.
Yashbir Singh, Petitioner.
29.4.1986 1.11.
1972 2.
I.M. Lal Tandon, Petitioner.
19.6.1966 1.11.
1972 3.
Hira Lal Kapoor, Petitioner.
29.4.1966 1.11.
1972 4.
Harbhaj an Singh, Petitioner.
16.8.1966 1.11.1972 5.
Som Dutt Sharma, Petitioner.
29.4.1966 1.11.1972 6.
A.K. Sharma, Respondent 5, 5.
9.1967 7.
V.K. Chandhok, Respondent 6, 25.
2.1968 8.
R.N. Verma, Respondent 7, 10.
8.1968 9.
Maglani, Respondent 8, 22.
4.1969 10.
Dev Raj Sharma, Respondent 9, 21.
5. 1970 11.
K.N.Sharma, Respondent 10, 9. 2.1971 The above chart shows that Respondents Nos.
5 to 10 who be 1028 long to group of apprentice Train Examiners were directly placed to working posts in Grade C after completion of five years training in accordance with the Railway Board 's circu lar dated 2nd July, 1970, on the respective dates shown in Column 3, which indicates that each one of them had been placed in Grade C prior to 1.11.
1972, while the petitioners were placed in Grade C with effect from 1.11.
1972, in pursuance of the Railway Board 's circular dated 30.10.
Since the Respondents Nos. 5 to 10 were appointed to Grade C earlier in time and as the petitioners were placed in Grade C later, they. were shown junior to the Respondents in the seniority list.
No valid objection can be raised against respondents ' seniority.
Further in the seniority list all those promotees who had been placed in Grade C with effect from April 1, 1966 under the Railway Board 's circular dated July 2, 1970 were shown senior to the petitioners.
Since the petitioners were not granted seniority with retrospective effect in Grade C as was done in the case of those who were promoted under the Circular dated July 2, 1970 they have assailed the Constitutional validity of Railway Board 's circular dated July 2, 1970.
Learned counsel for the petitioners contended that the Railway Board 's circular dated July 2, 1970 was illegal and unconstitutional for variety of reasons.
Firstly, the Rail way Board had no authority in law to grant seniority with retrospective effect to all those promotees who had been placed in Grade C with effect from April 1, 1966 in pursu ance of the circular dated July 2, 1970.
Secondly, the Railway Board practised discrimination between the promotees forming the same class of Grade D with regard to seniority in Grade C.
He contended that under the circular dated July 2, 1970 promotees belonging to Grade D (like the petition ers) were granted seniority in Grade C on their promotion to that grade with retrospective effect from the date of their appointment in Grade D and not from the date of their ap pointment or placement in Grade C whereas the petitioners who form the same class have not been granted the same benefit, instead their seniority has been determined with effect from the date of their entry in Grade C.
The peti tioners and all those who had been appointed in Grade D prior to April 1, 1966 and promoted to Grade C formed the same class and yet they have been treated differently with out any rational basis.
The petitioners were also recruited in 1966 and they all had completed service of more than 4 years approximately as Train Examiners in Grade D on Novem ber 30, 1972 when the circular was issued but they have not been given seniority in Grade C with retrospective effect as was done under the circular dated July 2, 1970.
1029 We have given our anxious consideration to these submis sions but we do not find any merit in the same.
The peti tioners have challenged validity of the Railway Board 's circular dated July 2, 1970 in 198 1 after 11 years.
All the petitioners were in service on the date that circular was issued and they were aware that their colleagues (promotees belonging to Grade D) were placed in Grade C and they had been granted seniority with retrospective effect but none of them challenged the validity of the circular.
Now petition ers cannot be permitted to challenge the validity of that circular after 11 years.
If the petitioners were aggrieved by the Railway Board 's circular dated July 2, 1970 they should have challenged the same within a reasonable period of time which they did not do so.
It is well settled that anyone who may feel aggrieved with an administrative order or decision affecting his right should act with due dili gence and promptitude and not sleep over the matter.
Raking of old matters after a long time is likely to result in administrative complications and difficulties and it would create insecurity and instability in the service which would affect its efficiency.
The petitioners are therefore not entitled to challenge the validity of the Railway Board 's circular dated July 2, 1970 after 11 years and their chal lenge is bound to fail on this ground alone.
We have considered the merit of the submission also but we find no legal or constitutional infirmity in the Circular dated July 2, 1970.
There was increase in the work of car riage and wagons examination, as more complicated type of rolling stock was available with the Indian Railways.
In order to reorganise the cadre of Train Examiners and to cope with the increased work load the Railway Board by its noti fication dated 27th October, 1965 reorganised the cadre.
It directed that vacancies in Grade D were to be exclusively filled by promotion from amongst skilled artisans and direct recruits were to be appointed straightaway to Grade C after completion of training of five years.
Validity of the noti fication was challenged before this Court in Roshan Lal Tandon 's case and the implementation of the circular was stayed.
This Court struck down only a portion of the notifi cation which has been extracted in the earlier part of this judgment but the rest of the directions contained in the notification remained unaffected, including the direction that with effect from April 1, 1966 all the Train Examiners on successful completion of their training should be straightaway brought on to the scale of Rs.205 280 instead of being first absorbed in Grade D. Similarly further direc tion that those apprentices who were undergoing training on April 1, 1966 shall undergo five years ' training instead of four years and during their training they would receive 1030 stipend in the scale of Rs. 180 2 10 and after completion of their training they will straightaway be appointed to Grade C. After the judgment of this Court, the Railway Board reconsidered the matter and with a view to implement the decision of this Court and to further carry out its policy of reorganisation as initiated under its circular dated October 27, 1965 it issued directions under its circular dated July 2, 1970, which is as under: "GOVERNMENT OF INDIA MINISTRY OF RAILWAY (RAILWAY BOARD) No. E(NG) i/69/PMI 180 New Delhi Dated 2nd July 1970 The GMs.
All India Railways.
Sub: Procedure for filling up posts of TXRs upgra dation of.
Boards letter No. E (NG) 165 PMI 86 dated 27.10.1965 and 13.9.1968.
The Board have been receiving representations from the staff working in the category of TXRs in scale Rs. 180 240 (AS) against the procedure prescribed for filling vacancies arising out of upgradation of 50% of posts in scale Rs. 180 240 (AS) to Rs.205280 w.e.f.
1.4.1966.
It has been decided in modification of previous orders that all the TXRs working in Grade 180240 consisting of both App.
of 4 years Trg.
and promotees from ranks as on 1.4.1966 should be promoted en masse to the grade Rs.205 280 irrespective of the quota of vacancies reserved for promotees, the excess to the permissible re organised cadre strength in the grade Rs.205 280 being worked off gradually by wastage such as retirement etc.
in grade Rs.205 280 (AS).
After 1.4.1966 50% of the vacancies arising in grade Rs.205 280 should be main tained in that grade and the remaining 50% will be down graded to the scale of Rs. 190240 to be filled by promotion of skilled artisans.
The 50% of the vacancies in grade Rs.205 280 (AS) should be filled by direct recruitment of App.
TXRs with 5 years training to the extent of 80% thereof and the remaining 20% by pro 1031 motees from grade Rs. 180 240 as laid down in paragraph 1 (ii)(a) of Board 's letter No. E(NG) 165 PMI 86 dated 27.10.1965.
This proce dure will continue to be followed till the cadre position is normalised and the excess in the grade of Rs. 205 280 eliminated.
(2) The staff promoted to the grade Rs.205 280 as on 1.4.1966 will be assigned seniority amongst themselves in the order of their inter se seniority in the grade Rs. 180 240 for the purpose of confirmation in that grade and also for further advancement.
They will all rank senior to those recruited as App.
TXRs with 5 years Trg.
and appointed after 1.4.1966 to the grade Rs.205 280.
(3) The above instructions may please be implemented immediately and a report submitted to the Board in due course.
receipt Sd (O.D.S harma) Asstt.
Director(E) Rly Board" The circular issued three directions, firstly, it directed that all the Train Examiners working in Grade 180 240 con sisting of both apprentice Train Examiners and promotees from rank as on April 1, 1966 should be promoted en masse to Grade C irrespective of quota reserved for promotees.
Sec ondly, it directed that after April 1, 1966 vacancies in Grade C to the extent of 50 per cent should be maintained in that Grade while the remaining 50 per cant should be down graded to Grade D to be exclusively filled by promotion of skilled artisans, it further directed that 50 per cent of the vacancies in Grade C should be filled up by direct recruitment of apprentices with five years training to the extent of 80 per cent thereof and remaining 20 per cent of vacancies from Grade D. Thirdly, it issued direction with regard to assigning seniority to the staff promoted to Grade C on April 1, 1966.
They were to carry their inter se sen iority in Grade D for the confirmation and also for further advancement.
It further directed that the promotees will rank senior to the direct recruits in Grade C appointed after April 1, 1966.
These directions were issued with the object and purpose of achieving the reorganisation which had been initiated by Railway 1032 Board under its circular dated October 27, 1965.
The scheme of reorganisation of cadre as contemplated by the circular dated October 27, 1965 was to be carried out with effect from April 1, 1966 and that date was followed by the Railway Board in its circular dated January 2, 1970.
The petition ers ' submission that the date April 1, 1966 was fixed in arbitrary manner without any basis is untenable.
The promo tees who were placed in the higher Grade C with effect from April 1, 1966 were undoubtedly senior to the petitioners in Grade D, none of the petitioners ' rights were affected by their promotion.
The reorganisation of the cadre of Train Examiners and the promotion to Grade C could not be complet ed on account of the pendency of Roshan Lal Tandon 's case in this Court and the stay orders issued therein.
After the decision of this Court the Railway Board implemented the scheme and it made promotion with retrospective effect.
As the promotion to Grade C had been stayed, during the penden cy of the writ petition in this Court the Railway Board was justified in granting promotion with effect from April 1, 1966 as initially reorganisation was proposed to be imple mented with effect from that date as is clear from Railway Board 's notification dated October 27, 1965.
The Railway Board promoted the staff with retrospective effect because on account of stay orders issued by the Court those entitled to be promoted with effect from April 1, 1966 could not be promoted.
The petitioners cannot claim parity with those who had been promoted to Grade C under the Railway Board 's circular dated July 2, 1970 as they do not belong to that class.
Equality can be claimed among equals and not with unequals.
Those persons who had acquired right of promotion under the Railway Board 's notification dated October 27, 1965 could not be promoted on account of litigation, they formed a distinct class and the petitioners cannot equate themselves with them as they were not entitled to promotion under the notification dated October 27, 1965.
The petition ers have no right in law to claim similar treatment.
There is therefore no merit in the petitioners ' plea of discrimi nation.
Validity of the Railway Board 's circular dated July 2, 1970 on the ground of it being discriminatory was raised before the Delhi High Court in writ petition No. 1147 of 1971, Chaman Lal and others vs Union of India and others decided on May 20, 1980.
A Division Bench of that Court upheld its validity.
In another writ petition No. 2834 of 198 1 Kewal Krishan vs Union of India and others again the validity of Railway Board 's circular dated July 2, 1970 as well as the validity of Railway Board 's circular dated January 28, 1981 was upheld by a Division Bench of the Delhi High Court on December 15, 1981.
Learned counsel for the petitioners challenged the validity of the 1033 Railway Board 's circular dated November 1, 1981 which di rected the.
Delhi Division to fall in line with other divi sions of Northern Railways for determining the seniority of Train Examiners.
It appears that seniority of Train Examin ers in Grade C working in other Divisions of Northern Rail way was determined, from the date of appointment in that Grade, in accordance with Rule 302 of the Railway Establish ment Manual but in Delhi Division that practice was not followed.
The Railway Board directed the Delhi Division to fall in line with other divisions in determining the senior ity of Train Examiners.
Learned counsel for the petitioners urged that since under the Railway Board 's circular dated October 30, 1972 the petitioners were placed en masse in Grade C in the scale of Rs.205 280 they are entitled to seniority with effect from the date of their appointment in Grade D and if that be so, they would rank senior to Re spondents Nos. 5 to 10 who were appointed later in time.
At this stage it would be profitable to have a glance at Rail way Board 's circular dated October 30, 1972 which is as under: "GOVERNMENT OF INDIA MINISTRY OF RAILWAYS (RAILWAY BOARD) No. PC 69/PS 5/TR 1 New Delhi dated 30.10.
1972 The General Managers, All India Railways.
Sub: Upgrading of the initial scale of pay of Train Examiners on Railways.
Ref: Board 's letters No. (1) E(NG) 65 PMI '86 dated 27.10.
(ii) No. E (NG) 165 PMI 86 dated 13.9.
(iii) No. E(NG) 1 69 .PM/ 1/130 dated 2.7.
The Board have considered the commu nications received from the National Federa tion of Indian Railwaymen and the All India Railwaymen 's Federation regarding the proce dure prescribed for filling and maintenance of vacancies in the Train Examiners ' cadre as envisaged in the above mentioned letters and more particularly their demand for abolition of the grade of Rs. 180 240.
It has now been decided in modification of existing orders that the 1034 initial grade of TXRs, viz. Rs. 180 240 should be abolished and all the TXRs working in that grade should be placed en masse in the grade Rs.205 280 w.e.f. 1.11.
It has been decided that vacancies in grade Rs.205 280 should hereafter be filled in the following manner: (i) 40% of vacancies to be filled by promotion or Artisans; (ii) 20% of vacancies to be reserved for existing Artisans going as Apprentice TXRs, with age relaxation upto 35 years; and (iii) 40% of vacancies to be filled by direct recruitment of Apprentices TXRs from the open market through Railway Service Com missions.
Pay of the staff brought on from grade Rs. 180 240 (AS) to Grade Rs.205 280(AS) will be fixed under Rule 2017(a)(ii) read with rule 2019 PII.
This has the approval of the President.
Sd/ (R.S. Bharal) Dy.
Director, Establishment (P & A) Railway Board No. PC 69/PS 5/TP 1 New Delhi dated 30.10.72 Copy of the FA & CAOS, and Chief Auditors of All Indian Railways.
Sd/ (R.S. Bharal) Dy.
Director, Establishment (P & A) Railway Board.
" By the aforesaid circular the entry grade of Train Examiners in the scald of Rs. 180 240 was abolished and all the Train Examiners working in that Grade were placed in the scale of Rs.205 280 with effect from November 1, 1972.
In pursuance to that decision, petitioners were included in Grade C with effect from November 1, 1972 and 1035 therefore they are entitled to seniority with effect from that date in Grade C.
In the absence of any statutory rule or directions petitioners are, not entitled to claim senior ity in Grade C with reference to the date of their appoint ment in Grade D.
The chart indicating respective dates of entry of petitioners and the Respondents 5 to 10 in Grade C. as extracted in the earlier part of the judgment would show that Respondents Nos. 5 to 10 were appointed in Grade C earlier in time than the petitioners, therefore they are entitled to be senior to the petitioners.
It is not disputed that Rule 302 of the Railway Establishment Manual lays down a general rule for determining seniority from the date of appointment in a particular grade and the petitioners have not placed any rule or instruction before us to support their case.
Seniority ordinarily reflects length of service in a particular cadre or grade.
It is generally regulated by service rules or in the absence of Rules by executive in structions.
By and large, such rules provide for determining seniority with reference to the date of appointment but there are instances where rules provide for determining seniority with reference to date of confirmation.
Normally, when a person is promoted or placed in a higher grade his seniority is determined with reference to the date of such promotion or placement unless the relevant rules provide to the contrary.
Seniority in the lower grade has no meaning for determining seniority in the higher grade except for determining inter se seniority of promotees.
Rule 302 con tains a general Rule and there is no exception to it.
In the absence of any contrary provision in the Rules, the general rule of seniority as laid down by Rule 302 must prevail.
Learned counsel then urged that the seniority list of Grade D had been prepared in 1968 and in that seniority list petitioners were shown senior to some of the respondents and that seniority could not legally be disturbed.
It appears that in the seniority list prepared in 1968 the names of some of the respondents was shown in Grade D on the assump tion that they held posts of Train Examiners in that Grade.
It was done on a wrong assumption.
Admittedly, the Respond ents Nos. 5 to 10 were apprentices who were undergoing training, and in accordance with the directions contained in the Railway Board notification dated October 27, 1965 they were entitled to appointment in Grade C straightaway on completion of their training.
They were no doubt drawing stipend at the rate of Rs. 180 240 which was the scale prescribed for Grade D but nonetheless they did not belong to Grade D as they were not appointed to any of the posts in that Grade.
Their names therefore could not be included in the seniority list of Grade D. Petitioners cannot draw any advantage from the mistake committed in 1036 including the Respondents name in the seniority list of 1968.
Learned counsel then urged that Hira Lal Kapoor, one of the petitioners was promoted on June 23, 1981 on the basis of his seniority in Grade D, therefore, other petitioners are also entitled to their seniority with effect from the date of their appointment in Grade D.
In the written submis sion filed on behalf of Respondents it is stated that the Deputy Regional Manager of Delhi had granted promotion to H.L. Kapoor on June 2, 1981 on ad hoc and temporary basis.
On receipt of representations and.
protests from Respondent No. 5 Ashok Kumar Sharma and the General Secretary.
Northern Railway Men 's Union, order of promotion issued in favour of H.L. Kapoor was cancelled and Sh.
A.K. Sharma, Respondent No. 5 was promoted.
Since the petitioners were placed in higher Grade C with effect from November 1, 1972 they are entitled to seniority with reference to date of their place ment in that Grade and they have no legal right to claim seniority in that Grade against those who were appointed to that Grade before November 1, 1972.
Learned counsel for the petitioners referred to Lok Sabha questions asked by Sh.
Suraj Bhan, M.P. and the an swers given to those questions with regard to seniority of direct recruits and promotees, (Annexures K of the petition).
The petitioners have asserted that in reply to the Lok Sabha questions, it was clearly stated by the Rail way Administration that direct recruit Train Examiners posted on working posts before November 1, 1972 in Grade C in the scale of Rs.205 280 will not be treated senior to the Train Examiners promoted en masse with effect from November 1, 1972.
In the counter affidavit filed by the respondents it is stated that the reply to the Lok Sabha questions as contained in Annexure K to the petition is of no relevance as the said questions were not admitted at all and no reply was given by the Railway Board.
It appears that the General Manager had prepared a draft reply to the Lok Sabha ques tions but the reply had not been finalised by the Railway Board which is the competent authority.
The Railway Board could have modified the draft of the reply as prepared by the General Manager but since the question was not admitted no reply was sent to the Lok Sabha.
The petitioner can therefore draw no support from Annexure K to the petition.
Learned counsel for the petitioners then urged that the petitioners were not promoted to Grade C instead they were placed en masse in Grade C on the abolition of Grade D therefore the date of their seniority should not be deter mined from the date of their placement in 1037 Grade C instead they are entitled to their seniority with reference to the date of their appointment in Grade D. He placed reliance on the directions, contained in paragraph 2 of the Railway Board 's circular dated October 30, 1972 that the petitioners ' salary in Grade C shall be fixed in accord ance with Rule 2017 R II read with rule 2019 II.
He urged that if the petitioners were treated to have been promoted to Grade C with effect from November 1, 1972 in that case their salary could have been fixed in accordance with Rule 2018 (R II) (PR 22/C).
It is true that the petitioners were not promoted from Grade D to Grade C instead Grade D was abolished and the petitioners and all other incumbents holding posts in Grade D were placed en masse in Grade C and the Railway Board issued directions that their salary shall be fixed in accordance with the Rule 2017 read with Rule 2018 (R II) (PR 22/C).
Whether petitioners were promoted to Grade C or whether they were placed en masse in that Grade does not make any difference so far as their entry to Grade C is concerned, in either case, they entered Grade C with effect from November 1, 1972.
Reference to a particular rule for determining their pay in the higher grade cannot change the criteria for determining seniority.
The Railway Board had never issued any direction for determining the petition ers seniority with reference to their date of appointment in the initial entry grade.
The petitioners have failed to show that any person junior to them has been made senior to them.
Their grievance is without any substance.
In view of the above discussion we find no merit in the petitions.
We accordingly dismiss the same with costs.
All interim orders stand discharged.
S.L. Petitions dismissed.
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(Under Article 32 of the Constitution of India). Petitioner in person (Inder Mohan Lal Tandon) in W.P. No. V.C. Mahajan, G.L. Sanghi, C.V.S. Rao, Kitty Kumaraman glam, Randhir Jain and S.K. Bhattacharya for the Respond ents. E (NG) 1/69/PMI 180 dated 2nd July, 1970 and No. E (NG) I 80 SR6 39 dated 28th November, 1981. They further claim relief for the issue of writ in the nature of mandamus restraining the respondent, Railway Authorities, from altering or issuing seniority list in pursuance of the Railway Board 's circular dated 28th November, 1023 1981 and to maintain the previous seniority list issued in 1968 for the purpose of promotions, confirmation and further advancement. In the Indian Railways, initial recruitment of Train Examiners, used to be made in the entry Grade D in the pay scale of Rs. 50 per cent of the vacan cies were filled by apprentices while the remaining 50% of the vacancies used to be filled by promotion of skilled artisans. 150 225 and later these grades were revised and the scale of D grade was raised to Rs. 180 240 and that of C Grade to Rs.205280. 120 140 should not be filled from apprentice Train Examiners upto 50 per cent as hitherto, but should exclusively be, filled by promotion of skilled arti sans. It further provided that vacancies in the next higher grade C (in the scale of Rs.205 280) should be filled from amongst the Train Examiners working in the grade of Rs. 180 240 as was being done prior to the issue of the notification. The effect of the Railway Board 's circular dated October 27, 1965 was that the existing apprentice Train Examiners who had already been absorbed in Grade D by March 31, 1966 were first accommodated in Grade C against 80% of the vacan cies reserved for them without undergoing any selection, while 20% of the vacancies reserved for the departmental Train Examiners, were to be filled by artisan promotees by selection and not on the basis of seniority cum suitability. who have already been or will be absorbed in scale Rs. Such staff should not be required to undergo a 'Selection ' before being absorbed in that grade. 180 240 the vacancies likely to occur during the period of appren ticeship of the apprentices under training as on 1.4.1966 should also be taken into account. Para graph 1 of the letter refers to this Court 's judgment in Roshan Lal Tandon 's case and also to that portion of the Railway Board 's circular dated October 27, 1965 which had been struck down by the Court and the interim orders issued by the Court restraining the Railway authorities from imple menting the Circular dated October 27, 1965 during the pendency of the writ petition. Paragraph 2 and 3 of the Circular dated September 13, 1968 stated that in view of the judgment of the Supreme Court the Board have decided that vacancies in the grade of Rs.205 280 (after taking into account the upgrading of 50 per cent of posts in the scale of Rs. 180 240 as on March 31, 1966 irrespective of whether they were initially recruited as Apprentice Train Examiners or were promoted from lower grades. It had come to Board 's notice that prior to the issue of the stay order, persons originally recruited as Apprentice Train Examiners who were in the 1026 scale of Rs. 180 240 have been promoted to the grade Rs.205 280 in pursuance of Board 's letter dated 27.10. The Railway Board issued another circular No. 180 240 to be filled by promotion of skilled artisans. It further directed that 50% of the vacancies in Grade C should be filled by direct recruitment of apprentice Train Examiners with five years ' training to the extent of 80% thereof and the remaining 20% by promotees from Grade D as laid down in paragraph 1 of the Railway Board 's circular dated 27.10.1965. The result of the circular was that all those promotees who had been appointed to Grade D prior to 1.4. 1966 stood absorbed in Grade C and they were granted seniority in that Grade with retrospective effect viz. 180 240, and in order to implement that decision it issued circular/letter No. PC 69 PS 5 TR 1, New Delhi dated 30th October, 1972, abolishing the entry Grade D of Train Examiners and placing the incumbents of that Grade en masse in Grade C in the scale of Rs.205 280 with effect from 1.11.1972. Paragraph 2 of the circular directed that the pay of the staff brought from Grade D (Rs. As all the incumbents of Grade D in the scale of Rs. This seniority list was not prepared in accordance with the prescribed criteria as had been done in other divisions. on the basis of the date of appointment in particular grade. In pursuance to that direction seniority of Train Examiners of Grade C placed in that Grade between 1.4. 1972 was published in 1981 by the authorities of the Delhi Divi sion of Northern Railway. After inviting objections, the seniority list was finally published in December, 1982. In that seniority list the petitioners were shown junior to Respondents Nos. 5 to 10, who were placed above the peti tioners. Before we consider the submissions made on behalf of petitioners it would be appropriate to refer to comparative position of petitioners and the respondents Nos. 2.1971 The above chart shows that Respondents Nos. 1972, while the petitioners were placed in Grade C with effect from 1.11. were shown junior to the Respondents in the seniority list. No valid objection can be raised against respondents ' seniority. 1029 We have given our anxious consideration to these submis sions but we do not find any merit in the same. Now petition ers cannot be permitted to challenge the validity of that circular after 11 years. There was increase in the work of car riage and wagons examination, as more complicated type of rolling stock was available with the Indian Railways. Sub: Procedure for filling up posts of TXRs upgra dation of. E (NG) 165 PMI 86 dated 27.10.1965 and 13.9.1968. 190240 to be filled by promotion of skilled artisans. 180 240 as laid down in paragraph 1 (ii)(a) of Board 's letter No. 180 240 for the purpose of confirmation in that grade and also for further advancement. They will all rank senior to those recruited as App. and appointed after 1.4.1966 to the grade Rs.205 280. (3) The above instructions may please be implemented immediately and a report submitted to the Board in due course. They were to carry their inter se sen iority in Grade D for the confirmation and also for further advancement. The petition ers ' submission that the date April 1, 1966 was fixed in arbitrary manner without any basis is untenable. After the decision of this Court the Railway Board implemented the scheme and it made promotion with retrospective effect. The petitioners cannot claim parity with those who had been promoted to Grade C under the Railway Board 's circular dated July 2, 1970 as they do not belong to that class. Equality can be claimed among equals and not with unequals. The petition ers have no right in law to claim similar treatment. There is therefore no merit in the petitioners ' plea of discrimi nation. A Division Bench of that Court upheld its validity. 2834 of 198 1 Kewal Krishan vs Union of India and others again the validity of Railway Board 's circular dated July 2, 1970 as well as the validity of Railway Board 's circular dated January 28, 1981 was upheld by a Division Bench of the Delhi High Court on December 15, 1981. Delhi Division to fall in line with other divi sions of Northern Railways for determining the seniority of Train Examiners. 5 to 10 who were appointed later in time. 1972 The General Managers, All India Railways. Sub: Upgrading of the initial scale of pay of Train Examiners on Railways. 180 240 should be abolished and all the TXRs working in that grade should be placed en masse in the grade Rs.205 280 w.e.f. Pay of the staff brought on from grade Rs. 180 240 (AS) to Grade Rs.205 280(AS) will be fixed under Rule 2017(a)(ii) read with rule 2019 PII. Director, Establishment (P & A) Railway Board No. Director, Establishment (P & A) Railway Board. " By the aforesaid circular the entry grade of Train Examiners in the scald of Rs. 5 to 10 were appointed in Grade C earlier in time than the petitioners, therefore they are entitled to be senior to the petitioners. It is not disputed that Rule 302 of the Railway Establishment Manual lays down a general rule for determining seniority from the date of appointment in a particular grade and the petitioners have not placed any rule or instruction before us to support their case. Seniority ordinarily reflects length of service in a particular cadre or grade. It is generally regulated by service rules or in the absence of Rules by executive in structions. By and large, such rules provide for determining seniority with reference to the date of appointment but there are instances where rules provide for determining seniority with reference to date of confirmation. Rule 302 con tains a general Rule and there is no exception to it. In the absence of any contrary provision in the Rules, the general rule of seniority as laid down by Rule 302 must prevail. Learned counsel then urged that the seniority list of Grade D had been prepared in 1968 and in that seniority list petitioners were shown senior to some of the respondents and that seniority could not legally be disturbed. It appears that in the seniority list prepared in 1968 the names of some of the respondents was shown in Grade D on the assump tion that they held posts of Train Examiners in that Grade. 180 240 which was the scale prescribed for Grade D but nonetheless they did not belong to Grade D as they were not appointed to any of the posts in that Grade. 5 Ashok Kumar Sharma and the General Secretary. Since the petitioners were placed in higher Grade C with effect from November 1, 1972 they are entitled to seniority with reference to date of their place ment in that Grade and they have no legal right to claim seniority in that Grade against those who were appointed to that Grade before November 1, 1972. Learned counsel for the petitioners referred to Lok Sabha questions asked by Sh. Suraj Bhan, M.P. and the an swers given to those questions with regard to seniority of direct recruits and promotees, (Annexures K of the petition). The petitioners have asserted that in reply to the Lok Sabha questions, it was clearly stated by the Rail way Administration that direct recruit Train Examiners posted on working posts before November 1, 1972 in Grade C in the scale of Rs.205 280 will not be treated senior to the Train Examiners promoted en masse with effect from November 1, 1972. Whether petitioners were promoted to Grade C or whether they were placed en masse in that Grade does not make any difference so far as their entry to Grade C is concerned, in either case, they entered Grade C with effect from November 1, 1972. Reference to a particular rule for determining their pay in the higher grade cannot change the criteria for determining seniority. The Railway Board had never issued any direction for determining the petition ers seniority with reference to their date of appointment in the initial entry grade. The petitioners have failed to show that any person junior to them has been made senior to them. Their grievance is without any substance. In view of the above discussion we find no merit in the petitions. We accordingly dismiss the same with costs.
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The petitioners were railway employees.
The Railway Board issued a circular dated July 2, 1970, laying down procedure for filling up posts of train examiners and upgra dation of posts.
It directed that vacancies arising in Grade C after 1.4.1966 to the extent of 50 per cent would be maintained in that grade and the remaining 50 per cent would be down graded to be filled by promotion of skilled arti sans.
It further directed that 50 per cent of the vacancies in Grade C should be filled by direct recruitment of appren tice Train Examiners with five years ' training to the extent of 80 per cent thereof and the remaining 20 per cent by promotees from Grade D as laid down in paragraph 1 of the Circular dated 27.10.1965 of the Board.
This procedure was directed to be followed till the cadre position was norma lised and the excess in the Grade of Rs.205 280 were elimi nated.
Paragraph 2 of the circular further directed that those promoted to Grade C in the scale of Rs.205280 as on April 1, 1966 would be assigned seniority amongst themselves in the order of their inter se seniority in the Grade of Rs. 180 240 for the purposes of confirmation, etc., in that grade and they would rank senior to those recruited as apprentice train examiners with five years ' training and appointed after 1.4.66 in the grade of Rs.205 280.
The result of the circular was that all those promotees, who had been appointed to Grade D prior to 1.4.66 stood absorbed in Grade C and they were granted seniority in that grade with retrospective effect, that is, with effect from April 1, 1966.
The Railway Board later took a policy decision to abol ish the entry grade D of train examiners in the pay scale of Rs. 180 240, and in order to implement that decision issued a circular dated October 30, 1972, abolishing the entry Grade D of the train examiners and placing the incumbents of that grade en masse in grade C in the scale of Rs.205280 with effect from 1.11.72.
Paragraph 2 of the circular di rected that the pay of the staff brought from Grade D (Rs.180 240) to grade C 1019 (Rs.205 280) would be fixed under Rule 2017 A (III) read with rule 2019 II.
As all the incumbents of grade D in the scale of Rs. 180 240 were placed en masse in the higher grade C in the scale of Rs.205 280, a provisional seniority list of grade C Train Examiners working in Delhi Division was prepared on November 16, 1981.
In that seniority list, the petitioners were shown senior to some of the respondents as the seniority was not determined in accordance with Rule 302 of the Railway Establishment Manual.
This seniority list was not prepared in accordance with the prescribed criteria, as had been done in the other Divisions.
The Board issued a circular dated 28.11.81, directing that the Delhi Division should also fail in line with the other Divisions of the Northern Railway, and the seniority of the train examiners appointed between 1.4.66 and 1.11.72 should be prepared in accordance with the existing practice.
viz. on the basis of the date of appointment in the particular grade.
In pursuance of that direction, seniority of the train examiners of grade C placed in that grade between 1.4.66 and 1.11.72, was published in 1981 by the authorities of the Delhi Division of the Northern Railway.
After inviting objections, the seniority list was finally published in December, 1982.
In that seniority list, the petitioners were shown junior to respondents 5 to 10.
Aggrieved, the peti tioners moved this Court by writ petitions, challenging the validity of the seniority list and for quashing the circu lars dated July 2, 1970 and November 28, 1981 of the Railway Board, and restraining the respondent Railway authorities from altering or issuing the seniority list in pursuance of the circular dated November 28, 1981 of the Railway Board and for maintaining the seniority list issued in 1968.
Dismissing the petitions, the Court, HELD: The Respondents Nos.
5 to 10, who belonged to the group of apprentice train examiners were directly placed to working posts in grade C after completion of 5 years ' train ing in accordance with the circular dated July 2, 1970 of the Railway Board, and each one of them had been placed in grade C prior to 1.11.72, while the petitioners were placed in grade C with effect from 1.11.72, in pursuance of the circular dated 30.10.72 of the Railway Board.
Since the respondents 5 to 10 were appointed to grade C earlier and the petitioners were placed in that grade later, the peti tioners were shown in the seniority list junior to the respondents concerned.
No valid objection can be raised against respondents ' seniority.
[1027H; 1028A C] 1020 The petitioners challenged the validity of the Railway Board 's circular dated July 12, 1970, in 1981 after 11 years.
All the petitioners were in service on the date that circular was issued and they were aware that their col leagues (promotees belonging to grade D) were placed in grade C and they had been granted seniority with retrospec tive effect, but none of them challenged the validity of the circular.
Now, the petitioners cannot be permitted to chal lenge the validity of that circular after 11 years.
The petitioners should have challenged the circular within a reasonable period of time which they did not do.
It is wellsettled that anyone, who may feel aggrieved by an admin istrative order or decision affecting his right, should act with due diligence and promptitude and not sleep over the matter.
Taking up old matters after a long time is likely to result in administrative complications and difficulties and would create insecurity and instability in the service which would affect its efficiency.
The petitioners are, therefore, not entitled to challenge the validity of the Railway Board 's circular dated July 2, 1970, after 11 years.
Even otherwise, on merits.
there is no legal and constitutional infirmity in the circular.
In order to reorganise the cadre of the train examiners to cope with the increased work load, the Railway Board issued a Notification dated October 27, 1965, reorganising the cadre.
The validity of the notifica tion was challenged before this Court in Roshan Lal Tandon 's case.
The Court struck down only a portion of the notifica tion and the rest of the directions contained in the notifi cation remained unaffected.
After the judgment of the Court, the Railway Board reconsidered the matter, and, with a view to implementing the decision of this Court and further carrying out its policy of reorganisation as initiated under its circular dated October 27, 1965, issued the circular dated July 2, 1970 [1029A H; 1030A B] The scheme of reorganisation of the cadre as contemplat ed by the circular dated October 27, 1965, was to be opera tive with effect from April 1, 1966.
The Petitioners ' sub mission that the date April 1, 1966, was fixed in an arbi trary manner without any basis, is untenable.
The promotees, who were placed in the higher grade C with effect from April 1, 1966, were undoubtedly senior to the petitioners in grade D, and none of the petitioners ' rights were affected by their promotions.
The Railway Board implemented the reorgan isation scheme after the decision of this Court in Roshan Lal Tandon 's case.
As promotion to grade C had been stayed during the pendency of Tandon 's case in this Court, the Railway Board was justified in granting promotion with retrospective effect from April 1, 1966, as initially, the reorganisation was proposed to be implemented from that date, which could not be done on account of stay orders issued by this Court.
The petitioners 1021 cannot claim parity with those who had been promoted to grade C under the Railway Board 's circular dated July 2, 1970, as they do not belong to that class.
Equality can be claimed amongst equals and not with unequals.
The persons, who had acquired the right of promotion under the Railway Board 's notification dated October 27, 1965, but could not be promoted on account of litigation, formed a separate class, and the petitioners could not equate themselves with them, as they were not entitled to promotion under the notification dated October 27, 1965.
There is no merit in the petitioners ' plea of discrimination.
[103AF H] The validity of the Railway Board 's circular dated July 2, 1970, was challenged by a writ petition before the Delhi High Court, which upheld the same.
Again, the validity of that circular as well as the circular dated January 28, 1981 of the Railway Board was challenged by a writ petition before the Delhi High Court, which upheld the same.
[1032F H] By the Circular dated October 30, 1972, of the Railway Board, the entry grade of train examiners in the scale of Rs. 180 240, was abolished and all the train examiners in that grade were placed in the scale of Rs.205 280 with effect from November 1, 1972.
The petitioners were included in grade C with effect from November 1, 1972, and, there fore, they are entitled to seniority with effect from that date in Grade C.
The petitioners are not entitled to claim seniority in grade C with reference to the date of their appointment in grade D. The respondents 5 to 10 were ap pointed in grade C earlier than the petitioners and, there fore, they are senior to the petitioners.
Rule 302 of the Railway Establishment Manual lays down a general rule for determining seniority from the date of appointment in a particular grade when a person is promoted to or placed in a higher grade, his seniority is determined with reference to the date of such promotion or placement unless the relevant rules provide to the contrary.
Seniority in lower grade has no meaning for determining seniority in the higher grade except for determining inter se seniority of the promotees.
In the absence of any contrary provision in the Rules, the general rule of seniority laid down by Rule 302 must pre vail.
[1034G H; 1035A E] It appears that in the seniority list prepared in 1968, the names of some of the respondents were shown in grade D on a wrong assumption.
The respondents 5 to 10 were appren tices undergoing training, and in accordance with the direc tions contained in the Railway Board 's notification dated October 27, 1965.
they were entitled to appointment 1022 straightaway on completion of their training.
They were drawing stipend at a rate which was the scale prescribed for grade D, but they did not belong to grade D and could not be included in the seniority list of grade D.
The petitioners cannot draw advantage from the mistake committed in includ ing the names of the respondents in the seniority list of 1968.
[1035F H; 1036A] The petitioners were placed in higher grade C with effect from November 1, 1972, and they are entitled to seniority with reference to their placement in that grade and they have no legal right to claim seniority in that grade as against those who were appointed to that grade before November 1, 1972.
[1036C D] Whether the petitioners were promoted to grade C or were placed en masse in that grade, does not make any difference in so far their entry to grade C is concerned; in either case, they entered grade C with effect from November 1, 1972.
The petitioners have failed to show that any person junior to them has been made senior to them.
Their grievance is without any substance.
[1037C E]
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The Railway Board issued a circular dated July 2, 1970, laying down procedure for filling up posts of train examiners and upgra dation of posts. It further directed that 50 per cent of the vacancies in Grade C should be filled by direct recruitment of appren tice Train Examiners with five years ' training to the extent of 80 per cent thereof and the remaining 20 per cent by promotees from Grade D as laid down in paragraph 1 of the Circular dated 27.10.1965 of the Board. 180 240 for the purposes of confirmation, etc., The result of the circular was that all those promotees, who had been appointed to Grade D prior to 1.4.66 stood absorbed in Grade C and they were granted seniority in that grade with retrospective effect, that is, with effect from April 1, 1966. As all the incumbents of grade D in the scale of Rs. 180 240 were placed en masse in the higher grade C in the scale of Rs.205 280, a provisional seniority list of grade C Train Examiners working in Delhi Division was prepared on November 16, 1981. In that seniority list, the petitioners were shown senior to some of the respondents as the seniority was not determined in accordance with Rule 302 of the Railway Establishment Manual. This seniority list was not prepared in accordance with the prescribed criteria, as had been done in the other Divisions. on the basis of the date of appointment in the particular grade. After inviting objections, the seniority list was finally published in December, 1982. Since the respondents 5 to 10 were appointed to grade C earlier and the petitioners were placed in that grade later, the peti tioners were shown in the seniority list junior to the respondents concerned. Now, the petitioners cannot be permitted to chal lenge the validity of that circular after 11 years. The petitioners should have challenged the circular within a reasonable period of time which they did not do. The Petitioners ' sub mission that the date April 1, 1966, was fixed in an arbi trary manner without any basis, is untenable. The promotees, who were placed in the higher grade C with effect from April 1, 1966, were undoubtedly senior to the petitioners in grade D, and none of the petitioners ' rights were affected by their promotions. Equality can be claimed amongst equals and not with unequals. There is no merit in the petitioners ' plea of discrimination. [103AF H] The validity of the Railway Board 's circular dated July 2, 1970, was challenged by a writ petition before the Delhi High Court, which upheld the same. [1032F H] By the Circular dated October 30, 1972, of the Railway Board, the entry grade of train examiners in the scale of Rs. Seniority in lower grade has no meaning for determining seniority in the higher grade except for determining inter se seniority of the promotees. The petitioners have failed to show that any person junior to them has been made senior to them. Their grievance is without any substance.
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| 0.408765
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No. 1123 of 1986.
(Under Article 32 of the Constitution of India).
R.K. Garg and J.R. Das for the petitioner.
A.K. Panda and Vinoo Bhagat for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
This is a petition under Article 32 of the Constitution challenging the validity of the list of candidates prepared by Orissa Public Service Commission, Cuttack for appointment as Probationary Munsifs in the State Judicial Service.
The selection of candidates for subordinate judicial service is governed by the Orissa Judicial Service Rules, 1964 (the "Rules").
The Rules were flamed under the proviso to Article 309 read with Article 234 of the Constitution of India.
The State Public Service Commission (The "Commission") is the selecting authority.
The candidates are required to be selected by written test followed by viva voce test.
The written examination carries the maximum marks of 950 and the viva voce test 200.
In accordance with the Rules, the Commission issued advertisement No. 12 of 1982 83 inviting applications from eligible candidates for posts of Probationary Munsifs.
The petitioner was one of the candidates who applied in response thereof.
In the written examination conducted by the Commis sion the petitioner secured 470 marks.
He was called for viva voce test in which he was given 30 marks.
He thus secured in all 500 out of 1150.
The Commission prepared a list of candidates which we may term as 'select list ' and recommended to the Government altogether 56 candidates in four batches as desired by the latter.
The petitioner did not find a place in that list.
The candidates with less number of aggregate marks than that of the petitioner have, however, been selected.
The petitioner, therefore, chal lenges the validity of selection, on the ground among others that it is arbitrary and contrary to the Rules.
1100 The reason for exclusion of the petitioner from the select list is not obscure.
It has been at any rate now made explicit.
He did not secure the minimum qualifying marks prescribed by the Commission in the viva voce test.
In the counter affidavit filed on behalf of the Commission it has been so stated.
It is said that the Commission has taken a decision that a candidate to be suitable for the post of Munsif, should secure at least 30% at the viva voce test.
That decision was taken on the advice of the High Court Judge.
The question for our consideration is whether the mini mum marks prescribed by the Commission at the viva voce test is justified, and whether the select list prepared by the Commission is in accordance with the Rules.
Rules 16, 17, 18 and 19 are the relevant rules which have a material bearing on the question that falls for determination: These Rules read as under: Rule 16: "The Commission shall summon for the viva voce test all candidates who have secured at the written examination not less than the minimum qualifying marks obtained in all subjects taken together which shall be the (30%) of the total marks in all the papers: Provided that Government may after consulta tion with the High Court and Commission fix higher qualifying marks in any or all of the subjects in the written examination in respect of any particular recruitment.
Rule 17: The Chief Justice or any of the other Judges of the High Court nominated by the Chief Justice shall represent the High Court and be present at the viva voce test and advise the Commission on the fitness of candi dates at the viva voce test from the point of view of their possession of the special quali ties required in the judicial service, but shall not be responsible for selection of candidates.
Rule 18: The marks obtained at the vive voce test shall be added to the marks obtained in the written examination.
The names of candi dates will then be arranged by the Commission in order of merit.
If two or more candidates obtain equal marks in the aggregate, the order shall be determined in accordance with the marks, secured at the written examination.
Should the marks secured at the written exami nation of the 1101 candidate concerned be also equal, then the order shall be decided in accordance with the total number of marks obtained in the optional papers.
Rule 19: (1) The Commission shall then forward to the Government in the Law Department the list of candidates prepared in accordance with Rule 18 indicating therein whether a candidate belongs to Schedule Caste or Scheduled Tribes.
(2) The list prepared shall be published by the Commission for general information.
(3) The list, unless the Governor in consulta tion with the High Court otherwise decides, shall ordinarily be in force for one year from the date of its preparation by the Commi ssion.
" The Rule making authorities have provided a scheme for selection of candidates for appointment to judicial posts.
Rule 16 prescribes the minimum qualifying marks to be se cured by candidates in the written examination.
It is 30% of the total marks in all the papers.
The candidates who have secured more than that minimum would alone be called for viva voce test.
The Rules do not prescribe any such minimum marks to be secured at the viva voce test.
After the viva voce test, the Commission shall add the marks of the viva voce test to the marks in the written examination.
There then, Rule 18 states: "The names of candidates will then be arranged by the Commission in the order of merit.
" This is the mandate of Rule 18.
The Commission shall add the two marks together, no matter what those marks at the viva voce test.
On the basis of the aggregate marks in both the tests, the names of candidates will have to be arranged in order of merit.
The list so prepared shall be forwarded to the Government.
The Commission has no power to exclude the name of any candidate from the select list merely be cause he has secured less marks at the viva voce test.
Similar pattern of selection is generally found in all the rules of recruitment which prescribe written examination and also viva voce test.
There are two authorities of this Court in this aspect of the matter.
In P.K. Ramchandra Iyer & Ors.
vs Union of India & Ors.
, ; this Court considered the scope of recruitment rules 1102 governing the selection of candidates to various disciplines under the Indian Council of Agricultural Research.
There the Agricultural Scientists Recruitment Board (ASRB) was re quired to select candidates by holding competitive examina tion and viva voce test.
ASRB prescribed minimum qualifying marks which a candidate must obtain at the viva voce test before his name could be included in the merit list.
The question that fell for consideration was whether the ASRB was competent to prescribe such a minimum? Accepting the contention that ASRB has no such power, this Court observed (p. 244): "Neither Rule 13 nor Rule 14 nor any other rule enables the ASRB to prescribe minimum qualifying marks to be obtained by the candi date at the viva voce test.
On the contrary, the language of Rule 14 clearly negatives any such power in the ASRB when it provides that after the written test if the candidate has obtained minimum marks, he is eligible for being called for viva voce test and the final merit list would be drawn up according to the aggregate of marks obtained by the candidate in written test plus viva voce examination.
The additional qualification which ASRB pre scribed to itself namely, that the candidate must have a further qualification of obtaining minimum marks in the viva voce test does not find place in Rules 13 and 14, it amounts virtually to a modification of the Rules.
By necessary inference, there was no such power in the ASRB to add to the required qualifica tions.
If such power is claimed, it has to be explicit and cannot be read by necessary implication for the obvious reason that such deviation from the rules is likely to cause irreparable and irreversible harm.
" The closest to the facts of this case is the recent decision of this Court in Umesh Chandra Shukla etc.
vs Union of India, [19851 Supp. 2 SCR 367.
There the scope of Delhi Judicial Service Rules, 1970 came up for considera tion.
Rules 17 and 18 of the Delhi Judicial Service Rules, 1970 are similar to Rules 16 and 18 of Orissa Judicial Service Rules, 1964.
The Selection Committee constituted under these Rules consisted among others of Judges of the High Court of Delhi.
The Selection Committee apparently thought that it has got power to exclude candidates securing less than 600 marks in the aggregate as not being suitable for appointment to the Judicial Service.
Accordingly it excluded all such candidates from the select list.
It was contended before this Court that the Selection Committee would be competent to 1103 prescribe a minimum standard to be crossed by candidates at the vive voce test in order to be suitable for appointment to judicial posts.
Repelling that contention this Court ob served (pp. 382 383): "With regard to the second contention, namely, that the High Court had no power to eliminate the names of candidates who had secured less than 600 marks in the aggregate after the viva voce test, reference has to be made to Rules 17 and 18 of the Rules which provide that the Selection Committee shall call for viva voce test only such candidates who are qualified at the written test as provided in the Appendix and that the Selection Committee shall prepare the list of candidates in order of merit after the viva voce test.
There is no power reserved under rule 18 of the Rules for the High Court to fix its own minimum marks in order to include candidates in the final list.
It is stated in paragraph 7 of the counter affidavit filed in Writ Petition No. 4363 of 1985 that the Selection Committee has inherent power to select candidates who according to it are suitable for appointment by prescribing the minimum marks which a candidate should obtain in the aggregate in order to get into the Delhi Judicial Service.
It is not neces sary to consider in this case whether any other reason such as character, antecedents, physical fitness which may disqualify a candi date from being appointed to the Delhi Judi cial Service may be taken into consideration by the Selection Committee while preparing the final list.
But on going through the Rules, we are of the view that no fresh disqualification or bar may be created by the High Court or the Selection Committee merely on the basis of the marks obtained at the examination because clause (6) of the Appendix itself has laid down the minimum marks which a candidate should obtain in the written papers or in the aggregate in order to qualify himself to become a member of the Judicial service.
The prescription of the minimum of 600 marks in the aggregate by the Selection Committee as an additional requirement which the candidate has to satisfy amounts to an amendment of what is prescribed by clause (6) of the Appendix.
The question whether a candidate included in the final list prepared and forwarded by the Selection Committee may be appointed or not is a matter to be considered by the appointing authority.
In the instant case the decision that a candidate should have sec 1104 ured a minimum of 600 marks in the aggregate in order to be included in the final select list is not even taken by the High Court but by the Selection Committee.
Moreover, recruit ment of persons other than District Judges to the Judicial Service is required to be made under Article 234 of the Constitution in accordance with the Rules made by the Governor as provided therein, in consultation with the High Court.
Article 235 which vests in the High Court the control over the District Courts and Courts subordinate thereto, cannot include the power of making rules with regard to recruitment of persons other than District Judges to the judicial service as it has been expressly dealt with in Article 234 of the Constitution.
We are of the view that the Selection Committee has no power to prescribe the minimum marks which a candidate should obtain in the aggregate different from the minimum already prescribed by the Rules in its Appendix.
We are, therefore, of the view that the exclusion of the names of certain candi dates, who had not secured 600 marks in the aggregate including marks obtained at the viva voce test from the list prepared under rule 18 of the Rules is not legal." In the light of these decisions the conclusion is inevi table that the Commission in the instant case also has no power to prescribe the minimum standard at viva voce test for determining the suitability of candidates for appoint ment as Munsifs.
It was, however, urged by counsel for the respondents that the principles enunciated by the aforesaid two deci sions of this Court cannot be extended to the case on hand.
The counsel sought to derive support for their contention on rule 17.
Rule 17 provides that the Chief Justice or any other Judge of the High Court nominated by the Chief Justice shall represent the High Court and be present at the viva voce test.
He shall also advice the Commission on the fit ness of the candidates at the viva voce test.
The advice may relate to the special qualities to be possessed by candi dates for Judicial Service.
The Rule 17, however, proceeds to state that such a Judge shall not be responsible for selection of candidates.
The contention for the respondents was that a Judge of the High Court was present at the viva voce test.
He was an expert in the field.
He was primarily concerned with regard to fitness of candidates for judicial service.
He advised the Commission to determine the minimum marks to be secured at the viva voce test.
The Commission accepted the advice and determined the cut out 1105 marks in the viva voce.
It was also contended that the Judge could advise as to fitness of candidates for judicial ap pointment and his advice could also relate to the minimum which a candidate should secure in the viva voce test.
If such power is not conceded to the Judge, his presence at the interview as provided under rule 17 would totally be unnec essary.
We are not persuaded by this argument.
That does not mean that we are doubting the purpose of rule 17.
The pur pose is undoubtedly laudable and indeed, it is in accordance with the observations of this Court in Ashok Kumar Yadav and Ors.
vs State of Haryana and Ors etc.
etc., [19851 Supp. 1 SCR 657.
There it was observed: "It is therefore essential that when selec tions to the Judicial Service are being made, a sitting Judge of the High Court to be nomi nated by the Chief Justice of the State should be invited to participate in the interview as an expert and since such sitting Judge comes as an expert who, by reason of the fact that he is a sitting High Court Judge knows the quality and character of the candidates ap pearing for the interview, the advice given by him should ordinarily be accepted, unless there are strong and cogent reasons for not accepting such advice and such strong and cogent reasons must be recorded in writing by the Chairman and members of the Public Service Commission.
" But the crux of the matter is whether the Judge present at the viva voce test has the power to add anything to the Rules of recruitment.
He may advice the Commission as to the special qualities required for judicial appointments.
His advice may be in regard to the range of subjects in respect of which the viva voce shall be conducted.
It may also cover the type and standard of questions to be put to candidates; or the acceptance of the answers given thereof.
But his advice cannot run counter to the statutory Rules.
The Rules have been framed under the proviso to Article 309 read with the Article 234 of the Constitution.
Article 234 requires that the appointment of persons other than District Judge to the Judicial Service of State shall be made by the Governor of the State.
It shall be in accordance with the rules made by the Governor in that behalf after consultation with the State Service Commission and with the State High Court.
The Rules in question have been made after consultation with the Commission and the State High Court.
The Commission 1106 which has been constituted under the Rules must, therefore faithfully follow the Rules.
It must select candidates in accordance with the Rules.
It cannot prescribe additional requirements for selection either as to eligibility or as to suitability.
The decision of the Commission to prescribe the minimum marks to be secured at the viva voce test would, therefore, be illegal and without authority.
In the result we allow the petition and quash the selec tion made by the Orissa Public Service Commission with a direction to redo the select list on the basis of the aggre gate marks obtained by the candidates in the written exami nation and at the viva voce test and in the light of the observations made.
The list so prepared shall be forwarded to the Government as required under rule 19 of the Rules for appointments as Munsifs.
The persons who fall within the revised list, if they are already in service need not be disturbed.
Their inter se seniority, may however, be regu lated as per the rankings in the revised list.
In the circumstances, however, we make no order as to cost.
P.S.S. Petition allowed.
|
The petitioner had secured 470 marks out of 950 in the written examination conducted by the Orissa Public Service Commission for the post of Probationary Munsifs for the year 1982 83.
In the viva voce test he was given 30 marks out of 200.
But he did not find a place in the merit list though candidates with less number of aggregate marks had been selected.
In the writ petition under article 32 of the Constitution he challenged the validity of selection on the ground, among others, that it was arbitrary and contrary to rules.
For the respondents it was submitted that the Commission had taken a decision on the advice of the High Court Judge who was present at the viva voce test as provided under r. 17 of the Orissa Judicial Service Rules, 1964, that a candidate to be suitable for the post of Munsif should secure at least 30 per cent marks at the viva voce test, and that the petition er did not secure the minimum qualifying marks so pre scribed.
Allowing the writ petition, HELD: 1.
The decision of the Orissa Public Service Commission to prescribe the minimum marks to be secured at the viva voce test for the post of Probationary Munsifs in the State Judicial Service was illegal and without authori ty.
[1106B] 2.1 The Orissa Judicial Service Rules, 1964 flamed under the proviso to Article 309 read with Article 234 of the Constitution, have been made by the Governor of the State after consultation with the State 1098 Public Service Commission and the State High Court.
The Commission, which has been constituted under the Rules must, therefore, faithfully follow the Rules.
It must select candidates in accordance with the Rules.
It cannot prescribe additional requirements for selection either as to eligibil ity or as to suitability.
[1105G H; 1106A] 2.2 Rule 16 of the Rules requires a candidate to secure a minimum of 30 per cent marks in the written examination to qualify.
The candidates who have secured more than that minimum would alone be called for viva voce test.
The Rules do not prescribe any such minimum marks to be secured at the viva voce test.
Rule 18 mandates the Commission to add the marks obtained at the written examination and the viva voce test together, no matter what the marks at the viva voce test.
On the basis of the aggregate marks in both the tests, the names of candidates will have to be arranged in order of merit.
The list so prepared is then to be forwarded to the Government under Rule 19.
[1101D E; F] The Commission, therefore, had no power to exclude the name of any candidate from the select list merely because he had secured less marks at the viva voce test.
[1101G] P.K. Ramchandra Iyer & Ors.
vs Union of India & Ors.
, ; ; and Umesh Chandra Shukla etc.
vs Union of India, [1985] Supp. 2 SCR 367, referred to.
Even if the minimum qualifying marks were fixed for the viva voce test by the Commission on the advice of the High Court Judge, present at the viva voce test in accord ance with r. 17 of the Rules, that cannot validate the action of the Commission, for he had no power to add any thing to the Rules of recruitment.
Rule 17 itself proceeds to state that such a Judge shall not be responsible for selection of candidates.
He may advise the Commission as to the special qualities required for judicial appointments.
His advice may be in regard to the range of subjects in respect of which the viva voce shall be conducted.
It may also cover the type and standard of questions to be put to candidates or the acceptance of the answers given thereof.
But his advice cannot run counter to the statutory Rules.
[1104F H; 1105F] Ashok Kumar Yadav and Ors.
vs State of Haryana and Ors. etc.
etc., [1985] Supp. 1 SCR 657, referred to. 4.
The Orissa Public Service Commission is directed to re do the select list on the basis of the aggregate marks obtained by the candidates 1099 in the written examination and at the viva voce test.
The list so prepared to be forwarded to the Government as re quired under r. 19 of the Rules for appointments as Munsifs.
The persons who fall within the revised list, if already in service need not be disturbed.
Their inter se seniority to be regulated as per the rankings in the revised list.
[1106B D]
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No. 1123 of 1986.
(Under Article 32 of the Constitution of India).
R.K. Garg and J.R. Das for the petitioner.
A.K. Panda and Vinoo Bhagat for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
This is a petition under Article 32 of the Constitution challenging the validity of the list of candidates prepared by Orissa Public Service Commission, Cuttack for appointment as Probationary Munsifs in the State Judicial Service.
The selection of candidates for subordinate judicial service is governed by the Orissa Judicial Service Rules, 1964 (the "Rules").
The Rules were flamed under the proviso to Article 309 read with Article 234 of the Constitution of India.
The State Public Service Commission (The "Commission") is the selecting authority.
The candidates are required to be selected by written test followed by viva voce test.
The written examination carries the maximum marks of 950 and the viva voce test 200.
In accordance with the Rules, the Commission issued advertisement No. 12 of 1982 83 inviting applications from eligible candidates for posts of Probationary Munsifs.
The petitioner was one of the candidates who applied in response thereof.
In the written examination conducted by the Commis sion the petitioner secured 470 marks.
He was called for viva voce test in which he was given 30 marks.
He thus secured in all 500 out of 1150.
The Commission prepared a list of candidates which we may term as 'select list ' and recommended to the Government altogether 56 candidates in four batches as desired by the latter.
The petitioner did not find a place in that list.
The candidates with less number of aggregate marks than that of the petitioner have, however, been selected.
The petitioner, therefore, chal lenges the validity of selection, on the ground among others that it is arbitrary and contrary to the Rules.
1100 The reason for exclusion of the petitioner from the select list is not obscure.
It has been at any rate now made explicit.
He did not secure the minimum qualifying marks prescribed by the Commission in the viva voce test.
In the counter affidavit filed on behalf of the Commission it has been so stated.
It is said that the Commission has taken a decision that a candidate to be suitable for the post of Munsif, should secure at least 30% at the viva voce test.
That decision was taken on the advice of the High Court Judge.
The question for our consideration is whether the mini mum marks prescribed by the Commission at the viva voce test is justified, and whether the select list prepared by the Commission is in accordance with the Rules.
Rules 16, 17, 18 and 19 are the relevant rules which have a material bearing on the question that falls for determination: These Rules read as under: Rule 16: "The Commission shall summon for the viva voce test all candidates who have secured at the written examination not less than the minimum qualifying marks obtained in all subjects taken together which shall be the (30%) of the total marks in all the papers: Provided that Government may after consulta tion with the High Court and Commission fix higher qualifying marks in any or all of the subjects in the written examination in respect of any particular recruitment.
Rule 17: The Chief Justice or any of the other Judges of the High Court nominated by the Chief Justice shall represent the High Court and be present at the viva voce test and advise the Commission on the fitness of candi dates at the viva voce test from the point of view of their possession of the special quali ties required in the judicial service, but shall not be responsible for selection of candidates.
Rule 18: The marks obtained at the vive voce test shall be added to the marks obtained in the written examination.
The names of candi dates will then be arranged by the Commission in order of merit.
If two or more candidates obtain equal marks in the aggregate, the order shall be determined in accordance with the marks, secured at the written examination.
Should the marks secured at the written exami nation of the 1101 candidate concerned be also equal, then the order shall be decided in accordance with the total number of marks obtained in the optional papers.
Rule 19: (1) The Commission shall then forward to the Government in the Law Department the list of candidates prepared in accordance with Rule 18 indicating therein whether a candidate belongs to Schedule Caste or Scheduled Tribes.
(2) The list prepared shall be published by the Commission for general information.
(3) The list, unless the Governor in consulta tion with the High Court otherwise decides, shall ordinarily be in force for one year from the date of its preparation by the Commi ssion.
" The Rule making authorities have provided a scheme for selection of candidates for appointment to judicial posts.
Rule 16 prescribes the minimum qualifying marks to be se cured by candidates in the written examination.
It is 30% of the total marks in all the papers.
The candidates who have secured more than that minimum would alone be called for viva voce test.
The Rules do not prescribe any such minimum marks to be secured at the viva voce test.
After the viva voce test, the Commission shall add the marks of the viva voce test to the marks in the written examination.
There then, Rule 18 states: "The names of candidates will then be arranged by the Commission in the order of merit.
" This is the mandate of Rule 18.
The Commission shall add the two marks together, no matter what those marks at the viva voce test.
On the basis of the aggregate marks in both the tests, the names of candidates will have to be arranged in order of merit.
The list so prepared shall be forwarded to the Government.
The Commission has no power to exclude the name of any candidate from the select list merely be cause he has secured less marks at the viva voce test.
Similar pattern of selection is generally found in all the rules of recruitment which prescribe written examination and also viva voce test.
There are two authorities of this Court in this aspect of the matter.
In P.K. Ramchandra Iyer & Ors.
vs Union of India & Ors.
, ; this Court considered the scope of recruitment rules 1102 governing the selection of candidates to various disciplines under the Indian Council of Agricultural Research.
There the Agricultural Scientists Recruitment Board (ASRB) was re quired to select candidates by holding competitive examina tion and viva voce test.
ASRB prescribed minimum qualifying marks which a candidate must obtain at the viva voce test before his name could be included in the merit list.
The question that fell for consideration was whether the ASRB was competent to prescribe such a minimum? Accepting the contention that ASRB has no such power, this Court observed (p. 244): "Neither Rule 13 nor Rule 14 nor any other rule enables the ASRB to prescribe minimum qualifying marks to be obtained by the candi date at the viva voce test.
On the contrary, the language of Rule 14 clearly negatives any such power in the ASRB when it provides that after the written test if the candidate has obtained minimum marks, he is eligible for being called for viva voce test and the final merit list would be drawn up according to the aggregate of marks obtained by the candidate in written test plus viva voce examination.
The additional qualification which ASRB pre scribed to itself namely, that the candidate must have a further qualification of obtaining minimum marks in the viva voce test does not find place in Rules 13 and 14, it amounts virtually to a modification of the Rules.
By necessary inference, there was no such power in the ASRB to add to the required qualifica tions.
If such power is claimed, it has to be explicit and cannot be read by necessary implication for the obvious reason that such deviation from the rules is likely to cause irreparable and irreversible harm.
" The closest to the facts of this case is the recent decision of this Court in Umesh Chandra Shukla etc.
vs Union of India, [19851 Supp. 2 SCR 367.
There the scope of Delhi Judicial Service Rules, 1970 came up for considera tion.
Rules 17 and 18 of the Delhi Judicial Service Rules, 1970 are similar to Rules 16 and 18 of Orissa Judicial Service Rules, 1964.
The Selection Committee constituted under these Rules consisted among others of Judges of the High Court of Delhi.
The Selection Committee apparently thought that it has got power to exclude candidates securing less than 600 marks in the aggregate as not being suitable for appointment to the Judicial Service.
Accordingly it excluded all such candidates from the select list.
It was contended before this Court that the Selection Committee would be competent to 1103 prescribe a minimum standard to be crossed by candidates at the vive voce test in order to be suitable for appointment to judicial posts.
Repelling that contention this Court ob served (pp. 382 383): "With regard to the second contention, namely, that the High Court had no power to eliminate the names of candidates who had secured less than 600 marks in the aggregate after the viva voce test, reference has to be made to Rules 17 and 18 of the Rules which provide that the Selection Committee shall call for viva voce test only such candidates who are qualified at the written test as provided in the Appendix and that the Selection Committee shall prepare the list of candidates in order of merit after the viva voce test.
There is no power reserved under rule 18 of the Rules for the High Court to fix its own minimum marks in order to include candidates in the final list.
It is stated in paragraph 7 of the counter affidavit filed in Writ Petition No. 4363 of 1985 that the Selection Committee has inherent power to select candidates who according to it are suitable for appointment by prescribing the minimum marks which a candidate should obtain in the aggregate in order to get into the Delhi Judicial Service.
It is not neces sary to consider in this case whether any other reason such as character, antecedents, physical fitness which may disqualify a candi date from being appointed to the Delhi Judi cial Service may be taken into consideration by the Selection Committee while preparing the final list.
But on going through the Rules, we are of the view that no fresh disqualification or bar may be created by the High Court or the Selection Committee merely on the basis of the marks obtained at the examination because clause (6) of the Appendix itself has laid down the minimum marks which a candidate should obtain in the written papers or in the aggregate in order to qualify himself to become a member of the Judicial service.
The prescription of the minimum of 600 marks in the aggregate by the Selection Committee as an additional requirement which the candidate has to satisfy amounts to an amendment of what is prescribed by clause (6) of the Appendix.
The question whether a candidate included in the final list prepared and forwarded by the Selection Committee may be appointed or not is a matter to be considered by the appointing authority.
In the instant case the decision that a candidate should have sec 1104 ured a minimum of 600 marks in the aggregate in order to be included in the final select list is not even taken by the High Court but by the Selection Committee.
Moreover, recruit ment of persons other than District Judges to the Judicial Service is required to be made under Article 234 of the Constitution in accordance with the Rules made by the Governor as provided therein, in consultation with the High Court.
Article 235 which vests in the High Court the control over the District Courts and Courts subordinate thereto, cannot include the power of making rules with regard to recruitment of persons other than District Judges to the judicial service as it has been expressly dealt with in Article 234 of the Constitution.
We are of the view that the Selection Committee has no power to prescribe the minimum marks which a candidate should obtain in the aggregate different from the minimum already prescribed by the Rules in its Appendix.
We are, therefore, of the view that the exclusion of the names of certain candi dates, who had not secured 600 marks in the aggregate including marks obtained at the viva voce test from the list prepared under rule 18 of the Rules is not legal." In the light of these decisions the conclusion is inevi table that the Commission in the instant case also has no power to prescribe the minimum standard at viva voce test for determining the suitability of candidates for appoint ment as Munsifs.
It was, however, urged by counsel for the respondents that the principles enunciated by the aforesaid two deci sions of this Court cannot be extended to the case on hand.
The counsel sought to derive support for their contention on rule 17.
Rule 17 provides that the Chief Justice or any other Judge of the High Court nominated by the Chief Justice shall represent the High Court and be present at the viva voce test.
He shall also advice the Commission on the fit ness of the candidates at the viva voce test.
The advice may relate to the special qualities to be possessed by candi dates for Judicial Service.
The Rule 17, however, proceeds to state that such a Judge shall not be responsible for selection of candidates.
The contention for the respondents was that a Judge of the High Court was present at the viva voce test.
He was an expert in the field.
He was primarily concerned with regard to fitness of candidates for judicial service.
He advised the Commission to determine the minimum marks to be secured at the viva voce test.
The Commission accepted the advice and determined the cut out 1105 marks in the viva voce.
It was also contended that the Judge could advise as to fitness of candidates for judicial ap pointment and his advice could also relate to the minimum which a candidate should secure in the viva voce test.
If such power is not conceded to the Judge, his presence at the interview as provided under rule 17 would totally be unnec essary.
We are not persuaded by this argument.
That does not mean that we are doubting the purpose of rule 17.
The pur pose is undoubtedly laudable and indeed, it is in accordance with the observations of this Court in Ashok Kumar Yadav and Ors.
vs State of Haryana and Ors etc.
etc., [19851 Supp. 1 SCR 657.
There it was observed: "It is therefore essential that when selec tions to the Judicial Service are being made, a sitting Judge of the High Court to be nomi nated by the Chief Justice of the State should be invited to participate in the interview as an expert and since such sitting Judge comes as an expert who, by reason of the fact that he is a sitting High Court Judge knows the quality and character of the candidates ap pearing for the interview, the advice given by him should ordinarily be accepted, unless there are strong and cogent reasons for not accepting such advice and such strong and cogent reasons must be recorded in writing by the Chairman and members of the Public Service Commission.
" But the crux of the matter is whether the Judge present at the viva voce test has the power to add anything to the Rules of recruitment.
He may advice the Commission as to the special qualities required for judicial appointments.
His advice may be in regard to the range of subjects in respect of which the viva voce shall be conducted.
It may also cover the type and standard of questions to be put to candidates; or the acceptance of the answers given thereof.
But his advice cannot run counter to the statutory Rules.
The Rules have been framed under the proviso to Article 309 read with the Article 234 of the Constitution.
Article 234 requires that the appointment of persons other than District Judge to the Judicial Service of State shall be made by the Governor of the State.
It shall be in accordance with the rules made by the Governor in that behalf after consultation with the State Service Commission and with the State High Court.
The Rules in question have been made after consultation with the Commission and the State High Court.
The Commission 1106 which has been constituted under the Rules must, therefore faithfully follow the Rules.
It must select candidates in accordance with the Rules.
It cannot prescribe additional requirements for selection either as to eligibility or as to suitability.
The decision of the Commission to prescribe the minimum marks to be secured at the viva voce test would, therefore, be illegal and without authority.
In the result we allow the petition and quash the selec tion made by the Orissa Public Service Commission with a direction to redo the select list on the basis of the aggre gate marks obtained by the candidates in the written exami nation and at the viva voce test and in the light of the observations made.
The list so prepared shall be forwarded to the Government as required under rule 19 of the Rules for appointments as Munsifs.
The persons who fall within the revised list, if they are already in service need not be disturbed.
Their inter se seniority, may however, be regu lated as per the rankings in the revised list.
In the circumstances, however, we make no order as to cost.
P.S.S. Petition allowed.
|
No. 1123 of 1986.
(Under Article 32 of the Constitution of India).
R.K. Garg and J.R. Das for the petitioner.
A.K. Panda and Vinoo Bhagat for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
This is a petition under Article 32 of the Constitution challenging the validity of the list of candidates prepared by Orissa Public Service Commission, Cuttack for appointment as Probationary Munsifs in the State Judicial Service.
The selection of candidates for subordinate judicial service is governed by the Orissa Judicial Service Rules, 1964 (the "Rules").
The Rules were flamed under the proviso to Article 309 read with Article 234 of the Constitution of India.
The State Public Service Commission (The "Commission") is the selecting authority.
The candidates are required to be selected by written test followed by viva voce test.
The written examination carries the maximum marks of 950 and the viva voce test 200.
In accordance with the Rules, the Commission issued advertisement No. 12 of 1982 83 inviting applications from eligible candidates for posts of Probationary Munsifs.
The petitioner was one of the candidates who applied in response thereof.
In the written examination conducted by the Commis sion the petitioner secured 470 marks.
He was called for viva voce test in which he was given 30 marks.
He thus secured in all 500 out of 1150.
The Commission prepared a list of candidates which we may term as 'select list ' and recommended to the Government altogether 56 candidates in four batches as desired by the latter.
The petitioner did not find a place in that list.
The candidates with less number of aggregate marks than that of the petitioner have, however, been selected.
The petitioner, therefore, chal lenges the validity of selection, on the ground among others that it is arbitrary and contrary to the Rules.
1100 The reason for exclusion of the petitioner from the select list is not obscure.
It has been at any rate now made explicit.
He did not secure the minimum qualifying marks prescribed by the Commission in the viva voce test.
In the counter affidavit filed on behalf of the Commission it has been so stated.
It is said that the Commission has taken a decision that a candidate to be suitable for the post of Munsif, should secure at least 30% at the viva voce test.
That decision was taken on the advice of the High Court Judge.
The question for our consideration is whether the mini mum marks prescribed by the Commission at the viva voce test is justified, and whether the select list prepared by the Commission is in accordance with the Rules.
Rules 16, 17, 18 and 19 are the relevant rules which have a material bearing on the question that falls for determination: These Rules read as under: Rule 16: "The Commission shall summon for the viva voce test all candidates who have secured at the written examination not less than the minimum qualifying marks obtained in all subjects taken together which shall be the (30%) of the total marks in all the papers: Provided that Government may after consulta tion with the High Court and Commission fix higher qualifying marks in any or all of the subjects in the written examination in respect of any particular recruitment.
Rule 17: The Chief Justice or any of the other Judges of the High Court nominated by the Chief Justice shall represent the High Court and be present at the viva voce test and advise the Commission on the fitness of candi dates at the viva voce test from the point of view of their possession of the special quali ties required in the judicial service, but shall not be responsible for selection of candidates.
Rule 18: The marks obtained at the vive voce test shall be added to the marks obtained in the written examination.
The names of candi dates will then be arranged by the Commission in order of merit.
If two or more candidates obtain equal marks in the aggregate, the order shall be determined in accordance with the marks, secured at the written examination.
Should the marks secured at the written exami nation of the 1101 candidate concerned be also equal, then the order shall be decided in accordance with the total number of marks obtained in the optional papers.
Rule 19: (1) The Commission shall then forward to the Government in the Law Department the list of candidates prepared in accordance with Rule 18 indicating therein whether a candidate belongs to Schedule Caste or Scheduled Tribes.
(2) The list prepared shall be published by the Commission for general information.
(3) The list, unless the Governor in consulta tion with the High Court otherwise decides, shall ordinarily be in force for one year from the date of its preparation by the Commi ssion.
" The Rule making authorities have provided a scheme for selection of candidates for appointment to judicial posts.
Rule 16 prescribes the minimum qualifying marks to be se cured by candidates in the written examination.
It is 30% of the total marks in all the papers.
The candidates who have secured more than that minimum would alone be called for viva voce test.
The Rules do not prescribe any such minimum marks to be secured at the viva voce test.
After the viva voce test, the Commission shall add the marks of the viva voce test to the marks in the written examination.
There then, Rule 18 states: "The names of candidates will then be arranged by the Commission in the order of merit.
" This is the mandate of Rule 18.
The Commission shall add the two marks together, no matter what those marks at the viva voce test.
On the basis of the aggregate marks in both the tests, the names of candidates will have to be arranged in order of merit.
The list so prepared shall be forwarded to the Government.
The Commission has no power to exclude the name of any candidate from the select list merely be cause he has secured less marks at the viva voce test.
Similar pattern of selection is generally found in all the rules of recruitment which prescribe written examination and also viva voce test.
There are two authorities of this Court in this aspect of the matter.
In P.K. Ramchandra Iyer & Ors.
vs Union of India & Ors.
, ; this Court considered the scope of recruitment rules 1102 governing the selection of candidates to various disciplines under the Indian Council of Agricultural Research.
There the Agricultural Scientists Recruitment Board (ASRB) was re quired to select candidates by holding competitive examina tion and viva voce test.
ASRB prescribed minimum qualifying marks which a candidate must obtain at the viva voce test before his name could be included in the merit list.
The question that fell for consideration was whether the ASRB was competent to prescribe such a minimum? Accepting the contention that ASRB has no such power, this Court observed (p. 244): "Neither Rule 13 nor Rule 14 nor any other rule enables the ASRB to prescribe minimum qualifying marks to be obtained by the candi date at the viva voce test.
On the contrary, the language of Rule 14 clearly negatives any such power in the ASRB when it provides that after the written test if the candidate has obtained minimum marks, he is eligible for being called for viva voce test and the final merit list would be drawn up according to the aggregate of marks obtained by the candidate in written test plus viva voce examination.
The additional qualification which ASRB pre scribed to itself namely, that the candidate must have a further qualification of obtaining minimum marks in the viva voce test does not find place in Rules 13 and 14, it amounts virtually to a modification of the Rules.
By necessary inference, there was no such power in the ASRB to add to the required qualifica tions.
If such power is claimed, it has to be explicit and cannot be read by necessary implication for the obvious reason that such deviation from the rules is likely to cause irreparable and irreversible harm.
" The closest to the facts of this case is the recent decision of this Court in Umesh Chandra Shukla etc.
vs Union of India, [19851 Supp. 2 SCR 367.
There the scope of Delhi Judicial Service Rules, 1970 came up for considera tion.
Rules 17 and 18 of the Delhi Judicial Service Rules, 1970 are similar to Rules 16 and 18 of Orissa Judicial Service Rules, 1964.
The Selection Committee constituted under these Rules consisted among others of Judges of the High Court of Delhi.
The Selection Committee apparently thought that it has got power to exclude candidates securing less than 600 marks in the aggregate as not being suitable for appointment to the Judicial Service.
Accordingly it excluded all such candidates from the select list.
It was contended before this Court that the Selection Committee would be competent to 1103 prescribe a minimum standard to be crossed by candidates at the vive voce test in order to be suitable for appointment to judicial posts.
Repelling that contention this Court ob served (pp. 382 383): "With regard to the second contention, namely, that the High Court had no power to eliminate the names of candidates who had secured less than 600 marks in the aggregate after the viva voce test, reference has to be made to Rules 17 and 18 of the Rules which provide that the Selection Committee shall call for viva voce test only such candidates who are qualified at the written test as provided in the Appendix and that the Selection Committee shall prepare the list of candidates in order of merit after the viva voce test.
There is no power reserved under rule 18 of the Rules for the High Court to fix its own minimum marks in order to include candidates in the final list.
It is stated in paragraph 7 of the counter affidavit filed in Writ Petition No. 4363 of 1985 that the Selection Committee has inherent power to select candidates who according to it are suitable for appointment by prescribing the minimum marks which a candidate should obtain in the aggregate in order to get into the Delhi Judicial Service.
It is not neces sary to consider in this case whether any other reason such as character, antecedents, physical fitness which may disqualify a candi date from being appointed to the Delhi Judi cial Service may be taken into consideration by the Selection Committee while preparing the final list.
But on going through the Rules, we are of the view that no fresh disqualification or bar may be created by the High Court or the Selection Committee merely on the basis of the marks obtained at the examination because clause (6) of the Appendix itself has laid down the minimum marks which a candidate should obtain in the written papers or in the aggregate in order to qualify himself to become a member of the Judicial service.
The prescription of the minimum of 600 marks in the aggregate by the Selection Committee as an additional requirement which the candidate has to satisfy amounts to an amendment of what is prescribed by clause (6) of the Appendix.
The question whether a candidate included in the final list prepared and forwarded by the Selection Committee may be appointed or not is a matter to be considered by the appointing authority.
In the instant case the decision that a candidate should have sec 1104 ured a minimum of 600 marks in the aggregate in order to be included in the final select list is not even taken by the High Court but by the Selection Committee.
Moreover, recruit ment of persons other than District Judges to the Judicial Service is required to be made under Article 234 of the Constitution in accordance with the Rules made by the Governor as provided therein, in consultation with the High Court.
Article 235 which vests in the High Court the control over the District Courts and Courts subordinate thereto, cannot include the power of making rules with regard to recruitment of persons other than District Judges to the judicial service as it has been expressly dealt with in Article 234 of the Constitution.
We are of the view that the Selection Committee has no power to prescribe the minimum marks which a candidate should obtain in the aggregate different from the minimum already prescribed by the Rules in its Appendix.
We are, therefore, of the view that the exclusion of the names of certain candi dates, who had not secured 600 marks in the aggregate including marks obtained at the viva voce test from the list prepared under rule 18 of the Rules is not legal." In the light of these decisions the conclusion is inevi table that the Commission in the instant case also has no power to prescribe the minimum standard at viva voce test for determining the suitability of candidates for appoint ment as Munsifs.
It was, however, urged by counsel for the respondents that the principles enunciated by the aforesaid two deci sions of this Court cannot be extended to the case on hand.
The counsel sought to derive support for their contention on rule 17.
Rule 17 provides that the Chief Justice or any other Judge of the High Court nominated by the Chief Justice shall represent the High Court and be present at the viva voce test.
He shall also advice the Commission on the fit ness of the candidates at the viva voce test.
The advice may relate to the special qualities to be possessed by candi dates for Judicial Service.
The Rule 17, however, proceeds to state that such a Judge shall not be responsible for selection of candidates.
The contention for the respondents was that a Judge of the High Court was present at the viva voce test.
He was an expert in the field.
He was primarily concerned with regard to fitness of candidates for judicial service.
He advised the Commission to determine the minimum marks to be secured at the viva voce test.
The Commission accepted the advice and determined the cut out 1105 marks in the viva voce.
It was also contended that the Judge could advise as to fitness of candidates for judicial ap pointment and his advice could also relate to the minimum which a candidate should secure in the viva voce test.
If such power is not conceded to the Judge, his presence at the interview as provided under rule 17 would totally be unnec essary.
We are not persuaded by this argument.
That does not mean that we are doubting the purpose of rule 17.
The pur pose is undoubtedly laudable and indeed, it is in accordance with the observations of this Court in Ashok Kumar Yadav and Ors.
vs State of Haryana and Ors etc.
etc., [19851 Supp. 1 SCR 657.
There it was observed: "It is therefore essential that when selec tions to the Judicial Service are being made, a sitting Judge of the High Court to be nomi nated by the Chief Justice of the State should be invited to participate in the interview as an expert and since such sitting Judge comes as an expert who, by reason of the fact that he is a sitting High Court Judge knows the quality and character of the candidates ap pearing for the interview, the advice given by him should ordinarily be accepted, unless there are strong and cogent reasons for not accepting such advice and such strong and cogent reasons must be recorded in writing by the Chairman and members of the Public Service Commission.
" But the crux of the matter is whether the Judge present at the viva voce test has the power to add anything to the Rules of recruitment.
He may advice the Commission as to the special qualities required for judicial appointments.
His advice may be in regard to the range of subjects in respect of which the viva voce shall be conducted.
It may also cover the type and standard of questions to be put to candidates; or the acceptance of the answers given thereof.
But his advice cannot run counter to the statutory Rules.
The Rules have been framed under the proviso to Article 309 read with the Article 234 of the Constitution.
Article 234 requires that the appointment of persons other than District Judge to the Judicial Service of State shall be made by the Governor of the State.
It shall be in accordance with the rules made by the Governor in that behalf after consultation with the State Service Commission and with the State High Court.
The Rules in question have been made after consultation with the Commission and the State High Court.
The Commission 1106 which has been constituted under the Rules must, therefore faithfully follow the Rules.
It must select candidates in accordance with the Rules.
It cannot prescribe additional requirements for selection either as to eligibility or as to suitability.
The decision of the Commission to prescribe the minimum marks to be secured at the viva voce test would, therefore, be illegal and without authority.
In the result we allow the petition and quash the selec tion made by the Orissa Public Service Commission with a direction to redo the select list on the basis of the aggre gate marks obtained by the candidates in the written exami nation and at the viva voce test and in the light of the observations made.
The list so prepared shall be forwarded to the Government as required under rule 19 of the Rules for appointments as Munsifs.
The persons who fall within the revised list, if they are already in service need not be disturbed.
Their inter se seniority, may however, be regu lated as per the rankings in the revised list.
In the circumstances, however, we make no order as to cost.
P.S.S. Petition allowed.
|
The petitioner had secured 470 marks out of 950 in the written examination conducted by the Orissa Public Service Commission for the post of Probationary Munsifs for the year 1982 83.
In the viva voce test he was given 30 marks out of 200.
But he did not find a place in the merit list though candidates with less number of aggregate marks had been selected.
In the writ petition under article 32 of the Constitution he challenged the validity of selection on the ground, among others, that it was arbitrary and contrary to rules.
For the respondents it was submitted that the Commission had taken a decision on the advice of the High Court Judge who was present at the viva voce test as provided under r. 17 of the Orissa Judicial Service Rules, 1964, that a candidate to be suitable for the post of Munsif should secure at least 30 per cent marks at the viva voce test, and that the petition er did not secure the minimum qualifying marks so pre scribed.
Allowing the writ petition, HELD: 1.
The decision of the Orissa Public Service Commission to prescribe the minimum marks to be secured at the viva voce test for the post of Probationary Munsifs in the State Judicial Service was illegal and without authori ty.
[1106B] 2.1 The Orissa Judicial Service Rules, 1964 flamed under the proviso to Article 309 read with Article 234 of the Constitution, have been made by the Governor of the State after consultation with the State 1098 Public Service Commission and the State High Court.
The Commission, which has been constituted under the Rules must, therefore, faithfully follow the Rules.
It must select candidates in accordance with the Rules.
It cannot prescribe additional requirements for selection either as to eligibil ity or as to suitability.
[1105G H; 1106A] 2.2 Rule 16 of the Rules requires a candidate to secure a minimum of 30 per cent marks in the written examination to qualify.
The candidates who have secured more than that minimum would alone be called for viva voce test.
The Rules do not prescribe any such minimum marks to be secured at the viva voce test.
Rule 18 mandates the Commission to add the marks obtained at the written examination and the viva voce test together, no matter what the marks at the viva voce test.
On the basis of the aggregate marks in both the tests, the names of candidates will have to be arranged in order of merit.
The list so prepared is then to be forwarded to the Government under Rule 19.
[1101D E; F] The Commission, therefore, had no power to exclude the name of any candidate from the select list merely because he had secured less marks at the viva voce test.
[1101G] P.K. Ramchandra Iyer & Ors.
vs Union of India & Ors.
, ; ; and Umesh Chandra Shukla etc.
vs Union of India, [1985] Supp. 2 SCR 367, referred to.
Even if the minimum qualifying marks were fixed for the viva voce test by the Commission on the advice of the High Court Judge, present at the viva voce test in accord ance with r. 17 of the Rules, that cannot validate the action of the Commission, for he had no power to add any thing to the Rules of recruitment.
Rule 17 itself proceeds to state that such a Judge shall not be responsible for selection of candidates.
He may advise the Commission as to the special qualities required for judicial appointments.
His advice may be in regard to the range of subjects in respect of which the viva voce shall be conducted.
It may also cover the type and standard of questions to be put to candidates or the acceptance of the answers given thereof.
But his advice cannot run counter to the statutory Rules.
[1104F H; 1105F] Ashok Kumar Yadav and Ors.
vs State of Haryana and Ors. etc.
etc., [1985] Supp. 1 SCR 657, referred to. 4.
The Orissa Public Service Commission is directed to re do the select list on the basis of the aggregate marks obtained by the candidates 1099 in the written examination and at the viva voce test.
The list so prepared to be forwarded to the Government as re quired under r. 19 of the Rules for appointments as Munsifs.
The persons who fall within the revised list, if already in service need not be disturbed.
Their inter se seniority to be regulated as per the rankings in the revised list.
[1106B D]
|
The petitioner had secured 470 marks out of 950 in the written examination conducted by the Orissa Public Service Commission for the post of Probationary Munsifs for the year 1982 83.
In the viva voce test he was given 30 marks out of 200.
But he did not find a place in the merit list though candidates with less number of aggregate marks had been selected.
In the writ petition under article 32 of the Constitution he challenged the validity of selection on the ground, among others, that it was arbitrary and contrary to rules.
For the respondents it was submitted that the Commission had taken a decision on the advice of the High Court Judge who was present at the viva voce test as provided under r. 17 of the Orissa Judicial Service Rules, 1964, that a candidate to be suitable for the post of Munsif should secure at least 30 per cent marks at the viva voce test, and that the petition er did not secure the minimum qualifying marks so pre scribed.
Allowing the writ petition, HELD: 1.
The decision of the Orissa Public Service Commission to prescribe the minimum marks to be secured at the viva voce test for the post of Probationary Munsifs in the State Judicial Service was illegal and without authori ty.
[1106B] 2.1 The Orissa Judicial Service Rules, 1964 flamed under the proviso to Article 309 read with Article 234 of the Constitution, have been made by the Governor of the State after consultation with the State 1098 Public Service Commission and the State High Court.
The Commission, which has been constituted under the Rules must, therefore, faithfully follow the Rules.
It must select candidates in accordance with the Rules.
It cannot prescribe additional requirements for selection either as to eligibil ity or as to suitability.
[1105G H; 1106A] 2.2 Rule 16 of the Rules requires a candidate to secure a minimum of 30 per cent marks in the written examination to qualify.
The candidates who have secured more than that minimum would alone be called for viva voce test.
The Rules do not prescribe any such minimum marks to be secured at the viva voce test.
Rule 18 mandates the Commission to add the marks obtained at the written examination and the viva voce test together, no matter what the marks at the viva voce test.
On the basis of the aggregate marks in both the tests, the names of candidates will have to be arranged in order of merit.
The list so prepared is then to be forwarded to the Government under Rule 19.
[1101D E; F] The Commission, therefore, had no power to exclude the name of any candidate from the select list merely because he had secured less marks at the viva voce test.
[1101G] P.K. Ramchandra Iyer & Ors.
vs Union of India & Ors.
, ; ; and Umesh Chandra Shukla etc.
vs Union of India, [1985] Supp. 2 SCR 367, referred to.
Even if the minimum qualifying marks were fixed for the viva voce test by the Commission on the advice of the High Court Judge, present at the viva voce test in accord ance with r. 17 of the Rules, that cannot validate the action of the Commission, for he had no power to add any thing to the Rules of recruitment.
Rule 17 itself proceeds to state that such a Judge shall not be responsible for selection of candidates.
He may advise the Commission as to the special qualities required for judicial appointments.
His advice may be in regard to the range of subjects in respect of which the viva voce shall be conducted.
It may also cover the type and standard of questions to be put to candidates or the acceptance of the answers given thereof.
But his advice cannot run counter to the statutory Rules.
[1104F H; 1105F] Ashok Kumar Yadav and Ors.
vs State of Haryana and Ors. etc.
etc., [1985] Supp. 1 SCR 657, referred to. 4.
The Orissa Public Service Commission is directed to re do the select list on the basis of the aggregate marks obtained by the candidates 1099 in the written examination and at the viva voce test.
The list so prepared to be forwarded to the Government as re quired under r. 19 of the Rules for appointments as Munsifs.
The persons who fall within the revised list, if already in service need not be disturbed.
Their inter se seniority to be regulated as per the rankings in the revised list.
[1106B D]
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ivil Appeal No. 2991 of 1986.
From the Judgment and Order dated 13.1.
1986 of the Madras High Court in Civil Revision Petition No. 3599 of 1983.
Ms. Shyamala Pappu, Ms. Dhaneshwari and R. Vasudevan for the Appellant.
section Srinivasan for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by special leave from the judgment and order of the High Court on 13th January, 1986 ordering eviction under Section 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, hereinafter called the Act.
This is an appeal by the tenant.
A room in the front portion of the building had been leased out to the tenant for non residential purposes.
The landlord resides in the other portion.
The landlord needed additional accommodation for residential purposes due to marriages in the family.
Was the portion let out as such separate and distinct unit for the purpose of Section 10(3)(c) of the Act? It was not and as such the landlord was entitled to seek eviction of the tenant under section 10(3)(c) of the Act.
It has been so held clearly by this Court in Shri Balaganesan Metals vs
M.N. Shanmugham Chetty and Ors., [1987] 2 1148 SCC 707 wherein the section has been analysed and explained.
Ms. Shyamala Pappu, learned counsel for the appellant sub mits that the decision needs reconsideration as the residen tial and the nonresidential part of the building covered as separate units and the requirements of the two separate parts have not been properly assessed therein.
We are unable to accept this criticism.
A building may consist of separate parts if the context so warrants.
In the instant case as in Shri Balaganesan Metal 's case the context and the user did not warrant treatment of the portion let out for non resi dential user either as a separate or distinct unit.
It was only a small part of the residential building and not a separate part.
It was secondly submitted that the expression "as the case may be", in the section has not been properly appreci ated.
We are unable to agree.
The difference between resi dential part and the nonresidential has been borne in mind by my learned brother in the judgment aforesaid.
Justice Morris in Bluston & Bramley Ltd. vs Leigh (Euler and Another, Third Parties), [1950] 2 A.E.R. page 29 at page 35 explained that the phrase "as the case may be" meant in the events that have happened.
Our attention was also drawn to the expression "as the case may be" as appearing in the Words and Phrases Permanent Edition 4 Page No. 596.
The meaning of the expression "as the case may be" is what the expression says, i.e., as the situation may be, in other words in case there are separate and distinct units then concept of need will apply accordingly.
Where, however, there is no such separate and distinct unit, it has no significance.
There is no magic in that expression.
The expression "as the case may be" has been properly construed in the judgment mentioned hereinbefore.
It was lastly contended that comparative hardship in the instant appeal has not been properly considered.
It appears that there is nothing in this point.
The appellant is an affluent businessman and it is not difficult for him to get alternative accommodation.
On the other hand, the respond ents have no other residential house than the one in ques tion will find it extremely difficult to get residential accommodation in the same locality and as such they will be put to immense hardship if they are not allowed to occupy the additional portion in their house which has been leased out to the tenant.
The Court has observed that there is no question of balance of convenience.
In that view of the matter this appeal must fail and is, therefore, dismissed.
There will, however, be no order as to costs.
P.S.S. Appeal dismissed.
|
The appellant was sought to be evicted under section 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 from a room leased out to him for non residential purposes in a residential building.
The landlord needed additional accommodation for residential purposes due to marriages in the family.
The High Court ordered eviction.
In the appeal by special leave, it was contended for the appellant that the portion let out to him was a separate and distinct unit for the purposes of section 10(3)(c) of the Act, that the expression 'as the case may be ' in the section has not been properly construed, and that the requirement and comparative hardship of the parties were not properly appre ciated.
Dismissing the appeal the Court, HELD: 1.
A building may consist of separate parts if the context so warrants.
In the instant case, the context and the user did not warrant treatment of the portion let out for non residential user either as a separate or distinct unit.
It was only a small part of the residential building and not a separate part.
The landlord was, therefore, enti tled to seek eviction of the tenant.
[1148B] Shri Balaganesan Metals vs
M.N. Shanmugham Chetty & Ors., ; , referred to.
The meaning of the expression 'as the case may be ' in 1147 section 10(3)(c) is what the expression says, i.e., as the situa tion may be, in other words, in case there are separate and distinct units then concept of need will apply accordingly.
Where, however, there is no such separate and distinct unit, as in the instant case, it has no significance.
[1148E] Bluston & Bramley Ltd. vs Leigh (Euler and Another, Third Parties) [1950] 2 A.E.R. page 29 at page 35, referred to.
The appellant is an affluent businessman and it is not difficult for him to get alternative accommodation.
On the other hand, the respondents who have no other residen tial house than the one in question will find it extremely difficult to get residential accommodation in the same locality and as such they will be put to immense hardship if they are not allowed to occupy the additional portion in their house which has been leased, out to the tenant.
There is no question of balance of convenience.
[1148FG]
|
ivil Appeal No. 2991 of 1986.
From the Judgment and Order dated 13.1.
1986 of the Madras High Court in Civil Revision Petition No. 3599 of 1983.
Ms. Shyamala Pappu, Ms. Dhaneshwari and R. Vasudevan for the Appellant.
section Srinivasan for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by special leave from the judgment and order of the High Court on 13th January, 1986 ordering eviction under Section 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, hereinafter called the Act.
This is an appeal by the tenant.
A room in the front portion of the building had been leased out to the tenant for non residential purposes.
The landlord resides in the other portion.
The landlord needed additional accommodation for residential purposes due to marriages in the family.
Was the portion let out as such separate and distinct unit for the purpose of Section 10(3)(c) of the Act? It was not and as such the landlord was entitled to seek eviction of the tenant under section 10(3)(c) of the Act.
It has been so held clearly by this Court in Shri Balaganesan Metals vs
M.N. Shanmugham Chetty and Ors., [1987] 2 1148 SCC 707 wherein the section has been analysed and explained.
Ms. Shyamala Pappu, learned counsel for the appellant sub mits that the decision needs reconsideration as the residen tial and the nonresidential part of the building covered as separate units and the requirements of the two separate parts have not been properly assessed therein.
We are unable to accept this criticism.
A building may consist of separate parts if the context so warrants.
In the instant case as in Shri Balaganesan Metal 's case the context and the user did not warrant treatment of the portion let out for non resi dential user either as a separate or distinct unit.
It was only a small part of the residential building and not a separate part.
It was secondly submitted that the expression "as the case may be", in the section has not been properly appreci ated.
We are unable to agree.
The difference between resi dential part and the nonresidential has been borne in mind by my learned brother in the judgment aforesaid.
Justice Morris in Bluston & Bramley Ltd. vs Leigh (Euler and Another, Third Parties), [1950] 2 A.E.R. page 29 at page 35 explained that the phrase "as the case may be" meant in the events that have happened.
Our attention was also drawn to the expression "as the case may be" as appearing in the Words and Phrases Permanent Edition 4 Page No. 596.
The meaning of the expression "as the case may be" is what the expression says, i.e., as the situation may be, in other words in case there are separate and distinct units then concept of need will apply accordingly.
Where, however, there is no such separate and distinct unit, it has no significance.
There is no magic in that expression.
The expression "as the case may be" has been properly construed in the judgment mentioned hereinbefore.
It was lastly contended that comparative hardship in the instant appeal has not been properly considered.
It appears that there is nothing in this point.
The appellant is an affluent businessman and it is not difficult for him to get alternative accommodation.
On the other hand, the respond ents have no other residential house than the one in ques tion will find it extremely difficult to get residential accommodation in the same locality and as such they will be put to immense hardship if they are not allowed to occupy the additional portion in their house which has been leased out to the tenant.
The Court has observed that there is no question of balance of convenience.
In that view of the matter this appeal must fail and is, therefore, dismissed.
There will, however, be no order as to costs.
P.S.S. Appeal dismissed.
|
ivil Appeal No. 2991 of 1986.
From the Judgment and Order dated 13.1.
1986 of the Madras High Court in Civil Revision Petition No. 3599 of 1983.
Ms. Shyamala Pappu, Ms. Dhaneshwari and R. Vasudevan for the Appellant.
section Srinivasan for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by special leave from the judgment and order of the High Court on 13th January, 1986 ordering eviction under Section 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, hereinafter called the Act.
This is an appeal by the tenant.
A room in the front portion of the building had been leased out to the tenant for non residential purposes.
The landlord resides in the other portion.
The landlord needed additional accommodation for residential purposes due to marriages in the family.
Was the portion let out as such separate and distinct unit for the purpose of Section 10(3)(c) of the Act? It was not and as such the landlord was entitled to seek eviction of the tenant under section 10(3)(c) of the Act.
It has been so held clearly by this Court in Shri Balaganesan Metals vs
M.N. Shanmugham Chetty and Ors., [1987] 2 1148 SCC 707 wherein the section has been analysed and explained.
Ms. Shyamala Pappu, learned counsel for the appellant sub mits that the decision needs reconsideration as the residen tial and the nonresidential part of the building covered as separate units and the requirements of the two separate parts have not been properly assessed therein.
We are unable to accept this criticism.
A building may consist of separate parts if the context so warrants.
In the instant case as in Shri Balaganesan Metal 's case the context and the user did not warrant treatment of the portion let out for non resi dential user either as a separate or distinct unit.
It was only a small part of the residential building and not a separate part.
It was secondly submitted that the expression "as the case may be", in the section has not been properly appreci ated.
We are unable to agree.
The difference between resi dential part and the nonresidential has been borne in mind by my learned brother in the judgment aforesaid.
Justice Morris in Bluston & Bramley Ltd. vs Leigh (Euler and Another, Third Parties), [1950] 2 A.E.R. page 29 at page 35 explained that the phrase "as the case may be" meant in the events that have happened.
Our attention was also drawn to the expression "as the case may be" as appearing in the Words and Phrases Permanent Edition 4 Page No. 596.
The meaning of the expression "as the case may be" is what the expression says, i.e., as the situation may be, in other words in case there are separate and distinct units then concept of need will apply accordingly.
Where, however, there is no such separate and distinct unit, it has no significance.
There is no magic in that expression.
The expression "as the case may be" has been properly construed in the judgment mentioned hereinbefore.
It was lastly contended that comparative hardship in the instant appeal has not been properly considered.
It appears that there is nothing in this point.
The appellant is an affluent businessman and it is not difficult for him to get alternative accommodation.
On the other hand, the respond ents have no other residential house than the one in ques tion will find it extremely difficult to get residential accommodation in the same locality and as such they will be put to immense hardship if they are not allowed to occupy the additional portion in their house which has been leased out to the tenant.
The Court has observed that there is no question of balance of convenience.
In that view of the matter this appeal must fail and is, therefore, dismissed.
There will, however, be no order as to costs.
P.S.S. Appeal dismissed.
|
The appellant was sought to be evicted under section 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 from a room leased out to him for non residential purposes in a residential building.
The landlord needed additional accommodation for residential purposes due to marriages in the family.
The High Court ordered eviction.
In the appeal by special leave, it was contended for the appellant that the portion let out to him was a separate and distinct unit for the purposes of section 10(3)(c) of the Act, that the expression 'as the case may be ' in the section has not been properly construed, and that the requirement and comparative hardship of the parties were not properly appre ciated.
Dismissing the appeal the Court, HELD: 1.
A building may consist of separate parts if the context so warrants.
In the instant case, the context and the user did not warrant treatment of the portion let out for non residential user either as a separate or distinct unit.
It was only a small part of the residential building and not a separate part.
The landlord was, therefore, enti tled to seek eviction of the tenant.
[1148B] Shri Balaganesan Metals vs
M.N. Shanmugham Chetty & Ors., ; , referred to.
The meaning of the expression 'as the case may be ' in 1147 section 10(3)(c) is what the expression says, i.e., as the situa tion may be, in other words, in case there are separate and distinct units then concept of need will apply accordingly.
Where, however, there is no such separate and distinct unit, as in the instant case, it has no significance.
[1148E] Bluston & Bramley Ltd. vs Leigh (Euler and Another, Third Parties) [1950] 2 A.E.R. page 29 at page 35, referred to.
The appellant is an affluent businessman and it is not difficult for him to get alternative accommodation.
On the other hand, the respondents who have no other residen tial house than the one in question will find it extremely difficult to get residential accommodation in the same locality and as such they will be put to immense hardship if they are not allowed to occupy the additional portion in their house which has been leased, out to the tenant.
There is no question of balance of convenience.
[1148FG]
|
The appellant was sought to be evicted under section 10(3)(c) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 from a room leased out to him for non residential purposes in a residential building.
The landlord needed additional accommodation for residential purposes due to marriages in the family.
The High Court ordered eviction.
In the appeal by special leave, it was contended for the appellant that the portion let out to him was a separate and distinct unit for the purposes of section 10(3)(c) of the Act, that the expression 'as the case may be ' in the section has not been properly construed, and that the requirement and comparative hardship of the parties were not properly appre ciated.
Dismissing the appeal the Court, HELD: 1.
A building may consist of separate parts if the context so warrants.
In the instant case, the context and the user did not warrant treatment of the portion let out for non residential user either as a separate or distinct unit.
It was only a small part of the residential building and not a separate part.
The landlord was, therefore, enti tled to seek eviction of the tenant.
[1148B] Shri Balaganesan Metals vs
M.N. Shanmugham Chetty & Ors., ; , referred to.
The meaning of the expression 'as the case may be ' in 1147 section 10(3)(c) is what the expression says, i.e., as the situa tion may be, in other words, in case there are separate and distinct units then concept of need will apply accordingly.
Where, however, there is no such separate and distinct unit, as in the instant case, it has no significance.
[1148E] Bluston & Bramley Ltd. vs Leigh (Euler and Another, Third Parties) [1950] 2 A.E.R. page 29 at page 35, referred to.
The appellant is an affluent businessman and it is not difficult for him to get alternative accommodation.
On the other hand, the respondents who have no other residen tial house than the one in question will find it extremely difficult to get residential accommodation in the same locality and as such they will be put to immense hardship if they are not allowed to occupy the additional portion in their house which has been leased, out to the tenant.
There is no question of balance of convenience.
[1148FG]
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Civil Appeal No. 2286 of 1987.
From the Judgment and Order dated 17.12.1986 of the Madhya Pradesh High Court in S.A. No. 536 of 1985.
V.M. Tarkunde, K.M.K. Nair for the Appellants.
Mukul Mudgal for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
This is an appeal from the judgment and order of the High Court of Madhya Pradesh dated 17th of December, 1986.
The appeal was 49 filed by the plaintiff whose suit for a declaration that the eight agreements/contracts executed between it and the defendant No. 1 M/s. Jayabharat Credit and Investment Company Ltd. were not 'hire purchase agreements ' but were agreements relating to transaction of loan and for injunction restraining the defendant No. 1.
from enforcing them until the decision of the suit, had been dismissed on the ground that the suit was not maintainable in view of the provisions of section 32 of the (hereinafter called 'the Act ').
Section 32 of the Act stipulates that notwithstanding any law for the time being in force no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the said Act.
The execution of documents containing the alleged arbitration clause was not disputed in this case.
The clause was as follows: "All disputes, differences or claims arising out of this agreement shall be settled by arbitration in accordance with the provisions of the or any statutory amendments thereof and shall be referred to the sole arbitration of a person to be nominated by the owners.
In the event of death, refusal, neglect, inability or incapability of the person so appointed to act as arbitrator, the owners may appoint a new arbitrator.
The award of the arbitrator shall be final and binding on all the parties concerned.
" Various issues were framed by the trial court.
The appellate court confirmed the said decision.
There was a second appeal to the High Court.
The High Court framed the question of law in the impugned judgment as follows: "Whether the courts below were right in holding that section 32 of the barred the suit and in dismissing the same on that ground? It was contended before the High Court by the appellant that the so called 'hire purchase agreements ' were nothing else than agreements entered into by the plaintiff and the defendant No. 1 with respect to transaction of loan.
It was the case of the appellant that the alleged arbitration agreement was not entered into as such in the sense though certain documents were executed, these were not properly understood as hire purchase agreements.
Therefore, the main ques 50 tion was whether the existence of the agreement as hire purchase agreement was denied by the appellant and put in issue before the court.
Specific case of the appellant was that this was a transaction of loan and there was in fact no agreement of arbitration.
It appears from the perusal of the plaint as well as the issues framed that the very existence of the agreement described as hire purchase agreements was put in issue.
The execution of the documents was not denied but it was alleged that these were manipulated documents, in other words fraudulent documents and it was further the case of the appellant that there were in fact no agreements which contained the arbitration agreement.
The case of the appellant was that there was no document containing any valid arbitration agreement in existence.
This fact was raised in the plaint and issue to that effect was raised, in other words that the appellant, plaintiff in this case was contended that the agreement described as hire purchase agreements were untrue and void procured fraudulently.
The issues framed by the learned trial judge also included this specific point.
Section 32 of the Act does not contemplate the case suits challenging the validity of a contract because it contains an arbitration clause.
If the intention of the legislature were that all documents containing an arbitration clause should come within the purview of sections 32 and 33, the legislature would have said so in appropriate words.
These sections have a very limited application, namely, where the existence of validity of an arbitration agreement and not the contract containing the arbitration agreement is challenged.
Every person, it has to be borne in mind has a right to bring a suit which was of a civil nature and the court had jurisdiction to try all suits of civil nature under section 9 of the Code of Civil Procedure.
That right has not been taken away by section 32 of the Act.
Such a right can only be taken away by express terms or by necessary implication.
Section 32 of the Act does not have that effect.
We have perused the plaint in this case; one of the issues, namely, issue No. 4 was "Whether the defendant No. 1 obtained disputed hire purchase agreements from the plaintiffs in pursuance of its money lending business?" The existence of the disputed hire purchase agreements were put in issue.
It was suggested that these were obtained by dubious method or that these were fraudulently procured.
It is true that the execution of an alleged document was not in issue but the existence of that document as an arbitration agreement was in issue.
Sections 32 and 33 of the Act on the true construction do not purport to deal with suits for declaration that there was never any contract or that contract is void.
This principle is well settled.
The Division Bench of the Calcutta High Court consisting of Harries, C.J. and Banerjee, J. in State of Bombay vs Adamjee Hajee Dawood and Co., A.I.R. 1951 Calcutta 147 held that 51 section 32 of the Act does not contemplate the case of a suit challenging the validity of a contract merely because it contains an arbitration clause.
This is the correct position in law.
If that is the law then in the facts and circumstances of the case the learned trial court, the learned appellate court and the High Court were in error in this case in dismissing the suit and the appeals respectively.
The appeal is, therefore, allowed and the judgment and order of the High Court and the courts below are set aside.
In the facts and circumstances of the case costs of the parties will be costs in the suit.
The suit will now proceed as expeditiously as possible.
S.L. Appeal allowed.
|
The appellant/plaintiffs filed a suit for a declaration that the eight agreements/contracts executed between the appellants and the defendant/respondent No. 1, were not 'hire purchase agreements ' but were agreements relating to the transaction of loan.
The suit was dismissed.
The appellate Court confirmed the decision of the Trial Court.
There was a second appeal to the High Court, whereafter the appellants moved this Court by special leave against the judgment and order of the High Court.
Allowing the Appeal, the Court, HELD: The suit had been dismissed on the ground that it was not maintainable in view of the provisions of section 32 of the .
Section 32 of the Act stipulates that notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the Act.
[49B C] Specific case of the appellants was that it was a transaction of loan and there was in fact no agreement of arbitration.
It appeared from the plaint as well as the issues framed that the very existence of the agreement described as hire purchase agreement was put in issue.
The execution of the documents was not denied but it was alleged that these were manipulated documents and that there were in fact no agreements which contained the arbitration agreement.
[50A C] Section 32 of the Act does not contemplate the case of suits challenging the validity of a contract because it contains an arbitration 48 clause.
The section has a very limited application, namely, where the existence of the validity of an arbitration agreement and not the contract containing the arbitration agreement is challenged.
[50D E] Every person has a right to bring a suit which is of a Civil nature and the Court has jurisdiction to try all suits of Civil nature under section 9 of the Code of Civil Procedure.
That right has not been taken away by section 32 of the Act.
One of the issues, framed namely.
issue No. 4 was "whether the defendant No. 1 obtained disputed hire purchase agreements from the plaintiffs in pursuance of its money lending business?" The existence of the disputed hire purchase agreements was put in issue.
It is true that the execution of an alleged document was not in issue, but the existence of that document as an arbitration agreement was in issue.
Section 32 of the Act does not purport to deal with suits for declaration that there was never any contract or that the contract is void.
This principle is well settled.
In State of Bombay vs Adamjee Hajee Dawood and Co., A.I.R. 1951 Calcutta 147, the Calcutta High Court held that section 32 of the Act does not contemplate the case of a suit challenging the validity of a contract merely because it contains an arbitration clause.
This is the correct position in law, and in the facts and circumstances of the case, the trial Court, the appellate Court and the High Court in this case were in error.
Their judgments and orders were set aside.
[50E H; 51A C] State of Bombay vs Adamjee Hajee Dawood & Co., A.I.R , referred to.
|
Civil Appeal No. 2286 of 1987.
From the Judgment and Order dated 17.12.1986 of the Madhya Pradesh High Court in S.A. No. 536 of 1985.
V.M. Tarkunde, K.M.K. Nair for the Appellants.
Mukul Mudgal for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
This is an appeal from the judgment and order of the High Court of Madhya Pradesh dated 17th of December, 1986.
The appeal was 49 filed by the plaintiff whose suit for a declaration that the eight agreements/contracts executed between it and the defendant No. 1 M/s. Jayabharat Credit and Investment Company Ltd. were not 'hire purchase agreements ' but were agreements relating to transaction of loan and for injunction restraining the defendant No. 1.
from enforcing them until the decision of the suit, had been dismissed on the ground that the suit was not maintainable in view of the provisions of section 32 of the (hereinafter called 'the Act ').
Section 32 of the Act stipulates that notwithstanding any law for the time being in force no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the said Act.
The execution of documents containing the alleged arbitration clause was not disputed in this case.
The clause was as follows: "All disputes, differences or claims arising out of this agreement shall be settled by arbitration in accordance with the provisions of the or any statutory amendments thereof and shall be referred to the sole arbitration of a person to be nominated by the owners.
In the event of death, refusal, neglect, inability or incapability of the person so appointed to act as arbitrator, the owners may appoint a new arbitrator.
The award of the arbitrator shall be final and binding on all the parties concerned.
" Various issues were framed by the trial court.
The appellate court confirmed the said decision.
There was a second appeal to the High Court.
The High Court framed the question of law in the impugned judgment as follows: "Whether the courts below were right in holding that section 32 of the barred the suit and in dismissing the same on that ground? It was contended before the High Court by the appellant that the so called 'hire purchase agreements ' were nothing else than agreements entered into by the plaintiff and the defendant No. 1 with respect to transaction of loan.
It was the case of the appellant that the alleged arbitration agreement was not entered into as such in the sense though certain documents were executed, these were not properly understood as hire purchase agreements.
Therefore, the main ques 50 tion was whether the existence of the agreement as hire purchase agreement was denied by the appellant and put in issue before the court.
Specific case of the appellant was that this was a transaction of loan and there was in fact no agreement of arbitration.
It appears from the perusal of the plaint as well as the issues framed that the very existence of the agreement described as hire purchase agreements was put in issue.
The execution of the documents was not denied but it was alleged that these were manipulated documents, in other words fraudulent documents and it was further the case of the appellant that there were in fact no agreements which contained the arbitration agreement.
The case of the appellant was that there was no document containing any valid arbitration agreement in existence.
This fact was raised in the plaint and issue to that effect was raised, in other words that the appellant, plaintiff in this case was contended that the agreement described as hire purchase agreements were untrue and void procured fraudulently.
The issues framed by the learned trial judge also included this specific point.
Section 32 of the Act does not contemplate the case suits challenging the validity of a contract because it contains an arbitration clause.
If the intention of the legislature were that all documents containing an arbitration clause should come within the purview of sections 32 and 33, the legislature would have said so in appropriate words.
These sections have a very limited application, namely, where the existence of validity of an arbitration agreement and not the contract containing the arbitration agreement is challenged.
Every person, it has to be borne in mind has a right to bring a suit which was of a civil nature and the court had jurisdiction to try all suits of civil nature under section 9 of the Code of Civil Procedure.
That right has not been taken away by section 32 of the Act.
Such a right can only be taken away by express terms or by necessary implication.
Section 32 of the Act does not have that effect.
We have perused the plaint in this case; one of the issues, namely, issue No. 4 was "Whether the defendant No. 1 obtained disputed hire purchase agreements from the plaintiffs in pursuance of its money lending business?" The existence of the disputed hire purchase agreements were put in issue.
It was suggested that these were obtained by dubious method or that these were fraudulently procured.
It is true that the execution of an alleged document was not in issue but the existence of that document as an arbitration agreement was in issue.
Sections 32 and 33 of the Act on the true construction do not purport to deal with suits for declaration that there was never any contract or that contract is void.
This principle is well settled.
The Division Bench of the Calcutta High Court consisting of Harries, C.J. and Banerjee, J. in State of Bombay vs Adamjee Hajee Dawood and Co., A.I.R. 1951 Calcutta 147 held that 51 section 32 of the Act does not contemplate the case of a suit challenging the validity of a contract merely because it contains an arbitration clause.
This is the correct position in law.
If that is the law then in the facts and circumstances of the case the learned trial court, the learned appellate court and the High Court were in error in this case in dismissing the suit and the appeals respectively.
The appeal is, therefore, allowed and the judgment and order of the High Court and the courts below are set aside.
In the facts and circumstances of the case costs of the parties will be costs in the suit.
The suit will now proceed as expeditiously as possible.
S.L. Appeal allowed.
|
Civil Appeal No. 2286 of 1987.
From the Judgment and Order dated 17.12.1986 of the Madhya Pradesh High Court in S.A. No. 536 of 1985.
V.M. Tarkunde, K.M.K. Nair for the Appellants.
Mukul Mudgal for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
This is an appeal from the judgment and order of the High Court of Madhya Pradesh dated 17th of December, 1986.
The appeal was 49 filed by the plaintiff whose suit for a declaration that the eight agreements/contracts executed between it and the defendant No. 1 M/s. Jayabharat Credit and Investment Company Ltd. were not 'hire purchase agreements ' but were agreements relating to transaction of loan and for injunction restraining the defendant No. 1.
from enforcing them until the decision of the suit, had been dismissed on the ground that the suit was not maintainable in view of the provisions of section 32 of the (hereinafter called 'the Act ').
Section 32 of the Act stipulates that notwithstanding any law for the time being in force no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the said Act.
The execution of documents containing the alleged arbitration clause was not disputed in this case.
The clause was as follows: "All disputes, differences or claims arising out of this agreement shall be settled by arbitration in accordance with the provisions of the or any statutory amendments thereof and shall be referred to the sole arbitration of a person to be nominated by the owners.
In the event of death, refusal, neglect, inability or incapability of the person so appointed to act as arbitrator, the owners may appoint a new arbitrator.
The award of the arbitrator shall be final and binding on all the parties concerned.
" Various issues were framed by the trial court.
The appellate court confirmed the said decision.
There was a second appeal to the High Court.
The High Court framed the question of law in the impugned judgment as follows: "Whether the courts below were right in holding that section 32 of the barred the suit and in dismissing the same on that ground? It was contended before the High Court by the appellant that the so called 'hire purchase agreements ' were nothing else than agreements entered into by the plaintiff and the defendant No. 1 with respect to transaction of loan.
It was the case of the appellant that the alleged arbitration agreement was not entered into as such in the sense though certain documents were executed, these were not properly understood as hire purchase agreements.
Therefore, the main ques 50 tion was whether the existence of the agreement as hire purchase agreement was denied by the appellant and put in issue before the court.
Specific case of the appellant was that this was a transaction of loan and there was in fact no agreement of arbitration.
It appears from the perusal of the plaint as well as the issues framed that the very existence of the agreement described as hire purchase agreements was put in issue.
The execution of the documents was not denied but it was alleged that these were manipulated documents, in other words fraudulent documents and it was further the case of the appellant that there were in fact no agreements which contained the arbitration agreement.
The case of the appellant was that there was no document containing any valid arbitration agreement in existence.
This fact was raised in the plaint and issue to that effect was raised, in other words that the appellant, plaintiff in this case was contended that the agreement described as hire purchase agreements were untrue and void procured fraudulently.
The issues framed by the learned trial judge also included this specific point.
Section 32 of the Act does not contemplate the case suits challenging the validity of a contract because it contains an arbitration clause.
If the intention of the legislature were that all documents containing an arbitration clause should come within the purview of sections 32 and 33, the legislature would have said so in appropriate words.
These sections have a very limited application, namely, where the existence of validity of an arbitration agreement and not the contract containing the arbitration agreement is challenged.
Every person, it has to be borne in mind has a right to bring a suit which was of a civil nature and the court had jurisdiction to try all suits of civil nature under section 9 of the Code of Civil Procedure.
That right has not been taken away by section 32 of the Act.
Such a right can only be taken away by express terms or by necessary implication.
Section 32 of the Act does not have that effect.
We have perused the plaint in this case; one of the issues, namely, issue No. 4 was "Whether the defendant No. 1 obtained disputed hire purchase agreements from the plaintiffs in pursuance of its money lending business?" The existence of the disputed hire purchase agreements were put in issue.
It was suggested that these were obtained by dubious method or that these were fraudulently procured.
It is true that the execution of an alleged document was not in issue but the existence of that document as an arbitration agreement was in issue.
Sections 32 and 33 of the Act on the true construction do not purport to deal with suits for declaration that there was never any contract or that contract is void.
This principle is well settled.
The Division Bench of the Calcutta High Court consisting of Harries, C.J. and Banerjee, J. in State of Bombay vs Adamjee Hajee Dawood and Co., A.I.R. 1951 Calcutta 147 held that 51 section 32 of the Act does not contemplate the case of a suit challenging the validity of a contract merely because it contains an arbitration clause.
This is the correct position in law.
If that is the law then in the facts and circumstances of the case the learned trial court, the learned appellate court and the High Court were in error in this case in dismissing the suit and the appeals respectively.
The appeal is, therefore, allowed and the judgment and order of the High Court and the courts below are set aside.
In the facts and circumstances of the case costs of the parties will be costs in the suit.
The suit will now proceed as expeditiously as possible.
S.L. Appeal allowed.
|
The appellant/plaintiffs filed a suit for a declaration that the eight agreements/contracts executed between the appellants and the defendant/respondent No. 1, were not 'hire purchase agreements ' but were agreements relating to the transaction of loan.
The suit was dismissed.
The appellate Court confirmed the decision of the Trial Court.
There was a second appeal to the High Court, whereafter the appellants moved this Court by special leave against the judgment and order of the High Court.
Allowing the Appeal, the Court, HELD: The suit had been dismissed on the ground that it was not maintainable in view of the provisions of section 32 of the .
Section 32 of the Act stipulates that notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the Act.
[49B C] Specific case of the appellants was that it was a transaction of loan and there was in fact no agreement of arbitration.
It appeared from the plaint as well as the issues framed that the very existence of the agreement described as hire purchase agreement was put in issue.
The execution of the documents was not denied but it was alleged that these were manipulated documents and that there were in fact no agreements which contained the arbitration agreement.
[50A C] Section 32 of the Act does not contemplate the case of suits challenging the validity of a contract because it contains an arbitration 48 clause.
The section has a very limited application, namely, where the existence of the validity of an arbitration agreement and not the contract containing the arbitration agreement is challenged.
[50D E] Every person has a right to bring a suit which is of a Civil nature and the Court has jurisdiction to try all suits of Civil nature under section 9 of the Code of Civil Procedure.
That right has not been taken away by section 32 of the Act.
One of the issues, framed namely.
issue No. 4 was "whether the defendant No. 1 obtained disputed hire purchase agreements from the plaintiffs in pursuance of its money lending business?" The existence of the disputed hire purchase agreements was put in issue.
It is true that the execution of an alleged document was not in issue, but the existence of that document as an arbitration agreement was in issue.
Section 32 of the Act does not purport to deal with suits for declaration that there was never any contract or that the contract is void.
This principle is well settled.
In State of Bombay vs Adamjee Hajee Dawood and Co., A.I.R. 1951 Calcutta 147, the Calcutta High Court held that section 32 of the Act does not contemplate the case of a suit challenging the validity of a contract merely because it contains an arbitration clause.
This is the correct position in law, and in the facts and circumstances of the case, the trial Court, the appellate Court and the High Court in this case were in error.
Their judgments and orders were set aside.
[50E H; 51A C] State of Bombay vs Adamjee Hajee Dawood & Co., A.I.R , referred to.
|
The appellant/plaintiffs filed a suit for a declaration that the eight agreements/contracts executed between the appellants and the defendant/respondent No. 1, were not 'hire purchase agreements ' but were agreements relating to the transaction of loan.
The suit was dismissed.
The appellate Court confirmed the decision of the Trial Court.
There was a second appeal to the High Court, whereafter the appellants moved this Court by special leave against the judgment and order of the High Court.
Allowing the Appeal, the Court, HELD: The suit had been dismissed on the ground that it was not maintainable in view of the provisions of section 32 of the .
Section 32 of the Act stipulates that notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be enforced, set aside, amended, modified or in any way affected otherwise than as provided in the Act.
[49B C] Specific case of the appellants was that it was a transaction of loan and there was in fact no agreement of arbitration.
It appeared from the plaint as well as the issues framed that the very existence of the agreement described as hire purchase agreement was put in issue.
The execution of the documents was not denied but it was alleged that these were manipulated documents and that there were in fact no agreements which contained the arbitration agreement.
[50A C] Section 32 of the Act does not contemplate the case of suits challenging the validity of a contract because it contains an arbitration 48 clause.
The section has a very limited application, namely, where the existence of the validity of an arbitration agreement and not the contract containing the arbitration agreement is challenged.
[50D E] Every person has a right to bring a suit which is of a Civil nature and the Court has jurisdiction to try all suits of Civil nature under section 9 of the Code of Civil Procedure.
That right has not been taken away by section 32 of the Act.
One of the issues, framed namely.
issue No. 4 was "whether the defendant No. 1 obtained disputed hire purchase agreements from the plaintiffs in pursuance of its money lending business?" The existence of the disputed hire purchase agreements was put in issue.
It is true that the execution of an alleged document was not in issue, but the existence of that document as an arbitration agreement was in issue.
Section 32 of the Act does not purport to deal with suits for declaration that there was never any contract or that the contract is void.
This principle is well settled.
In State of Bombay vs Adamjee Hajee Dawood and Co., A.I.R. 1951 Calcutta 147, the Calcutta High Court held that section 32 of the Act does not contemplate the case of a suit challenging the validity of a contract merely because it contains an arbitration clause.
This is the correct position in law, and in the facts and circumstances of the case, the trial Court, the appellate Court and the High Court in this case were in error.
Their judgments and orders were set aside.
[50E H; 51A C] State of Bombay vs Adamjee Hajee Dawood & Co., A.I.R , referred to.
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minal Appeal No. 170 of 1961.
Appeal by special leave from the judgment and order dated August 28, 1961, of the Allahabad High Court (Lucknow Bench) at Lucknow in Cr.
Case No. 125 of 1961.
A.S. R. Chari, B. Parthasarathy, R. K. Garg, section C.Aggarwal, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellant.
G. C. Mathur and C. P. Lal, for respondent No. 2. 1962.
September 13.
The judgment of the Court was de livered by DAS GUPTA, J.
This appeal by special leave is against an order of the High Court at Allahabad rejecting on August 28, 1961 an application made by the present appellant.
For a proper appreciation of the contention raised in the appeal it is necessary to set out in some detail the complicated.
facts which gave rise to her application.
It appears that on January 23, 1938 the appellant 's mother Mrs. A. E. Forbes executed a will leaving all her property to her three children, viz., the appellant, Mrs. V. G. Paterson, Mrs. E. D. Earle and Mr. 0.
V. Forbes.
The testatrix died on June 6, 1939 and this appellant applied for a probate.
The probate was granted on November 30, 1939.
On May, 4, 1943 when Criminal Appeal No. 9 of 1943 was being argued before a, Single Judge of the Oudh Chief Court the Counsel for the State brought it to the notice of the judge that Mr. 0.
V. Forbes brother of the present appellant had made in his application before the Trial Court and in other ways certain aspersions against the conduct of the Trial Court which amounted to contempt of Court.
The 43 learned judge ordered the issue of notice against Mr. O. V. Forbes in this matter.
On May 6 1943 the present appellant also filed an application for similar action under the Contempt of Courts Act against her brother Mr. Forbes.
On this also notice was issued to Mr. Forbes.
As the notices are not on record we do not know the actual terms of the notice; but it does not appear to be disputed that by these notices Mr. Forbes was asked to appear be ore the Oudh Chief Court to show cause why he should not be proceeded against for contempt of court.
Mr. Forbes however did not appear.
Some time after this a bailable warrant appears to have been issued for the arrest of Mr. Forbes.
The warrant was returned unexecuted.
A registered notice was thereafter issued under the orders of the Court asking Mr. Forbes to attend the Oudh Chief Court on September 23, 1943.
On that date also he did not appear.
The learned judges of the Chief Court being of opinion that Mr. Forbes was concealing himself only to avoid the execution of the warrant, made the following order : "Accordingly we order that action be taken under section 87 of the Code of Criminal Procedure against Mr. Forbes and direct the issue of a written proclamation requiring him to appear in this Court on the 25th November, 1943 at 10 a.m.
This proclamation will be issued in strict accordance with the requirements of section 87 Cr.
P.C. The proclamation will also be published once in the Pioneer of Lucknow and the Daily Statesman of Calcutta.
Under section 88 of the Code of Criminal Procedure We further order attachment of the moveable and immoveable property belonging to Mr. Forbes within the jurisdiction of this Court including : 1.
G.P. Notes and bonds for Rs.1,070,000/ in the hands of the Registrar of this Court.
Rs. 12,250/ deposited in this Court in the Personal Ledger, Trustees and Stake Hol ders Fund; 3.
G.P. Notes belonging to Mr. Forbes of the face value of Rs. 55,000/ attached in Execution Case No. 16 of 1942 in the Court of the Civil judge, Lucknow : Dr. Hari Shanker Dube vs O. V. Forbes.
" The proclamation was duly published and certain property was attached on the basis that it was the property of Mr. 0.
V. Forbes.
On March 30, 1 '944, the Oudh Chief Court recorded an order stating that as Mr. Forbes did not appear within the time specified in the proclamation and under sub section (7) of section 88 of the Code of Criminal Procedure the property under attachment was at the disposal of the Provincial Government.
As regards the two applications for contempt the Court made the following order: ""These applications will therefore be adjourned sine ded until Mr. Forbes appears or is arrested.
" On September 21, 1944, the Court made an order withdrawing the prohibitory order it had earlier issued against the Registrar and the Civil judge, Lucknow.
It appears that after the Oudh Chief Court made the order on March 30, 1944 stating that the attached property was at the disposal of the Provincial Government under sub section 7 of section 88 of the Code of Criminal Procedure the Provincial Government directed the City Magistrate to take suitable action for the disposal of the attached property.
It was to facilitate such action by the City 'Magistrate that the prohibitory orders were withdrawn.
The Chief Court also made an order directing the Registrar and the Civil judge to send the attached property to the City Magistrate for disposal according to law.
On the same date Mrs. Paterson was also directed to hand over all the property in her possession which she may be 45 holding a custodian for 'Mr. O.V. Forbes to the City Magistrate.
It, appears that in August 1943 the City Magistrate forwarded to the U.P. Government at Lucknow promissory notes of the total value of Rs. 2,28,800/ said to be the attached property adding"these G. P. Notes to the total value of Rs. 2,28,800/ have been ordered to be forfeited to the U. P. Government by the Chief Court of Oudh under order dated 21st September 1944 in Criminal Miscellaneous Application No. 47 of 1943".
It was further stated that : "It is requested that necessary action may be taken ' by you to credit the sum under the head Fines and Forfeitures Apparently this has been done.
Mr. Forbes died in 1953.
On April 4.
1960 the present appellant made an application to the U.P. Government in which she stated that Mr. Forbes had died intestate and that his only heirs were his two sifters, the appellant herself and her sister Mrs. E. D. Earle for whom she was the trustee and prayed that as the Government was " 'only in the position of a receiver or a trustee of the property of Mr. Forbes this trusteeship having ceased with Mr. Forbes death .the government should return the property to the appellant and her sister".
On September 3, 1960 the Government rejected this prayer stating ""that this was a confiscated property of Mr. Forbes and that on legal grounds her claim was Wholey untenable" but added these, words : " 'If however she has any special reasons for invoking the compassion of Government `she may indicate the same to Government and also furnish convincing evidence that Mr. Forbes actually has died and that she is his sole heir or one of the heirs entitled to his assets.
" The appellant pointed out to the Government in her letter dated September 12, 1960 that the property of Mr. Forbes has not been confiscated bet merely attached and emphasised that the Government had no proprietary right to the attached property but 46 could retain it only as a custodian or trustee for the time being.
She asked the Government to re consider the whole situation.
The reply of Government, if any was apparently unsatisfactory and so on November 29, 1960 the appellant filed an application under article 226 of the Constitution in the High Court at Allahabad in which after stating the several facts as regards the attachment of the property and the action taken by the Government, she prayed for a writ of certiorari to quash the Government 's order of September 3,1960 and also for a writ of Mandamus ordering the Government to hand over the Government promissory notes and cash money which had been attached.
On March 29, 1961 the ' High Court rejected this application.
The High Court pointed out that the applicant had not shown that the State Government had failed to carry out any duty imposed by law and further that the order dated September 5, 1960 could not be said to be either judicial or a quasi judicial order or even an administrative order passed without jurisdiction.
It was then that ' on May 1, 1961 the appellant made to the High Court at Allahabad the application out of which the present appeal has arisen.
By this application the appellant asked for four relilfs : (a) for an order terminating the contempt of court proceedings; (b) for an order vacating the orders of attachment made by the Chief Court; (c) for a direction on the Finance Secretary, U. P. Government, to restore the attached property to the applicant as executrix of the estate of late Mrs. A. E. Forbes.
A copy of the writ petition dated the 29th November, 1960 in which it had been mentioned that the proceedings under section 87 and section 88 of the Code of Criminal Procedure were illegal because the code was applicable to proceedings for contempt, was attached to the application.
It was further stated in the present application that in any case the attachment was void inasmuch as the property that was attached 47 was at the time of attachment an undistributed part of the estate of late Mrs. A. E. Forbes and so vested in this appellant as executrix.
By separate but concuring judgments Mr. Justice Mulla and Mr. justice Nigam, who heard this application rejected the applicant 's prayer for vacating the order of attachment or for any direction to the Finance Secretary, U.P. Government for restoration of the attached property.
Mr. Justice Mulla based his decision mainly on the point that the appellant had herself acted in an unclean way, and she having been responsible for getting warrants under sections 87 and 88 of the Code of Criminal Procedure issued against Mr. Forbes it did not lie in her mouth to say now that the issue of these processes was without jurisdiction and held that as she was instrumental in getting the order now complained of passed, the discretionary powers of the Court should not be exercised in her favour, especially, as she had made the application after a long delay.
The learned judge also expressed the opinion that the judges of the Chief Court acted within their jurisdiction in issuing processes under sections 87 and 88 of the Code of Criminal Procedure that this order was just and legal and the State had come into the custody of the property under the due process of law.
In the opinion Of the learned judge "Mr. Forbes was willing to give away this property rather than, face a prosecution for contempt of Court" and added "if he took up that attitude it cannot be said by the heirs of Mr. Forbes that now the property should be released in their favour".
Mr. Justice Nigam stressed the point that the Court had attached the property belonging to ',Mr. Forbes and the present appellant had handed over the property " treating it to be the property of Mr. O.V. Forbes.
" According to this learned Judge if the property that was attached did not belong to Mr. 0.
V. Forbes this appellant should have " 'never handed over the property voluntarily".
He was further 48 of opinion that "the fact that she voluntarily handed a property over as belonging to Mr. Forbes and actually suggested that this particular property be attached clearly amounted to. . . an admission of 'the ownership of the property vesting in Mr. 0.
V. Forbes and the property not being part of the undistributed assets in the possession of '.
Mrs. Peterson as executrix to Mrs. A. E. Forbes.
" After holding that the Code of Criminal Procedure was not directly learned Judge expressed the opinion that "the Bench could adopt its own procedure for enforcing the attendance of the delinqent" and added 'if it adopted the procedure prescribed in the Code of Criminal Procedure, I can see no warrant for the contention that the procedure adopted was wrong, improper and beyond the jurisdiction of the Court.
" Finally, he held that it would be contrary to the interests of justice to review the order " 'after a lapse of about 18 years.
" The learned Judge also held that the Court was no longer in possession of the attached property, the same having been handed over to the City Magistrate for being passed on to the State Government and could not therefore pass any orders in respect of the property.
He also expressed the view that prima facie it appeared to him that the appellant 's remedy, if any, was by a civil suit.
The contempt proceedings were however directed to be consigned to the record as abated.
The present appeal is directed against the High Court 's decision refusing to give the plaintiff the substantial relief asked for in the application, viz., a direction on the Finance Secretary, U. P. Government to restore the attached property to her.
The first question for consideration is whether at the time of attachment the property formed .
part of the unadministered estate of Mrs. A. E. Forbes.
If that was the correct legal position there could not be in law attachment of that property as the property 49 of Mr. Forbes, even if section 87 and s.88 could be applied to secure the arrest of a person alleged to have committed contempt.
Mr. justice Mulla has not dealt with this question.
Justice Nigam has however formed the definite conclusion that the property had vested in Mr. O.V. Forbes on the date of attachment and was not part of the undistributed assets of Mrs. A. E. Forbes in the hand of the executrix.
In coming to this conclusion the learned Judge appears to have relied on what he described as " 'the fact that she (Mrs. Paterson) voluntarily handed the property over as belonging to Mr. Forbes and actually suggested that this particular property be attached".
It is not clear from the record of this case on what materials the learned judge thought that Mrs. Paterson actually suggested that this particular property be attached.
That she really handed the property over appears to be correct.
It appears reasonable to think that she did so in obedience to the order of the Court.
The matter was stated thus by her in Para.
8 of the Writ Petition: "8.
That under the orders of the Hon 'ble Chief Court of Avadh the petitioner deposited with the Registrar of that Court and finally with the City Magistrate, Lucknow, unadministered assets consisting of Government Promissory Notes and each totalling Rupees 2,41,300/ detailed in the list attached to this petition which the then City Magistrate, Sri section G. Bose Mullick was pleased to transfer the same to the Finance Secretary to the U. P. Government, Lucknow, in August, 1948.
" In the counter affidavit filed on behalf of the State of O. P. in the writ petition the statements made in this paragraph was admitted to be true.
It appears clear therefore that the petitioner made over the securities and cash the property which was attached tinder the orders of the Chief Court of Oudh.
It is further to be borne in mind that the petitioner made the 50 definite statement in this Para.
8 of the writ Petition that the property that was made over by her formed part of the unadministered assets in her hand and the truth of this statement was admitted by the State of U.P It is difficult to see how it can be reasonably here that merely because the executrix banded over certain assets in her hand to the Registrar and the City Magistrate in obedience to the orders of the Chief Court thereby become vested in Mr. 0.
V. Forbes.
The property in the hands of the executrix could become vested in Mr. O. V. Forbes only on her handing over the same to him or to somebody on his behalf.
Delivering the property to the Registrar of the Court or to the City Magistrate could not amount to handing over to the legatee.
For, obviously the Registrar of the Chief Court or the City Magistrate, Lucknow, were not acting on behalf of the legatee Mr. 0.
V. Forbes but indeed acting against his inte rests.
In our opinion, the property did not cease to be unadministered assets of the estates of Mrs. A. E. Forbes merely because under the orders of the Court this appellant, who was the executrix, had the assets in her hand deposited with the Registrar or the City Magistrate.
It must therefore be held that the property which was attached was at the time of attachment not the property of Mr. O. V. Forbes but formed part of the unadministered assets of Mrs. A. E. Forbes.
This property could not be legally attached in any proceedings for securing the arrest of Mr. O. V. Forbes.
If what was attached did not form part of the property of Mr. 0.
V. Forbes, the order of attachment was invalid; and there would be no scope for the operation of section 88 (7) of the Code of Criminal Procedure.
Assuming that the property was of Mr. 0.
V. Forbes, the question arises whether it would, as a result of the attachment, be at the disposal of 51 Government under s.88 (7) of the Code of Criminal Procedure.
In Sukhdev Singh Sodhi vs The Chief Justice and Judges of the Pepsu High Court(1) it was held that the Code of Criminal Procedure does not apply to proceedings for contempt.
On this authority it must be held that the provisions of sections 87 and 88 would also not be available to securing 'the presence of a person who is alleged to have committed contempt.
It may be mentioned that on behelf of the appellant, 'Mr. Chari had urged that even if the property was of Mr. 0.
V. Forbes, the a leged contemner, the Chief Court of Oudh had no power to attach it.
The High Court seems to think that the Chief Court could choose any procedure it liked in the matter of punishing people for contempt and so if it thought that it would not finally dispose of contempt proceedings without the alleged contemner being present before it, it had the inherent right of first issuing a warrant of arrest and next, if that was not successful, by proclamation for his appearance and also by attachment of his property.
It seems to us that the Chief Court as a Court of record had the right to punish persons for contempt and for the proper exercise of that power it will have all other powers necessary and incidental to it.
It is however unnecessary to decide whether such necessary and incidental powers include the power of arrest and of attaching the alleged contemner 's property in an attempt to secure his presence.
But assuming they do, we are of opinion that the Chief Court had still no right to make over the attached property to Government.
The right of the Government to have any control over the attached property flows from the provisions of section 88 of the Criminal Procedure Code ' As no attachment could legally be made under section 88, Criminal Procedure Code, in any proceeding for contempt, the provisions of section 88 (7) of the Code of Criminal Procedure, under which (1) ; 52 the property under attachment shall be at the disposal of the State Government, if the proclaimed person does not appear within the time prescribed in the proclamation cannot come into operation.
The position therefore is that Government is in possession of the property that was attached under the orders of the Chief Court; but the possession is, without any authority of law.
The question then arises : whether the Court can or should direct restoration of the property to the rightful owner.
On behalf of the State of V., P. it is argued that if the Government is in unlawful possession of the property the proper remedy for the rightful owner is to seek his remedy in a civil suit.
In such a suit he will have to pay the necessary court fee, and it will be open to Government to take the plea of limitation or such other defences as may be available to it.
This would ordinarily be a correct statement of the position in law.
In the present case, we have however the special circumstance that it is by reason of an error on the part of the Chief Court that the property has found its way to the State Government.
Proceedings taken by the Chief Court against Mr. 0.
V. Forbes for alleged contempt of the Court must be taken to be fully justified , as such action is necessary not only to uphold the dignity of the Court but also to keep the administration of justice free from calumny.
When however we find that Court acted without jurisdiction in attaching the property, and in any case, in ordering such property to be handed over to Government we have to remember the other great principle which was stated many years ago in these words by Cairns, L. C. in Rodger vs Comptoir D ' Escompte Da Paris(1): "One of the first and highest duties of all courts is to take care that the act of the Court does no injury to any of the suitors. . .
To say that we arc aware, is not to say that whenever a court after wrongly deciding a case between two parties discovers that the decision was wrong it has the (1) [1871] L. R. 3 P. C. 465,475.
53 inherent jurisdiction to re open the matter and to set matters right by altering the decision.
In many cases when the Court has made a mistake the party who has suffered for that mistake is without any remedy except what he can get in accordance with the provisions Of appeal, revision or review.
As the courts are careful to point out again and again, courts of law have the jurisdiction to decide wrongly as well as rightly and the mere fact that the decision is wrong does not give a party a remedy.
Those considerations against the use of inherent jurisdiction to: correct errors made by the courts in the exercise of its jurisdiction have, however, no application to cases like the present.
Here, the Court for the purpose of exercising its jurisdiction in a matter of contempt took steps to attach certain properties.
This is not a case where there are conflicting claims between two parties which have been decided by a judgment or order of the Court as between the parties.
The question really is whether the rightful owner of the property would have it or the Government which has come into possession of the property without being a claimant to it because of an erroneous order of the court should retain it, if it is found that the order was wrong.
In our opinion, this question must be answered in favour of the rightful owner of the property.
We have assumed that the Court had the power to attach the properties of the alleged contemner; but have held that it had no power in law to make these over to the Government.
The attachment however could only subsist so long as the contemner was alive.
On the contemner 's death the attachment could not in law or equity continue.
For, the purpose for which the attachment was made, viz., to secure the presence of the allegead contemner could no longer be achieved.
Obviously, in such a case, the rightful owner of the property would be entitled to restoration of the property on the contemner 's death.
It would not be proper for the Court to say then that it 54 cannot do anything in the matter because the property has passed into the hands of the Government by the Court 's own mistakes.
In our opinion, the court will be failing to perform its primary function of doing justice if in such circumstances the court, on discovering its mistake refuses to correct that mistake.
As it is plain here that it is the mistaken act of the Court which has put Government in possession of the property even though without being a claimant to it, it is only right and proper that the Court should correct that error and restore the property to the person from whom it was wrongly taken.
We cannot see what legitimate grievance the State of U. P. can have against this.
It had no title to the attached property and it would have had no control over it., except for the mistaken application of the provisions of section 88 (7) of the Code of Criminal Procedure.
If now it is found that the Court had made a mistake, first, in attaching the property in question, and secondly, even apart from that, in directing the property to be made over to Government, the Government cannot legitimately object to the Court correcting this mistake.
It would be deplorable if in circumstances like these the Court would find itself helpless to correct its mistake and to order restoration on an application being made to it in that behalf.
In our opinion, the applicant is entitled to an order for restoration of the attached property.
We accordingly allow the appeal, and order that tile Finance Secretary, U. P. Government be directed to restore to this appellant, the attached property which is in the possession of the Government.
In the peculiar circumstances of the case, we make no order as to costs.
Appeal allowed.
|
The appellant 's mother died leaving a will executed in favour of the appellant her sister and her brother.
The appellant applied for a probate and it was granted to her.
Subsequently in connection with a criminal appeal before the Oudh Chief Court applications were filed by the counsel for the State as well as the appellant for proceeding against her brother one Mr. Forbes under the Contempt of Courts Act.
On the failure of Mr. Forbes to appear in pursuance of notices issued by the Court, a proclamation under s.87 of Code of Criminal Procedure was published and certain properties were attached under s.88 of the Code of Criminal Procedure.
These properties were assumed to belong to Mr. Forbes and they were under the custody of the appellant.
Finding that Mr. Forbes did not even then appear the Court recorded an order that the attached properties were at the disposal of the Government and the contempt proceedings would be adjourned sine die until Mr. Forbes appears or is arrested.
On directions from the Court the appellant handed over the properties to the City Magistrate who in turn forwarded them to the Government.
Thereafter Mr. Forbes died.
After his death the appellant made an application to the 41 Government for the return of the properties.
The Government refused to comply with this request and following an abortive writ petition filed by the appellant before the High Court for the issue of a writ of Mandamus against the Government, she filed before the High Court an application for a direction on the Secretary to the U. P. Government to restore the attached property.
The High Court dismissed the application and the appellant appealed to the Supreme Court by way of special leave.
The main questions which were raised in the appeal were whether at the time of the attachment the properties formed part of the administered estate of the appellant 's mother, whether the properties could be legally attached for securing the arrest of Mr. Forbes and whether the provisions of the Code of Criminal Procedure applied to contempt proceedings.
A .further question raised was whether the property attached under section 88(7) of the Code of Criminal Procedure would be at the disposal of the Government.
Held, that the properties in the hands of the executrix could become vested in Mr. Forbes only on her handing over the same to him or to somebody on his behalf.
The properties did not cease to be unadministered assets of the estate of the appellant 's mother merely because under the orders of the Court the appellant who was the executrix handed over the properties to the Magistrate.
The properties therefore could not be legally attached in any proceeding for securing the arrest of Mr. Forbes.
The order of attachment being invalid there is no question of the application of section 88(7) of the Code of Criminal Procedure and the properties being at the disposal of the Government.
Even if the properties belonged to Mr. Forbes the provisions of sections 87 and 88 of the Criminal Procedure would not be available for securing the presence of a person who is alleged to have committed contempt.
Assuming that apart from the Criminal Procedure Code, the Court had the power to attach the contemner 's property it had no right to make over the attached property to the Government.
The possession of the properties by the Government is therefore without the authority of law.
It was further held that even if the attachment order was valid and the Government came into possession of the properties under the authority of law the courts attachment order can only subsist so long as the contemner was alive and the rightful owner of the property would be entitled to restoration of the property on the contemmner 's death.
The Court will be failing in its duty if on discovering its mistake of ordering an illegal attachment and wrongful delivery to the Government refused to correct the mistake.
Sukhdev Singh Sodhi vs The Chief Justice and Judges of the, Pepsu High Court; , , followed.
42 Bodgar vs Comptoir d ' Escomute di Paris, 3 P. C. 465, referred to.
|
minal Appeal No. 170 of 1961.
Appeal by special leave from the judgment and order dated August 28, 1961, of the Allahabad High Court (Lucknow Bench) at Lucknow in Cr.
Case No. 125 of 1961.
A.S. R. Chari, B. Parthasarathy, R. K. Garg, section C.Aggarwal, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellant.
G. C. Mathur and C. P. Lal, for respondent No. 2. 1962.
September 13.
The judgment of the Court was de livered by DAS GUPTA, J.
This appeal by special leave is against an order of the High Court at Allahabad rejecting on August 28, 1961 an application made by the present appellant.
For a proper appreciation of the contention raised in the appeal it is necessary to set out in some detail the complicated.
facts which gave rise to her application.
It appears that on January 23, 1938 the appellant 's mother Mrs. A. E. Forbes executed a will leaving all her property to her three children, viz., the appellant, Mrs. V. G. Paterson, Mrs. E. D. Earle and Mr. 0.
V. Forbes.
The testatrix died on June 6, 1939 and this appellant applied for a probate.
The probate was granted on November 30, 1939.
On May, 4, 1943 when Criminal Appeal No. 9 of 1943 was being argued before a, Single Judge of the Oudh Chief Court the Counsel for the State brought it to the notice of the judge that Mr. 0.
V. Forbes brother of the present appellant had made in his application before the Trial Court and in other ways certain aspersions against the conduct of the Trial Court which amounted to contempt of Court.
The 43 learned judge ordered the issue of notice against Mr. O. V. Forbes in this matter.
On May 6 1943 the present appellant also filed an application for similar action under the Contempt of Courts Act against her brother Mr. Forbes.
On this also notice was issued to Mr. Forbes.
As the notices are not on record we do not know the actual terms of the notice; but it does not appear to be disputed that by these notices Mr. Forbes was asked to appear be ore the Oudh Chief Court to show cause why he should not be proceeded against for contempt of court.
Mr. Forbes however did not appear.
Some time after this a bailable warrant appears to have been issued for the arrest of Mr. Forbes.
The warrant was returned unexecuted.
A registered notice was thereafter issued under the orders of the Court asking Mr. Forbes to attend the Oudh Chief Court on September 23, 1943.
On that date also he did not appear.
The learned judges of the Chief Court being of opinion that Mr. Forbes was concealing himself only to avoid the execution of the warrant, made the following order : "Accordingly we order that action be taken under section 87 of the Code of Criminal Procedure against Mr. Forbes and direct the issue of a written proclamation requiring him to appear in this Court on the 25th November, 1943 at 10 a.m.
This proclamation will be issued in strict accordance with the requirements of section 87 Cr.
P.C. The proclamation will also be published once in the Pioneer of Lucknow and the Daily Statesman of Calcutta.
Under section 88 of the Code of Criminal Procedure We further order attachment of the moveable and immoveable property belonging to Mr. Forbes within the jurisdiction of this Court including : 1.
G.P. Notes and bonds for Rs.1,070,000/ in the hands of the Registrar of this Court.
Rs. 12,250/ deposited in this Court in the Personal Ledger, Trustees and Stake Hol ders Fund; 3.
G.P. Notes belonging to Mr. Forbes of the face value of Rs. 55,000/ attached in Execution Case No. 16 of 1942 in the Court of the Civil judge, Lucknow : Dr. Hari Shanker Dube vs O. V. Forbes.
" The proclamation was duly published and certain property was attached on the basis that it was the property of Mr. 0.
V. Forbes.
On March 30, 1 '944, the Oudh Chief Court recorded an order stating that as Mr. Forbes did not appear within the time specified in the proclamation and under sub section (7) of section 88 of the Code of Criminal Procedure the property under attachment was at the disposal of the Provincial Government.
As regards the two applications for contempt the Court made the following order: ""These applications will therefore be adjourned sine ded until Mr. Forbes appears or is arrested.
" On September 21, 1944, the Court made an order withdrawing the prohibitory order it had earlier issued against the Registrar and the Civil judge, Lucknow.
It appears that after the Oudh Chief Court made the order on March 30, 1944 stating that the attached property was at the disposal of the Provincial Government under sub section 7 of section 88 of the Code of Criminal Procedure the Provincial Government directed the City Magistrate to take suitable action for the disposal of the attached property.
It was to facilitate such action by the City 'Magistrate that the prohibitory orders were withdrawn.
The Chief Court also made an order directing the Registrar and the Civil judge to send the attached property to the City Magistrate for disposal according to law.
On the same date Mrs. Paterson was also directed to hand over all the property in her possession which she may be 45 holding a custodian for 'Mr. O.V. Forbes to the City Magistrate.
It, appears that in August 1943 the City Magistrate forwarded to the U.P. Government at Lucknow promissory notes of the total value of Rs. 2,28,800/ said to be the attached property adding"these G. P. Notes to the total value of Rs. 2,28,800/ have been ordered to be forfeited to the U. P. Government by the Chief Court of Oudh under order dated 21st September 1944 in Criminal Miscellaneous Application No. 47 of 1943".
It was further stated that : "It is requested that necessary action may be taken ' by you to credit the sum under the head Fines and Forfeitures Apparently this has been done.
Mr. Forbes died in 1953.
On April 4.
1960 the present appellant made an application to the U.P. Government in which she stated that Mr. Forbes had died intestate and that his only heirs were his two sifters, the appellant herself and her sister Mrs. E. D. Earle for whom she was the trustee and prayed that as the Government was " 'only in the position of a receiver or a trustee of the property of Mr. Forbes this trusteeship having ceased with Mr. Forbes death .the government should return the property to the appellant and her sister".
On September 3, 1960 the Government rejected this prayer stating ""that this was a confiscated property of Mr. Forbes and that on legal grounds her claim was Wholey untenable" but added these, words : " 'If however she has any special reasons for invoking the compassion of Government `she may indicate the same to Government and also furnish convincing evidence that Mr. Forbes actually has died and that she is his sole heir or one of the heirs entitled to his assets.
" The appellant pointed out to the Government in her letter dated September 12, 1960 that the property of Mr. Forbes has not been confiscated bet merely attached and emphasised that the Government had no proprietary right to the attached property but 46 could retain it only as a custodian or trustee for the time being.
She asked the Government to re consider the whole situation.
The reply of Government, if any was apparently unsatisfactory and so on November 29, 1960 the appellant filed an application under article 226 of the Constitution in the High Court at Allahabad in which after stating the several facts as regards the attachment of the property and the action taken by the Government, she prayed for a writ of certiorari to quash the Government 's order of September 3,1960 and also for a writ of Mandamus ordering the Government to hand over the Government promissory notes and cash money which had been attached.
On March 29, 1961 the ' High Court rejected this application.
The High Court pointed out that the applicant had not shown that the State Government had failed to carry out any duty imposed by law and further that the order dated September 5, 1960 could not be said to be either judicial or a quasi judicial order or even an administrative order passed without jurisdiction.
It was then that ' on May 1, 1961 the appellant made to the High Court at Allahabad the application out of which the present appeal has arisen.
By this application the appellant asked for four relilfs : (a) for an order terminating the contempt of court proceedings; (b) for an order vacating the orders of attachment made by the Chief Court; (c) for a direction on the Finance Secretary, U. P. Government, to restore the attached property to the applicant as executrix of the estate of late Mrs. A. E. Forbes.
A copy of the writ petition dated the 29th November, 1960 in which it had been mentioned that the proceedings under section 87 and section 88 of the Code of Criminal Procedure were illegal because the code was applicable to proceedings for contempt, was attached to the application.
It was further stated in the present application that in any case the attachment was void inasmuch as the property that was attached 47 was at the time of attachment an undistributed part of the estate of late Mrs. A. E. Forbes and so vested in this appellant as executrix.
By separate but concuring judgments Mr. Justice Mulla and Mr. justice Nigam, who heard this application rejected the applicant 's prayer for vacating the order of attachment or for any direction to the Finance Secretary, U.P. Government for restoration of the attached property.
Mr. Justice Mulla based his decision mainly on the point that the appellant had herself acted in an unclean way, and she having been responsible for getting warrants under sections 87 and 88 of the Code of Criminal Procedure issued against Mr. Forbes it did not lie in her mouth to say now that the issue of these processes was without jurisdiction and held that as she was instrumental in getting the order now complained of passed, the discretionary powers of the Court should not be exercised in her favour, especially, as she had made the application after a long delay.
The learned judge also expressed the opinion that the judges of the Chief Court acted within their jurisdiction in issuing processes under sections 87 and 88 of the Code of Criminal Procedure that this order was just and legal and the State had come into the custody of the property under the due process of law.
In the opinion Of the learned judge "Mr. Forbes was willing to give away this property rather than, face a prosecution for contempt of Court" and added "if he took up that attitude it cannot be said by the heirs of Mr. Forbes that now the property should be released in their favour".
Mr. Justice Nigam stressed the point that the Court had attached the property belonging to ',Mr. Forbes and the present appellant had handed over the property " treating it to be the property of Mr. O.V. Forbes.
" According to this learned Judge if the property that was attached did not belong to Mr. 0.
V. Forbes this appellant should have " 'never handed over the property voluntarily".
He was further 48 of opinion that "the fact that she voluntarily handed a property over as belonging to Mr. Forbes and actually suggested that this particular property be attached clearly amounted to. . . an admission of 'the ownership of the property vesting in Mr. 0.
V. Forbes and the property not being part of the undistributed assets in the possession of '.
Mrs. Peterson as executrix to Mrs. A. E. Forbes.
" After holding that the Code of Criminal Procedure was not directly learned Judge expressed the opinion that "the Bench could adopt its own procedure for enforcing the attendance of the delinqent" and added 'if it adopted the procedure prescribed in the Code of Criminal Procedure, I can see no warrant for the contention that the procedure adopted was wrong, improper and beyond the jurisdiction of the Court.
" Finally, he held that it would be contrary to the interests of justice to review the order " 'after a lapse of about 18 years.
" The learned Judge also held that the Court was no longer in possession of the attached property, the same having been handed over to the City Magistrate for being passed on to the State Government and could not therefore pass any orders in respect of the property.
He also expressed the view that prima facie it appeared to him that the appellant 's remedy, if any, was by a civil suit.
The contempt proceedings were however directed to be consigned to the record as abated.
The present appeal is directed against the High Court 's decision refusing to give the plaintiff the substantial relief asked for in the application, viz., a direction on the Finance Secretary, U. P. Government to restore the attached property to her.
The first question for consideration is whether at the time of attachment the property formed .
part of the unadministered estate of Mrs. A. E. Forbes.
If that was the correct legal position there could not be in law attachment of that property as the property 49 of Mr. Forbes, even if section 87 and s.88 could be applied to secure the arrest of a person alleged to have committed contempt.
Mr. justice Mulla has not dealt with this question.
Justice Nigam has however formed the definite conclusion that the property had vested in Mr. O.V. Forbes on the date of attachment and was not part of the undistributed assets of Mrs. A. E. Forbes in the hand of the executrix.
In coming to this conclusion the learned Judge appears to have relied on what he described as " 'the fact that she (Mrs. Paterson) voluntarily handed the property over as belonging to Mr. Forbes and actually suggested that this particular property be attached".
It is not clear from the record of this case on what materials the learned judge thought that Mrs. Paterson actually suggested that this particular property be attached.
That she really handed the property over appears to be correct.
It appears reasonable to think that she did so in obedience to the order of the Court.
The matter was stated thus by her in Para.
8 of the Writ Petition: "8.
That under the orders of the Hon 'ble Chief Court of Avadh the petitioner deposited with the Registrar of that Court and finally with the City Magistrate, Lucknow, unadministered assets consisting of Government Promissory Notes and each totalling Rupees 2,41,300/ detailed in the list attached to this petition which the then City Magistrate, Sri section G. Bose Mullick was pleased to transfer the same to the Finance Secretary to the U. P. Government, Lucknow, in August, 1948.
" In the counter affidavit filed on behalf of the State of O. P. in the writ petition the statements made in this paragraph was admitted to be true.
It appears clear therefore that the petitioner made over the securities and cash the property which was attached tinder the orders of the Chief Court of Oudh.
It is further to be borne in mind that the petitioner made the 50 definite statement in this Para.
8 of the writ Petition that the property that was made over by her formed part of the unadministered assets in her hand and the truth of this statement was admitted by the State of U.P It is difficult to see how it can be reasonably here that merely because the executrix banded over certain assets in her hand to the Registrar and the City Magistrate in obedience to the orders of the Chief Court thereby become vested in Mr. 0.
V. Forbes.
The property in the hands of the executrix could become vested in Mr. O. V. Forbes only on her handing over the same to him or to somebody on his behalf.
Delivering the property to the Registrar of the Court or to the City Magistrate could not amount to handing over to the legatee.
For, obviously the Registrar of the Chief Court or the City Magistrate, Lucknow, were not acting on behalf of the legatee Mr. 0.
V. Forbes but indeed acting against his inte rests.
In our opinion, the property did not cease to be unadministered assets of the estates of Mrs. A. E. Forbes merely because under the orders of the Court this appellant, who was the executrix, had the assets in her hand deposited with the Registrar or the City Magistrate.
It must therefore be held that the property which was attached was at the time of attachment not the property of Mr. O. V. Forbes but formed part of the unadministered assets of Mrs. A. E. Forbes.
This property could not be legally attached in any proceedings for securing the arrest of Mr. O. V. Forbes.
If what was attached did not form part of the property of Mr. 0.
V. Forbes, the order of attachment was invalid; and there would be no scope for the operation of section 88 (7) of the Code of Criminal Procedure.
Assuming that the property was of Mr. 0.
V. Forbes, the question arises whether it would, as a result of the attachment, be at the disposal of 51 Government under s.88 (7) of the Code of Criminal Procedure.
In Sukhdev Singh Sodhi vs The Chief Justice and Judges of the Pepsu High Court(1) it was held that the Code of Criminal Procedure does not apply to proceedings for contempt.
On this authority it must be held that the provisions of sections 87 and 88 would also not be available to securing 'the presence of a person who is alleged to have committed contempt.
It may be mentioned that on behelf of the appellant, 'Mr. Chari had urged that even if the property was of Mr. 0.
V. Forbes, the a leged contemner, the Chief Court of Oudh had no power to attach it.
The High Court seems to think that the Chief Court could choose any procedure it liked in the matter of punishing people for contempt and so if it thought that it would not finally dispose of contempt proceedings without the alleged contemner being present before it, it had the inherent right of first issuing a warrant of arrest and next, if that was not successful, by proclamation for his appearance and also by attachment of his property.
It seems to us that the Chief Court as a Court of record had the right to punish persons for contempt and for the proper exercise of that power it will have all other powers necessary and incidental to it.
It is however unnecessary to decide whether such necessary and incidental powers include the power of arrest and of attaching the alleged contemner 's property in an attempt to secure his presence.
But assuming they do, we are of opinion that the Chief Court had still no right to make over the attached property to Government.
The right of the Government to have any control over the attached property flows from the provisions of section 88 of the Criminal Procedure Code ' As no attachment could legally be made under section 88, Criminal Procedure Code, in any proceeding for contempt, the provisions of section 88 (7) of the Code of Criminal Procedure, under which (1) ; 52 the property under attachment shall be at the disposal of the State Government, if the proclaimed person does not appear within the time prescribed in the proclamation cannot come into operation.
The position therefore is that Government is in possession of the property that was attached under the orders of the Chief Court; but the possession is, without any authority of law.
The question then arises : whether the Court can or should direct restoration of the property to the rightful owner.
On behalf of the State of V., P. it is argued that if the Government is in unlawful possession of the property the proper remedy for the rightful owner is to seek his remedy in a civil suit.
In such a suit he will have to pay the necessary court fee, and it will be open to Government to take the plea of limitation or such other defences as may be available to it.
This would ordinarily be a correct statement of the position in law.
In the present case, we have however the special circumstance that it is by reason of an error on the part of the Chief Court that the property has found its way to the State Government.
Proceedings taken by the Chief Court against Mr. 0.
V. Forbes for alleged contempt of the Court must be taken to be fully justified , as such action is necessary not only to uphold the dignity of the Court but also to keep the administration of justice free from calumny.
When however we find that Court acted without jurisdiction in attaching the property, and in any case, in ordering such property to be handed over to Government we have to remember the other great principle which was stated many years ago in these words by Cairns, L. C. in Rodger vs Comptoir D ' Escompte Da Paris(1): "One of the first and highest duties of all courts is to take care that the act of the Court does no injury to any of the suitors. . .
To say that we arc aware, is not to say that whenever a court after wrongly deciding a case between two parties discovers that the decision was wrong it has the (1) [1871] L. R. 3 P. C. 465,475.
53 inherent jurisdiction to re open the matter and to set matters right by altering the decision.
In many cases when the Court has made a mistake the party who has suffered for that mistake is without any remedy except what he can get in accordance with the provisions Of appeal, revision or review.
As the courts are careful to point out again and again, courts of law have the jurisdiction to decide wrongly as well as rightly and the mere fact that the decision is wrong does not give a party a remedy.
Those considerations against the use of inherent jurisdiction to: correct errors made by the courts in the exercise of its jurisdiction have, however, no application to cases like the present.
Here, the Court for the purpose of exercising its jurisdiction in a matter of contempt took steps to attach certain properties.
This is not a case where there are conflicting claims between two parties which have been decided by a judgment or order of the Court as between the parties.
The question really is whether the rightful owner of the property would have it or the Government which has come into possession of the property without being a claimant to it because of an erroneous order of the court should retain it, if it is found that the order was wrong.
In our opinion, this question must be answered in favour of the rightful owner of the property.
We have assumed that the Court had the power to attach the properties of the alleged contemner; but have held that it had no power in law to make these over to the Government.
The attachment however could only subsist so long as the contemner was alive.
On the contemner 's death the attachment could not in law or equity continue.
For, the purpose for which the attachment was made, viz., to secure the presence of the allegead contemner could no longer be achieved.
Obviously, in such a case, the rightful owner of the property would be entitled to restoration of the property on the contemner 's death.
It would not be proper for the Court to say then that it 54 cannot do anything in the matter because the property has passed into the hands of the Government by the Court 's own mistakes.
In our opinion, the court will be failing to perform its primary function of doing justice if in such circumstances the court, on discovering its mistake refuses to correct that mistake.
As it is plain here that it is the mistaken act of the Court which has put Government in possession of the property even though without being a claimant to it, it is only right and proper that the Court should correct that error and restore the property to the person from whom it was wrongly taken.
We cannot see what legitimate grievance the State of U. P. can have against this.
It had no title to the attached property and it would have had no control over it., except for the mistaken application of the provisions of section 88 (7) of the Code of Criminal Procedure.
If now it is found that the Court had made a mistake, first, in attaching the property in question, and secondly, even apart from that, in directing the property to be made over to Government, the Government cannot legitimately object to the Court correcting this mistake.
It would be deplorable if in circumstances like these the Court would find itself helpless to correct its mistake and to order restoration on an application being made to it in that behalf.
In our opinion, the applicant is entitled to an order for restoration of the attached property.
We accordingly allow the appeal, and order that tile Finance Secretary, U. P. Government be directed to restore to this appellant, the attached property which is in the possession of the Government.
In the peculiar circumstances of the case, we make no order as to costs.
Appeal allowed.
|
Appeal by special leave from the judgment and order dated August 28, 1961, of the Allahabad High Court (Lucknow Bench) at Lucknow in Cr. A.S. R. Chari, B. Parthasarathy, R. K. Garg, section C.Aggarwal, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellant. G. C. Mathur and C. P. Lal, for respondent No. For a proper appreciation of the contention raised in the appeal it is necessary to set out in some detail the complicated. facts which gave rise to her application. the appellant, Mrs. V. G. Paterson, Mrs. E. D. Earle and Mr. 0. The testatrix died on June 6, 1939 and this appellant applied for a probate. The probate was granted on November 30, 1939. 9 of 1943 was being argued before a, Single Judge of the Oudh Chief Court the Counsel for the State brought it to the notice of the judge that Mr. 0. V. Forbes brother of the present appellant had made in his application before the Trial Court and in other ways certain aspersions against the conduct of the Trial Court which amounted to contempt of Court. The 43 learned judge ordered the issue of notice against Mr. O. V. Forbes in this matter. On this also notice was issued to Mr. Forbes. As the notices are not on record we do not know the actual terms of the notice; but it does not appear to be disputed that by these notices Mr. Forbes was asked to appear be ore the Oudh Chief Court to show cause why he should not be proceeded against for contempt of court. Some time after this a bailable warrant appears to have been issued for the arrest of Mr. Forbes. P.C. The proclamation will also be published once in the Pioneer of Lucknow and the Daily Statesman of Calcutta. Under section 88 of the Code of Criminal Procedure We further order attachment of the moveable and immoveable property belonging to Mr. Forbes within the jurisdiction of this Court including : 1. G.P. Notes and bonds for Rs.1,070,000/ in the hands of the Registrar of this Court. 12,250/ deposited in this Court in the Personal Ledger, Trustees and Stake Hol ders Fund; 3. G.P. Notes belonging to Mr. Forbes of the face value of Rs. 16 of 1942 in the Court of the Civil judge, Lucknow : Dr. Hari Shanker Dube vs O. V. Forbes. " The proclamation was duly published and certain property was attached on the basis that it was the property of Mr. 0. It appears that after the Oudh Chief Court made the order on March 30, 1944 stating that the attached property was at the disposal of the Provincial Government under sub section 7 of section 88 of the Code of Criminal Procedure the Provincial Government directed the City Magistrate to take suitable action for the disposal of the attached property. It was to facilitate such action by the City 'Magistrate that the prohibitory orders were withdrawn. The Chief Court also made an order directing the Registrar and the Civil judge to send the attached property to the City Magistrate for disposal according to law. It, appears that in August 1943 the City Magistrate forwarded to the U.P. Government at Lucknow promissory notes of the total value of Rs. 2,28,800/ said to be the attached property adding"these G. P. Notes to the total value of Rs. 2,28,800/ have been ordered to be forfeited to the U. P. Government by the Chief Court of Oudh under order dated 21st September 1944 in Criminal Miscellaneous Application No. It was further stated that : "It is requested that necessary action may be taken ' by you to credit the sum under the head Fines and Forfeitures Apparently this has been done. She asked the Government to re consider the whole situation. The reply of Government, if any was apparently unsatisfactory and so on November 29, 1960 the appellant filed an application under article 226 of the Constitution in the High Court at Allahabad in which after stating the several facts as regards the attachment of the property and the action taken by the Government, she prayed for a writ of certiorari to quash the Government 's order of September 3,1960 and also for a writ of Mandamus ordering the Government to hand over the Government promissory notes and cash money which had been attached. On March 29, 1961 the ' High Court rejected this application. The High Court pointed out that the applicant had not shown that the State Government had failed to carry out any duty imposed by law and further that the order dated September 5, 1960 could not be said to be either judicial or a quasi judicial order or even an administrative order passed without jurisdiction. A copy of the writ petition dated the 29th November, 1960 in which it had been mentioned that the proceedings under section 87 and section 88 of the Code of Criminal Procedure were illegal because the code was applicable to proceedings for contempt, was attached to the application. The learned judge also expressed the opinion that the judges of the Chief Court acted within their jurisdiction in issuing processes under sections 87 and 88 of the Code of Criminal Procedure that this order was just and legal and the State had come into the custody of the property under the due process of law. In the opinion Of the learned judge "Mr. Forbes was willing to give away this property rather than, face a prosecution for contempt of Court" and added "if he took up that attitude it cannot be said by the heirs of Mr. Forbes that now the property should be released in their favour". Mr. Justice Nigam stressed the point that the Court had attached the property belonging to ',Mr. Forbes and the present appellant had handed over the property " treating it to be the property of Mr. O.V. Forbes. " According to this learned Judge if the property that was attached did not belong to Mr. 0. V. Forbes this appellant should have " 'never handed over the property voluntarily". He was further 48 of opinion that "the fact that she voluntarily handed a property over as belonging to Mr. Forbes and actually suggested that this particular property be attached clearly amounted to. . . an admission of 'the ownership of the property vesting in Mr. 0. V. Forbes and the property not being part of the undistributed assets in the possession of '. Mrs. Peterson as executrix to Mrs. A. E. Forbes. " Finally, he held that it would be contrary to the interests of justice to review the order " 'after a lapse of about 18 years. " The learned Judge also held that the Court was no longer in possession of the attached property, the same having been handed over to the City Magistrate for being passed on to the State Government and could not therefore pass any orders in respect of the property. He also expressed the view that prima facie it appeared to him that the appellant 's remedy, if any, was by a civil suit. The contempt proceedings were however directed to be consigned to the record as abated. The present appeal is directed against the High Court 's decision refusing to give the plaintiff the substantial relief asked for in the application, viz., a direction on the Finance Secretary, U. P. Government to restore the attached property to her. The first question for consideration is whether at the time of attachment the property formed . part of the unadministered estate of Mrs. A. E. Forbes. Mr. justice Mulla has not dealt with this question. In coming to this conclusion the learned Judge appears to have relied on what he described as " 'the fact that she (Mrs. Paterson) voluntarily handed the property over as belonging to Mr. Forbes and actually suggested that this particular property be attached". It is not clear from the record of this case on what materials the learned judge thought that Mrs. Paterson actually suggested that this particular property be attached. That she really handed the property over appears to be correct. It appears reasonable to think that she did so in obedience to the order of the Court. The matter was stated thus by her in Para. It is further to be borne in mind that the petitioner made the 50 definite statement in this Para. 8 of the writ Petition that the property that was made over by her formed part of the unadministered assets in her hand and the truth of this statement was admitted by the State of U.P It is difficult to see how it can be reasonably here that merely because the executrix banded over certain assets in her hand to the Registrar and the City Magistrate in obedience to the orders of the Chief Court thereby become vested in Mr. 0. The property in the hands of the executrix could become vested in Mr. O. V. Forbes only on her handing over the same to him or to somebody on his behalf. Delivering the property to the Registrar of the Court or to the City Magistrate could not amount to handing over to the legatee. For, obviously the Registrar of the Chief Court or the City Magistrate, Lucknow, were not acting on behalf of the legatee Mr. 0. V. Forbes but indeed acting against his inte rests. In our opinion, the property did not cease to be unadministered assets of the estates of Mrs. A. E. Forbes merely because under the orders of the Court this appellant, who was the executrix, had the assets in her hand deposited with the Registrar or the City Magistrate. This property could not be legally attached in any proceedings for securing the arrest of Mr. O. V. Forbes. If what was attached did not form part of the property of Mr. 0. V. Forbes, the order of attachment was invalid; and there would be no scope for the operation of section 88 (7) of the Code of Criminal Procedure. In Sukhdev Singh Sodhi vs The Chief Justice and Judges of the Pepsu High Court(1) it was held that the Code of Criminal Procedure does not apply to proceedings for contempt. On this authority it must be held that the provisions of sections 87 and 88 would also not be available to securing 'the presence of a person who is alleged to have committed contempt. V. Forbes, the a leged contemner, the Chief Court of Oudh had no power to attach it. The High Court seems to think that the Chief Court could choose any procedure it liked in the matter of punishing people for contempt and so if it thought that it would not finally dispose of contempt proceedings without the alleged contemner being present before it, it had the inherent right of first issuing a warrant of arrest and next, if that was not successful, by proclamation for his appearance and also by attachment of his property. It is however unnecessary to decide whether such necessary and incidental powers include the power of arrest and of attaching the alleged contemner 's property in an attempt to secure his presence. But assuming they do, we are of opinion that the Chief Court had still no right to make over the attached property to Government. The position therefore is that Government is in possession of the property that was attached under the orders of the Chief Court; but the possession is, without any authority of law. The question then arises : whether the Court can or should direct restoration of the property to the rightful owner. On behalf of the State of V., P. it is argued that if the Government is in unlawful possession of the property the proper remedy for the rightful owner is to seek his remedy in a civil suit. In such a suit he will have to pay the necessary court fee, and it will be open to Government to take the plea of limitation or such other defences as may be available to it. This would ordinarily be a correct statement of the position in law. In the present case, we have however the special circumstance that it is by reason of an error on the part of the Chief Court that the property has found its way to the State Government. Proceedings taken by the Chief Court against Mr. 0. V. Forbes for alleged contempt of the Court must be taken to be fully justified , as such action is necessary not only to uphold the dignity of the Court but also to keep the administration of justice free from calumny. When however we find that Court acted without jurisdiction in attaching the property, and in any case, in ordering such property to be handed over to Government we have to remember the other great principle which was stated many years ago in these words by Cairns, L. C. in Rodger vs Comptoir D ' Escompte Da Paris(1): "One of the first and highest duties of all courts is to take care that the act of the Court does no injury to any of the suitors. . . 53 inherent jurisdiction to re open the matter and to set matters right by altering the decision. In many cases when the Court has made a mistake the party who has suffered for that mistake is without any remedy except what he can get in accordance with the provisions Of appeal, revision or review. As the courts are careful to point out again and again, courts of law have the jurisdiction to decide wrongly as well as rightly and the mere fact that the decision is wrong does not give a party a remedy. Those considerations against the use of inherent jurisdiction to: correct errors made by the courts in the exercise of its jurisdiction have, however, no application to cases like the present. Here, the Court for the purpose of exercising its jurisdiction in a matter of contempt took steps to attach certain properties. This is not a case where there are conflicting claims between two parties which have been decided by a judgment or order of the Court as between the parties. In our opinion, this question must be answered in favour of the rightful owner of the property. We have assumed that the Court had the power to attach the properties of the alleged contemner; but have held that it had no power in law to make these over to the Government. The attachment however could only subsist so long as the contemner was alive. On the contemner 's death the attachment could not in law or equity continue. For, the purpose for which the attachment was made, viz., to secure the presence of the allegead contemner could no longer be achieved. Obviously, in such a case, the rightful owner of the property would be entitled to restoration of the property on the contemner 's death. In our opinion, the court will be failing to perform its primary function of doing justice if in such circumstances the court, on discovering its mistake refuses to correct that mistake. As it is plain here that it is the mistaken act of the Court which has put Government in possession of the property even though without being a claimant to it, it is only right and proper that the Court should correct that error and restore the property to the person from whom it was wrongly taken. We cannot see what legitimate grievance the State of U. P. can have against this. It had no title to the attached property and it would have had no control over it., except for the mistaken application of the provisions of section 88 (7) of the Code of Criminal Procedure. In our opinion, the applicant is entitled to an order for restoration of the attached property. In the peculiar circumstances of the case, we make no order as to costs.
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The appellant 's mother died leaving a will executed in favour of the appellant her sister and her brother.
The appellant applied for a probate and it was granted to her.
Subsequently in connection with a criminal appeal before the Oudh Chief Court applications were filed by the counsel for the State as well as the appellant for proceeding against her brother one Mr. Forbes under the Contempt of Courts Act.
On the failure of Mr. Forbes to appear in pursuance of notices issued by the Court, a proclamation under s.87 of Code of Criminal Procedure was published and certain properties were attached under s.88 of the Code of Criminal Procedure.
These properties were assumed to belong to Mr. Forbes and they were under the custody of the appellant.
Finding that Mr. Forbes did not even then appear the Court recorded an order that the attached properties were at the disposal of the Government and the contempt proceedings would be adjourned sine die until Mr. Forbes appears or is arrested.
On directions from the Court the appellant handed over the properties to the City Magistrate who in turn forwarded them to the Government.
Thereafter Mr. Forbes died.
After his death the appellant made an application to the 41 Government for the return of the properties.
The Government refused to comply with this request and following an abortive writ petition filed by the appellant before the High Court for the issue of a writ of Mandamus against the Government, she filed before the High Court an application for a direction on the Secretary to the U. P. Government to restore the attached property.
The High Court dismissed the application and the appellant appealed to the Supreme Court by way of special leave.
The main questions which were raised in the appeal were whether at the time of the attachment the properties formed part of the administered estate of the appellant 's mother, whether the properties could be legally attached for securing the arrest of Mr. Forbes and whether the provisions of the Code of Criminal Procedure applied to contempt proceedings.
A .further question raised was whether the property attached under section 88(7) of the Code of Criminal Procedure would be at the disposal of the Government.
Held, that the properties in the hands of the executrix could become vested in Mr. Forbes only on her handing over the same to him or to somebody on his behalf.
The properties did not cease to be unadministered assets of the estate of the appellant 's mother merely because under the orders of the Court the appellant who was the executrix handed over the properties to the Magistrate.
The properties therefore could not be legally attached in any proceeding for securing the arrest of Mr. Forbes.
The order of attachment being invalid there is no question of the application of section 88(7) of the Code of Criminal Procedure and the properties being at the disposal of the Government.
Even if the properties belonged to Mr. Forbes the provisions of sections 87 and 88 of the Criminal Procedure would not be available for securing the presence of a person who is alleged to have committed contempt.
Assuming that apart from the Criminal Procedure Code, the Court had the power to attach the contemner 's property it had no right to make over the attached property to the Government.
The possession of the properties by the Government is therefore without the authority of law.
It was further held that even if the attachment order was valid and the Government came into possession of the properties under the authority of law the courts attachment order can only subsist so long as the contemner was alive and the rightful owner of the property would be entitled to restoration of the property on the contemmner 's death.
The Court will be failing in its duty if on discovering its mistake of ordering an illegal attachment and wrongful delivery to the Government refused to correct the mistake.
Sukhdev Singh Sodhi vs The Chief Justice and Judges of the, Pepsu High Court; , , followed.
42 Bodgar vs Comptoir d ' Escomute di Paris, 3 P. C. 465, referred to.
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The appellant 's mother died leaving a will executed in favour of the appellant her sister and her brother.
The appellant applied for a probate and it was granted to her.
Subsequently in connection with a criminal appeal before the Oudh Chief Court applications were filed by the counsel for the State as well as the appellant for proceeding against her brother one Mr. Forbes under the Contempt of Courts Act.
On the failure of Mr. Forbes to appear in pursuance of notices issued by the Court, a proclamation under s.87 of Code of Criminal Procedure was published and certain properties were attached under s.88 of the Code of Criminal Procedure.
These properties were assumed to belong to Mr. Forbes and they were under the custody of the appellant.
Finding that Mr. Forbes did not even then appear the Court recorded an order that the attached properties were at the disposal of the Government and the contempt proceedings would be adjourned sine die until Mr. Forbes appears or is arrested.
On directions from the Court the appellant handed over the properties to the City Magistrate who in turn forwarded them to the Government.
Thereafter Mr. Forbes died.
After his death the appellant made an application to the 41 Government for the return of the properties.
The Government refused to comply with this request and following an abortive writ petition filed by the appellant before the High Court for the issue of a writ of Mandamus against the Government, she filed before the High Court an application for a direction on the Secretary to the U. P. Government to restore the attached property.
The High Court dismissed the application and the appellant appealed to the Supreme Court by way of special leave.
The main questions which were raised in the appeal were whether at the time of the attachment the properties formed part of the administered estate of the appellant 's mother, whether the properties could be legally attached for securing the arrest of Mr. Forbes and whether the provisions of the Code of Criminal Procedure applied to contempt proceedings.
A .further question raised was whether the property attached under section 88(7) of the Code of Criminal Procedure would be at the disposal of the Government.
Held, that the properties in the hands of the executrix could become vested in Mr. Forbes only on her handing over the same to him or to somebody on his behalf.
The properties did not cease to be unadministered assets of the estate of the appellant 's mother merely because under the orders of the Court the appellant who was the executrix handed over the properties to the Magistrate.
The properties therefore could not be legally attached in any proceeding for securing the arrest of Mr. Forbes.
The order of attachment being invalid there is no question of the application of section 88(7) of the Code of Criminal Procedure and the properties being at the disposal of the Government.
Even if the properties belonged to Mr. Forbes the provisions of sections 87 and 88 of the Criminal Procedure would not be available for securing the presence of a person who is alleged to have committed contempt.
Assuming that apart from the Criminal Procedure Code, the Court had the power to attach the contemner 's property it had no right to make over the attached property to the Government.
The possession of the properties by the Government is therefore without the authority of law.
It was further held that even if the attachment order was valid and the Government came into possession of the properties under the authority of law the courts attachment order can only subsist so long as the contemner was alive and the rightful owner of the property would be entitled to restoration of the property on the contemmner 's death.
The Court will be failing in its duty if on discovering its mistake of ordering an illegal attachment and wrongful delivery to the Government refused to correct the mistake.
Sukhdev Singh Sodhi vs The Chief Justice and Judges of the, Pepsu High Court; , , followed.
42 Bodgar vs Comptoir d ' Escomute di Paris, 3 P. C. 465, referred to.
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ION: Special Leave A Petition (CRL. ) No. 1765 of 1987 From the Judgment and order dated 8/9.7.1987 of the Bombay High Court in W.P. No. 332 of 1987.
V.N. Ganpule for the Petitioner.
Soli J. Sorabjee, K.J. John and A.K. Desai for the Respondents.
The Judgment of the Court was delivered by SEN, J.
The by section 630, enacts: "630.
Penalty for wrongful withholding of property (1) If any officer or employee of a company (a) wrongfully obtains possession of any property of a company; or D (b) having any such property in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorised by this Act; he shall, on the complaint of the company or any creditor or contributory thereof, be punishable with fine which may extend to one thousand rupees.
(2) The Court trying the offence may also order such officer or employee to deliver up or refund, within a time F to be fixed by the Court, any such property wrongfully obtained or wrongfully withheld or knowingly misapplied, or in default, to suffer imprisonment for a term which may extend to two years.
" The only question involved in this special leave petition is as to the scope and effect of sub section
(1) of section 630 of the Act.
The controversy is as to the meaning of the term 'officer or employee ' used in sub s(1) of section 630 and as to the meaning of the words 'any such property ' in cl.
(b) thereof and there is a conflict of opinion between the High Courts of Calcutta and Bombay on the question.
On a literal construction of the term 'officer or employee ' occurring in sub section
(1) of section 630 of H 172 the Act, the High Court of Calcutta in Amritlal Chum vs Devi Ranjan Jha & Anr., held that it refers only to the existing officers and employees of a company.
It also held that the words 'any such property ' in section 630(l)(b) relate to property specified in cl.
(a) viz. property of a company wrongfully taken possession of by a present officer or employee of the company.
The High Court of Bombay, on the other hand, has placed a beneficent construction on the provisions contained in section 630 and according to it, the term 'officer or employee ' in sub section
(1) of section 630 must be interpreted to mean not only the present officers and employees of a company but also to include past officers and employees of the company.
It is also of the view that the words 'any such property ' in ck (b) qualify the words 'any property of a company ' appearing in cl.
That has been the consistent view taken by the High Court of Bombay in a series of cases.
See: Harkishan Lakhimal Gidwani vs Achyut Kashinath Wagh & Anr., , Govind T. Jagtiani vs Sirajuddin section Kazi & Anr., [ which have since been followed in a series of cases referred to by the learned Single Judge (Ashok Agarwal, J.).
The issues involved in the special leave petition are of considerable importance to the corporate sector as many of the business organisations, both in the public as well as the private sector, are required to provide residential accommodation to their officers and employees as a condition of their service to attract better talent and have of necessity to purchase residential flats in multi storeyed buildings in large cities and towns for the use of such officers and employees during the course of their employment, and the question is whether the provisions contained in sub section
(1) of section 630 which provide for the launching of a prosecution against an officer or employee of a company for wrongful possession of such property under cls.
(a) and (b) of sub section
(1) of section 630 and for the recovery of such property by the issue of process under sub section (2), also extends to past officers and employees of the company and whether the Court trying the offence has the power to issue a process under sub section
(2) against such officer or employee.
At the conclusion of the hearing we had by a short order dismissed the special leave petition and held that the view expressed by the learned Single Judge following the earlier decisions of the High Court in Harkishan Lakhimal Gidwani and reiterated in Govind T. Jagtiani was to be preferred to the view to the contrary expressed by the High Court of Calcutta in Amritlal Chum.
As the respondent Shipping Corporation of India, a public sector undertakings, was in dire need of the flat in question which is situate in a posh locality like the Cuffe Parade in 173 Bombay, for the use of its senior executive, we could not accede to the request of the learned counsel for the petitioner to refer the case to a bench of three judges and heard learned counsel for the parties at quit some length on August 27,1987 and dismissed the special leave petition.
The reasons therefor follow.
At the very threshold it is necessary to set out a few facts.
The petitioner Baldev Krishan Sahi was an Under Secretary to the Government of India in the Ministry of Shipping & Transport and on May 21, 1974 accepted employment as Joint Manager in the Mogul Line Limited, a Government of India undertaking, after obtaining release from government service.
He was first allotted a service quarter.
In 1975 the company purchased a spacious flat being flat No. 151 in Jolly Maker Apartment III at 119, Cuffe Parade and the petitioner being the senior most executive was allotted the flat for his residence.
The petitioner retired from the service of the company on or about September 30, 1984.
Prior to that i.e. On September 26, 1984 he addressed a letter requesting the company to permit him to continue to live in the company 's premises during the period of his accumulated leave after his retirement i.e. for a period of six months, undertaking to vacate the flat as early as possible.
It appears that the company on humanitarian grounds acceded to this request and permitted the petitioner to stay on in the company 's flat for six months after his retirement and in accordance with the company 's rules, he was required to pay compensation for the use of the premises.
After the expiry of the said period of six months, the company addressed a letter dated April 26, 1985 requesting the petitioner to vacate the premises stating that if he failed to do so, he would be liable to pay higher compensation as per the company 's rules.
Since the petitioner failed to vacate the flat, the company initiated proceedings for his eviction under the Public Premises (Eviction of Unauthorised occupants) Act, 1971.
The Estate officer by order dated December 2, 1985 directed the eviction of the petitioner.
The petitioner carried an appeal to the City Civil & Sessions Court, Bombay but the same was dismissed by the Principal Judge, City Civil Court by his order dated January 16, 1986.
He then preferred a revision to the High Court and the High Court by its order dated January 28, 1986 allowed the same, set aside the eviction order and directed the Estate officer to give a personal hearing to the petitioner.
Instead of availing of that opportunity, the petitioner on March 3, 1986 moved the High Court by a petition under article 226 of the Constitution and obtained ad interim stay of the proceedings before the Estate officer.
A few days thereafter i.e. On March 7, 1986 the petitioner instituted a suit being Civil Suit No. 174 1382/86 in Small Causes Court, Bombay seeking a declaration that he was a tenant of the disputed flat, which is now pending.
In view of this, the company was constrained to lodge a complaint against the petitioner under section 630 of the Act in the Court of the Additional Chief Metropolitan Magistrate, 37th Court, Esplanade, Bombay alleging that he was wrongfully withholding the flat in question which had been given to him for his residence during the period of his employment and and thereby committed an offence punishable under section 630.
The learned Magistrate by his order dated May 22, 1986 took cognizance of the complaint against the petitioner and directed issue of process.
On June 30, 1986 the company merged with the Shipping Corporation of India and all its assets and liabilities were taken over by the Corporation.
The Corporation in the counter affidavit interalia has pleaded that there is acute shortage of housing accommodation in the Metropolitan City of Bombay and it becomes necessary for the Corporation with a view to attract good talent to provide suitable housing accommodation to its officers and employees, and that due to acute financial liquidity it is not possible for the Corporation to buy property in Bombay for this purpose.
It is further pleaded that the petitioner was given the flat for his residence during the period of his employment and that he was bound to vacate the same after his retirement.
It is asserted that the petitioner with a dishonest intention is wrongfully with holding the flat and has instituted false and frivolous proceedings with the ulterior object of protracting and delaying the eviction proceedings.
We are informed that the petitioner has been deliberately and dishonestly withholding the flat covering an area of 1750 square feet in Cuffe Parade which is a posh area, valued at approximately Rs.30 lakhs and putting it to his own use contrary to the terms of his employment.
The first and foremost argument of learned counsel for the petitioner is that the provision contained in section 630 of the Act is a penal provision and therefore must be subject to a strict construction and there is no room for intendment.
It is submitted that on a true construction, the scope and effect of the section was limited to such property of the company which was wrongfully obtained by an officer or employee of the company.
Emphasis was placed upon the words any such property ' in cl.
(b) of sub section
(1) for the contention that cl.
(b) does not stand by itself but is inter connected with cl.
(a) and therefore both clauses (a) and (b) must be read together.
In essence, the submission is that sub section
(1) of section 630 of the Act makes it an offence where any officer or employee of a company wrongfully withholds possession of 175 such property of the company.
Secondly, it is contended that the legislature never intended to include past officers and employees of a company within the ambit of section 630 of the Act which provides for prosecution of an officer or employee of a company for wrongfully withholding the property of the company inasmuch as it has used different languages where it was so intended, namely, in sections 538 and 545.
The entire argument of the learned counsel is based upon the judgment of the High Court of Calcutta in Amritlal Chum 's case.
We are afraid, we find it difficult to subscribe to the narrow construction placed by the High Court of Calcutta on the provision contained in sub section
(I) of section 630 of the Act which defeats the very purpose and object with which it had been introduced.
The beneficent provision contained in section 630 no doubt penal, has been purposely enacted by the legislature with the object of providing a summary procedure for retrieving the property of the company (a) where an officer or employee of a company wrongfully obtains possession of property of the company, or (b) where having been placed in possession of any such property during the course of his employment.
wrongfully withholds possession of it after the termination of his employment.
It is the duty of the Court to place a broad and liberal construction on the provision in furtherance of the object and purpose of the legislation which would suppress the mischief and advance the remedy.
Section 630 of the Act which makes the wrongful withholding of any property of a company by an officer or employee of the company a penal offence, is typical of the economy of language which is characteristic of the draughtsman of the Act.
The section is in two parts.
Sub section
(1) by clauses (a) and (b) creates two distinct and separate offences.
First of these is the one contemplated by cl.
(a), namely, where an officer or employee of a company wrongfully obtains possession of any property of the company during the course of his employment, to which he is not entitled.
Normally, it is only the present officers and employees who can secure possession of any property of a company.
It is also possible for such an officer or employee after termination of his employment to wrongfully take away possession of any such property.
This is the function of cl.
(a) and although it primarily refers to the existing officers and employees, it may also take in past officers and employees.
In contrast, cl.
(b) contemplates a case where an officer or employee of a company having any property of a company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the 176 articles and authorised by the Act.
It may well be that an officer or employee may have lawfully obtained possession of any such property during the course of his employment but wrongfully withholds it after the termination of his employment.
That appears to be one of the functions of cl.
It would be noticed that cl.
(b) also makes it an offence if any officer or employee of a company having any property of the company in his possession knowingly applies it to purposes other than those expressed or directed in the articles and authorised by the Act.
That would primarily apply to the present officers and employees and may also include past officers and employees.
There is therefore no warrant to give a restrictive meaning to the term 'officer or employee ' appearing in sub section
(1) of section 630 of the Act.
It is quite evident that clauses (a) and (b) are separated by the word 'or ' and therefore are clearly disjunctive.
The High Court of Calcutta in Amritlal Chum 's case obviously fell into an error in seeking to curtail the ambit of section 630(l)(b) by giving a restrictive meaning to the terms 'officer or employee ' which must take its colour from the context in which it appears.
The whole object of enacting sub section
(1) of section 630 is the preservation of the property of a company by the creation of two distinct offences by clauses (a) and (b) which arise under different sets of circumstances, and it would be rendered nugatory by projecting cl.
(a) into cl.
There is also no warrant for the construction placed by the High Court of Calcutta on the words 'any such property ' occurring in cl.
(b) as applicable to such property of a company, possession of which is wrongfully obtained by an officer or employee of the company i.e. refers to the whole of cl.
According to the plain construction, the words 'any such property ' in cl.
(b) relate to any property of a company as mentioned in cl.
Section 630 of the Act plainly makes it an offence if an officer or employee of the company who was permitted to use any property of the company during his employment, wrongfully retains or occupies the same after the termination of his employment.
By a curious process of reasoning, the High Court of Calcutta in Amritlal Chum 's case held that section 630 of the Act applies only to the existing officers and employees and not to those whose employment has been terminated.
In somewhat similar facts, an officer of Messrs Jardine Hendersons Limited who had been placed in possession of a furnished flat in premises No. 27, Ballygunj Park, Calcutta as a condition of his service, wrongfully retained possession thereof after ceasing to be an officer of the company.
The question was whether he had thereby committed an 177 Offence punishable under section 630 of the Act.
N.G. Chaudhuri, J. speaking for himself and G.C. Chatterjee, J. held that the opening words of sub section
(1) of section 630, namely, 'if any officer or employee of a company ' qualify 'the acts of delinquency ' specified in clauses (a) and (b) thereof.
He further held that the High Court of Bombay was in error in laying down in Govind T. Jagtiani 's case that for purposes of prosecution, cl.
(a) of section 630(1) was referable to existing officer or employee of a company, while cl.
(b) was wide enough to include former or past officer or employee of the company inasmuch as on a plain reading of the section the two clauses do not permit different interpretations, as suggested.
Further, whenever the framers of the law in their wisdom thought it proper to bring within the mischief of the provisions of the Act former officers or employees of a company, they did not hesitate to do so and they expressly legislated.
In particular, the learned judge referred to section 538 which provides for prosecution for offences by officers of companies in liquidation and uses the expression 'a past or present officer of a company etc. ', as also section 545 which provides for prosecution of delinquent officers and members of a company during the course of winding up and uses the words 'any past or present officer etc. ' Upon that basis, he observed that there was no reason to give a twisted and laboured interpretation to the provisions of section 630 of the Act which its plain reading does not permit.
The learned Judge also referred to the words 'any such property ' in cl.
(b) as taking in the property mentioned in cl.
(a) i.e. property wrongfully obtained.
The reasoning of the learned Judges does not bear scrutiny and renders cl.
(b) of section 630( l) wholly redundant.
It is the wrongful withholding of such property, meaning the property of the company after termination of the employment.
which is an offence under section 630(l)(b) of the Act, as rightly pointed out by V.S. Kotwal, J. in Harkishan Lakhimal Gidwani vs Achyut Kashinath Wagh (supra).
The facts were also identical as here.
The petitioner there was the General Manager of a company known as the English Electrical Company of India Limited, a company incorporated under the having its registered office at Calcutta.
He had been allotted the premises of a flat, approximately 3,500 square feet in area, located at Mayfair Gardens, Little Gibbs Road, Bombay.
He had been inducted into the flat only by virtue of his capacity as the General Manager of the company 's branch office at Bombay but the company allowed him to retain the same on humanitarian grounds for a short period after his retirement to enable him to find alternative accommodation.
This humanitarian and charitable consideration shown by the company was reciprocated by the petitioner by adopting H 178 an adamant attitude and he declined to vacate the same on one pretext or another.
The question was whether such wrongful retention of the flat amounted to an offence under section 63() of the Act.
The Court repelled the contention that section 630 of the Act applies only to the existing officers and employees of the company and not to former officers and employees, and that the phrase 'any such property ' used in cl.
(b), even though cls.
(a) and (b) are separated by the word 'or ' which must in the context in which it appears be read as 'and ' and so construed, must mean withholding of property wrongfully obtained by an existing officer or employee.
Kotwal, J.
On a careful analysis of section 630 held that the provisions of the section apply not only to the present officers and employees of the company but also to past officers and employees, and observed: "It is held that the features and deductions which flow logically and inescapably on an analysis of section 630 are that: (i) Clause (a) of the section is self contained and independent of cl.
(b) with the capacity of creating penal liability 4 embracing the case of an existing employee or officer of the company.
(ii) Clause (b) is equally independent and distinct from cl.
(a) as regards penal consequences squarely covering the case of a past employee or officer.
(iii) The entitlement of an officer to the property of the company is contingent on the right and capacity of the officer by virtue of his employment which is transformed into the actual possession of the property and the duration of such right would be co terminus with the terms of employment.
" In Govind T. Jagtiani vs Sirajuddin section Kazi, (supra), Kanade, J. fol lowed the critical analysis of section 630 made by Kotwal, J. as above, and observed that the entitlement of an officer to the property of the company and the duration of such right would be co terminus with the terms of employment and the right would stand extinguished with the termination to the employment giving rise to an obligation to hand over the property back to the company, and observed: "If the property is held back, the retained possession would amount to wrongful withholding of the property of the company.
While the existence of the capacity, right and possession would be during employment, the withholding may be even after the termination of the employment and though the possession as it precedes the act of retention or withholding may be rightful in the past affording an 179 Opportunity to withhold, the withholding may be wrongful as in the present case.
" The learned Judge (Ashok Agarwal, J.) observes that that has been the consistent view of the High Court and has referred to the subsequent decisions of Khatri j J. and Kurdukar, J.
In our considered opinion, the construction placed by the High Court on the provisions contained in s.630(1) is the only construction possible.
We accordingly uphold the view of the High Court of Bombay that the terms 'officer or employee ' of a company applies not only to existing officers or employees but also to past officers or employees if such officer or employee either (a) wrongfully obtains possession of any property, or (b) having obtained such property during the course of his employment, withholds the same after the termination of his employment.
The decision to the contrary of the High Court of Calcutta in Amritlal Chum 's case does not lay down good law and is overruled.
In the result, the special leave petition must fail and is dismissed with costs.
The petitioner is given one month 's time to vacate the premises failing which the respondents will be at liberty to take such proceedings as the law provides.
We direct the Additional Chief Metropolitan Magistrate, 37th Court, Esplanade, Bombay to proceed with the trial of Crl.
Case No. 76/S/1986 and dispose it of as expeditiously as possible and in any event, not later than four months from today.
P.S.S. Petition dismissed.
|
Sub section ( l ) of section 630 of the provides for launching of prosecution against an officer or employee of a company, who (a) wrongfully obtains possession of any property of a company, or (b) having any such property in his possession wrongfully withholds or knowingly misapplies the same.
The petitioner who was given a flat by the company for his residence during the period of his employment did not vacate it on his retirement.
He was granted six months time on humanitarian grounds upon his undertaking to comply with.
Upon his failure to vacate the premises the company lodged a complaint against him under section 630 of the Act for wrongful withholding of its property.
The Magistrate took congnizance of the complaint and directed issue of process.
Dismissing the writ petition filed by him under article 227 of the Constitution read with section 482 Cr.
P.C. seeking to quash the proceedings, the High Court following its consistent view in a series of cases that the term 'officer or employee ' in sub section
(1) of section 630 must be interpreted to mean not only the present officer or employee of company but also to include past officers and employees of the company and that the words 'any such property ' in cl.
(b) qualify the words 'any property of a company ' appearing in cl.
(a), held that the case does not call for interference.
169 In the special leave petition it was contended for the petitioner that the provision contained in section 630 of the Act is a penal provision and, therefore, must be subject to a strict construction and there is no room for intendment, that the term 'officer or employee ' occurring in sub section
(1) of section 630 refers only to the existing officers and employees of a company, and not the past officers, and that cl.
(b) of sub section
(I) does not stand by itself but is interconnected with cl.
(a) thereof and therefore cl.
(a) and cl.
(b) must be read together and when so read the words 'any such property ' in cl.
(b) do not qualify the words 'any property of a company ' in cl.
(a) and only relate to the property of company wrongfully taken possession of by a present officer.
Dismissing the special leave petition, ^ HELD: 1.
Section 630 of the plainly makes it an offence if an officer or employee of the company who was permitted to use any property of the company during his employment, wrongfully retains or occupies the same after the termination of his employment.
[176F G] 2.1 The term 'officer or employee ' of a company in section 630(1) applies not only to existing officers or employees but also to past officers or employees if such officer or employee either (a) wrongfully obtains possession of any property, or (b) having obtained such property during the course of his employment, withholds the same after the termination of his employment.
[179B C] 2.2 The beneficent provision contained in section 630 of the though penal, has been purposely enacted by the legislature with the object of providing a summary procedure for retrieving the property of the company.
It is the duty of the Court to place a broad and liberal construction on the provision in furtherance of the object and purpose of the legislation which would suppress the mischief and advance the remedy.
[175C E] 2.3 Sub section
(1) of section 630 of the Act by clauses (a) and (b) creates two distinct and separate offences: (1) Where an officer or employee of a company wrongfully obtains possession of any property of the company during the course of his employment, to which he is not entitled.
Normally, it is only the present officers and employees who can secure possession of any property of a company.
It is also possible for such an officer or employee after termination of his employment to wrongfully take away possession of any such property.
This is the function of cl.
(a) 170 and although it primarily refers to the existing officers and employees, it may also take in past officers and employees.
(2) Where an officer or employee of a company having any property of a company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorized by the Act.
It may well be that an officer or employee may have lawfully obtained possession of any such property during the course of his employment but wrongfully withholds it after the termination of his employment.
That appears to be one of the functions of cl.
Clause (b) also makes it an offence if any officer or employee of a company having any property of the company in his possession knowingly applies it to purposes other than those expressed or directed in the articles and authorized by the Act.
That would primarily apply to the present officers and employees and may also include past officers and employees.
There is therefore no warrant to give a restrictive meaning to the term 'officer or employee ' appearing in sub section
(1) of section 630 of the Act.
[175F H; 176A C] 3.
It is quite evident that clauses (a) and (b) are separated by the word 'or ' and therefore are clearly disjunctive.
The whole object of enacting the provision is the preservation of the property of a company by the creation of two distinct offences by clauses (a) and.(b) which arise under different sets of circumstances, and it would be rendered nugatory by projecting cl.
(a) into cl.
1176C, D E] 4.
According to the plain construction, the words 'any such property ' in cl.
(b) relate to 'any property of a company ' as mentioned in cl.
It is wrongful with holding of such property meaning the property of the company after termination of the employment, which is an offence under section 630(l)(b) of the Act.
[176F; 177E F] 5.
The petitioner given one month 's time to vacate the premises failing which the respondents to take such proceedings as the law provides.
The Additional Chief Metropolitan Magistrate to proceed with the trial and dispose it of expeditiously.
[179D E] Harkishan Lakhimal Gidwani vs Achyat Kashinath Wagh & Anr., , and Govind T. Jagtiani vs Sirajuddin section Kazi & Anr., , approved.
Amritlal Chum vs Devi Ranjan Jha & Anr., , overruled. 171
|
ION: Special Leave A Petition (CRL. ) No. 1765 of 1987 From the Judgment and order dated 8/9.7.1987 of the Bombay High Court in W.P. No. 332 of 1987.
V.N. Ganpule for the Petitioner.
Soli J. Sorabjee, K.J. John and A.K. Desai for the Respondents.
The Judgment of the Court was delivered by SEN, J.
The by section 630, enacts: "630.
Penalty for wrongful withholding of property (1) If any officer or employee of a company (a) wrongfully obtains possession of any property of a company; or D (b) having any such property in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorised by this Act; he shall, on the complaint of the company or any creditor or contributory thereof, be punishable with fine which may extend to one thousand rupees.
(2) The Court trying the offence may also order such officer or employee to deliver up or refund, within a time F to be fixed by the Court, any such property wrongfully obtained or wrongfully withheld or knowingly misapplied, or in default, to suffer imprisonment for a term which may extend to two years.
" The only question involved in this special leave petition is as to the scope and effect of sub section
(1) of section 630 of the Act.
The controversy is as to the meaning of the term 'officer or employee ' used in sub s(1) of section 630 and as to the meaning of the words 'any such property ' in cl.
(b) thereof and there is a conflict of opinion between the High Courts of Calcutta and Bombay on the question.
On a literal construction of the term 'officer or employee ' occurring in sub section
(1) of section 630 of H 172 the Act, the High Court of Calcutta in Amritlal Chum vs Devi Ranjan Jha & Anr., held that it refers only to the existing officers and employees of a company.
It also held that the words 'any such property ' in section 630(l)(b) relate to property specified in cl.
(a) viz. property of a company wrongfully taken possession of by a present officer or employee of the company.
The High Court of Bombay, on the other hand, has placed a beneficent construction on the provisions contained in section 630 and according to it, the term 'officer or employee ' in sub section
(1) of section 630 must be interpreted to mean not only the present officers and employees of a company but also to include past officers and employees of the company.
It is also of the view that the words 'any such property ' in ck (b) qualify the words 'any property of a company ' appearing in cl.
That has been the consistent view taken by the High Court of Bombay in a series of cases.
See: Harkishan Lakhimal Gidwani vs Achyut Kashinath Wagh & Anr., , Govind T. Jagtiani vs Sirajuddin section Kazi & Anr., [ which have since been followed in a series of cases referred to by the learned Single Judge (Ashok Agarwal, J.).
The issues involved in the special leave petition are of considerable importance to the corporate sector as many of the business organisations, both in the public as well as the private sector, are required to provide residential accommodation to their officers and employees as a condition of their service to attract better talent and have of necessity to purchase residential flats in multi storeyed buildings in large cities and towns for the use of such officers and employees during the course of their employment, and the question is whether the provisions contained in sub section
(1) of section 630 which provide for the launching of a prosecution against an officer or employee of a company for wrongful possession of such property under cls.
(a) and (b) of sub section
(1) of section 630 and for the recovery of such property by the issue of process under sub section (2), also extends to past officers and employees of the company and whether the Court trying the offence has the power to issue a process under sub section
(2) against such officer or employee.
At the conclusion of the hearing we had by a short order dismissed the special leave petition and held that the view expressed by the learned Single Judge following the earlier decisions of the High Court in Harkishan Lakhimal Gidwani and reiterated in Govind T. Jagtiani was to be preferred to the view to the contrary expressed by the High Court of Calcutta in Amritlal Chum.
As the respondent Shipping Corporation of India, a public sector undertakings, was in dire need of the flat in question which is situate in a posh locality like the Cuffe Parade in 173 Bombay, for the use of its senior executive, we could not accede to the request of the learned counsel for the petitioner to refer the case to a bench of three judges and heard learned counsel for the parties at quit some length on August 27,1987 and dismissed the special leave petition.
The reasons therefor follow.
At the very threshold it is necessary to set out a few facts.
The petitioner Baldev Krishan Sahi was an Under Secretary to the Government of India in the Ministry of Shipping & Transport and on May 21, 1974 accepted employment as Joint Manager in the Mogul Line Limited, a Government of India undertaking, after obtaining release from government service.
He was first allotted a service quarter.
In 1975 the company purchased a spacious flat being flat No. 151 in Jolly Maker Apartment III at 119, Cuffe Parade and the petitioner being the senior most executive was allotted the flat for his residence.
The petitioner retired from the service of the company on or about September 30, 1984.
Prior to that i.e. On September 26, 1984 he addressed a letter requesting the company to permit him to continue to live in the company 's premises during the period of his accumulated leave after his retirement i.e. for a period of six months, undertaking to vacate the flat as early as possible.
It appears that the company on humanitarian grounds acceded to this request and permitted the petitioner to stay on in the company 's flat for six months after his retirement and in accordance with the company 's rules, he was required to pay compensation for the use of the premises.
After the expiry of the said period of six months, the company addressed a letter dated April 26, 1985 requesting the petitioner to vacate the premises stating that if he failed to do so, he would be liable to pay higher compensation as per the company 's rules.
Since the petitioner failed to vacate the flat, the company initiated proceedings for his eviction under the Public Premises (Eviction of Unauthorised occupants) Act, 1971.
The Estate officer by order dated December 2, 1985 directed the eviction of the petitioner.
The petitioner carried an appeal to the City Civil & Sessions Court, Bombay but the same was dismissed by the Principal Judge, City Civil Court by his order dated January 16, 1986.
He then preferred a revision to the High Court and the High Court by its order dated January 28, 1986 allowed the same, set aside the eviction order and directed the Estate officer to give a personal hearing to the petitioner.
Instead of availing of that opportunity, the petitioner on March 3, 1986 moved the High Court by a petition under article 226 of the Constitution and obtained ad interim stay of the proceedings before the Estate officer.
A few days thereafter i.e. On March 7, 1986 the petitioner instituted a suit being Civil Suit No. 174 1382/86 in Small Causes Court, Bombay seeking a declaration that he was a tenant of the disputed flat, which is now pending.
In view of this, the company was constrained to lodge a complaint against the petitioner under section 630 of the Act in the Court of the Additional Chief Metropolitan Magistrate, 37th Court, Esplanade, Bombay alleging that he was wrongfully withholding the flat in question which had been given to him for his residence during the period of his employment and and thereby committed an offence punishable under section 630.
The learned Magistrate by his order dated May 22, 1986 took cognizance of the complaint against the petitioner and directed issue of process.
On June 30, 1986 the company merged with the Shipping Corporation of India and all its assets and liabilities were taken over by the Corporation.
The Corporation in the counter affidavit interalia has pleaded that there is acute shortage of housing accommodation in the Metropolitan City of Bombay and it becomes necessary for the Corporation with a view to attract good talent to provide suitable housing accommodation to its officers and employees, and that due to acute financial liquidity it is not possible for the Corporation to buy property in Bombay for this purpose.
It is further pleaded that the petitioner was given the flat for his residence during the period of his employment and that he was bound to vacate the same after his retirement.
It is asserted that the petitioner with a dishonest intention is wrongfully with holding the flat and has instituted false and frivolous proceedings with the ulterior object of protracting and delaying the eviction proceedings.
We are informed that the petitioner has been deliberately and dishonestly withholding the flat covering an area of 1750 square feet in Cuffe Parade which is a posh area, valued at approximately Rs.30 lakhs and putting it to his own use contrary to the terms of his employment.
The first and foremost argument of learned counsel for the petitioner is that the provision contained in section 630 of the Act is a penal provision and therefore must be subject to a strict construction and there is no room for intendment.
It is submitted that on a true construction, the scope and effect of the section was limited to such property of the company which was wrongfully obtained by an officer or employee of the company.
Emphasis was placed upon the words any such property ' in cl.
(b) of sub section
(1) for the contention that cl.
(b) does not stand by itself but is inter connected with cl.
(a) and therefore both clauses (a) and (b) must be read together.
In essence, the submission is that sub section
(1) of section 630 of the Act makes it an offence where any officer or employee of a company wrongfully withholds possession of 175 such property of the company.
Secondly, it is contended that the legislature never intended to include past officers and employees of a company within the ambit of section 630 of the Act which provides for prosecution of an officer or employee of a company for wrongfully withholding the property of the company inasmuch as it has used different languages where it was so intended, namely, in sections 538 and 545.
The entire argument of the learned counsel is based upon the judgment of the High Court of Calcutta in Amritlal Chum 's case.
We are afraid, we find it difficult to subscribe to the narrow construction placed by the High Court of Calcutta on the provision contained in sub section
(I) of section 630 of the Act which defeats the very purpose and object with which it had been introduced.
The beneficent provision contained in section 630 no doubt penal, has been purposely enacted by the legislature with the object of providing a summary procedure for retrieving the property of the company (a) where an officer or employee of a company wrongfully obtains possession of property of the company, or (b) where having been placed in possession of any such property during the course of his employment.
wrongfully withholds possession of it after the termination of his employment.
It is the duty of the Court to place a broad and liberal construction on the provision in furtherance of the object and purpose of the legislation which would suppress the mischief and advance the remedy.
Section 630 of the Act which makes the wrongful withholding of any property of a company by an officer or employee of the company a penal offence, is typical of the economy of language which is characteristic of the draughtsman of the Act.
The section is in two parts.
Sub section
(1) by clauses (a) and (b) creates two distinct and separate offences.
First of these is the one contemplated by cl.
(a), namely, where an officer or employee of a company wrongfully obtains possession of any property of the company during the course of his employment, to which he is not entitled.
Normally, it is only the present officers and employees who can secure possession of any property of a company.
It is also possible for such an officer or employee after termination of his employment to wrongfully take away possession of any such property.
This is the function of cl.
(a) and although it primarily refers to the existing officers and employees, it may also take in past officers and employees.
In contrast, cl.
(b) contemplates a case where an officer or employee of a company having any property of a company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the 176 articles and authorised by the Act.
It may well be that an officer or employee may have lawfully obtained possession of any such property during the course of his employment but wrongfully withholds it after the termination of his employment.
That appears to be one of the functions of cl.
It would be noticed that cl.
(b) also makes it an offence if any officer or employee of a company having any property of the company in his possession knowingly applies it to purposes other than those expressed or directed in the articles and authorised by the Act.
That would primarily apply to the present officers and employees and may also include past officers and employees.
There is therefore no warrant to give a restrictive meaning to the term 'officer or employee ' appearing in sub section
(1) of section 630 of the Act.
It is quite evident that clauses (a) and (b) are separated by the word 'or ' and therefore are clearly disjunctive.
The High Court of Calcutta in Amritlal Chum 's case obviously fell into an error in seeking to curtail the ambit of section 630(l)(b) by giving a restrictive meaning to the terms 'officer or employee ' which must take its colour from the context in which it appears.
The whole object of enacting sub section
(1) of section 630 is the preservation of the property of a company by the creation of two distinct offences by clauses (a) and (b) which arise under different sets of circumstances, and it would be rendered nugatory by projecting cl.
(a) into cl.
There is also no warrant for the construction placed by the High Court of Calcutta on the words 'any such property ' occurring in cl.
(b) as applicable to such property of a company, possession of which is wrongfully obtained by an officer or employee of the company i.e. refers to the whole of cl.
According to the plain construction, the words 'any such property ' in cl.
(b) relate to any property of a company as mentioned in cl.
Section 630 of the Act plainly makes it an offence if an officer or employee of the company who was permitted to use any property of the company during his employment, wrongfully retains or occupies the same after the termination of his employment.
By a curious process of reasoning, the High Court of Calcutta in Amritlal Chum 's case held that section 630 of the Act applies only to the existing officers and employees and not to those whose employment has been terminated.
In somewhat similar facts, an officer of Messrs Jardine Hendersons Limited who had been placed in possession of a furnished flat in premises No. 27, Ballygunj Park, Calcutta as a condition of his service, wrongfully retained possession thereof after ceasing to be an officer of the company.
The question was whether he had thereby committed an 177 Offence punishable under section 630 of the Act.
N.G. Chaudhuri, J. speaking for himself and G.C. Chatterjee, J. held that the opening words of sub section
(1) of section 630, namely, 'if any officer or employee of a company ' qualify 'the acts of delinquency ' specified in clauses (a) and (b) thereof.
He further held that the High Court of Bombay was in error in laying down in Govind T. Jagtiani 's case that for purposes of prosecution, cl.
(a) of section 630(1) was referable to existing officer or employee of a company, while cl.
(b) was wide enough to include former or past officer or employee of the company inasmuch as on a plain reading of the section the two clauses do not permit different interpretations, as suggested.
Further, whenever the framers of the law in their wisdom thought it proper to bring within the mischief of the provisions of the Act former officers or employees of a company, they did not hesitate to do so and they expressly legislated.
In particular, the learned judge referred to section 538 which provides for prosecution for offences by officers of companies in liquidation and uses the expression 'a past or present officer of a company etc. ', as also section 545 which provides for prosecution of delinquent officers and members of a company during the course of winding up and uses the words 'any past or present officer etc. ' Upon that basis, he observed that there was no reason to give a twisted and laboured interpretation to the provisions of section 630 of the Act which its plain reading does not permit.
The learned Judge also referred to the words 'any such property ' in cl.
(b) as taking in the property mentioned in cl.
(a) i.e. property wrongfully obtained.
The reasoning of the learned Judges does not bear scrutiny and renders cl.
(b) of section 630( l) wholly redundant.
It is the wrongful withholding of such property, meaning the property of the company after termination of the employment.
which is an offence under section 630(l)(b) of the Act, as rightly pointed out by V.S. Kotwal, J. in Harkishan Lakhimal Gidwani vs Achyut Kashinath Wagh (supra).
The facts were also identical as here.
The petitioner there was the General Manager of a company known as the English Electrical Company of India Limited, a company incorporated under the having its registered office at Calcutta.
He had been allotted the premises of a flat, approximately 3,500 square feet in area, located at Mayfair Gardens, Little Gibbs Road, Bombay.
He had been inducted into the flat only by virtue of his capacity as the General Manager of the company 's branch office at Bombay but the company allowed him to retain the same on humanitarian grounds for a short period after his retirement to enable him to find alternative accommodation.
This humanitarian and charitable consideration shown by the company was reciprocated by the petitioner by adopting H 178 an adamant attitude and he declined to vacate the same on one pretext or another.
The question was whether such wrongful retention of the flat amounted to an offence under section 63() of the Act.
The Court repelled the contention that section 630 of the Act applies only to the existing officers and employees of the company and not to former officers and employees, and that the phrase 'any such property ' used in cl.
(b), even though cls.
(a) and (b) are separated by the word 'or ' which must in the context in which it appears be read as 'and ' and so construed, must mean withholding of property wrongfully obtained by an existing officer or employee.
Kotwal, J.
On a careful analysis of section 630 held that the provisions of the section apply not only to the present officers and employees of the company but also to past officers and employees, and observed: "It is held that the features and deductions which flow logically and inescapably on an analysis of section 630 are that: (i) Clause (a) of the section is self contained and independent of cl.
(b) with the capacity of creating penal liability 4 embracing the case of an existing employee or officer of the company.
(ii) Clause (b) is equally independent and distinct from cl.
(a) as regards penal consequences squarely covering the case of a past employee or officer.
(iii) The entitlement of an officer to the property of the company is contingent on the right and capacity of the officer by virtue of his employment which is transformed into the actual possession of the property and the duration of such right would be co terminus with the terms of employment.
" In Govind T. Jagtiani vs Sirajuddin section Kazi, (supra), Kanade, J. fol lowed the critical analysis of section 630 made by Kotwal, J. as above, and observed that the entitlement of an officer to the property of the company and the duration of such right would be co terminus with the terms of employment and the right would stand extinguished with the termination to the employment giving rise to an obligation to hand over the property back to the company, and observed: "If the property is held back, the retained possession would amount to wrongful withholding of the property of the company.
While the existence of the capacity, right and possession would be during employment, the withholding may be even after the termination of the employment and though the possession as it precedes the act of retention or withholding may be rightful in the past affording an 179 Opportunity to withhold, the withholding may be wrongful as in the present case.
" The learned Judge (Ashok Agarwal, J.) observes that that has been the consistent view of the High Court and has referred to the subsequent decisions of Khatri j J. and Kurdukar, J.
In our considered opinion, the construction placed by the High Court on the provisions contained in s.630(1) is the only construction possible.
We accordingly uphold the view of the High Court of Bombay that the terms 'officer or employee ' of a company applies not only to existing officers or employees but also to past officers or employees if such officer or employee either (a) wrongfully obtains possession of any property, or (b) having obtained such property during the course of his employment, withholds the same after the termination of his employment.
The decision to the contrary of the High Court of Calcutta in Amritlal Chum 's case does not lay down good law and is overruled.
In the result, the special leave petition must fail and is dismissed with costs.
The petitioner is given one month 's time to vacate the premises failing which the respondents will be at liberty to take such proceedings as the law provides.
We direct the Additional Chief Metropolitan Magistrate, 37th Court, Esplanade, Bombay to proceed with the trial of Crl.
Case No. 76/S/1986 and dispose it of as expeditiously as possible and in any event, not later than four months from today.
P.S.S. Petition dismissed.
|
1765 of 1987 From the Judgment and order dated 8/9.7.1987 of the Bombay High Court in W.P. No. Soli J. Sorabjee, K.J. John and A.K. Desai for the Respondents. The Judgment of the Court was delivered by SEN, J.
The by section 630, enacts: "630. Penalty for wrongful withholding of property (1) If any officer or employee of a company (a) wrongfully obtains possession of any property of a company; or D (b) having any such property in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorised by this Act; he shall, on the complaint of the company or any creditor or contributory thereof, be punishable with fine which may extend to one thousand rupees. " The only question involved in this special leave petition is as to the scope and effect of sub section
(1) of section 630 of the Act. The controversy is as to the meaning of the term 'officer or employee ' used in sub s(1) of section 630 and as to the meaning of the words 'any such property ' in cl. (b) thereof and there is a conflict of opinion between the High Courts of Calcutta and Bombay on the question. On a literal construction of the term 'officer or employee ' occurring in sub section
(1) of section 630 of H 172 the Act, the High Court of Calcutta in Amritlal Chum vs Devi Ranjan Jha & Anr., held that it refers only to the existing officers and employees of a company. property of a company wrongfully taken possession of by a present officer or employee of the company. The High Court of Bombay, on the other hand, has placed a beneficent construction on the provisions contained in section 630 and according to it, the term 'officer or employee ' in sub section
(1) of section 630 must be interpreted to mean not only the present officers and employees of a company but also to include past officers and employees of the company. It is also of the view that the words 'any such property ' in ck (b) qualify the words 'any property of a company ' appearing in cl. That has been the consistent view taken by the High Court of Bombay in a series of cases. See: Harkishan Lakhimal Gidwani vs Achyut Kashinath Wagh & Anr., , Govind T. Jagtiani vs Sirajuddin section Kazi & Anr., [ As the respondent Shipping Corporation of India, a public sector undertakings, was in dire need of the flat in question which is situate in a posh locality like the Cuffe Parade in 173 Bombay, for the use of its senior executive, we could not accede to the request of the learned counsel for the petitioner to refer the case to a bench of three judges and heard learned counsel for the parties at quit some length on August 27,1987 and dismissed the special leave petition. At the very threshold it is necessary to set out a few facts. In 1975 the company purchased a spacious flat being flat No. 151 in Jolly Maker Apartment III at 119, Cuffe Parade and the petitioner being the senior most executive was allotted the flat for his residence. The petitioner retired from the service of the company on or about September 30, 1984. Prior to that i.e. On September 26, 1984 he addressed a letter requesting the company to permit him to continue to live in the company 's premises during the period of his accumulated leave after his retirement i.e. for a period of six months, undertaking to vacate the flat as early as possible. It appears that the company on humanitarian grounds acceded to this request and permitted the petitioner to stay on in the company 's flat for six months after his retirement and in accordance with the company 's rules, he was required to pay compensation for the use of the premises. After the expiry of the said period of six months, the company addressed a letter dated April 26, 1985 requesting the petitioner to vacate the premises stating that if he failed to do so, he would be liable to pay higher compensation as per the company 's rules. Since the petitioner failed to vacate the flat, the company initiated proceedings for his eviction under the Public Premises (Eviction of Unauthorised occupants) Act, 1971. The Estate officer by order dated December 2, 1985 directed the eviction of the petitioner. The petitioner carried an appeal to the City Civil & Sessions Court, Bombay but the same was dismissed by the Principal Judge, City Civil Court by his order dated January 16, 1986. He then preferred a revision to the High Court and the High Court by its order dated January 28, 1986 allowed the same, set aside the eviction order and directed the Estate officer to give a personal hearing to the petitioner. Instead of availing of that opportunity, the petitioner on March 3, 1986 moved the High Court by a petition under article 226 of the Constitution and obtained ad interim stay of the proceedings before the Estate officer. A few days thereafter i.e. On March 7, 1986 the petitioner instituted a suit being Civil Suit No. 174 1382/86 in Small Causes Court, Bombay seeking a declaration that he was a tenant of the disputed flat, which is now pending. In view of this, the company was constrained to lodge a complaint against the petitioner under section 630 of the Act in the Court of the Additional Chief Metropolitan Magistrate, 37th Court, Esplanade, Bombay alleging that he was wrongfully withholding the flat in question which had been given to him for his residence during the period of his employment and and thereby committed an offence punishable under section 630. The learned Magistrate by his order dated May 22, 1986 took cognizance of the complaint against the petitioner and directed issue of process. On June 30, 1986 the company merged with the Shipping Corporation of India and all its assets and liabilities were taken over by the Corporation. It is asserted that the petitioner with a dishonest intention is wrongfully with holding the flat and has instituted false and frivolous proceedings with the ulterior object of protracting and delaying the eviction proceedings. We are informed that the petitioner has been deliberately and dishonestly withholding the flat covering an area of 1750 square feet in Cuffe Parade which is a posh area, valued at approximately Rs.30 lakhs and putting it to his own use contrary to the terms of his employment. It is submitted that on a true construction, the scope and effect of the section was limited to such property of the company which was wrongfully obtained by an officer or employee of the company. Emphasis was placed upon the words any such property ' in cl. (b) of sub section
(1) for the contention that cl. (b) does not stand by itself but is inter connected with cl. (a) and therefore both clauses (a) and (b) must be read together. Secondly, it is contended that the legislature never intended to include past officers and employees of a company within the ambit of section 630 of the Act which provides for prosecution of an officer or employee of a company for wrongfully withholding the property of the company inasmuch as it has used different languages where it was so intended, namely, in sections 538 and 545. The entire argument of the learned counsel is based upon the judgment of the High Court of Calcutta in Amritlal Chum 's case. wrongfully withholds possession of it after the termination of his employment. It is the duty of the Court to place a broad and liberal construction on the provision in furtherance of the object and purpose of the legislation which would suppress the mischief and advance the remedy. Section 630 of the Act which makes the wrongful withholding of any property of a company by an officer or employee of the company a penal offence, is typical of the economy of language which is characteristic of the draughtsman of the Act. Sub section
(1) by clauses (a) and (b) creates two distinct and separate offences. First of these is the one contemplated by cl. (a), namely, where an officer or employee of a company wrongfully obtains possession of any property of the company during the course of his employment, to which he is not entitled. Normally, it is only the present officers and employees who can secure possession of any property of a company. It is also possible for such an officer or employee after termination of his employment to wrongfully take away possession of any such property. (a) and although it primarily refers to the existing officers and employees, it may also take in past officers and employees. It may well be that an officer or employee may have lawfully obtained possession of any such property during the course of his employment but wrongfully withholds it after the termination of his employment. That appears to be one of the functions of cl. (b) also makes it an offence if any officer or employee of a company having any property of the company in his possession knowingly applies it to purposes other than those expressed or directed in the articles and authorised by the Act. That would primarily apply to the present officers and employees and may also include past officers and employees. It is quite evident that clauses (a) and (b) are separated by the word 'or ' and therefore are clearly disjunctive. The whole object of enacting sub section
(1) of section 630 is the preservation of the property of a company by the creation of two distinct offences by clauses (a) and (b) which arise under different sets of circumstances, and it would be rendered nugatory by projecting cl. There is also no warrant for the construction placed by the High Court of Calcutta on the words 'any such property ' occurring in cl. (b) as applicable to such property of a company, possession of which is wrongfully obtained by an officer or employee of the company i.e. refers to the whole of cl. According to the plain construction, the words 'any such property ' in cl. (b) relate to any property of a company as mentioned in cl. Section 630 of the Act plainly makes it an offence if an officer or employee of the company who was permitted to use any property of the company during his employment, wrongfully retains or occupies the same after the termination of his employment. By a curious process of reasoning, the High Court of Calcutta in Amritlal Chum 's case held that section 630 of the Act applies only to the existing officers and employees and not to those whose employment has been terminated. In somewhat similar facts, an officer of Messrs Jardine Hendersons Limited who had been placed in possession of a furnished flat in premises No. 27, Ballygunj Park, Calcutta as a condition of his service, wrongfully retained possession thereof after ceasing to be an officer of the company. The question was whether he had thereby committed an 177 Offence punishable under section 630 of the Act. He further held that the High Court of Bombay was in error in laying down in Govind T. Jagtiani 's case that for purposes of prosecution, cl. (a) of section 630(1) was referable to existing officer or employee of a company, while cl. Further, whenever the framers of the law in their wisdom thought it proper to bring within the mischief of the provisions of the Act former officers or employees of a company, they did not hesitate to do so and they expressly legislated. In particular, the learned judge referred to section 538 which provides for prosecution for offences by officers of companies in liquidation and uses the expression 'a past or present officer of a company etc. ', Upon that basis, he observed that there was no reason to give a twisted and laboured interpretation to the provisions of section 630 of the Act which its plain reading does not permit. The learned Judge also referred to the words 'any such property ' in cl. (b) as taking in the property mentioned in cl. The reasoning of the learned Judges does not bear scrutiny and renders cl. It is the wrongful withholding of such property, meaning the property of the company after termination of the employment. which is an offence under section 630(l)(b) of the Act, as rightly pointed out by V.S. Kotwal, J. in Harkishan Lakhimal Gidwani vs Achyut Kashinath Wagh (supra). The petitioner there was the General Manager of a company known as the English Electrical Company of India Limited, a company incorporated under the having its registered office at Calcutta. He had been allotted the premises of a flat, approximately 3,500 square feet in area, located at Mayfair Gardens, Little Gibbs Road, Bombay. He had been inducted into the flat only by virtue of his capacity as the General Manager of the company 's branch office at Bombay but the company allowed him to retain the same on humanitarian grounds for a short period after his retirement to enable him to find alternative accommodation. This humanitarian and charitable consideration shown by the company was reciprocated by the petitioner by adopting H 178 an adamant attitude and he declined to vacate the same on one pretext or another. The question was whether such wrongful retention of the flat amounted to an offence under section 63() of the Act. The Court repelled the contention that section 630 of the Act applies only to the existing officers and employees of the company and not to former officers and employees, and that the phrase 'any such property ' used in cl. (a) and (b) are separated by the word 'or ' which must in the context in which it appears be read as 'and ' and so construed, must mean withholding of property wrongfully obtained by an existing officer or employee. (b) with the capacity of creating penal liability 4 embracing the case of an existing employee or officer of the company. (ii) Clause (b) is equally independent and distinct from cl. (a) as regards penal consequences squarely covering the case of a past employee or officer. (iii) The entitlement of an officer to the property of the company is contingent on the right and capacity of the officer by virtue of his employment which is transformed into the actual possession of the property and the duration of such right would be co terminus with the terms of employment. While the existence of the capacity, right and possession would be during employment, the withholding may be even after the termination of the employment and though the possession as it precedes the act of retention or withholding may be rightful in the past affording an 179 Opportunity to withhold, the withholding may be wrongful as in the present case. The decision to the contrary of the High Court of Calcutta in Amritlal Chum 's case does not lay down good law and is overruled. In the result, the special leave petition must fail and is dismissed with costs. The petitioner is given one month 's time to vacate the premises failing which the respondents will be at liberty to take such proceedings as the law provides. We direct the Additional Chief Metropolitan Magistrate, 37th Court, Esplanade, Bombay to proceed with the trial of Crl. 76/S/1986 and dispose it of as expeditiously as possible and in any event, not later than four months from today.
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Sub section ( l ) of section 630 of the provides for launching of prosecution against an officer or employee of a company, who (a) wrongfully obtains possession of any property of a company, or (b) having any such property in his possession wrongfully withholds or knowingly misapplies the same.
The petitioner who was given a flat by the company for his residence during the period of his employment did not vacate it on his retirement.
He was granted six months time on humanitarian grounds upon his undertaking to comply with.
Upon his failure to vacate the premises the company lodged a complaint against him under section 630 of the Act for wrongful withholding of its property.
The Magistrate took congnizance of the complaint and directed issue of process.
Dismissing the writ petition filed by him under article 227 of the Constitution read with section 482 Cr.
P.C. seeking to quash the proceedings, the High Court following its consistent view in a series of cases that the term 'officer or employee ' in sub section
(1) of section 630 must be interpreted to mean not only the present officer or employee of company but also to include past officers and employees of the company and that the words 'any such property ' in cl.
(b) qualify the words 'any property of a company ' appearing in cl.
(a), held that the case does not call for interference.
169 In the special leave petition it was contended for the petitioner that the provision contained in section 630 of the Act is a penal provision and, therefore, must be subject to a strict construction and there is no room for intendment, that the term 'officer or employee ' occurring in sub section
(1) of section 630 refers only to the existing officers and employees of a company, and not the past officers, and that cl.
(b) of sub section
(I) does not stand by itself but is interconnected with cl.
(a) thereof and therefore cl.
(a) and cl.
(b) must be read together and when so read the words 'any such property ' in cl.
(b) do not qualify the words 'any property of a company ' in cl.
(a) and only relate to the property of company wrongfully taken possession of by a present officer.
Dismissing the special leave petition, ^ HELD: 1.
Section 630 of the plainly makes it an offence if an officer or employee of the company who was permitted to use any property of the company during his employment, wrongfully retains or occupies the same after the termination of his employment.
[176F G] 2.1 The term 'officer or employee ' of a company in section 630(1) applies not only to existing officers or employees but also to past officers or employees if such officer or employee either (a) wrongfully obtains possession of any property, or (b) having obtained such property during the course of his employment, withholds the same after the termination of his employment.
[179B C] 2.2 The beneficent provision contained in section 630 of the though penal, has been purposely enacted by the legislature with the object of providing a summary procedure for retrieving the property of the company.
It is the duty of the Court to place a broad and liberal construction on the provision in furtherance of the object and purpose of the legislation which would suppress the mischief and advance the remedy.
[175C E] 2.3 Sub section
(1) of section 630 of the Act by clauses (a) and (b) creates two distinct and separate offences: (1) Where an officer or employee of a company wrongfully obtains possession of any property of the company during the course of his employment, to which he is not entitled.
Normally, it is only the present officers and employees who can secure possession of any property of a company.
It is also possible for such an officer or employee after termination of his employment to wrongfully take away possession of any such property.
This is the function of cl.
(a) 170 and although it primarily refers to the existing officers and employees, it may also take in past officers and employees.
(2) Where an officer or employee of a company having any property of a company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorized by the Act.
It may well be that an officer or employee may have lawfully obtained possession of any such property during the course of his employment but wrongfully withholds it after the termination of his employment.
That appears to be one of the functions of cl.
Clause (b) also makes it an offence if any officer or employee of a company having any property of the company in his possession knowingly applies it to purposes other than those expressed or directed in the articles and authorized by the Act.
That would primarily apply to the present officers and employees and may also include past officers and employees.
There is therefore no warrant to give a restrictive meaning to the term 'officer or employee ' appearing in sub section
(1) of section 630 of the Act.
[175F H; 176A C] 3.
It is quite evident that clauses (a) and (b) are separated by the word 'or ' and therefore are clearly disjunctive.
The whole object of enacting the provision is the preservation of the property of a company by the creation of two distinct offences by clauses (a) and.(b) which arise under different sets of circumstances, and it would be rendered nugatory by projecting cl.
(a) into cl.
1176C, D E] 4.
According to the plain construction, the words 'any such property ' in cl.
(b) relate to 'any property of a company ' as mentioned in cl.
It is wrongful with holding of such property meaning the property of the company after termination of the employment, which is an offence under section 630(l)(b) of the Act.
[176F; 177E F] 5.
The petitioner given one month 's time to vacate the premises failing which the respondents to take such proceedings as the law provides.
The Additional Chief Metropolitan Magistrate to proceed with the trial and dispose it of expeditiously.
[179D E] Harkishan Lakhimal Gidwani vs Achyat Kashinath Wagh & Anr., , and Govind T. Jagtiani vs Sirajuddin section Kazi & Anr., , approved.
Amritlal Chum vs Devi Ranjan Jha & Anr., , overruled. 171
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Sub section ( l ) of section 630 of the provides for launching of prosecution against an officer or employee of a company, who (a) wrongfully obtains possession of any property of a company, or (b) having any such property in his possession wrongfully withholds or knowingly misapplies the same. He was granted six months time on humanitarian grounds upon his undertaking to comply with. Upon his failure to vacate the premises the company lodged a complaint against him under section 630 of the Act for wrongful withholding of its property. The Magistrate took congnizance of the complaint and directed issue of process. (b) qualify the words 'any property of a company ' appearing in cl. (a), held that the case does not call for interference. (b) of sub section
(I) does not stand by itself but is interconnected with cl. (b) must be read together and when so read the words 'any such property ' in cl. (a) and only relate to the property of company wrongfully taken possession of by a present officer. Dismissing the special leave petition, ^ HELD: 1. Section 630 of the plainly makes it an offence if an officer or employee of the company who was permitted to use any property of the company during his employment, wrongfully retains or occupies the same after the termination of his employment. [176F G] 2.1 The term 'officer or employee ' of a company in section 630(1) applies not only to existing officers or employees but also to past officers or employees if such officer or employee either (a) wrongfully obtains possession of any property, or (b) having obtained such property during the course of his employment, withholds the same after the termination of his employment. Normally, it is only the present officers and employees who can secure possession of any property of a company. It is also possible for such an officer or employee after termination of his employment to wrongfully take away possession of any such property. (a) 170 and although it primarily refers to the existing officers and employees, it may also take in past officers and employees. (2) Where an officer or employee of a company having any property of a company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles and authorized by the Act. It may well be that an officer or employee may have lawfully obtained possession of any such property during the course of his employment but wrongfully withholds it after the termination of his employment. That appears to be one of the functions of cl. That would primarily apply to the present officers and employees and may also include past officers and employees. It is quite evident that clauses (a) and (b) are separated by the word 'or ' and therefore are clearly disjunctive. The whole object of enacting the provision is the preservation of the property of a company by the creation of two distinct offences by clauses (a) and.(b) which arise under different sets of circumstances, and it would be rendered nugatory by projecting cl. (b) relate to 'any property of a company ' as mentioned in cl. The petitioner given one month 's time to vacate the premises failing which the respondents to take such proceedings as the law provides. [179D E] Harkishan Lakhimal Gidwani vs Achyat Kashinath Wagh & Anr., , and Govind T. Jagtiani vs Sirajuddin section Kazi & Anr., , Amritlal Chum vs Devi Ranjan Jha & Anr., ,
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tition Nos 7597 99 of 1983.
And Writ Petition Nos.
7606 09 of 1983.
(Under Article 32 of the Constitution of India).
A.K. Sen, F.S. Nariman, S.N. Kacker, A.K. Ganguli, R.F. Nariman, A. Patnaik and M.M. Kshatriya for the Petitioners.
F Shanti Bhushan, S.N. Chatterjee, G.L. Sanghi, Dr. Y.S. Chitale, G. Rath, Advocate General, R.K. Patra, R.K. Mehta and H. K .
Puri for the Respondents.
The Judgment of the Court was delivered by G JAGANNATHA SHETTY, J.
"Sal seed" which is a minor forest produce at Orissa has again become the major subject of litigation between commercial users and the State of orissa.
The petitioners herein are holders of long term license from the 318 Government of orissa for collection of sal seeds from certain A specified forest divisions on payment of royalty.
The State of orissa enacted Orissa Forest.
Produce (Control of Trade) Act, 1981 (The "Act").
It received the assent of President on August 21, 1981.
The object of the Act was to prevent smuggling forest and also to provide State monopoly in such forest produce.
Under Section 1(3) }3 of the Act the State is empowered from time to time to issue a notification specifying the area or areas the forest produce in relation to which and the date from which the Act shall come into force.
Purporting to act under this provision a notification dated December 9.
1982 was issued by the State Government directing that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds.
Thereafter, the Government refused to accept royalty from the petitioners in respect of certain forest divisions on the ground that the notification had the effect of rescinding the existing contracts between the Government and the petitioners.
The petitioners thereupon moved the orissa High Court with Writ Petitions for declaration that the said notification was void and did not have the effect of rescinding their contracts in relation to sal seeds.
The orissa High Court dismissed the Writ Petitions.
The matter was brought before this Court in Civil Appeal Nos.
6230 31 of 1983.
This Court allowed the appeals by judgment dated May 5, 1987.
which has been since reported in Utkal Contractors & Joinery Pvt. Ltd. and ors.
vs State of orissa and ors.
, AIR 1987 SC 1455 = ; The nub of the arguments in those appeals was that the Act was not concerned with the sal seeds grown in the Government lands or Government Forests, and in any event, the petitioners ' contract remained untouched by the notification dated December 9, 1982.
It was also contended that since the Government was already the owner of forest produce in Government lands, all that was necessary to create a State monopoly in any forest produce, was to vest in the Government the exclusive right to such forest produce grown in private holding.
After dealing with the object of the Act and relevant provisions, a bench of this Court consisting one of us (o. Chinnappa Reddy, J.) said: "Thus none of these provisions deals with forest produce grown in Government lands nor is there any other provision in the Act which expressly deals with forest produce grown in Government lands.
The scheme of the Act is, 319 therefore, fully in tune with the object set out in the Statement of objects and Reasons and in the Preamble, namely that of creating a monopoly in forest produce by making the Government the exclusive purchaser of forest produce grown in private holdings.
It as argued by the learned Additional Solicitor General that section 5(1)(1) was totally out of tune with the rest of the provisions and, while the rest of the provisions dealt with forest produce grown in private holdings the very wide language of section S(1)(a) made it applicable to all forest produce whether grown in private holdings or Government forests.
We do not think that it is permissible for us to construe section 5(1)(a) in the very wide terms in which we are asked to construe it by the learned Additional Solicitor General because of its wide language, as that would merely introduce needless confusion into the scheme of the Act.
Having scanned the object and the scheme of the Act, having examined each of the provisions of the Act textually and contextually, we do not think it is proper for us to construe the words of section S(1)(a) in their literal sense; we think that the proper way to construe.
section 5(1)(a) is to give a restricted meaning to the wide and general words there used so as to fit into the general scheme of the Act and section 5(1)(b) are concerned by the conjunction 'and ', and having regard to the circumstances leading to the enactment and the policy and design of the Act, we think that clauses (a) and (b) must be construed in such a way as to reflect each other.
We have no doubt that the contracts relating to specified forest produce which stand rescinded are contracts in relation to forest produce grown in private holdings only.
If the very object of the Act is to create a monopoly in forest produce in the Government so as enable the Government, among other things, to enter into contracts, there was no point in rescinding contracts already validly entered into by the Government.
Again section 5(1) does not bar any future contracts by the Government in respect of forest produce; if so, what is the justification for construing section 5(1) in such a way as to put an end to contracts already entered into by the Government.
Viewing section 5(1)(a) and 5(1)(b) together and in the light of the preamble and the Statement of objects and Reasons and against the decor of the remaining provisions of the Act, we have no doubt that section 5(1) like the rest of the provisions applied to forest produce grown in private hold 320 ings and not to forest produce grown in Government landS. " Then the conclusion was expressed in the following terms: "We declare that the Act and the notification issued under the Act do not apply to forest produce grown in Government forests and that it was not, therefore, open to the Government to treat the contract dated May 25, 1979, as rescinded.
" On May 29, 1987, the Governor of (Orissa promulgated orissa Forest Produce (Control of Trade) (Amendment and Validation) ordinance, 1987, (The "ordinance").
The ordinance shall be deemed to have come into force with effect from September 5, 1981 when the principal Act was notified in the Orissa Gazette.
The ordinance purports to render the aforesaid decision ineffective.
The petitioners have again approached this Court challenging the validity of the ordinance.
Before we examine the contentions raised in these petitions, lt will be useful to set out the provisions of ordinance: "(2) It shall be deemed to have come into force on the date on which the Orissa Forest Produce (Control of Trade) Act 1981 (hereinafter referred to as the principal Act) had come into force, i.e. 5.9.1981 when the principal Act was notified in the orissa Gazette.
2. 3 In clause (c) section 2 of the principal Act, the full stop at the end of the clause shall be substituted by a comma and thereafter the following shall be added at the end, namely: "Whether grown or found on land owned by private persons or on land owned by the State Government (j, or in Government forests.
In Section 5 of the principal Act, in sub section (1) (1) "(i) for clause (a) the following clause shall be substituted, namely: 321 "(a) all contracts for the purchase, sale, gathering or collection of specified forest produce grown or found in the said area shall stand rescinded, whether such forest produce is grown or found on land owned by private persons or on land owned by the State Government or in Government forests.
" (ii) After Explanation III, the following Explanation shall be added, namely: "Explanation IV The Explanations I to III shall be deemed to be explanations to clause (b) of this sub section only and shall not be deemed as in any manner qualifying or detracting from clause (a) of this sub section or saving any contracts referred to in clause (a) from the operation of the provision for recission of contracts contained in the said clause (a)".
In section 9 of the principal Act for sub section (4) the following sub section shall be substituted namely: "(4) The State Government or its authorised officer or agent shall be entitled to take delivery of any specified forest produce collected by any person from land owned by the State Government or Government Forests on payment of only such collection charges as may be determined by the State Government from time to time.
Provided that it shall be open to the State Government or the authorised officer or agent to refuse to take delivery of any such forest produce which is not fit for consumption or use as raw material for manufacture or for trade: Provided further that in the case of any dispute, the Divisional Forest officer or such other officer who may be specifically empowered in this behalf, as specified in sub section (2), shall hear and dispose of the same in the manner provided in this Act and the Rules made thereunder. " 5.Notwithstanding any judgment, decree or order of any Court to the contrary, the Notification dated the 9th 322 December, 1982, issued by the State Government under sub section (3) of section 1 of the principal Act in respect of sal seeds shall be deemed to have been issued in respect of sal seeds whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests and shall be as valid and effectual as if it were issued under sub section (3) of section 1 of the principal Act as amended by this ordinance and all instructions and orders issued or made and all actions taken or things done pursuant to the said Notification in respect of sale, purchase and collection of sal seeds shall be deemed to have been validly made, taken or done under the principal Act as amended by this ordinance." Section 2(c) of the Act has now been enlarged to include forest produce whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests Section 5 of the Act has been amended to nullify all existing private contracts in relation to specified forest produce.
It reads: "5.
Restriction on the purchase and transport and rescission of subsisting contracts.
(1) on the issue of a notification under sub section (3) of section 1 in respect of any area (a) All contracts for purchase, sale gathering or collection of specified forest produce grown or found in the said area shall stand rescinded, whether such forest produce is grown or found on land owned by the State Government or in Government forests, (b) No person, other than (i) the State Government, (ii) an officer of the State Government authorised in writing in that behalf; or (iii) an agent in respect of the unit in which the specified forest produce is grown or found shall purchase or transport any specified forest produce in the said area.
323 Section 5 would come into effect only upon the notification issued by the Government under Section 1(3) of the Act.
The Government has not issued a fresh notification under Section (3) so far as sal seeds are concerned.
But the ordinance itself by Section 5 purports to validate the notification issued by the Government on December 9, 1982 the legality of which we will presently consider.
Mr. Nariman, learned Counsel for the petitioners, contended that the object and drift of the Act was to provide state monopoly in specified forest produce only to prevent smuggling and the notification dated December 9, 1982 was extraneous to the purpose of the Act.
In support of the contention, the Counsel relied upon the Statement of objects and Roasons of the Act, the ordinance and Industrial Policy of the State Government.
We do not think that the purpose of the Act or the ordinance was to provide State monopoloy only to prevent smuggling.
Even in the previous decision of this Court, it was observed that the object of the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce.
The Preamble of the Act which is a key to the enactment is also clear on the object.
It reads: "An Act to provide for control and regulation of trade in certain forest produce by creation of State monopoly in such trade " Secondly, the validity of the statutory notification cannot be judged merely on the basis of statement of objects and reasons accompanying the Bill.
Nor it could be tested by the Government policy taken from time to time.
The executive policy of the Government, or the Statement of objects and reasons of the Act or ordinance cannot control the actual words used in the legislation.
In the Central Bank of India vs Their Workmen, [ ; section K., Das.
J. said: "The statement of objects and reasons is not admissible, however, for construing the section; far less can it control the actual words used." In State of West Bengal vs Union of India, [ 1964] 1 SCR 371 at p. 382.
Sinha, C.J. Observed: "It is however well settled that the Statement of objects and reasons accompanying a bill, when introduced in Parliament cannot be used to determine the true meaning and effect of substantive provisions of the statute.
They 324 cannot be used except for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation.
But we cannot use this statement as an aid to the construction of the enactment or to how that the legislature did not intend to acquire the proprietary rights vested in the State or in any way to affect the State Governments ' rights as owner of minerals.
A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeita a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the Statute.
" The petitioners cannot also contend that the annulment of their contracts and the restrictions brought about on their rights to trade are unreasonable or arbitrary.
Such restrictions must be presumed to be reasonable and in the interest of general public.
It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service.
The State may enter into trade like any other person either for administrative reasons or with the object of mitigating the evils in the trade, or even for the purpose of making profits in order to enrich the State exchequer.
The law relating to such trading activities must be presumed to be reasonable and in the interest of general public.
That was the view taken by this Court in Akadasi Padhan vs State of Orissa, [1963] 2 Supp.
SCR 691 where it was observed that the law relating to such state monopoly should be presumed to be reasonable and in the interest of general public within the scope of Article 19(6)(ii) of the Constitution.
As to the contention of Mr. Nariman, that the provisions of the Act and the Rules made thereunder do not bar future contracts the like of which the petitioners are having, we may say that it would be impermissible for the State to enter into such contracts hereafterwards.
The parties or Agents employed by the State cannot work for their own benefits.
They must work on behalf of the State.
That is what has been stated in Akadasi Padhan vs State of orissa, (Supra).
"It seems to us that when the State carries on any trade, business or industry it must inevitably carry it on either departmentally or through its officers appointed in that be half.
In the very nature of things, the States as such, cannot function without the help of its servants or employees and 325 that inevitably introduce the concept.
Of agency in a narrow and limited sense.
If the State cannot act without the aid and assistance of its employees or servants, it would be difficult to exclude the concept of agency altogether.
Just as the State can appoint a public officer to carry on the trade or its business so can it appoint an agent to carry on the trade on its behalf.
Normally and ordinarily, the trade should be carried on departmentally or with the assistance of public servants appointed in that behalf.
But there may be some trade or business in which it would be inexpendient to undertake the work of trade or business department or with the assistance of State servants.
In such cases, it would be open to the State to employ the services of agents, provided the agents work on behalf of the State and not for themselves.
" The next question to be considered is whether the State while purporting to amend the Act has encroached upon the judicial power and set aside the binding judgment of this Court.
We do not think that Mr. Nariman was justified in contending so.
The principles have been well established in a string of decisions of this Court, and we may briefly summarise as follows: The legsilature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law.
There is no prohibition against retrospective legislation.
The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively.
That of course, is subject to the legislative competence and subject to other constitutional limitation.
The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a well known pattern of all validating acts.
Such validating legislation which removes the causes of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power.
The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision.
[Hari Singh & ors.
vs The Military Estate officer & Anr., [ 19731 1 SCR 515; Government of Andhra Pradesh & Anr.
vs Hindustan Tools Ltd., 11975] Supp.
SCR 394; V.N. Saxena vs State of M.P.; , 326 and Misri Lal Jain Etc.
vs State of Orissa & Anr.
, [ ] In the instant case having regard to the then existing provisions of the Act, this Court declare.
that the Act and notification issued thereunder in relation to sal seeds did not apply to sal seeds grown in Government forests.
The Act has been suitably amended by the impugned ordinance by removing the cause of ineffectiveness pointed out by this Court.
The new provisions would now cover specified forest produce whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests and the contracts relating thereto.
Such contracts shall stand rescinded when a notification under Section 1(3) of the Act is issued.
What remains to be considered is, whether it is necessary for the Government to issue a fresh notification under Section 1(3) of the Act.
Mr. Nariman contended that the notification issued on December 9, 1982 was held to be applicable only to sal seeds grown in the private holdings, and in the absence of amendment to section 1(3), the validation of such a notification would not be effective to nullify the con tracts which the petitioners are having.
It was also urged that the notification was "still born" and could not have been validated.
We are unable to accept this contention also.
The definition of "forest produce" under Section 2(c) has been enlarged to include among others, sal seeds, grown or found on Government lands or in Government forests.
Clause (a) of Sub section (1) of Section 5 has been substituted covering all contracts for the purchase, sale, gathering or collection or 'specified forest produce ' grown or found.
in the area specified in the notification issued under Section 1(3) of the Act.
Both these provisions shall be deemed to have come into force with effect from September S, 1981 the date on which the Act had come into F; force.
The notification dated December 9, 1982 issued under Section 1(3) of the Act reads: "SRO No. 852/82 In exercise of the powers conferred by sub section(3) of Section 1 of the Orissa Forest Produce (Control of Trade) Act, 1981 (orissa Act 22 of 1981), the State Government do hereby direct that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds. " This notification has been validated under Section 5 of the ordinance not withstanding any judgment, decree or order of any Court to the contrary.
It shall be deemed to have been issued in respect of sal 327 seeds also grown or found in Government forests.
It shall be valid and effectual as if it were issued under Section 1(3) of the Act as amended by the ordinance.
This validation, in our opinion is more than sufficient to make it operative to cover the contracts of the petitioners.
It does not suffer from any infirmity.
The impugned ordinance is, therefore, valid and cannot be challenged on any ground.
In the result, these petitions fail and are dismissed, but we make to order as to costs.
N.P.V. Petitions dismissed.
|
The Orissa Forest Produce (Control of Trade) Act, 1981 was enacted to prevent smuggling forest produce and also to provide State monopoly in such forest produce.
The State was empowered under section 1(3) of the Act, from time to time to issue a notification specifying the area or areas, the forest produce in relation to which and the date from which the Act shall come into force.
The State Government issued a notification dated December 9, 1982 directing that the Act shall come into force at once in the whole of the State of Orrisa in relation to sal seeds The petitioners were holders of long term license from the Government for collection of sal seeds from certain specified forest 315 divisions on payment of royalty.
Consequent upon the issue of the above notification, the Government refused to accept royalty from the petitioners in respect of certain forest divisions on the ground that the notification had the effect of rescinding the existing contracts between the Government and the petitioners.
The petitioners thereupon filed writ petitions before the High Court for a declaration that the above notification was void, and did not have the effect of rescinding their contracts in relation to sal seeds.
The High Court dismissed the writ petitions.
The Supreme Court, allowing the appeals of the petitioners, held that the Act and the notification issued thereunder did not apply to forest produce grown in Government forests and that it was not, therefore, open to the Government to treat the contract dated May 25,1979.
as rescinded.
On May 29, 1987, the Governor of Orissa promulgated orissa Forest Produce (Control of Trade) (Amendment and Validation) ordinance 1987 deeming it to have come into force with effect from September 5,1981, when the principal Act was notified in the Gazette, rendering the aforesaid decision ineffective.
The petitioners challenged the validity of this ordinance in this Court.
Dismissing the writ petitions, this Court, ^ HELD: 1.1.
The impugned ordinance is valid and cannot be challenged on any ground.
[327B] 1.2 The object to the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce and not to provide State monopoly only to prevent smuggling.
The validity of the statutory notification cannot be judged merely on the basis of statement of objects and reasons accompanying the Bill.
Nor could it be tested by the Government policy from time to time.
[318B] The executive policy of the Government or the statement of objects and reasons of the Act or ordinances cannot control the words used in the legislation.
[323F] Central Bank of India vs Their Workmen, ; and State of West Bengal vs Union of India, [1964] 1 SCR 371 at p. 382, relied on.
316 1.3 It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service.
The State may enter into trade like any other person either for administrative reasons or with the object of mitigating the evils in the trade, or even for the purpose of making profits in order to enrich the State exchequer.
The law relating to such trading activities must be presumed to be reasonable and in the interest of general public.
[324D E] Akadasi Padhan vs State of Orissa, [19631 2 Supp.
SCR 691, relied on.
1.4 The legislature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law.
There is no prohibition against retrospective legislation.
The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively, subject, of course, to the legislative competence and other constitutional limitation.
[325E F] 1.5 The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a wellknown pattern of all validating acts.
Such validating legislation which removes the cause of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power.
The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision.
[325F G] In the instant case, having regard to the then existing provisions of the Act, this Court declared that the Act and notification issued thereunder in relation to sal seeds did not apply to sal seeds grown in Government forests.
The Act has been suitably amended by the impugned ordinance by removing the cause of ineffectiveness pointed out by this Court.
The definition of "forest produce" under section 2(c) has been enlarged to include, among others, sal seeds, grown or found on Government lands or in Government forests.
Clause (a) of subsection (1) of section 5 has been substituted covering all contracts for the purchase, sale, gathering or collection of 'specified forest produce ' grown or found in the area specified in the notification issued under section 1(3) of the Act.
Such contracts shall stand rescinded when a notification under section 1(3) of the Act is issued.
Both these provisions shall be deemed to have come into force with effect from September 5, 1981, the date on which the Act had come into force.
[326A B, E F] 317 The notification dated December 9, 1982 has been validated under A section 5 of the ordinance notwithstanding any judgment, decree or order of any Court to the contrary.
It shall be deemed to have been issued in respect of sal seeds also grown or found in Government forests.
lt shall be valid and effectual as if it were issued under section 1(3) of the Act as amended by the ordinance.
This validation is more than sufficient to make it operative to cover the contracts of the petitioners.
It does not suffer from any infirmity.
[326H; 327A B] 1.6 It would be impermissible for the State to enter into such contracts in future.
The parties or Agents employed by the State cannot work for their own benefits.
They must work on behalf of the State.
[324F G ] Utkal Contractors & Joinery Pvt. Ltd. and Ors.
vs State of Orrisa & ors.
, AIR 1987 SC 1455 [1987] 3 SCC 279; Hari Singh & ors.
vs The Military Estate officer & Anr., [19731 1 SCR 515;Government of Andhra Pradesh & Anr.
vs Hindustan Tools Ltd., 119751 Supp.
SCR 394; V.N. Saxena vs State of M.P., ; and Misri Lal Jain Etc.
vs State of Orissa & Anr.
, ; , referred to.
|
tition Nos 7597 99 of 1983.
And Writ Petition Nos.
7606 09 of 1983.
(Under Article 32 of the Constitution of India).
A.K. Sen, F.S. Nariman, S.N. Kacker, A.K. Ganguli, R.F. Nariman, A. Patnaik and M.M. Kshatriya for the Petitioners.
F Shanti Bhushan, S.N. Chatterjee, G.L. Sanghi, Dr. Y.S. Chitale, G. Rath, Advocate General, R.K. Patra, R.K. Mehta and H. K .
Puri for the Respondents.
The Judgment of the Court was delivered by G JAGANNATHA SHETTY, J.
"Sal seed" which is a minor forest produce at Orissa has again become the major subject of litigation between commercial users and the State of orissa.
The petitioners herein are holders of long term license from the 318 Government of orissa for collection of sal seeds from certain A specified forest divisions on payment of royalty.
The State of orissa enacted Orissa Forest.
Produce (Control of Trade) Act, 1981 (The "Act").
It received the assent of President on August 21, 1981.
The object of the Act was to prevent smuggling forest and also to provide State monopoly in such forest produce.
Under Section 1(3) }3 of the Act the State is empowered from time to time to issue a notification specifying the area or areas the forest produce in relation to which and the date from which the Act shall come into force.
Purporting to act under this provision a notification dated December 9.
1982 was issued by the State Government directing that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds.
Thereafter, the Government refused to accept royalty from the petitioners in respect of certain forest divisions on the ground that the notification had the effect of rescinding the existing contracts between the Government and the petitioners.
The petitioners thereupon moved the orissa High Court with Writ Petitions for declaration that the said notification was void and did not have the effect of rescinding their contracts in relation to sal seeds.
The orissa High Court dismissed the Writ Petitions.
The matter was brought before this Court in Civil Appeal Nos.
6230 31 of 1983.
This Court allowed the appeals by judgment dated May 5, 1987.
which has been since reported in Utkal Contractors & Joinery Pvt. Ltd. and ors.
vs State of orissa and ors.
, AIR 1987 SC 1455 = ; The nub of the arguments in those appeals was that the Act was not concerned with the sal seeds grown in the Government lands or Government Forests, and in any event, the petitioners ' contract remained untouched by the notification dated December 9, 1982.
It was also contended that since the Government was already the owner of forest produce in Government lands, all that was necessary to create a State monopoly in any forest produce, was to vest in the Government the exclusive right to such forest produce grown in private holding.
After dealing with the object of the Act and relevant provisions, a bench of this Court consisting one of us (o. Chinnappa Reddy, J.) said: "Thus none of these provisions deals with forest produce grown in Government lands nor is there any other provision in the Act which expressly deals with forest produce grown in Government lands.
The scheme of the Act is, 319 therefore, fully in tune with the object set out in the Statement of objects and Reasons and in the Preamble, namely that of creating a monopoly in forest produce by making the Government the exclusive purchaser of forest produce grown in private holdings.
It as argued by the learned Additional Solicitor General that section 5(1)(1) was totally out of tune with the rest of the provisions and, while the rest of the provisions dealt with forest produce grown in private holdings the very wide language of section S(1)(a) made it applicable to all forest produce whether grown in private holdings or Government forests.
We do not think that it is permissible for us to construe section 5(1)(a) in the very wide terms in which we are asked to construe it by the learned Additional Solicitor General because of its wide language, as that would merely introduce needless confusion into the scheme of the Act.
Having scanned the object and the scheme of the Act, having examined each of the provisions of the Act textually and contextually, we do not think it is proper for us to construe the words of section S(1)(a) in their literal sense; we think that the proper way to construe.
section 5(1)(a) is to give a restricted meaning to the wide and general words there used so as to fit into the general scheme of the Act and section 5(1)(b) are concerned by the conjunction 'and ', and having regard to the circumstances leading to the enactment and the policy and design of the Act, we think that clauses (a) and (b) must be construed in such a way as to reflect each other.
We have no doubt that the contracts relating to specified forest produce which stand rescinded are contracts in relation to forest produce grown in private holdings only.
If the very object of the Act is to create a monopoly in forest produce in the Government so as enable the Government, among other things, to enter into contracts, there was no point in rescinding contracts already validly entered into by the Government.
Again section 5(1) does not bar any future contracts by the Government in respect of forest produce; if so, what is the justification for construing section 5(1) in such a way as to put an end to contracts already entered into by the Government.
Viewing section 5(1)(a) and 5(1)(b) together and in the light of the preamble and the Statement of objects and Reasons and against the decor of the remaining provisions of the Act, we have no doubt that section 5(1) like the rest of the provisions applied to forest produce grown in private hold 320 ings and not to forest produce grown in Government landS. " Then the conclusion was expressed in the following terms: "We declare that the Act and the notification issued under the Act do not apply to forest produce grown in Government forests and that it was not, therefore, open to the Government to treat the contract dated May 25, 1979, as rescinded.
" On May 29, 1987, the Governor of (Orissa promulgated orissa Forest Produce (Control of Trade) (Amendment and Validation) ordinance, 1987, (The "ordinance").
The ordinance shall be deemed to have come into force with effect from September 5, 1981 when the principal Act was notified in the Orissa Gazette.
The ordinance purports to render the aforesaid decision ineffective.
The petitioners have again approached this Court challenging the validity of the ordinance.
Before we examine the contentions raised in these petitions, lt will be useful to set out the provisions of ordinance: "(2) It shall be deemed to have come into force on the date on which the Orissa Forest Produce (Control of Trade) Act 1981 (hereinafter referred to as the principal Act) had come into force, i.e. 5.9.1981 when the principal Act was notified in the orissa Gazette.
2. 3 In clause (c) section 2 of the principal Act, the full stop at the end of the clause shall be substituted by a comma and thereafter the following shall be added at the end, namely: "Whether grown or found on land owned by private persons or on land owned by the State Government (j, or in Government forests.
In Section 5 of the principal Act, in sub section (1) (1) "(i) for clause (a) the following clause shall be substituted, namely: 321 "(a) all contracts for the purchase, sale, gathering or collection of specified forest produce grown or found in the said area shall stand rescinded, whether such forest produce is grown or found on land owned by private persons or on land owned by the State Government or in Government forests.
" (ii) After Explanation III, the following Explanation shall be added, namely: "Explanation IV The Explanations I to III shall be deemed to be explanations to clause (b) of this sub section only and shall not be deemed as in any manner qualifying or detracting from clause (a) of this sub section or saving any contracts referred to in clause (a) from the operation of the provision for recission of contracts contained in the said clause (a)".
In section 9 of the principal Act for sub section (4) the following sub section shall be substituted namely: "(4) The State Government or its authorised officer or agent shall be entitled to take delivery of any specified forest produce collected by any person from land owned by the State Government or Government Forests on payment of only such collection charges as may be determined by the State Government from time to time.
Provided that it shall be open to the State Government or the authorised officer or agent to refuse to take delivery of any such forest produce which is not fit for consumption or use as raw material for manufacture or for trade: Provided further that in the case of any dispute, the Divisional Forest officer or such other officer who may be specifically empowered in this behalf, as specified in sub section (2), shall hear and dispose of the same in the manner provided in this Act and the Rules made thereunder. " 5.Notwithstanding any judgment, decree or order of any Court to the contrary, the Notification dated the 9th 322 December, 1982, issued by the State Government under sub section (3) of section 1 of the principal Act in respect of sal seeds shall be deemed to have been issued in respect of sal seeds whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests and shall be as valid and effectual as if it were issued under sub section (3) of section 1 of the principal Act as amended by this ordinance and all instructions and orders issued or made and all actions taken or things done pursuant to the said Notification in respect of sale, purchase and collection of sal seeds shall be deemed to have been validly made, taken or done under the principal Act as amended by this ordinance." Section 2(c) of the Act has now been enlarged to include forest produce whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests Section 5 of the Act has been amended to nullify all existing private contracts in relation to specified forest produce.
It reads: "5.
Restriction on the purchase and transport and rescission of subsisting contracts.
(1) on the issue of a notification under sub section (3) of section 1 in respect of any area (a) All contracts for purchase, sale gathering or collection of specified forest produce grown or found in the said area shall stand rescinded, whether such forest produce is grown or found on land owned by the State Government or in Government forests, (b) No person, other than (i) the State Government, (ii) an officer of the State Government authorised in writing in that behalf; or (iii) an agent in respect of the unit in which the specified forest produce is grown or found shall purchase or transport any specified forest produce in the said area.
323 Section 5 would come into effect only upon the notification issued by the Government under Section 1(3) of the Act.
The Government has not issued a fresh notification under Section (3) so far as sal seeds are concerned.
But the ordinance itself by Section 5 purports to validate the notification issued by the Government on December 9, 1982 the legality of which we will presently consider.
Mr. Nariman, learned Counsel for the petitioners, contended that the object and drift of the Act was to provide state monopoly in specified forest produce only to prevent smuggling and the notification dated December 9, 1982 was extraneous to the purpose of the Act.
In support of the contention, the Counsel relied upon the Statement of objects and Roasons of the Act, the ordinance and Industrial Policy of the State Government.
We do not think that the purpose of the Act or the ordinance was to provide State monopoloy only to prevent smuggling.
Even in the previous decision of this Court, it was observed that the object of the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce.
The Preamble of the Act which is a key to the enactment is also clear on the object.
It reads: "An Act to provide for control and regulation of trade in certain forest produce by creation of State monopoly in such trade " Secondly, the validity of the statutory notification cannot be judged merely on the basis of statement of objects and reasons accompanying the Bill.
Nor it could be tested by the Government policy taken from time to time.
The executive policy of the Government, or the Statement of objects and reasons of the Act or ordinance cannot control the actual words used in the legislation.
In the Central Bank of India vs Their Workmen, [ ; section K., Das.
J. said: "The statement of objects and reasons is not admissible, however, for construing the section; far less can it control the actual words used." In State of West Bengal vs Union of India, [ 1964] 1 SCR 371 at p. 382.
Sinha, C.J. Observed: "It is however well settled that the Statement of objects and reasons accompanying a bill, when introduced in Parliament cannot be used to determine the true meaning and effect of substantive provisions of the statute.
They 324 cannot be used except for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation.
But we cannot use this statement as an aid to the construction of the enactment or to how that the legislature did not intend to acquire the proprietary rights vested in the State or in any way to affect the State Governments ' rights as owner of minerals.
A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeita a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the Statute.
" The petitioners cannot also contend that the annulment of their contracts and the restrictions brought about on their rights to trade are unreasonable or arbitrary.
Such restrictions must be presumed to be reasonable and in the interest of general public.
It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service.
The State may enter into trade like any other person either for administrative reasons or with the object of mitigating the evils in the trade, or even for the purpose of making profits in order to enrich the State exchequer.
The law relating to such trading activities must be presumed to be reasonable and in the interest of general public.
That was the view taken by this Court in Akadasi Padhan vs State of Orissa, [1963] 2 Supp.
SCR 691 where it was observed that the law relating to such state monopoly should be presumed to be reasonable and in the interest of general public within the scope of Article 19(6)(ii) of the Constitution.
As to the contention of Mr. Nariman, that the provisions of the Act and the Rules made thereunder do not bar future contracts the like of which the petitioners are having, we may say that it would be impermissible for the State to enter into such contracts hereafterwards.
The parties or Agents employed by the State cannot work for their own benefits.
They must work on behalf of the State.
That is what has been stated in Akadasi Padhan vs State of orissa, (Supra).
"It seems to us that when the State carries on any trade, business or industry it must inevitably carry it on either departmentally or through its officers appointed in that be half.
In the very nature of things, the States as such, cannot function without the help of its servants or employees and 325 that inevitably introduce the concept.
Of agency in a narrow and limited sense.
If the State cannot act without the aid and assistance of its employees or servants, it would be difficult to exclude the concept of agency altogether.
Just as the State can appoint a public officer to carry on the trade or its business so can it appoint an agent to carry on the trade on its behalf.
Normally and ordinarily, the trade should be carried on departmentally or with the assistance of public servants appointed in that behalf.
But there may be some trade or business in which it would be inexpendient to undertake the work of trade or business department or with the assistance of State servants.
In such cases, it would be open to the State to employ the services of agents, provided the agents work on behalf of the State and not for themselves.
" The next question to be considered is whether the State while purporting to amend the Act has encroached upon the judicial power and set aside the binding judgment of this Court.
We do not think that Mr. Nariman was justified in contending so.
The principles have been well established in a string of decisions of this Court, and we may briefly summarise as follows: The legsilature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law.
There is no prohibition against retrospective legislation.
The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively.
That of course, is subject to the legislative competence and subject to other constitutional limitation.
The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a well known pattern of all validating acts.
Such validating legislation which removes the causes of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power.
The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision.
[Hari Singh & ors.
vs The Military Estate officer & Anr., [ 19731 1 SCR 515; Government of Andhra Pradesh & Anr.
vs Hindustan Tools Ltd., 11975] Supp.
SCR 394; V.N. Saxena vs State of M.P.; , 326 and Misri Lal Jain Etc.
vs State of Orissa & Anr.
, [ ] In the instant case having regard to the then existing provisions of the Act, this Court declare.
that the Act and notification issued thereunder in relation to sal seeds did not apply to sal seeds grown in Government forests.
The Act has been suitably amended by the impugned ordinance by removing the cause of ineffectiveness pointed out by this Court.
The new provisions would now cover specified forest produce whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests and the contracts relating thereto.
Such contracts shall stand rescinded when a notification under Section 1(3) of the Act is issued.
What remains to be considered is, whether it is necessary for the Government to issue a fresh notification under Section 1(3) of the Act.
Mr. Nariman contended that the notification issued on December 9, 1982 was held to be applicable only to sal seeds grown in the private holdings, and in the absence of amendment to section 1(3), the validation of such a notification would not be effective to nullify the con tracts which the petitioners are having.
It was also urged that the notification was "still born" and could not have been validated.
We are unable to accept this contention also.
The definition of "forest produce" under Section 2(c) has been enlarged to include among others, sal seeds, grown or found on Government lands or in Government forests.
Clause (a) of Sub section (1) of Section 5 has been substituted covering all contracts for the purchase, sale, gathering or collection or 'specified forest produce ' grown or found.
in the area specified in the notification issued under Section 1(3) of the Act.
Both these provisions shall be deemed to have come into force with effect from September S, 1981 the date on which the Act had come into F; force.
The notification dated December 9, 1982 issued under Section 1(3) of the Act reads: "SRO No. 852/82 In exercise of the powers conferred by sub section(3) of Section 1 of the Orissa Forest Produce (Control of Trade) Act, 1981 (orissa Act 22 of 1981), the State Government do hereby direct that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds. " This notification has been validated under Section 5 of the ordinance not withstanding any judgment, decree or order of any Court to the contrary.
It shall be deemed to have been issued in respect of sal 327 seeds also grown or found in Government forests.
It shall be valid and effectual as if it were issued under Section 1(3) of the Act as amended by the ordinance.
This validation, in our opinion is more than sufficient to make it operative to cover the contracts of the petitioners.
It does not suffer from any infirmity.
The impugned ordinance is, therefore, valid and cannot be challenged on any ground.
In the result, these petitions fail and are dismissed, but we make to order as to costs.
N.P.V. Petitions dismissed.
|
(Under Article 32 of the Constitution of India). A.K. Sen, F.S. Nariman, S.N. Kacker, A.K. Ganguli, R.F. Nariman, A. Patnaik and M.M. Kshatriya for the Petitioners. F Shanti Bhushan, S.N. Chatterjee, G.L. Sanghi, Dr. Y.S. Chitale, G. Rath, Advocate General, R.K. Patra, R.K. Mehta and H. K . The Judgment of the Court was delivered by G JAGANNATHA SHETTY, J.
"Sal seed" which is a minor forest produce at Orissa has again become the major subject of litigation between commercial users and the State of orissa. The petitioners herein are holders of long term license from the 318 Government of orissa for collection of sal seeds from certain A specified forest divisions on payment of royalty. The State of orissa enacted Orissa Forest. Produce (Control of Trade) Act, 1981 (The "Act"). It received the assent of President on August 21, 1981. The object of the Act was to prevent smuggling forest and also to provide State monopoly in such forest produce. Under Section 1(3) }3 of the Act the State is empowered from time to time to issue a notification specifying the area or areas the forest produce in relation to which and the date from which the Act shall come into force. Purporting to act under this provision a notification dated December 9. 1982 was issued by the State Government directing that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds. Thereafter, the Government refused to accept royalty from the petitioners in respect of certain forest divisions on the ground that the notification had the effect of rescinding the existing contracts between the Government and the petitioners. The orissa High Court dismissed the Writ Petitions. The matter was brought before this Court in Civil Appeal Nos. This Court allowed the appeals by judgment dated May 5, 1987. which has been since reported in Utkal Contractors & Joinery Pvt. It was also contended that since the Government was already the owner of forest produce in Government lands, all that was necessary to create a State monopoly in any forest produce, was to vest in the Government the exclusive right to such forest produce grown in private holding. After dealing with the object of the Act and relevant provisions, a bench of this Court consisting one of us (o. Chinnappa Reddy, J.) said: "Thus none of these provisions deals with forest produce grown in Government lands nor is there any other provision in the Act which expressly deals with forest produce grown in Government lands. We do not think that it is permissible for us to construe section 5(1)(a) in the very wide terms in which we are asked to construe it by the learned Additional Solicitor General because of its wide language, as that would merely introduce needless confusion into the scheme of the Act. We have no doubt that the contracts relating to specified forest produce which stand rescinded are contracts in relation to forest produce grown in private holdings only. If the very object of the Act is to create a monopoly in forest produce in the Government so as enable the Government, among other things, to enter into contracts, there was no point in rescinding contracts already validly entered into by the Government. " On May 29, 1987, the Governor of (Orissa promulgated orissa Forest Produce (Control of Trade) (Amendment and Validation) ordinance, 1987, (The "ordinance"). The ordinance shall be deemed to have come into force with effect from September 5, 1981 when the principal Act was notified in the Orissa Gazette. The ordinance purports to render the aforesaid decision ineffective. The petitioners have again approached this Court challenging the validity of the ordinance. In Section 5 of the principal Act, in sub section (1) (1) "(i) for clause (a) the following clause shall be substituted, namely: 321 "(a) all contracts for the purchase, sale, gathering or collection of specified forest produce grown or found in the said area shall stand rescinded, whether such forest produce is grown or found on land owned by private persons or on land owned by the State Government or in Government forests. " (ii) After Explanation III, the following Explanation shall be added, namely: "Explanation IV The Explanations I to III shall be deemed to be explanations to clause (b) of this sub section only and shall not be deemed as in any manner qualifying or detracting from clause (a) of this sub section or saving any contracts referred to in clause (a) from the operation of the provision for recission of contracts contained in the said clause (a)". Section 2(c) of the Act has now been enlarged to include forest produce whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests Section 5 of the Act has been amended to nullify all existing private contracts in relation to specified forest produce. Restriction on the purchase and transport and rescission of subsisting contracts. 323 Section 5 would come into effect only upon the notification issued by the Government under Section 1(3) of the Act. The Government has not issued a fresh notification under Section (3) so far as sal seeds are concerned. But the ordinance itself by Section 5 purports to validate the notification issued by the Government on December 9, 1982 the legality of which we will presently consider. Mr. Nariman, learned Counsel for the petitioners, contended that the object and drift of the Act was to provide state monopoly in specified forest produce only to prevent smuggling and the notification dated December 9, 1982 was extraneous to the purpose of the Act. We do not think that the purpose of the Act or the ordinance was to provide State monopoloy only to prevent smuggling. Even in the previous decision of this Court, it was observed that the object of the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce. The Preamble of the Act which is a key to the enactment is also clear on the object. It reads: "An Act to provide for control and regulation of trade in certain forest produce by creation of State monopoly in such trade " Secondly, the validity of the statutory notification cannot be judged merely on the basis of statement of objects and reasons accompanying the Bill. Nor it could be tested by the Government policy taken from time to time. The executive policy of the Government, or the Statement of objects and reasons of the Act or ordinance cannot control the actual words used in the legislation. In the Central Bank of India vs Their Workmen, [ ; section K., Das. J. said: "The statement of objects and reasons is not admissible, however, for construing the section; far less can it control the actual words used." In State of West Bengal vs Union of India, [ 1964] 1 SCR 371 at p. 382. They 324 cannot be used except for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation. A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeita a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the Statute. " The petitioners cannot also contend that the annulment of their contracts and the restrictions brought about on their rights to trade are unreasonable or arbitrary. Such restrictions must be presumed to be reasonable and in the interest of general public. It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service. The State may enter into trade like any other person either for administrative reasons or with the object of mitigating the evils in the trade, or even for the purpose of making profits in order to enrich the State exchequer. The law relating to such trading activities must be presumed to be reasonable and in the interest of general public. That was the view taken by this Court in Akadasi Padhan vs State of Orissa, [1963] 2 Supp. SCR 691 where it was observed that the law relating to such state monopoly should be presumed to be reasonable and in the interest of general public within the scope of Article 19(6)(ii) of the Constitution. As to the contention of Mr. Nariman, that the provisions of the Act and the Rules made thereunder do not bar future contracts the like of which the petitioners are having, we may say that it would be impermissible for the State to enter into such contracts hereafterwards. The parties or Agents employed by the State cannot work for their own benefits. That is what has been stated in Akadasi Padhan vs State of orissa, (Supra). "It seems to us that when the State carries on any trade, business or industry it must inevitably carry it on either departmentally or through its officers appointed in that be half. In the very nature of things, the States as such, cannot function without the help of its servants or employees and 325 that inevitably introduce the concept. If the State cannot act without the aid and assistance of its employees or servants, it would be difficult to exclude the concept of agency altogether. Just as the State can appoint a public officer to carry on the trade or its business so can it appoint an agent to carry on the trade on its behalf. Normally and ordinarily, the trade should be carried on departmentally or with the assistance of public servants appointed in that behalf. But there may be some trade or business in which it would be inexpendient to undertake the work of trade or business department or with the assistance of State servants. In such cases, it would be open to the State to employ the services of agents, provided the agents work on behalf of the State and not for themselves. " The next question to be considered is whether the State while purporting to amend the Act has encroached upon the judicial power and set aside the binding judgment of this Court. We do not think that Mr. Nariman was justified in contending so. The principles have been well established in a string of decisions of this Court, and we may briefly summarise as follows: The legsilature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law. There is no prohibition against retrospective legislation. The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively. That of course, is subject to the legislative competence and subject to other constitutional limitation. The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a well known pattern of all validating acts. Such validating legislation which removes the causes of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power. The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision. 19731 1 SCR 515; Government of Andhra Pradesh & Anr. SCR 394; V.N. Saxena vs State of M.P.; , 326 and Misri Lal Jain Etc. , [ ] In the instant case having regard to the then existing provisions of the Act, this Court declare. that the Act and notification issued thereunder in relation to sal seeds did not apply to sal seeds grown in Government forests. The Act has been suitably amended by the impugned ordinance by removing the cause of ineffectiveness pointed out by this Court. The new provisions would now cover specified forest produce whether grown or found on land owned by private persons or on land owned by the State Government or in Government forests and the contracts relating thereto. Such contracts shall stand rescinded when a notification under Section 1(3) of the Act is issued. What remains to be considered is, whether it is necessary for the Government to issue a fresh notification under Section 1(3) of the Act. It was also urged that the notification was "still born" and could not have been validated. We are unable to accept this contention also. The definition of "forest produce" under Section 2(c) has been enlarged to include among others, sal seeds, grown or found on Government lands or in Government forests. Clause (a) of Sub section (1) of Section 5 has been substituted covering all contracts for the purchase, sale, gathering or collection or 'specified forest produce ' grown or found. in the area specified in the notification issued under Section 1(3) of the Act. Both these provisions shall be deemed to have come into force with effect from September S, 1981 the date on which the Act had come into F; force. The notification dated December 9, 1982 issued under Section 1(3) of the Act reads: "SRO No. 852/82 In exercise of the powers conferred by sub section(3) of Section 1 of the Orissa Forest Produce (Control of Trade) Act, 1981 (orissa Act 22 of 1981), the State Government do hereby direct that the Act shall come into force at once in the whole of the State of Orissa in relation to sal seeds. " This notification has been validated under Section 5 of the ordinance not withstanding any judgment, decree or order of any Court to the contrary. It shall be deemed to have been issued in respect of sal 327 seeds also grown or found in Government forests. It shall be valid and effectual as if it were issued under Section 1(3) of the Act as amended by the ordinance. This validation, in our opinion is more than sufficient to make it operative to cover the contracts of the petitioners. The impugned ordinance is, therefore, valid and cannot be challenged on any ground. In the result, these petitions fail and are dismissed, but we make to order as to costs.
|
The Orissa Forest Produce (Control of Trade) Act, 1981 was enacted to prevent smuggling forest produce and also to provide State monopoly in such forest produce.
The State was empowered under section 1(3) of the Act, from time to time to issue a notification specifying the area or areas, the forest produce in relation to which and the date from which the Act shall come into force.
The State Government issued a notification dated December 9, 1982 directing that the Act shall come into force at once in the whole of the State of Orrisa in relation to sal seeds The petitioners were holders of long term license from the Government for collection of sal seeds from certain specified forest 315 divisions on payment of royalty.
Consequent upon the issue of the above notification, the Government refused to accept royalty from the petitioners in respect of certain forest divisions on the ground that the notification had the effect of rescinding the existing contracts between the Government and the petitioners.
The petitioners thereupon filed writ petitions before the High Court for a declaration that the above notification was void, and did not have the effect of rescinding their contracts in relation to sal seeds.
The High Court dismissed the writ petitions.
The Supreme Court, allowing the appeals of the petitioners, held that the Act and the notification issued thereunder did not apply to forest produce grown in Government forests and that it was not, therefore, open to the Government to treat the contract dated May 25,1979.
as rescinded.
On May 29, 1987, the Governor of Orissa promulgated orissa Forest Produce (Control of Trade) (Amendment and Validation) ordinance 1987 deeming it to have come into force with effect from September 5,1981, when the principal Act was notified in the Gazette, rendering the aforesaid decision ineffective.
The petitioners challenged the validity of this ordinance in this Court.
Dismissing the writ petitions, this Court, ^ HELD: 1.1.
The impugned ordinance is valid and cannot be challenged on any ground.
[327B] 1.2 The object to the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce and not to provide State monopoly only to prevent smuggling.
The validity of the statutory notification cannot be judged merely on the basis of statement of objects and reasons accompanying the Bill.
Nor could it be tested by the Government policy from time to time.
[318B] The executive policy of the Government or the statement of objects and reasons of the Act or ordinances cannot control the words used in the legislation.
[323F] Central Bank of India vs Their Workmen, ; and State of West Bengal vs Union of India, [1964] 1 SCR 371 at p. 382, relied on.
316 1.3 It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service.
The State may enter into trade like any other person either for administrative reasons or with the object of mitigating the evils in the trade, or even for the purpose of making profits in order to enrich the State exchequer.
The law relating to such trading activities must be presumed to be reasonable and in the interest of general public.
[324D E] Akadasi Padhan vs State of Orissa, [19631 2 Supp.
SCR 691, relied on.
1.4 The legislature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law.
There is no prohibition against retrospective legislation.
The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively, subject, of course, to the legislative competence and other constitutional limitation.
[325E F] 1.5 The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a wellknown pattern of all validating acts.
Such validating legislation which removes the cause of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power.
The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision.
[325F G] In the instant case, having regard to the then existing provisions of the Act, this Court declared that the Act and notification issued thereunder in relation to sal seeds did not apply to sal seeds grown in Government forests.
The Act has been suitably amended by the impugned ordinance by removing the cause of ineffectiveness pointed out by this Court.
The definition of "forest produce" under section 2(c) has been enlarged to include, among others, sal seeds, grown or found on Government lands or in Government forests.
Clause (a) of subsection (1) of section 5 has been substituted covering all contracts for the purchase, sale, gathering or collection of 'specified forest produce ' grown or found in the area specified in the notification issued under section 1(3) of the Act.
Such contracts shall stand rescinded when a notification under section 1(3) of the Act is issued.
Both these provisions shall be deemed to have come into force with effect from September 5, 1981, the date on which the Act had come into force.
[326A B, E F] 317 The notification dated December 9, 1982 has been validated under A section 5 of the ordinance notwithstanding any judgment, decree or order of any Court to the contrary.
It shall be deemed to have been issued in respect of sal seeds also grown or found in Government forests.
lt shall be valid and effectual as if it were issued under section 1(3) of the Act as amended by the ordinance.
This validation is more than sufficient to make it operative to cover the contracts of the petitioners.
It does not suffer from any infirmity.
[326H; 327A B] 1.6 It would be impermissible for the State to enter into such contracts in future.
The parties or Agents employed by the State cannot work for their own benefits.
They must work on behalf of the State.
[324F G ] Utkal Contractors & Joinery Pvt. Ltd. and Ors.
vs State of Orrisa & ors.
, AIR 1987 SC 1455 [1987] 3 SCC 279; Hari Singh & ors.
vs The Military Estate officer & Anr., [19731 1 SCR 515;Government of Andhra Pradesh & Anr.
vs Hindustan Tools Ltd., 119751 Supp.
SCR 394; V.N. Saxena vs State of M.P., ; and Misri Lal Jain Etc.
vs State of Orissa & Anr.
, ; , referred to.
|
The Orissa Forest Produce (Control of Trade) Act, 1981 was enacted to prevent smuggling forest produce and also to provide State monopoly in such forest produce. The petitioners thereupon filed writ petitions before the High Court for a declaration that the above notification was void, and did not have the effect of rescinding their contracts in relation to sal seeds. The High Court dismissed the writ petitions. The petitioners challenged the validity of this ordinance in this Court. Dismissing the writ petitions, this Court, ^ HELD: 1.1. The impugned ordinance is valid and cannot be challenged on any ground. [327B] 1.2 The object to the Act was to prevent smuggling and to provide for State monopoly in the specified forest produce and not to provide State monopoly only to prevent smuggling. Nor could it be tested by the Government policy from time to time. [318B] The executive policy of the Government or the statement of objects and reasons of the Act or ordinances cannot control the words used in the legislation. [323F] Central Bank of India vs Their Workmen, ; and State of West Bengal vs Union of India, [1964] 1 SCR 371 at p. 382, relied on. 316 1.3 It is open to the State to make laws for creating State monopolies either partially or complete in respect of any trade or business or industry or service. The law relating to such trading activities must be presumed to be reasonable and in the interest of general public. [324D E] Akadasi Padhan vs State of Orissa, [19631 2 Supp. 1.4 The legislature may, at any time, in exercise of the plenary power conferred on it by Articles 245 and 246 of the Constitution render a judicial decision ineffective by enacting a valid law. There is no prohibition against retrospective legislation. The power of the legislature to pass a law postulates the power to pass it prospectively as well as retrospectively, subject, of course, to the legislative competence and other constitutional limitation. [325E F] 1.5 The rendering ineffective of judgments or orders of competent Courts by changing their basis by legislative enactment is a wellknown pattern of all validating acts. Such validating legislation which removes the cause of ineffectiveness or invalidity of action or proceedings cannot be considered as encroachment on judicial power. The legislature, however, cannot by a bare declaration, without more, directly overrule, reverse or set aside any judicial decision. The definition of "forest produce" under section 2(c) has been enlarged to include, among others, sal seeds, grown or found on Government lands or in Government forests. Both these provisions shall be deemed to have come into force with effect from September 5, 1981, the date on which the Act had come into force. [326A B, E F] 317 The notification dated December 9, 1982 has been validated under A section 5 of the ordinance notwithstanding any judgment, decree or order of any Court to the contrary. This validation is more than sufficient to make it operative to cover the contracts of the petitioners. The parties or Agents employed by the State cannot work for their own benefits. [324F G ] Utkal Contractors & Joinery Pvt. 19731 1 SCR 515;Government of Andhra Pradesh & Anr. SCR 394; V.N. Saxena vs State of M.P., ; and Misri Lal Jain Etc.
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Civil Appeal No. 2598 of 1987.
370 From the Judgment and order dated 26.5.1987 of the Karnataka A High Court in W.A. No. 615 of 1987.
Dr. Y.S. Chitale and K.J. John for the Appellant.
S.S. Javali, Ranjit Kumar and Dev Dass for the Respondents.
The Judgment of the Court was delivered by Dutt, J.
Special leave is granted.
As elaborate submissions have been made at the preliminary hearing of the special leave petition on the merits of the case by both the parties, we proceed to dispose of the appeal on merits.
This appeal involves the question as to the eligibility of the appellant for admission in the First Year MBBS Course of the Mysore University.
The appellant passed the B.Sc.
Examination of the Mysore University with Botany, Chemistry and Zoology securing 54.7% marks in the aggregate.
She also passed the PUC in the year 1979 with Physics, Chemistry and Biology as optional subjects and obtained 43.1% marks in the aggregate.
She sought for admission in a private Medical College or Institute.
On her query, the second respondent, who is the Principal of the Institute, by his latter dated February 26, 1986 con firmed that the appellant was eligible for admission to MBBS Course.
The relevant portion of the letter, as quoted in the special leave petition, is extracted below: "With reference to your telegram, I wish to write that candidates passing B.Sc.
degree examination with Physics, Chemistry and Biology or Chemistry, Biology and Zoology as optional subjects, are eligible, provided such of these candidates who have passed with Chemistry, Biology and Zoology should have passed Physics as optional subject in II year PUC or equivalent examination (Pre degree or Intermediate) or the additional Physics examination of any University or Institution recognised by the State Government.
The candidate should have obtained 50% marks in the optional subjects in the B.Sc.
degree examination.
" It is the case of the appellant that on the basis of the said letter, she joined the Institute in February, 1986.
However, by Memo dated 371 September 19, 1986 the second respondent intimated the appellant that her admission had not been approved by the University of Mysore.
The relevant portion of the letter of the Registrar of the University of Mysore, as quoted in the said Memo, is given below: "She has secured 54% in B.Sc., but secured 43% in PUC.
Hence she is not eligible.
Her admission may be cancelled.
" The appellant moved the Karnataka High Court by filing a writ petition under Article 226 of the Constitution of India challenging the validity of the cancellation of her admission in the First Year MBBS Course and praying for an order directing the respondents to allow her to continue as a student of the First Year MBBS Course.
A learned Single Judge of the High Court by his judgment dated April 8, 1987 rejected the writ petition on the ground that the appellant not having obtained 50% marks in the aggregate in Physics, Chemistry and Biology in the PUC examination, was not eligible for admission to the MBBS Course.
On appeal by the appellant, the Division Bench of the High Court also took the same view and dismissed the appeal.
Hence the present appeal by special leave.
The Mysore University to which the Institute or College is affiliated has framed regulations regarding admission to MBBS Course for the academic year 1985 86.
The relevant provisions of the said regulations are extracted below: " 1. ADMlSSlONS ELIGIBIL1TY: (a) The candidate shall have passed the Two Year PUC Examination conducted by the PUC Board, Karnataka State with Physics, Chemistry and Biology as optional subjects or any other examinations recognised as equivalent by the Mysore University and/or shall have passed the competitive examination conducted by the Karnataka Government for this purpose.
or B.Sc.
Examination of an Indian University provided that 372 he has passed the B.Sc.
Examination with not less than two of the following subjects: Physics, Chemistry, Biology (Botany, Zoology) and further that he has passed the earlier qualifying examinations with the following subjects: Physics, Chemistry, Biology and English.
Provided that the candidate should have secured not less than 50% of the total marks in Physics, Chemistry, Biology subjects taken together at the qualifying and/or competitive examination.
Provided further that in respect of candidates belonging to Scheduled Caste/Scheduled Tribe the minimum marks required for admission shall be 40% in lieu of 50% for general candidats.
(b) The candidate should have completed 17 years on the 31st December of the year of admission. " Under Regulation l(a), a candidate having passed the Two Year PUC or equivalent examination with Physics, Chemistry and Biology as optional subjects or B.Sc.
Examination of an Indian University with Physics, Chemistry, Biology will be eligible for admission in the First Year MBBS Course subject to this that the candidate should have secured not less than 50% of the total marks in Physics, Chemistry and Biology taken together at the qualifying and/or competitive examination.
It follows, therefore, that a candidate has to secure 50% of the total marks in Physics, Chemistry and Biology taken together in the PUC or an equivalent examination, which is a condition precedent to her eligibility for admission in the First Year MBBS Course.
The High Court has rightly observed that as the appellant did not secure 50% of the total marks in Physics, Chemistry and Biology in the PUC Examination, she was not eligible for admission in the First Year MBBS Course also rightly overruling the contention of the appellant that the marks obtained by her in Physics in the PUC Course should be added to the marks obtained by her in the B.Sc.
Examination so that it would work out to 50% of the tot.
marks in Physics, Chemistry and Biology.
Under Regulation 1(a), a candidate after passing B.Sc.
Exami 373 nation and seeking admission in the seats reserved for B.Sc.
candidates has to secure 50% of the total marks in Physics, Chemistry and Biology in the PUC Examination.
It is true that the appellant has obtained 54% marks in the B.Sc.
Examination, but she had failed to obtain 50% marks in the aggregate in the PUC Examination in Physics, Chemistry and Biology.
In the circumstances, she was not eligible for admission ill the First Year MBBS Course.
We are afraid, the Karnataka Medical Colleges (Selection of Candidates for Admission to 1 MBBS) Rules, 1985, hereinafter referred to as 'the said Rules ', are not applicable to seats in Private Colleges other than Government seats, which is apparent from Sub rule (2) of rule 1.
Sub rule (2) of rule 1 provides as follows: "R.1(2) These rules shall be applicable to the selection of candidates made on or after the date of commencement of these rules, for admission to the I year MBBS Course in the State of Karnataka in respect of all the seats in Government Colleges and the Government seats in the Private Colleges, as indicated in the Schedule to these Rules.
" Dr. Chitale, learned Counsel appearing on behalf of the appellant, has placed much reliance upon the Government Order dated August 1, 1984 annexing a copy of the said Rules.
The relevant portion of the Government Order is as follows: "O R D E R Accordingly, after considering the matter, Government of Karnataka hereby direct that Rules for selection of candidates for admission on to I M.B.B.S. Course in the Government and Private Medical Colleges for the academic year 1985 86 and onwards shall be as in Annexure to this order." In the Government order, no doubt, Private Medical Colleges have been mentioned, but it does not follow that the said Rules would apply to all candidates in the Private Medical Colleges.
Sub rule (2) of rule 1 of the said Rules, which has been extracted above, clearly shows that the said Rules would apply to only Government seats in the Private Colleges and, as such, in the Government order Private Colleges have been mentioned.
There is, therefore, no substance in the contention made on behalf of the appellant that the said Rules would also be applicable to the appellant.
374 Even assuming that the said Rules are applicable to the case of A the appellant, still the appellant will not be eligible for admission in the First Year MBBS Course in view of sub rule (5) of rule 3 of the said Rules, which provides, inter alia, that a person who does not belong to any of the Scheduled Castes or Scheduled Tribes, he has to obtain 50% of marks in PUC or equivalent examination in Physics, Chemistry and Biology as optional subjects.
Thus, the appellant was not eligible for admission in the First Year MBBS Course of Mysore University.
The High Court was, therefore, right in overruling the contention of the appellant that she was eligible for admission in the First Year MBBS Course.
Now the question is whether the appellant should be allowed to continue her studies in the MBBS Course.
By virtue of the interim order of the High Court, the appellant completed the First Year MBBS Course and by virtue of the interim order passed by this Court, the appellant appeared in the First Year MBBS Examination.
It has been strenuously urged by the learned Counsel appearing on behalf of the University that as the appellant was not eligible for admission and was illegally admitted by the Institute in violation of the eligibility rules of the University, the appellant should not be allowed to continue her studies in the MBBS Course under the University.
In support of that contention, much reliance has been placed by the learned Counsel on a decision of this Court in A.P. Christians Medical Educational Society vs Government of Andhra Pradesh, ; What happened in that case was that the appellant Society without being affiliated to the University and despite strong protests and warnings of the University admitted students to the Medical College in the First Year MBBS Course in total disregard of the provisions of the A.P. Education Act, the Osmania University Act and the regulations of the Osmania University.
Some students, who were admitted to the Medical College, filed a writ petition before this Court.
While dismissing the writ petition of the students, this Court observed as follows: "Shri Venugopal suggested that we might issue appropriate directions to the University to protect the interest of the students.
We do not think that we can possibly accede to the request made by Shri Venugopal on behalf of the student.
Any direction of the nature sought by Shri Venu gopal would be in clear transgression of the provisions of the University Act and the regulations of the University.
We cannot by our fiat direct the University to disobey the statute to which it owes its existence and the regulations 375 made by the University itself.
We cannot imagine anything more destructive of the rule of law than a direction by the court to disobey the laws.
" It was further observed by this Court as follows: "We regret that the students who have been admitted into the college have not only lost the money which they must have spent to gain admission into the college, but have also lost one or two years of precious time virtually jeopardising their future careers.
But that is a situation which they have brought upon themselves as they sought and obtained admission in the college despite the warnings issued by the University from time to time.
" It appears from the observations extracted above that the students were themselves to blame, for they had clear knowledge that the College was not affiliated to the University and in spite of the warning of the University they sought for the admission in the College in the First Year MBBS Course and were admitted.
In that context this Court made the above observations.
We may refer to a later decision of this Court in Rajendra Prasad Mathur vs Karnataka University, ; In that case, the condition for eligibility for admission to B.E. Degree Course of the Karnataka University was that the students seeking admission should have passed the two year pre University Examination of the pre University Education Board, Bangalore, or an examination held by any other Board or University recognised as equivalent to it.
The appellants, in that case, were admitted to certain private Engineering Colleges for the B.E. Degree Course upon payment of capitation fees, although they were not eligible for admission as the Higher Secondary Examination held by the Secondary Education Board, Rajasthan, passed by some of the appellants and the first B.Sc.
Examination of Rajasthan and Udaipur University passed by the remaining appellants, were not recognised as equivalent to the two year pre University Education Board, Bangalore.
While dismissing the appeals of the students on the ground that they were not eligible for admission in the engineering colleges, Bhagwati, C.J. who delivered the judgment of the Court, observed as follows: "We accordingly endorse the view taken by the learned Judge and affirmed by the Division Bench of the High 376 Court.
But the question still remains whether we should allow the appellants to continue their studies in the respective Engineering Colleges in which they were admitted.
It was strenuously pressed upon us on behalf of the appellants that under the orders initially of the learned Judge and thereafter of this Court they have been pursuing their course of study in the respective Engineering Colleges and their admissions should not now be disturbed because if they are now thrown out after a period of almost four years since their admission their whole future will be blighted.
Now it is true that the appellants were not eligible for admission to the Engineering Degree Course and they had no legitimate claim to such admission.
But it must be noted that the blame for their wrongful admission must lie more upon the Engineering Colleges which granted admission than upon the appellants.
It is quite possible that the appellants did not know that neither the Higher Secondary Examination of the Secondary Education Board, Rajasthan nor the first year B.Sc.
examination of the Rajasthan and Udaipur Universities was recognised as equivalent to the Pre University Examination of the Pre University Education Board, Bangalore.
The appellants being young students from Rajasthan might have presumed that since they had passed the first year B.Sc.
examination of the Rajasthan or Udaipur University or in any event the Higher Secondary Examination of the Secondary Education Board, Rajasthan they were eligible for admission.
The fault lies with the Engineering Colleges which admitted the appellants because the Principal of these Engineering Colleges must have known that the appellants were not eligible for admission and yet for the sake of capitation fee in some of the cases they granted admission to the appellants.
We do not see why the appellants should suffer for the sins of the managements of these Engineering Colleges.
We would, therefore, notwithstanding the view taken by us in this judgment allow the appellants to continue their studies in the respective Engineering Colleges in which they were granted admission.
But we do feel that against the erring Engineering Colleges the Karnataka University should take appropriate action because the managements of these Engineering Colleges have not only admitted students ineligible for admission but thereby deprived an equal number of eligible students from getting admission to the 377 Engineering Degree Course.
We also endorse the directions given by the learned Judge in the penultimate paragraph of his judgment with a view to preventing admission of ineligible students.
" This Court was, therefore, of the view that as the students were innocent and were admitted to the Colleges for the sake of capitation fee in some cases, they should not be penalised and should be allowed to continue their studies in the respective Engineering Colleges in which they were granted admission.
The facts of the instant case are, more or less, similar to the Rajendra Prasad Mathur 's case (supra).
It has been already noticed that on the appellant s query ' the Principal of the Institute by his letter dated February 26, 1986 informed her that she was eligible for admission in the First Year MBBS Course.
It was, inter alia, stated in the letter that the candidate should have obtained 5()% marks in the optional subjects in the B.Sc.
Examination.
There is no dispute that the appellant had obtained 50% marks in those subjects in the B.Sc.
Examination.
The appellant was, therefore.
quite innocent and she was quite justified in relying upon the information supplied to her by none else than the Principal of the Institute in the said letter in regard to the eligibility of the admission in the First Year MBBS Course.
In the circumstances, we do not think that we shall be justified in penalising the appellant by not allowing her to continue her studies in the MBBS Course.
Prima facie it was the fault of the Principal of the Institute but, in our view, the statement that was made by him in his said letter to the appellant as to the eligibility of the appellant for admission in the MBBS Course, was on a bona fide interpretation of the regulations framed by the Mysore University for admission to MBBS Course for the academic year 1985 86, which to some extent suffer from ambiguity.
The regulations should have been more clear and specific.
Be that as it may, following the decision of this Court in Rajendra Prasad Mathur 's case (supra) while we dismiss the appeal.
we direct that the appellant shall be allowed to prosecute her studies in the MBBS Course, and that her result for the First Year MBBS Examination be declared within two weeks from date.
There will, however, be no order as to costs.
H.L.C. Appeal allowed.
|
The appellant, who had passed B.Sc.
Examination with Botany.
Chemistry and zoology securing 54.7% marks in the aggregate, and, who had passed earlier the P.U.C. examination with Physics, Chemistry and Biology securing 43.1% marks in the aggregate, joined a private medical college after its principal had confirmed in writing that she was eligible for admission to the M.B.B.S. Course.
After six months in the college, she was informed by the principal that her admission had not been approved by the University as she had secured only 43% marks in the P.U.C. examination while the required minimum was 50% according to the Regulations framed by the University.
The appellant 's writ petition challenging the validity of the cancellation of her admission to the medical college having been dismissed by a Single Judge and her appeal against the same having been rejected by the Division Bench of the High Court, she approached the Court by special leave.
Counsel for the appellant contended inter alia that she was eligible for admission in terms of the Karnataka Medical Colleges (Selection of Candidates for Admission to M.B.B.S.) Rules, 1985, and that in any case, since the appellant had completed the first year M.B.B.S. Course by virtue of interim orders passed by the High Court and this Court, she should be allowed to continue her studies in the M.B.B.S. Course.
Allowing the appeal, ^ HELD: Under Regulation l(a) of the Regulations of the University regarding admission to M.B.B.S. Course for the Academic year 198586, a candidate after passing B.Sc.
Examination and seeking admission in the seats reserved for B.Sc.
candidates should have secured 50% of the total marks in Physics, Chemistry and Biology in the P.U.C. Exami 369 nation.
It is true that the appellant has obtained 54% marks in the B.Sc.
Examination, but she had failed to obtain 50% marks in the aggregate in the PUC Examination in Physics, Chemistry and Biology.
In the circumstances, she was not eligible for admission in the First Year MBBS Course.
[372H; 373A B] There is no substance in the contention made on behalf of the appellant that the Karnataka Medical Colleges (Selection of Candidates for admission to I MBBS) Rules, 1985 would also be applicable to the appellant.
Even assuming that the said Rules are applicable to the case of the appellant, still the appellant will not be eligible for admission in the First Year M.B.B.S. Course in view of sub r. (5) of r. 3 of the said Rules, which provides, inter alia, that a person who does not belong to any of the Scheduled Castes or Scheduled Tribes, has to obtain 50% of marks in P.U.C. Or equivalent examination in Physics, Chemistry and Biology as optional subjects.
Thus, the appellant was not eligible for admission.
[373H; 374A B] On the appellant 's query, the Principal of the Institute by his letter dated February 26, 1986 informed her that she was eligible for admission in the First Year M.B.B.S. Course.
lt was, inter alia, stated in the letter that the candidate should have obtained 50% marks in the optional subjects in the B.Sc.
Examination.
There is no dispute that the appellant had obtained 54% marks in those subjects in the B.Sc.
Examination.
The appellant was, therefore, quite innocent and she was quite justified in relying upon the information supplied to her by none else than the Principal of the Institute.
In the circumstances, we do not think that we shall be justified in penalising the appellant by not allowing her to continue her studies in the M.B.B.S. Course.
Prima facie it was the fault of the Principal of the Institute but, in our view, the statement that was made by him in his said letter to the appellant as to the eligibility of the appellant for admission in the M.B.B.S. Course, was on a bona fide interpretation of the Regulations framed by the University, which to some extent suffer from ambiguity.
The Regulations should have been more clear and specific.
[377C F] A.P. Christians Medical Education Society vs Government of Andhra Pradesh, [19861 2 S.C.C. 667, distinguished.
G Rajendra Prasad Mathur vs Karnataka University, A.I.R. , relied on.
|
Civil Appeal No. 2598 of 1987.
370 From the Judgment and order dated 26.5.1987 of the Karnataka A High Court in W.A. No. 615 of 1987.
Dr. Y.S. Chitale and K.J. John for the Appellant.
S.S. Javali, Ranjit Kumar and Dev Dass for the Respondents.
The Judgment of the Court was delivered by Dutt, J.
Special leave is granted.
As elaborate submissions have been made at the preliminary hearing of the special leave petition on the merits of the case by both the parties, we proceed to dispose of the appeal on merits.
This appeal involves the question as to the eligibility of the appellant for admission in the First Year MBBS Course of the Mysore University.
The appellant passed the B.Sc.
Examination of the Mysore University with Botany, Chemistry and Zoology securing 54.7% marks in the aggregate.
She also passed the PUC in the year 1979 with Physics, Chemistry and Biology as optional subjects and obtained 43.1% marks in the aggregate.
She sought for admission in a private Medical College or Institute.
On her query, the second respondent, who is the Principal of the Institute, by his latter dated February 26, 1986 con firmed that the appellant was eligible for admission to MBBS Course.
The relevant portion of the letter, as quoted in the special leave petition, is extracted below: "With reference to your telegram, I wish to write that candidates passing B.Sc.
degree examination with Physics, Chemistry and Biology or Chemistry, Biology and Zoology as optional subjects, are eligible, provided such of these candidates who have passed with Chemistry, Biology and Zoology should have passed Physics as optional subject in II year PUC or equivalent examination (Pre degree or Intermediate) or the additional Physics examination of any University or Institution recognised by the State Government.
The candidate should have obtained 50% marks in the optional subjects in the B.Sc.
degree examination.
" It is the case of the appellant that on the basis of the said letter, she joined the Institute in February, 1986.
However, by Memo dated 371 September 19, 1986 the second respondent intimated the appellant that her admission had not been approved by the University of Mysore.
The relevant portion of the letter of the Registrar of the University of Mysore, as quoted in the said Memo, is given below: "She has secured 54% in B.Sc., but secured 43% in PUC.
Hence she is not eligible.
Her admission may be cancelled.
" The appellant moved the Karnataka High Court by filing a writ petition under Article 226 of the Constitution of India challenging the validity of the cancellation of her admission in the First Year MBBS Course and praying for an order directing the respondents to allow her to continue as a student of the First Year MBBS Course.
A learned Single Judge of the High Court by his judgment dated April 8, 1987 rejected the writ petition on the ground that the appellant not having obtained 50% marks in the aggregate in Physics, Chemistry and Biology in the PUC examination, was not eligible for admission to the MBBS Course.
On appeal by the appellant, the Division Bench of the High Court also took the same view and dismissed the appeal.
Hence the present appeal by special leave.
The Mysore University to which the Institute or College is affiliated has framed regulations regarding admission to MBBS Course for the academic year 1985 86.
The relevant provisions of the said regulations are extracted below: " 1. ADMlSSlONS ELIGIBIL1TY: (a) The candidate shall have passed the Two Year PUC Examination conducted by the PUC Board, Karnataka State with Physics, Chemistry and Biology as optional subjects or any other examinations recognised as equivalent by the Mysore University and/or shall have passed the competitive examination conducted by the Karnataka Government for this purpose.
or B.Sc.
Examination of an Indian University provided that 372 he has passed the B.Sc.
Examination with not less than two of the following subjects: Physics, Chemistry, Biology (Botany, Zoology) and further that he has passed the earlier qualifying examinations with the following subjects: Physics, Chemistry, Biology and English.
Provided that the candidate should have secured not less than 50% of the total marks in Physics, Chemistry, Biology subjects taken together at the qualifying and/or competitive examination.
Provided further that in respect of candidates belonging to Scheduled Caste/Scheduled Tribe the minimum marks required for admission shall be 40% in lieu of 50% for general candidats.
(b) The candidate should have completed 17 years on the 31st December of the year of admission. " Under Regulation l(a), a candidate having passed the Two Year PUC or equivalent examination with Physics, Chemistry and Biology as optional subjects or B.Sc.
Examination of an Indian University with Physics, Chemistry, Biology will be eligible for admission in the First Year MBBS Course subject to this that the candidate should have secured not less than 50% of the total marks in Physics, Chemistry and Biology taken together at the qualifying and/or competitive examination.
It follows, therefore, that a candidate has to secure 50% of the total marks in Physics, Chemistry and Biology taken together in the PUC or an equivalent examination, which is a condition precedent to her eligibility for admission in the First Year MBBS Course.
The High Court has rightly observed that as the appellant did not secure 50% of the total marks in Physics, Chemistry and Biology in the PUC Examination, she was not eligible for admission in the First Year MBBS Course also rightly overruling the contention of the appellant that the marks obtained by her in Physics in the PUC Course should be added to the marks obtained by her in the B.Sc.
Examination so that it would work out to 50% of the tot.
marks in Physics, Chemistry and Biology.
Under Regulation 1(a), a candidate after passing B.Sc.
Exami 373 nation and seeking admission in the seats reserved for B.Sc.
candidates has to secure 50% of the total marks in Physics, Chemistry and Biology in the PUC Examination.
It is true that the appellant has obtained 54% marks in the B.Sc.
Examination, but she had failed to obtain 50% marks in the aggregate in the PUC Examination in Physics, Chemistry and Biology.
In the circumstances, she was not eligible for admission ill the First Year MBBS Course.
We are afraid, the Karnataka Medical Colleges (Selection of Candidates for Admission to 1 MBBS) Rules, 1985, hereinafter referred to as 'the said Rules ', are not applicable to seats in Private Colleges other than Government seats, which is apparent from Sub rule (2) of rule 1.
Sub rule (2) of rule 1 provides as follows: "R.1(2) These rules shall be applicable to the selection of candidates made on or after the date of commencement of these rules, for admission to the I year MBBS Course in the State of Karnataka in respect of all the seats in Government Colleges and the Government seats in the Private Colleges, as indicated in the Schedule to these Rules.
" Dr. Chitale, learned Counsel appearing on behalf of the appellant, has placed much reliance upon the Government Order dated August 1, 1984 annexing a copy of the said Rules.
The relevant portion of the Government Order is as follows: "O R D E R Accordingly, after considering the matter, Government of Karnataka hereby direct that Rules for selection of candidates for admission on to I M.B.B.S. Course in the Government and Private Medical Colleges for the academic year 1985 86 and onwards shall be as in Annexure to this order." In the Government order, no doubt, Private Medical Colleges have been mentioned, but it does not follow that the said Rules would apply to all candidates in the Private Medical Colleges.
Sub rule (2) of rule 1 of the said Rules, which has been extracted above, clearly shows that the said Rules would apply to only Government seats in the Private Colleges and, as such, in the Government order Private Colleges have been mentioned.
There is, therefore, no substance in the contention made on behalf of the appellant that the said Rules would also be applicable to the appellant.
374 Even assuming that the said Rules are applicable to the case of A the appellant, still the appellant will not be eligible for admission in the First Year MBBS Course in view of sub rule (5) of rule 3 of the said Rules, which provides, inter alia, that a person who does not belong to any of the Scheduled Castes or Scheduled Tribes, he has to obtain 50% of marks in PUC or equivalent examination in Physics, Chemistry and Biology as optional subjects.
Thus, the appellant was not eligible for admission in the First Year MBBS Course of Mysore University.
The High Court was, therefore, right in overruling the contention of the appellant that she was eligible for admission in the First Year MBBS Course.
Now the question is whether the appellant should be allowed to continue her studies in the MBBS Course.
By virtue of the interim order of the High Court, the appellant completed the First Year MBBS Course and by virtue of the interim order passed by this Court, the appellant appeared in the First Year MBBS Examination.
It has been strenuously urged by the learned Counsel appearing on behalf of the University that as the appellant was not eligible for admission and was illegally admitted by the Institute in violation of the eligibility rules of the University, the appellant should not be allowed to continue her studies in the MBBS Course under the University.
In support of that contention, much reliance has been placed by the learned Counsel on a decision of this Court in A.P. Christians Medical Educational Society vs Government of Andhra Pradesh, ; What happened in that case was that the appellant Society without being affiliated to the University and despite strong protests and warnings of the University admitted students to the Medical College in the First Year MBBS Course in total disregard of the provisions of the A.P. Education Act, the Osmania University Act and the regulations of the Osmania University.
Some students, who were admitted to the Medical College, filed a writ petition before this Court.
While dismissing the writ petition of the students, this Court observed as follows: "Shri Venugopal suggested that we might issue appropriate directions to the University to protect the interest of the students.
We do not think that we can possibly accede to the request made by Shri Venugopal on behalf of the student.
Any direction of the nature sought by Shri Venu gopal would be in clear transgression of the provisions of the University Act and the regulations of the University.
We cannot by our fiat direct the University to disobey the statute to which it owes its existence and the regulations 375 made by the University itself.
We cannot imagine anything more destructive of the rule of law than a direction by the court to disobey the laws.
" It was further observed by this Court as follows: "We regret that the students who have been admitted into the college have not only lost the money which they must have spent to gain admission into the college, but have also lost one or two years of precious time virtually jeopardising their future careers.
But that is a situation which they have brought upon themselves as they sought and obtained admission in the college despite the warnings issued by the University from time to time.
" It appears from the observations extracted above that the students were themselves to blame, for they had clear knowledge that the College was not affiliated to the University and in spite of the warning of the University they sought for the admission in the College in the First Year MBBS Course and were admitted.
In that context this Court made the above observations.
We may refer to a later decision of this Court in Rajendra Prasad Mathur vs Karnataka University, ; In that case, the condition for eligibility for admission to B.E. Degree Course of the Karnataka University was that the students seeking admission should have passed the two year pre University Examination of the pre University Education Board, Bangalore, or an examination held by any other Board or University recognised as equivalent to it.
The appellants, in that case, were admitted to certain private Engineering Colleges for the B.E. Degree Course upon payment of capitation fees, although they were not eligible for admission as the Higher Secondary Examination held by the Secondary Education Board, Rajasthan, passed by some of the appellants and the first B.Sc.
Examination of Rajasthan and Udaipur University passed by the remaining appellants, were not recognised as equivalent to the two year pre University Education Board, Bangalore.
While dismissing the appeals of the students on the ground that they were not eligible for admission in the engineering colleges, Bhagwati, C.J. who delivered the judgment of the Court, observed as follows: "We accordingly endorse the view taken by the learned Judge and affirmed by the Division Bench of the High 376 Court.
But the question still remains whether we should allow the appellants to continue their studies in the respective Engineering Colleges in which they were admitted.
It was strenuously pressed upon us on behalf of the appellants that under the orders initially of the learned Judge and thereafter of this Court they have been pursuing their course of study in the respective Engineering Colleges and their admissions should not now be disturbed because if they are now thrown out after a period of almost four years since their admission their whole future will be blighted.
Now it is true that the appellants were not eligible for admission to the Engineering Degree Course and they had no legitimate claim to such admission.
But it must be noted that the blame for their wrongful admission must lie more upon the Engineering Colleges which granted admission than upon the appellants.
It is quite possible that the appellants did not know that neither the Higher Secondary Examination of the Secondary Education Board, Rajasthan nor the first year B.Sc.
examination of the Rajasthan and Udaipur Universities was recognised as equivalent to the Pre University Examination of the Pre University Education Board, Bangalore.
The appellants being young students from Rajasthan might have presumed that since they had passed the first year B.Sc.
examination of the Rajasthan or Udaipur University or in any event the Higher Secondary Examination of the Secondary Education Board, Rajasthan they were eligible for admission.
The fault lies with the Engineering Colleges which admitted the appellants because the Principal of these Engineering Colleges must have known that the appellants were not eligible for admission and yet for the sake of capitation fee in some of the cases they granted admission to the appellants.
We do not see why the appellants should suffer for the sins of the managements of these Engineering Colleges.
We would, therefore, notwithstanding the view taken by us in this judgment allow the appellants to continue their studies in the respective Engineering Colleges in which they were granted admission.
But we do feel that against the erring Engineering Colleges the Karnataka University should take appropriate action because the managements of these Engineering Colleges have not only admitted students ineligible for admission but thereby deprived an equal number of eligible students from getting admission to the 377 Engineering Degree Course.
We also endorse the directions given by the learned Judge in the penultimate paragraph of his judgment with a view to preventing admission of ineligible students.
" This Court was, therefore, of the view that as the students were innocent and were admitted to the Colleges for the sake of capitation fee in some cases, they should not be penalised and should be allowed to continue their studies in the respective Engineering Colleges in which they were granted admission.
The facts of the instant case are, more or less, similar to the Rajendra Prasad Mathur 's case (supra).
It has been already noticed that on the appellant s query ' the Principal of the Institute by his letter dated February 26, 1986 informed her that she was eligible for admission in the First Year MBBS Course.
It was, inter alia, stated in the letter that the candidate should have obtained 5()% marks in the optional subjects in the B.Sc.
Examination.
There is no dispute that the appellant had obtained 50% marks in those subjects in the B.Sc.
Examination.
The appellant was, therefore.
quite innocent and she was quite justified in relying upon the information supplied to her by none else than the Principal of the Institute in the said letter in regard to the eligibility of the admission in the First Year MBBS Course.
In the circumstances, we do not think that we shall be justified in penalising the appellant by not allowing her to continue her studies in the MBBS Course.
Prima facie it was the fault of the Principal of the Institute but, in our view, the statement that was made by him in his said letter to the appellant as to the eligibility of the appellant for admission in the MBBS Course, was on a bona fide interpretation of the regulations framed by the Mysore University for admission to MBBS Course for the academic year 1985 86, which to some extent suffer from ambiguity.
The regulations should have been more clear and specific.
Be that as it may, following the decision of this Court in Rajendra Prasad Mathur 's case (supra) while we dismiss the appeal.
we direct that the appellant shall be allowed to prosecute her studies in the MBBS Course, and that her result for the First Year MBBS Examination be declared within two weeks from date.
There will, however, be no order as to costs.
H.L.C. Appeal allowed.
|
Civil Appeal No. 2598 of 1987.
370 From the Judgment and order dated 26.5.1987 of the Karnataka A High Court in W.A. No. 615 of 1987.
Dr. Y.S. Chitale and K.J. John for the Appellant.
S.S. Javali, Ranjit Kumar and Dev Dass for the Respondents.
The Judgment of the Court was delivered by Dutt, J.
Special leave is granted.
As elaborate submissions have been made at the preliminary hearing of the special leave petition on the merits of the case by both the parties, we proceed to dispose of the appeal on merits.
This appeal involves the question as to the eligibility of the appellant for admission in the First Year MBBS Course of the Mysore University.
The appellant passed the B.Sc.
Examination of the Mysore University with Botany, Chemistry and Zoology securing 54.7% marks in the aggregate.
She also passed the PUC in the year 1979 with Physics, Chemistry and Biology as optional subjects and obtained 43.1% marks in the aggregate.
She sought for admission in a private Medical College or Institute.
On her query, the second respondent, who is the Principal of the Institute, by his latter dated February 26, 1986 con firmed that the appellant was eligible for admission to MBBS Course.
The relevant portion of the letter, as quoted in the special leave petition, is extracted below: "With reference to your telegram, I wish to write that candidates passing B.Sc.
degree examination with Physics, Chemistry and Biology or Chemistry, Biology and Zoology as optional subjects, are eligible, provided such of these candidates who have passed with Chemistry, Biology and Zoology should have passed Physics as optional subject in II year PUC or equivalent examination (Pre degree or Intermediate) or the additional Physics examination of any University or Institution recognised by the State Government.
The candidate should have obtained 50% marks in the optional subjects in the B.Sc.
degree examination.
" It is the case of the appellant that on the basis of the said letter, she joined the Institute in February, 1986.
However, by Memo dated 371 September 19, 1986 the second respondent intimated the appellant that her admission had not been approved by the University of Mysore.
The relevant portion of the letter of the Registrar of the University of Mysore, as quoted in the said Memo, is given below: "She has secured 54% in B.Sc., but secured 43% in PUC.
Hence she is not eligible.
Her admission may be cancelled.
" The appellant moved the Karnataka High Court by filing a writ petition under Article 226 of the Constitution of India challenging the validity of the cancellation of her admission in the First Year MBBS Course and praying for an order directing the respondents to allow her to continue as a student of the First Year MBBS Course.
A learned Single Judge of the High Court by his judgment dated April 8, 1987 rejected the writ petition on the ground that the appellant not having obtained 50% marks in the aggregate in Physics, Chemistry and Biology in the PUC examination, was not eligible for admission to the MBBS Course.
On appeal by the appellant, the Division Bench of the High Court also took the same view and dismissed the appeal.
Hence the present appeal by special leave.
The Mysore University to which the Institute or College is affiliated has framed regulations regarding admission to MBBS Course for the academic year 1985 86.
The relevant provisions of the said regulations are extracted below: " 1. ADMlSSlONS ELIGIBIL1TY: (a) The candidate shall have passed the Two Year PUC Examination conducted by the PUC Board, Karnataka State with Physics, Chemistry and Biology as optional subjects or any other examinations recognised as equivalent by the Mysore University and/or shall have passed the competitive examination conducted by the Karnataka Government for this purpose.
or B.Sc.
Examination of an Indian University provided that 372 he has passed the B.Sc.
Examination with not less than two of the following subjects: Physics, Chemistry, Biology (Botany, Zoology) and further that he has passed the earlier qualifying examinations with the following subjects: Physics, Chemistry, Biology and English.
Provided that the candidate should have secured not less than 50% of the total marks in Physics, Chemistry, Biology subjects taken together at the qualifying and/or competitive examination.
Provided further that in respect of candidates belonging to Scheduled Caste/Scheduled Tribe the minimum marks required for admission shall be 40% in lieu of 50% for general candidats.
(b) The candidate should have completed 17 years on the 31st December of the year of admission. " Under Regulation l(a), a candidate having passed the Two Year PUC or equivalent examination with Physics, Chemistry and Biology as optional subjects or B.Sc.
Examination of an Indian University with Physics, Chemistry, Biology will be eligible for admission in the First Year MBBS Course subject to this that the candidate should have secured not less than 50% of the total marks in Physics, Chemistry and Biology taken together at the qualifying and/or competitive examination.
It follows, therefore, that a candidate has to secure 50% of the total marks in Physics, Chemistry and Biology taken together in the PUC or an equivalent examination, which is a condition precedent to her eligibility for admission in the First Year MBBS Course.
The High Court has rightly observed that as the appellant did not secure 50% of the total marks in Physics, Chemistry and Biology in the PUC Examination, she was not eligible for admission in the First Year MBBS Course also rightly overruling the contention of the appellant that the marks obtained by her in Physics in the PUC Course should be added to the marks obtained by her in the B.Sc.
Examination so that it would work out to 50% of the tot.
marks in Physics, Chemistry and Biology.
Under Regulation 1(a), a candidate after passing B.Sc.
Exami 373 nation and seeking admission in the seats reserved for B.Sc.
candidates has to secure 50% of the total marks in Physics, Chemistry and Biology in the PUC Examination.
It is true that the appellant has obtained 54% marks in the B.Sc.
Examination, but she had failed to obtain 50% marks in the aggregate in the PUC Examination in Physics, Chemistry and Biology.
In the circumstances, she was not eligible for admission ill the First Year MBBS Course.
We are afraid, the Karnataka Medical Colleges (Selection of Candidates for Admission to 1 MBBS) Rules, 1985, hereinafter referred to as 'the said Rules ', are not applicable to seats in Private Colleges other than Government seats, which is apparent from Sub rule (2) of rule 1.
Sub rule (2) of rule 1 provides as follows: "R.1(2) These rules shall be applicable to the selection of candidates made on or after the date of commencement of these rules, for admission to the I year MBBS Course in the State of Karnataka in respect of all the seats in Government Colleges and the Government seats in the Private Colleges, as indicated in the Schedule to these Rules.
" Dr. Chitale, learned Counsel appearing on behalf of the appellant, has placed much reliance upon the Government Order dated August 1, 1984 annexing a copy of the said Rules.
The relevant portion of the Government Order is as follows: "O R D E R Accordingly, after considering the matter, Government of Karnataka hereby direct that Rules for selection of candidates for admission on to I M.B.B.S. Course in the Government and Private Medical Colleges for the academic year 1985 86 and onwards shall be as in Annexure to this order." In the Government order, no doubt, Private Medical Colleges have been mentioned, but it does not follow that the said Rules would apply to all candidates in the Private Medical Colleges.
Sub rule (2) of rule 1 of the said Rules, which has been extracted above, clearly shows that the said Rules would apply to only Government seats in the Private Colleges and, as such, in the Government order Private Colleges have been mentioned.
There is, therefore, no substance in the contention made on behalf of the appellant that the said Rules would also be applicable to the appellant.
374 Even assuming that the said Rules are applicable to the case of A the appellant, still the appellant will not be eligible for admission in the First Year MBBS Course in view of sub rule (5) of rule 3 of the said Rules, which provides, inter alia, that a person who does not belong to any of the Scheduled Castes or Scheduled Tribes, he has to obtain 50% of marks in PUC or equivalent examination in Physics, Chemistry and Biology as optional subjects.
Thus, the appellant was not eligible for admission in the First Year MBBS Course of Mysore University.
The High Court was, therefore, right in overruling the contention of the appellant that she was eligible for admission in the First Year MBBS Course.
Now the question is whether the appellant should be allowed to continue her studies in the MBBS Course.
By virtue of the interim order of the High Court, the appellant completed the First Year MBBS Course and by virtue of the interim order passed by this Court, the appellant appeared in the First Year MBBS Examination.
It has been strenuously urged by the learned Counsel appearing on behalf of the University that as the appellant was not eligible for admission and was illegally admitted by the Institute in violation of the eligibility rules of the University, the appellant should not be allowed to continue her studies in the MBBS Course under the University.
In support of that contention, much reliance has been placed by the learned Counsel on a decision of this Court in A.P. Christians Medical Educational Society vs Government of Andhra Pradesh, ; What happened in that case was that the appellant Society without being affiliated to the University and despite strong protests and warnings of the University admitted students to the Medical College in the First Year MBBS Course in total disregard of the provisions of the A.P. Education Act, the Osmania University Act and the regulations of the Osmania University.
Some students, who were admitted to the Medical College, filed a writ petition before this Court.
While dismissing the writ petition of the students, this Court observed as follows: "Shri Venugopal suggested that we might issue appropriate directions to the University to protect the interest of the students.
We do not think that we can possibly accede to the request made by Shri Venugopal on behalf of the student.
Any direction of the nature sought by Shri Venu gopal would be in clear transgression of the provisions of the University Act and the regulations of the University.
We cannot by our fiat direct the University to disobey the statute to which it owes its existence and the regulations 375 made by the University itself.
We cannot imagine anything more destructive of the rule of law than a direction by the court to disobey the laws.
" It was further observed by this Court as follows: "We regret that the students who have been admitted into the college have not only lost the money which they must have spent to gain admission into the college, but have also lost one or two years of precious time virtually jeopardising their future careers.
But that is a situation which they have brought upon themselves as they sought and obtained admission in the college despite the warnings issued by the University from time to time.
" It appears from the observations extracted above that the students were themselves to blame, for they had clear knowledge that the College was not affiliated to the University and in spite of the warning of the University they sought for the admission in the College in the First Year MBBS Course and were admitted.
In that context this Court made the above observations.
We may refer to a later decision of this Court in Rajendra Prasad Mathur vs Karnataka University, ; In that case, the condition for eligibility for admission to B.E. Degree Course of the Karnataka University was that the students seeking admission should have passed the two year pre University Examination of the pre University Education Board, Bangalore, or an examination held by any other Board or University recognised as equivalent to it.
The appellants, in that case, were admitted to certain private Engineering Colleges for the B.E. Degree Course upon payment of capitation fees, although they were not eligible for admission as the Higher Secondary Examination held by the Secondary Education Board, Rajasthan, passed by some of the appellants and the first B.Sc.
Examination of Rajasthan and Udaipur University passed by the remaining appellants, were not recognised as equivalent to the two year pre University Education Board, Bangalore.
While dismissing the appeals of the students on the ground that they were not eligible for admission in the engineering colleges, Bhagwati, C.J. who delivered the judgment of the Court, observed as follows: "We accordingly endorse the view taken by the learned Judge and affirmed by the Division Bench of the High 376 Court.
But the question still remains whether we should allow the appellants to continue their studies in the respective Engineering Colleges in which they were admitted.
It was strenuously pressed upon us on behalf of the appellants that under the orders initially of the learned Judge and thereafter of this Court they have been pursuing their course of study in the respective Engineering Colleges and their admissions should not now be disturbed because if they are now thrown out after a period of almost four years since their admission their whole future will be blighted.
Now it is true that the appellants were not eligible for admission to the Engineering Degree Course and they had no legitimate claim to such admission.
But it must be noted that the blame for their wrongful admission must lie more upon the Engineering Colleges which granted admission than upon the appellants.
It is quite possible that the appellants did not know that neither the Higher Secondary Examination of the Secondary Education Board, Rajasthan nor the first year B.Sc.
examination of the Rajasthan and Udaipur Universities was recognised as equivalent to the Pre University Examination of the Pre University Education Board, Bangalore.
The appellants being young students from Rajasthan might have presumed that since they had passed the first year B.Sc.
examination of the Rajasthan or Udaipur University or in any event the Higher Secondary Examination of the Secondary Education Board, Rajasthan they were eligible for admission.
The fault lies with the Engineering Colleges which admitted the appellants because the Principal of these Engineering Colleges must have known that the appellants were not eligible for admission and yet for the sake of capitation fee in some of the cases they granted admission to the appellants.
We do not see why the appellants should suffer for the sins of the managements of these Engineering Colleges.
We would, therefore, notwithstanding the view taken by us in this judgment allow the appellants to continue their studies in the respective Engineering Colleges in which they were granted admission.
But we do feel that against the erring Engineering Colleges the Karnataka University should take appropriate action because the managements of these Engineering Colleges have not only admitted students ineligible for admission but thereby deprived an equal number of eligible students from getting admission to the 377 Engineering Degree Course.
We also endorse the directions given by the learned Judge in the penultimate paragraph of his judgment with a view to preventing admission of ineligible students.
" This Court was, therefore, of the view that as the students were innocent and were admitted to the Colleges for the sake of capitation fee in some cases, they should not be penalised and should be allowed to continue their studies in the respective Engineering Colleges in which they were granted admission.
The facts of the instant case are, more or less, similar to the Rajendra Prasad Mathur 's case (supra).
It has been already noticed that on the appellant s query ' the Principal of the Institute by his letter dated February 26, 1986 informed her that she was eligible for admission in the First Year MBBS Course.
It was, inter alia, stated in the letter that the candidate should have obtained 5()% marks in the optional subjects in the B.Sc.
Examination.
There is no dispute that the appellant had obtained 50% marks in those subjects in the B.Sc.
Examination.
The appellant was, therefore.
quite innocent and she was quite justified in relying upon the information supplied to her by none else than the Principal of the Institute in the said letter in regard to the eligibility of the admission in the First Year MBBS Course.
In the circumstances, we do not think that we shall be justified in penalising the appellant by not allowing her to continue her studies in the MBBS Course.
Prima facie it was the fault of the Principal of the Institute but, in our view, the statement that was made by him in his said letter to the appellant as to the eligibility of the appellant for admission in the MBBS Course, was on a bona fide interpretation of the regulations framed by the Mysore University for admission to MBBS Course for the academic year 1985 86, which to some extent suffer from ambiguity.
The regulations should have been more clear and specific.
Be that as it may, following the decision of this Court in Rajendra Prasad Mathur 's case (supra) while we dismiss the appeal.
we direct that the appellant shall be allowed to prosecute her studies in the MBBS Course, and that her result for the First Year MBBS Examination be declared within two weeks from date.
There will, however, be no order as to costs.
H.L.C. Appeal allowed.
|
The appellant, who had passed B.Sc.
Examination with Botany.
Chemistry and zoology securing 54.7% marks in the aggregate, and, who had passed earlier the P.U.C. examination with Physics, Chemistry and Biology securing 43.1% marks in the aggregate, joined a private medical college after its principal had confirmed in writing that she was eligible for admission to the M.B.B.S. Course.
After six months in the college, she was informed by the principal that her admission had not been approved by the University as she had secured only 43% marks in the P.U.C. examination while the required minimum was 50% according to the Regulations framed by the University.
The appellant 's writ petition challenging the validity of the cancellation of her admission to the medical college having been dismissed by a Single Judge and her appeal against the same having been rejected by the Division Bench of the High Court, she approached the Court by special leave.
Counsel for the appellant contended inter alia that she was eligible for admission in terms of the Karnataka Medical Colleges (Selection of Candidates for Admission to M.B.B.S.) Rules, 1985, and that in any case, since the appellant had completed the first year M.B.B.S. Course by virtue of interim orders passed by the High Court and this Court, she should be allowed to continue her studies in the M.B.B.S. Course.
Allowing the appeal, ^ HELD: Under Regulation l(a) of the Regulations of the University regarding admission to M.B.B.S. Course for the Academic year 198586, a candidate after passing B.Sc.
Examination and seeking admission in the seats reserved for B.Sc.
candidates should have secured 50% of the total marks in Physics, Chemistry and Biology in the P.U.C. Exami 369 nation.
It is true that the appellant has obtained 54% marks in the B.Sc.
Examination, but she had failed to obtain 50% marks in the aggregate in the PUC Examination in Physics, Chemistry and Biology.
In the circumstances, she was not eligible for admission in the First Year MBBS Course.
[372H; 373A B] There is no substance in the contention made on behalf of the appellant that the Karnataka Medical Colleges (Selection of Candidates for admission to I MBBS) Rules, 1985 would also be applicable to the appellant.
Even assuming that the said Rules are applicable to the case of the appellant, still the appellant will not be eligible for admission in the First Year M.B.B.S. Course in view of sub r. (5) of r. 3 of the said Rules, which provides, inter alia, that a person who does not belong to any of the Scheduled Castes or Scheduled Tribes, has to obtain 50% of marks in P.U.C. Or equivalent examination in Physics, Chemistry and Biology as optional subjects.
Thus, the appellant was not eligible for admission.
[373H; 374A B] On the appellant 's query, the Principal of the Institute by his letter dated February 26, 1986 informed her that she was eligible for admission in the First Year M.B.B.S. Course.
lt was, inter alia, stated in the letter that the candidate should have obtained 50% marks in the optional subjects in the B.Sc.
Examination.
There is no dispute that the appellant had obtained 54% marks in those subjects in the B.Sc.
Examination.
The appellant was, therefore, quite innocent and she was quite justified in relying upon the information supplied to her by none else than the Principal of the Institute.
In the circumstances, we do not think that we shall be justified in penalising the appellant by not allowing her to continue her studies in the M.B.B.S. Course.
Prima facie it was the fault of the Principal of the Institute but, in our view, the statement that was made by him in his said letter to the appellant as to the eligibility of the appellant for admission in the M.B.B.S. Course, was on a bona fide interpretation of the Regulations framed by the University, which to some extent suffer from ambiguity.
The Regulations should have been more clear and specific.
[377C F] A.P. Christians Medical Education Society vs Government of Andhra Pradesh, [19861 2 S.C.C. 667, distinguished.
G Rajendra Prasad Mathur vs Karnataka University, A.I.R. , relied on.
|
The appellant, who had passed B.Sc.
Examination with Botany.
Chemistry and zoology securing 54.7% marks in the aggregate, and, who had passed earlier the P.U.C. examination with Physics, Chemistry and Biology securing 43.1% marks in the aggregate, joined a private medical college after its principal had confirmed in writing that she was eligible for admission to the M.B.B.S. Course.
After six months in the college, she was informed by the principal that her admission had not been approved by the University as she had secured only 43% marks in the P.U.C. examination while the required minimum was 50% according to the Regulations framed by the University.
The appellant 's writ petition challenging the validity of the cancellation of her admission to the medical college having been dismissed by a Single Judge and her appeal against the same having been rejected by the Division Bench of the High Court, she approached the Court by special leave.
Counsel for the appellant contended inter alia that she was eligible for admission in terms of the Karnataka Medical Colleges (Selection of Candidates for Admission to M.B.B.S.) Rules, 1985, and that in any case, since the appellant had completed the first year M.B.B.S. Course by virtue of interim orders passed by the High Court and this Court, she should be allowed to continue her studies in the M.B.B.S. Course.
Allowing the appeal, ^ HELD: Under Regulation l(a) of the Regulations of the University regarding admission to M.B.B.S. Course for the Academic year 198586, a candidate after passing B.Sc.
Examination and seeking admission in the seats reserved for B.Sc.
candidates should have secured 50% of the total marks in Physics, Chemistry and Biology in the P.U.C. Exami 369 nation.
It is true that the appellant has obtained 54% marks in the B.Sc.
Examination, but she had failed to obtain 50% marks in the aggregate in the PUC Examination in Physics, Chemistry and Biology.
In the circumstances, she was not eligible for admission in the First Year MBBS Course.
[372H; 373A B] There is no substance in the contention made on behalf of the appellant that the Karnataka Medical Colleges (Selection of Candidates for admission to I MBBS) Rules, 1985 would also be applicable to the appellant.
Even assuming that the said Rules are applicable to the case of the appellant, still the appellant will not be eligible for admission in the First Year M.B.B.S. Course in view of sub r. (5) of r. 3 of the said Rules, which provides, inter alia, that a person who does not belong to any of the Scheduled Castes or Scheduled Tribes, has to obtain 50% of marks in P.U.C. Or equivalent examination in Physics, Chemistry and Biology as optional subjects.
Thus, the appellant was not eligible for admission.
[373H; 374A B] On the appellant 's query, the Principal of the Institute by his letter dated February 26, 1986 informed her that she was eligible for admission in the First Year M.B.B.S. Course.
lt was, inter alia, stated in the letter that the candidate should have obtained 50% marks in the optional subjects in the B.Sc.
Examination.
There is no dispute that the appellant had obtained 54% marks in those subjects in the B.Sc.
Examination.
The appellant was, therefore, quite innocent and she was quite justified in relying upon the information supplied to her by none else than the Principal of the Institute.
In the circumstances, we do not think that we shall be justified in penalising the appellant by not allowing her to continue her studies in the M.B.B.S. Course.
Prima facie it was the fault of the Principal of the Institute but, in our view, the statement that was made by him in his said letter to the appellant as to the eligibility of the appellant for admission in the M.B.B.S. Course, was on a bona fide interpretation of the Regulations framed by the University, which to some extent suffer from ambiguity.
The Regulations should have been more clear and specific.
[377C F] A.P. Christians Medical Education Society vs Government of Andhra Pradesh, [19861 2 S.C.C. 667, distinguished.
G Rajendra Prasad Mathur vs Karnataka University, A.I.R. , relied on.
| 1
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| 1
| 1
|
ition No. 7993 of 1982.
(Under Article 32 of the Constitution of India).
R.K. Jain and R.P. Singh for the Petitioner.
Prithiviraj and Mrs. Shobha Dikshit for Respondent Nos. 1 and 3 to 5.
Kuldip Singh, Additional Solicitor General, Mr. C.V. Subba Rao and B. Parthasarthy for Respondent No. 2.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
This is a petition under Article 32 of the Constitution.
The petitioner is engaged in the manufacture of Khandsari sugar.
The petitioner challenges the validity of the U.P. Khandsari Sugar (Levy) order, 1981 ("Levy order").
It was issued in exercise of powers under Section 3 of the by virtue of delegation of power by the Central Government under Section 5 of the said Act.
The levy order requires Khandsari manufacturing units to surrender levy of 50% of the production by sulphitation units in the first process.
The balance 50% of that process with the total production by subsequent processes was left free to be sold in the open market by the manufacturing units.
The price fixed for the levy Khandsari sugar was Rs. 320 per quintal .
The petitioner challenges the price fixation on the ground that the State Government has not taken into consideration the guidelines in built in sub section 3C of section 3 of the .
The petitioner alleges that the levy order is unreasonable or excessive restriction on the fundamental rights guaranteed under Articles 19(1)(g) and 14 of the Constitution.
lt is also the case of the petitioner that the State Government sold the levy sugar by public auction realising large profit and the levy therefore, was a colourable exercise of the power.
Before considering these contentions, we may start with recent observation of o. Chinnappa Reddy, J. in Union of India vs Cynamide India Ltd. AIR 1987 Sept. SC 1802 at 1805: .
"Price fixation is neither the function nor the forte of the Court.
We concern ourselves neither with the policy nor with the rates.
But we do not totally deny ourselves the jurisdiction to inquire into the question, in appropriate 580 proceedings, whether relevant considerations have gone in and irrelevant considerations kept out of the determination of the price.
For example, if the legislature has decreed the pricing policy and prescribed the factors which should guide the determination of the price, we wilt, if necessary, inquire into the question whether the policy and the factors are present to the mind of the authorities specifying the price.
But our examination will stop there.
We will go no further.
We will not deluge ourselves with more facts and figures.
The assembling of the raw materials and the mechanics of the price fixation are the concern of the executive and we leave it to them.
And, we will not revaluate the considerations even if the prices are demonstrably injurious to some manufacturers or producers.
The Court will, of course, examine if there is any hostile discrimination.
That is a different 'cup of tea ' altogether.
" This will be the parametre and the limitation of inquiry by Courts whenever the price fixation of any essential commodity is called into question.
The Court does not act like a Chartered accountant nor acts like an Income Tax officer.
The Court is not concerned with any individual case or any particular problem.
The Court only examines whether the price determined was with due regard to considerations provided by the statute.
And whether extraneous matters have been excluded from determination.
In the present case even this limited inquiry appears to be unnecessary.
The validity of the same levy order was the subject matter of decision of this Court in New India Sugar Works vs State of Uttar Pradesh & Ors.
l ; There Fazal Ali, J. who spoke for the Bench observed: "It was next strongly contended that in fixation of the price of levy sugar the Government has not taken into consideration the fact that the petitioners would undergo a serious loss because the price would not be sufficient even to cover their manufacturing cost.
We are, however, unable to agree with this argument.
The policy of price control has for its dominant object equitable distribution and availability of the commodity at fair price so as to benefit the consumers.
It is manifest that individual interest, however, precious they may be must yield to the larger interest of the 581 community viz., in the instant case, the large body of the consumers of sugar.
In fact, even if the petitioners have to bear some loss there can be no question of the restrictions imposed on the petitioners being unreasonable.
In Shree Meenakshi Mills Ltd. vs U.O.I. this Court observed as follows.
"If fair price is to be fixed leaving a reasonable margin of profit, there is never any question of infringment of fundamental right to carry on business by imposing reasonable restrictions.
In determining the reasonableness of a restriction imposed by law in the field of industry, trade or commerce, it has to be remembered that the mere fact that some of those who are engaged in these are alleging loss after the imposition of law will not render the law unreasonable." (Emphasis supplied).
Similar view was taken by this Court in the case of Prag Ice and oil Mills & Anr.
vs Union of India [ ; where the Court speaking through Beg, C.J. Observed as follows: "It has also to be remembered that the object is to secure equitable distribution and availability at fair price so that it is the interest of the consumer and not of the producer which is the determining factor in applying any objective tests at any particular time.
" In this view of the matter, the primary consideration in the fixation of price would be the interest of consumers rather than that of the producers.
Moreover, we think that since the petitioners are allowed to sell freely at any rate they like the remaining 50% of the sugar (after excluding the 50% which they have to give for levy) as also the produce by the second and third process, the loss if any caused to the petitioners would be minimal.
Mr. R.K. Jain learned counsel for the petitioner however, urged that the above case did not lay down the correct law.
He said that the primary consideration in the fixation of price would not be the interest of consumers, but to ensure a reasonable return to producers.
That H 582 according to him the law laid down by this Court in (i) The Panipat Co operative Sugar Mills vs Union of India [19731 2 SCR 860 and Anakapalle Coop.
& Industrial Society Ltd. vs Union of India & Ors.
, [ ; Since these two decisions have not been referred to in the New India Sugar Works case we should refer this case to a larger bench for decision.
We do not think that the counsel is justified in his submission.
We do not find any diversity of views taken in the aforesaid cases.
All those cases concerned with the price fixation of the essential commodity under the essential Commodities Act.
The primary object of the Act was to control the production supply and distribution of essential commodities and to make such commodities available at a reasonable price.
The Preamble of the Act makes it clear.
It reads: "An Act to provide in the interest of the general public, for the control of the production, supply and distribution of, and trade and commerce in certain commodities.
" The exercise provided under the Act was intended ultimately to serve the interest of consumers.
It is fundamental in the entire scheme of the Act.
But then, the interest of the industry as a whole cannot be left out.
It is also required to be borne in mind.
The levy price of sugar should ensure reasonable return to the industry.
That is one of the guidelines provided under sub section 3C of Section 3 of the .
But that does not mean that the interest of producers should outweigh the interest of consumers.
It would be tilting the balance too much.
Such a contention in our opinion, also runs afoul of our earlier analysis.
It is true that there is no express reference to Panipat and Anakapalle in the judgment in New India Sugar Works.
But the judgment need not be a digest of cases.
It need not be written like a thesis.
The decision in New India Sugar Works may be brief, but not less predictable on the principles of Panipat and Anakapalle.
There this Court found the levy price reasonable even from the point of view of the industry.
This Court took into consideration the liberty reserved to manufacturers to sell freely 50% of the Sugar manufactured and also 100% of the produce by 2nd and 3rd processes.
This Court was of opinion that by such a free sale the industry could get reasonable return.
We agree with this conclusion and see no reason for reconsideration.
As to the grievance of the petitioner that the State has made 583 profit by the sale of Khandsari sugar at public auction, we perused the counter affidavit of the State.
We do not find any colourable exercise of the power.
There was every justification for the sale by public auction.
It has been stated that the petitioner and some other producers delivered inferior quality of Khandsari.
That was found to be unacceptable to consumers at Fair Price Shops.
The State officers accordingly reported to the Government.
The Government issued instructions to distribute the levy sugar liberally through permits for marriages and religious functions.
The consumers, however, could not come forward.
The Government then directed the disposal of levy sugar by public auction.
It was not with a view to earn profit although incidentally the Government made some profit.
The levy sugar was brought to public sale only to prevent deterioration when the consumers refused to accept it.
We have no reason to doubt the explanation given by the State Government.
In the result, the Writ Petition fails and is dismissed with costs.
N.P.V. Petition dismissed.
|
% In a writ petition, the petitioner challenged the price fixation on the ground; that the State Government had not taken into consideration the guidelines in built in sub section 3C of section 3 of the , that the levy order was unreasonable or excessive restriction on the fundamental rights guaranteed under Articles 19(1)(g) and 14 of the Constitution, and that the levy was a colourable exercise of the power as the State Government sold the levy sugar by public auction realising large profit.
Dismissing the Writ Petition, ^ HELD: 1.1 The Court does not act like a Chartered Accountant nor acts like an Income Tax officer.
The Court is not concerned with any individual case of any particular problem.
The Court only examines whether the price determined was with due regard to considerations provided by the statute, and whether extraneous matters have been excluded from determination.
[580D E] Union of India vs Cynamide India Ltd. AIR 1987 Sept. SC 180 ' at 1805.
followed.
1.2 The primary consideration in the fixation of price would be 578 the interest of consumers rather than that of producers.
[581F] Since the petitioners in the instant case, are allowed to sell freely at any rate they like, the remaining 50% of the Sugar (after excluding the 50% which they have to give for levy) as also the produce by the second and third process, the loss if any caused to the petitioners would be minimal.
[581Gl New India Sugar Works vs State of Uttar Pradesh & Ors., ; , relied.
1.3 It is clear from the Preamble, that the primary object of the was to control production, supply, and distribution of essential commodities, and to make such commodities available at a reasonable price.
The exercise provided under the Act was intended ultimately to serve the interest of consumers.
It is fundamental in the entire scheme of the Act.
But then, the interest of the industry as a whole cannot be left out.
It is also required to be borne in mind.
The levy price of sugar should ensure reasonable return to the industry.
That is one of the guidelines provided under sub section 3C of section 3 of the Act.
But that does not mean that the interest of producers should outweigh the interest of consumers.
It would be tilting the balance too much.
[582C F] 1.4 There is no colourable exercise of power.
There was every justification for the sale by public auction.
The petitioner and some other producers delivered inferior quality of Khandsari, which was found to be unacceptable to consumers at Fair Price Shops.
The State officers accordingly reported to the Government, which issued instructions to distribute the levy sugar liberally through permits for marriages and religious functions.
The consumers, however, could not come forward.
The Government then directed the disposal of levy sugar by public auction.
It was not with a view to earn profit, although incidentally the Government made some profit.
The levy sugar was brought to public sale only to prevent deterioration when the consumers refused to accept it.
[583A C] The Panipat Co operative Sugar mills vs Union of India [197312 SCR 860 and Anakapalle Coop.
& Industrial Society Ltd. vs Union of India & Ors.
, ; , referred to.
|
ition No. 7993 of 1982.
(Under Article 32 of the Constitution of India).
R.K. Jain and R.P. Singh for the Petitioner.
Prithiviraj and Mrs. Shobha Dikshit for Respondent Nos. 1 and 3 to 5.
Kuldip Singh, Additional Solicitor General, Mr. C.V. Subba Rao and B. Parthasarthy for Respondent No. 2.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
This is a petition under Article 32 of the Constitution.
The petitioner is engaged in the manufacture of Khandsari sugar.
The petitioner challenges the validity of the U.P. Khandsari Sugar (Levy) order, 1981 ("Levy order").
It was issued in exercise of powers under Section 3 of the by virtue of delegation of power by the Central Government under Section 5 of the said Act.
The levy order requires Khandsari manufacturing units to surrender levy of 50% of the production by sulphitation units in the first process.
The balance 50% of that process with the total production by subsequent processes was left free to be sold in the open market by the manufacturing units.
The price fixed for the levy Khandsari sugar was Rs. 320 per quintal .
The petitioner challenges the price fixation on the ground that the State Government has not taken into consideration the guidelines in built in sub section 3C of section 3 of the .
The petitioner alleges that the levy order is unreasonable or excessive restriction on the fundamental rights guaranteed under Articles 19(1)(g) and 14 of the Constitution.
lt is also the case of the petitioner that the State Government sold the levy sugar by public auction realising large profit and the levy therefore, was a colourable exercise of the power.
Before considering these contentions, we may start with recent observation of o. Chinnappa Reddy, J. in Union of India vs Cynamide India Ltd. AIR 1987 Sept. SC 1802 at 1805: .
"Price fixation is neither the function nor the forte of the Court.
We concern ourselves neither with the policy nor with the rates.
But we do not totally deny ourselves the jurisdiction to inquire into the question, in appropriate 580 proceedings, whether relevant considerations have gone in and irrelevant considerations kept out of the determination of the price.
For example, if the legislature has decreed the pricing policy and prescribed the factors which should guide the determination of the price, we wilt, if necessary, inquire into the question whether the policy and the factors are present to the mind of the authorities specifying the price.
But our examination will stop there.
We will go no further.
We will not deluge ourselves with more facts and figures.
The assembling of the raw materials and the mechanics of the price fixation are the concern of the executive and we leave it to them.
And, we will not revaluate the considerations even if the prices are demonstrably injurious to some manufacturers or producers.
The Court will, of course, examine if there is any hostile discrimination.
That is a different 'cup of tea ' altogether.
" This will be the parametre and the limitation of inquiry by Courts whenever the price fixation of any essential commodity is called into question.
The Court does not act like a Chartered accountant nor acts like an Income Tax officer.
The Court is not concerned with any individual case or any particular problem.
The Court only examines whether the price determined was with due regard to considerations provided by the statute.
And whether extraneous matters have been excluded from determination.
In the present case even this limited inquiry appears to be unnecessary.
The validity of the same levy order was the subject matter of decision of this Court in New India Sugar Works vs State of Uttar Pradesh & Ors.
l ; There Fazal Ali, J. who spoke for the Bench observed: "It was next strongly contended that in fixation of the price of levy sugar the Government has not taken into consideration the fact that the petitioners would undergo a serious loss because the price would not be sufficient even to cover their manufacturing cost.
We are, however, unable to agree with this argument.
The policy of price control has for its dominant object equitable distribution and availability of the commodity at fair price so as to benefit the consumers.
It is manifest that individual interest, however, precious they may be must yield to the larger interest of the 581 community viz., in the instant case, the large body of the consumers of sugar.
In fact, even if the petitioners have to bear some loss there can be no question of the restrictions imposed on the petitioners being unreasonable.
In Shree Meenakshi Mills Ltd. vs U.O.I. this Court observed as follows.
"If fair price is to be fixed leaving a reasonable margin of profit, there is never any question of infringment of fundamental right to carry on business by imposing reasonable restrictions.
In determining the reasonableness of a restriction imposed by law in the field of industry, trade or commerce, it has to be remembered that the mere fact that some of those who are engaged in these are alleging loss after the imposition of law will not render the law unreasonable." (Emphasis supplied).
Similar view was taken by this Court in the case of Prag Ice and oil Mills & Anr.
vs Union of India [ ; where the Court speaking through Beg, C.J. Observed as follows: "It has also to be remembered that the object is to secure equitable distribution and availability at fair price so that it is the interest of the consumer and not of the producer which is the determining factor in applying any objective tests at any particular time.
" In this view of the matter, the primary consideration in the fixation of price would be the interest of consumers rather than that of the producers.
Moreover, we think that since the petitioners are allowed to sell freely at any rate they like the remaining 50% of the sugar (after excluding the 50% which they have to give for levy) as also the produce by the second and third process, the loss if any caused to the petitioners would be minimal.
Mr. R.K. Jain learned counsel for the petitioner however, urged that the above case did not lay down the correct law.
He said that the primary consideration in the fixation of price would not be the interest of consumers, but to ensure a reasonable return to producers.
That H 582 according to him the law laid down by this Court in (i) The Panipat Co operative Sugar Mills vs Union of India [19731 2 SCR 860 and Anakapalle Coop.
& Industrial Society Ltd. vs Union of India & Ors.
, [ ; Since these two decisions have not been referred to in the New India Sugar Works case we should refer this case to a larger bench for decision.
We do not think that the counsel is justified in his submission.
We do not find any diversity of views taken in the aforesaid cases.
All those cases concerned with the price fixation of the essential commodity under the essential Commodities Act.
The primary object of the Act was to control the production supply and distribution of essential commodities and to make such commodities available at a reasonable price.
The Preamble of the Act makes it clear.
It reads: "An Act to provide in the interest of the general public, for the control of the production, supply and distribution of, and trade and commerce in certain commodities.
" The exercise provided under the Act was intended ultimately to serve the interest of consumers.
It is fundamental in the entire scheme of the Act.
But then, the interest of the industry as a whole cannot be left out.
It is also required to be borne in mind.
The levy price of sugar should ensure reasonable return to the industry.
That is one of the guidelines provided under sub section 3C of Section 3 of the .
But that does not mean that the interest of producers should outweigh the interest of consumers.
It would be tilting the balance too much.
Such a contention in our opinion, also runs afoul of our earlier analysis.
It is true that there is no express reference to Panipat and Anakapalle in the judgment in New India Sugar Works.
But the judgment need not be a digest of cases.
It need not be written like a thesis.
The decision in New India Sugar Works may be brief, but not less predictable on the principles of Panipat and Anakapalle.
There this Court found the levy price reasonable even from the point of view of the industry.
This Court took into consideration the liberty reserved to manufacturers to sell freely 50% of the Sugar manufactured and also 100% of the produce by 2nd and 3rd processes.
This Court was of opinion that by such a free sale the industry could get reasonable return.
We agree with this conclusion and see no reason for reconsideration.
As to the grievance of the petitioner that the State has made 583 profit by the sale of Khandsari sugar at public auction, we perused the counter affidavit of the State.
We do not find any colourable exercise of the power.
There was every justification for the sale by public auction.
It has been stated that the petitioner and some other producers delivered inferior quality of Khandsari.
That was found to be unacceptable to consumers at Fair Price Shops.
The State officers accordingly reported to the Government.
The Government issued instructions to distribute the levy sugar liberally through permits for marriages and religious functions.
The consumers, however, could not come forward.
The Government then directed the disposal of levy sugar by public auction.
It was not with a view to earn profit although incidentally the Government made some profit.
The levy sugar was brought to public sale only to prevent deterioration when the consumers refused to accept it.
We have no reason to doubt the explanation given by the State Government.
In the result, the Writ Petition fails and is dismissed with costs.
N.P.V. Petition dismissed.
|
ition No. 7993 of 1982.
(Under Article 32 of the Constitution of India).
R.K. Jain and R.P. Singh for the Petitioner.
Prithiviraj and Mrs. Shobha Dikshit for Respondent Nos. 1 and 3 to 5.
Kuldip Singh, Additional Solicitor General, Mr. C.V. Subba Rao and B. Parthasarthy for Respondent No. 2.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
This is a petition under Article 32 of the Constitution.
The petitioner is engaged in the manufacture of Khandsari sugar.
The petitioner challenges the validity of the U.P. Khandsari Sugar (Levy) order, 1981 ("Levy order").
It was issued in exercise of powers under Section 3 of the by virtue of delegation of power by the Central Government under Section 5 of the said Act.
The levy order requires Khandsari manufacturing units to surrender levy of 50% of the production by sulphitation units in the first process.
The balance 50% of that process with the total production by subsequent processes was left free to be sold in the open market by the manufacturing units.
The price fixed for the levy Khandsari sugar was Rs. 320 per quintal .
The petitioner challenges the price fixation on the ground that the State Government has not taken into consideration the guidelines in built in sub section 3C of section 3 of the .
The petitioner alleges that the levy order is unreasonable or excessive restriction on the fundamental rights guaranteed under Articles 19(1)(g) and 14 of the Constitution.
lt is also the case of the petitioner that the State Government sold the levy sugar by public auction realising large profit and the levy therefore, was a colourable exercise of the power.
Before considering these contentions, we may start with recent observation of o. Chinnappa Reddy, J. in Union of India vs Cynamide India Ltd. AIR 1987 Sept. SC 1802 at 1805: .
"Price fixation is neither the function nor the forte of the Court.
We concern ourselves neither with the policy nor with the rates.
But we do not totally deny ourselves the jurisdiction to inquire into the question, in appropriate 580 proceedings, whether relevant considerations have gone in and irrelevant considerations kept out of the determination of the price.
For example, if the legislature has decreed the pricing policy and prescribed the factors which should guide the determination of the price, we wilt, if necessary, inquire into the question whether the policy and the factors are present to the mind of the authorities specifying the price.
But our examination will stop there.
We will go no further.
We will not deluge ourselves with more facts and figures.
The assembling of the raw materials and the mechanics of the price fixation are the concern of the executive and we leave it to them.
And, we will not revaluate the considerations even if the prices are demonstrably injurious to some manufacturers or producers.
The Court will, of course, examine if there is any hostile discrimination.
That is a different 'cup of tea ' altogether.
" This will be the parametre and the limitation of inquiry by Courts whenever the price fixation of any essential commodity is called into question.
The Court does not act like a Chartered accountant nor acts like an Income Tax officer.
The Court is not concerned with any individual case or any particular problem.
The Court only examines whether the price determined was with due regard to considerations provided by the statute.
And whether extraneous matters have been excluded from determination.
In the present case even this limited inquiry appears to be unnecessary.
The validity of the same levy order was the subject matter of decision of this Court in New India Sugar Works vs State of Uttar Pradesh & Ors.
l ; There Fazal Ali, J. who spoke for the Bench observed: "It was next strongly contended that in fixation of the price of levy sugar the Government has not taken into consideration the fact that the petitioners would undergo a serious loss because the price would not be sufficient even to cover their manufacturing cost.
We are, however, unable to agree with this argument.
The policy of price control has for its dominant object equitable distribution and availability of the commodity at fair price so as to benefit the consumers.
It is manifest that individual interest, however, precious they may be must yield to the larger interest of the 581 community viz., in the instant case, the large body of the consumers of sugar.
In fact, even if the petitioners have to bear some loss there can be no question of the restrictions imposed on the petitioners being unreasonable.
In Shree Meenakshi Mills Ltd. vs U.O.I. this Court observed as follows.
"If fair price is to be fixed leaving a reasonable margin of profit, there is never any question of infringment of fundamental right to carry on business by imposing reasonable restrictions.
In determining the reasonableness of a restriction imposed by law in the field of industry, trade or commerce, it has to be remembered that the mere fact that some of those who are engaged in these are alleging loss after the imposition of law will not render the law unreasonable." (Emphasis supplied).
Similar view was taken by this Court in the case of Prag Ice and oil Mills & Anr.
vs Union of India [ ; where the Court speaking through Beg, C.J. Observed as follows: "It has also to be remembered that the object is to secure equitable distribution and availability at fair price so that it is the interest of the consumer and not of the producer which is the determining factor in applying any objective tests at any particular time.
" In this view of the matter, the primary consideration in the fixation of price would be the interest of consumers rather than that of the producers.
Moreover, we think that since the petitioners are allowed to sell freely at any rate they like the remaining 50% of the sugar (after excluding the 50% which they have to give for levy) as also the produce by the second and third process, the loss if any caused to the petitioners would be minimal.
Mr. R.K. Jain learned counsel for the petitioner however, urged that the above case did not lay down the correct law.
He said that the primary consideration in the fixation of price would not be the interest of consumers, but to ensure a reasonable return to producers.
That H 582 according to him the law laid down by this Court in (i) The Panipat Co operative Sugar Mills vs Union of India [19731 2 SCR 860 and Anakapalle Coop.
& Industrial Society Ltd. vs Union of India & Ors.
, [ ; Since these two decisions have not been referred to in the New India Sugar Works case we should refer this case to a larger bench for decision.
We do not think that the counsel is justified in his submission.
We do not find any diversity of views taken in the aforesaid cases.
All those cases concerned with the price fixation of the essential commodity under the essential Commodities Act.
The primary object of the Act was to control the production supply and distribution of essential commodities and to make such commodities available at a reasonable price.
The Preamble of the Act makes it clear.
It reads: "An Act to provide in the interest of the general public, for the control of the production, supply and distribution of, and trade and commerce in certain commodities.
" The exercise provided under the Act was intended ultimately to serve the interest of consumers.
It is fundamental in the entire scheme of the Act.
But then, the interest of the industry as a whole cannot be left out.
It is also required to be borne in mind.
The levy price of sugar should ensure reasonable return to the industry.
That is one of the guidelines provided under sub section 3C of Section 3 of the .
But that does not mean that the interest of producers should outweigh the interest of consumers.
It would be tilting the balance too much.
Such a contention in our opinion, also runs afoul of our earlier analysis.
It is true that there is no express reference to Panipat and Anakapalle in the judgment in New India Sugar Works.
But the judgment need not be a digest of cases.
It need not be written like a thesis.
The decision in New India Sugar Works may be brief, but not less predictable on the principles of Panipat and Anakapalle.
There this Court found the levy price reasonable even from the point of view of the industry.
This Court took into consideration the liberty reserved to manufacturers to sell freely 50% of the Sugar manufactured and also 100% of the produce by 2nd and 3rd processes.
This Court was of opinion that by such a free sale the industry could get reasonable return.
We agree with this conclusion and see no reason for reconsideration.
As to the grievance of the petitioner that the State has made 583 profit by the sale of Khandsari sugar at public auction, we perused the counter affidavit of the State.
We do not find any colourable exercise of the power.
There was every justification for the sale by public auction.
It has been stated that the petitioner and some other producers delivered inferior quality of Khandsari.
That was found to be unacceptable to consumers at Fair Price Shops.
The State officers accordingly reported to the Government.
The Government issued instructions to distribute the levy sugar liberally through permits for marriages and religious functions.
The consumers, however, could not come forward.
The Government then directed the disposal of levy sugar by public auction.
It was not with a view to earn profit although incidentally the Government made some profit.
The levy sugar was brought to public sale only to prevent deterioration when the consumers refused to accept it.
We have no reason to doubt the explanation given by the State Government.
In the result, the Writ Petition fails and is dismissed with costs.
N.P.V. Petition dismissed.
|
% In a writ petition, the petitioner challenged the price fixation on the ground; that the State Government had not taken into consideration the guidelines in built in sub section 3C of section 3 of the , that the levy order was unreasonable or excessive restriction on the fundamental rights guaranteed under Articles 19(1)(g) and 14 of the Constitution, and that the levy was a colourable exercise of the power as the State Government sold the levy sugar by public auction realising large profit.
Dismissing the Writ Petition, ^ HELD: 1.1 The Court does not act like a Chartered Accountant nor acts like an Income Tax officer.
The Court is not concerned with any individual case of any particular problem.
The Court only examines whether the price determined was with due regard to considerations provided by the statute, and whether extraneous matters have been excluded from determination.
[580D E] Union of India vs Cynamide India Ltd. AIR 1987 Sept. SC 180 ' at 1805.
followed.
1.2 The primary consideration in the fixation of price would be 578 the interest of consumers rather than that of producers.
[581F] Since the petitioners in the instant case, are allowed to sell freely at any rate they like, the remaining 50% of the Sugar (after excluding the 50% which they have to give for levy) as also the produce by the second and third process, the loss if any caused to the petitioners would be minimal.
[581Gl New India Sugar Works vs State of Uttar Pradesh & Ors., ; , relied.
1.3 It is clear from the Preamble, that the primary object of the was to control production, supply, and distribution of essential commodities, and to make such commodities available at a reasonable price.
The exercise provided under the Act was intended ultimately to serve the interest of consumers.
It is fundamental in the entire scheme of the Act.
But then, the interest of the industry as a whole cannot be left out.
It is also required to be borne in mind.
The levy price of sugar should ensure reasonable return to the industry.
That is one of the guidelines provided under sub section 3C of section 3 of the Act.
But that does not mean that the interest of producers should outweigh the interest of consumers.
It would be tilting the balance too much.
[582C F] 1.4 There is no colourable exercise of power.
There was every justification for the sale by public auction.
The petitioner and some other producers delivered inferior quality of Khandsari, which was found to be unacceptable to consumers at Fair Price Shops.
The State officers accordingly reported to the Government, which issued instructions to distribute the levy sugar liberally through permits for marriages and religious functions.
The consumers, however, could not come forward.
The Government then directed the disposal of levy sugar by public auction.
It was not with a view to earn profit, although incidentally the Government made some profit.
The levy sugar was brought to public sale only to prevent deterioration when the consumers refused to accept it.
[583A C] The Panipat Co operative Sugar mills vs Union of India [197312 SCR 860 and Anakapalle Coop.
& Industrial Society Ltd. vs Union of India & Ors.
, ; , referred to.
|
% In a writ petition, the petitioner challenged the price fixation on the ground; that the State Government had not taken into consideration the guidelines in built in sub section 3C of section 3 of the , that the levy order was unreasonable or excessive restriction on the fundamental rights guaranteed under Articles 19(1)(g) and 14 of the Constitution, and that the levy was a colourable exercise of the power as the State Government sold the levy sugar by public auction realising large profit.
Dismissing the Writ Petition, ^ HELD: 1.1 The Court does not act like a Chartered Accountant nor acts like an Income Tax officer.
The Court is not concerned with any individual case of any particular problem.
The Court only examines whether the price determined was with due regard to considerations provided by the statute, and whether extraneous matters have been excluded from determination.
[580D E] Union of India vs Cynamide India Ltd. AIR 1987 Sept. SC 180 ' at 1805.
followed.
1.2 The primary consideration in the fixation of price would be 578 the interest of consumers rather than that of producers.
[581F] Since the petitioners in the instant case, are allowed to sell freely at any rate they like, the remaining 50% of the Sugar (after excluding the 50% which they have to give for levy) as also the produce by the second and third process, the loss if any caused to the petitioners would be minimal.
[581Gl New India Sugar Works vs State of Uttar Pradesh & Ors., ; , relied.
1.3 It is clear from the Preamble, that the primary object of the was to control production, supply, and distribution of essential commodities, and to make such commodities available at a reasonable price.
The exercise provided under the Act was intended ultimately to serve the interest of consumers.
It is fundamental in the entire scheme of the Act.
But then, the interest of the industry as a whole cannot be left out.
It is also required to be borne in mind.
The levy price of sugar should ensure reasonable return to the industry.
That is one of the guidelines provided under sub section 3C of section 3 of the Act.
But that does not mean that the interest of producers should outweigh the interest of consumers.
It would be tilting the balance too much.
[582C F] 1.4 There is no colourable exercise of power.
There was every justification for the sale by public auction.
The petitioner and some other producers delivered inferior quality of Khandsari, which was found to be unacceptable to consumers at Fair Price Shops.
The State officers accordingly reported to the Government, which issued instructions to distribute the levy sugar liberally through permits for marriages and religious functions.
The consumers, however, could not come forward.
The Government then directed the disposal of levy sugar by public auction.
It was not with a view to earn profit, although incidentally the Government made some profit.
The levy sugar was brought to public sale only to prevent deterioration when the consumers refused to accept it.
[583A C] The Panipat Co operative Sugar mills vs Union of India [197312 SCR 860 and Anakapalle Coop.
& Industrial Society Ltd. vs Union of India & Ors.
, ; , referred to.
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Civil Appeal No. 2603 2605 of 1987.
From the Judgment and order dated 8.12.1986 of the Rajasthan High Court in D.B. Special Appeal No. 889, 975 and 1135 of 1986.
G.L. Sanghi and Mrs. Rani Chhabra for the Appellants.
Shanti Bhushan and S.K. Jain for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
Special Leave granted.
Appeals are disposed of by this order.
The three appellants had been granted permits on a route from Bhadra to Hissar via Adampur.
This route lay both in the State of Rajasthan and in the State of Haryana and was thus an inter State route.
When the permits were about to expire the petitioners filed applications for their renewal in accordance with the provisions of section 58 of the Motor Vehicles Act (hereinafter called 'the Act ').
At the same time, the Rajasthan State Road Transport Corporation (hereinafter referred to as 'the Corporation ') also moved applications before the Regional Transport Authority, Bikaner, for the grant of fresh permits to it on the same route.
The applications for renewal of permits made by the petitioners as well as the applications for the grant of permits by the Corporation were heard together by the Re gional Transport Authority, Bikaner (R.T.A.) on several dates, the 643 last of which was the 6th of November, 1981.
On that date, orders were reserved by the R.T.A. The R.T.A., however, passed its order only on 27th November, 1982, about a year after the date of the hearing.
It rejected the renewal applications of the petitioners and granted permits to the Corporation in respect of the above route.
Aggrieved by the orders of the R.T.A., the petitioners filed appeals before the State Transport Appellate Tribunal (S.T.A.T.) The STAT dismissed the appeals preferred by the petitioners and confirmed the order of the R.T.A. The petitioners filed writ petitions in the High Court of Rajasthan, which were dismissed by a Single Judge on 2 1st July, 1986.
Further appeals preferred by the petitioners and certain other operators were dismissed by a Division Bench of the High Court of Rajasthan by its judgment and order dated 8th December, 1986.
These Special Leave Petitions have been preferred against the order of the Division Bench dated 8th December, 1986.
We have come to the conclusion that the order of the R.T.A. (and consequently the orders of the STAT and the High Court) should be set aside and the matter should be remitted back to the R.T.A. for fresh consideration on the short ground that the petitioners have not had a fair opportunity of putting forward and being heard on their contentions relevant to the issue before the R.T.A. The principal issue that had to be considered by the R.T.A. was whether the claims of the Corporation for the grant of a permit had precedence over the claims of the petitioners for renewal.
This issue had to be decided in the context of two statutory provisions.
The first is section 47( 1H) of the Act which reads as follows: Notwithstanding anything contained in this section, an application for a stage carriage permit from a State transport undertaking for operating in any inter State route shall be given preference over all other applications: Provided that the authority shall not grant a permit under this sub section unless it is satisfied that the State transport undertaking would be able to operate in the inter State route without detriment to its responsibility for providing efficient and adequate road transport service in any notified area or notified route as is referred to in subsection (3) of section 68D where the undertaking operates the service.
644 Explanation For the purposes of this sub section, "inter State route" means any route lying contiguously in two or more States.
The second relevant provision is the third proviso inserted in section 58(2) of the Act by an amendment applicable to the State of Rajasthan.
This sub section, in so far it is material for our present purposes, reads: . "(2) A permit may be renewed on an application made and disposed of as if it were an application for a permit: Provided further that, other conditions being equal, an application for stage carriage permit by a State transport undertaking as defined in section 68(A), shall be given preference over applications from individual owners and cooperative societies.
" The arguments before the R.T.A. primarily ranged round the question whether the terms of the proviso to section 47(1H) were fulfilled in the present case or not.
The petitioners (as well as operators on several other routes whose requests for renewal had also been countered by applications for permits by the Corporation) con tended that the Corporation was not in a position to operate in the inter State routes in question without detriment to its responsibility for providing efficient and adequate road transport service in routes which had already been nationalized under Chapter IV A of the Act.
The R.T.A. has applied its mind to this contention in what may be described as a piecemeal manner.
This was because applications made by several private operators and the corporation in regard to various routes came up for consideration by it in separate meetings held at different places on different occasions.
In fact it is this which also explains the delay in the passing of its order by the R.T.A. in the present case.
In course of the hearing before us, we called upon the respondents to produce the original records.
These show that the mat ter relating to renewal of permits of six operators (including the preG sent petitioners) was heard on 6.11.1981 and orders reserved.
On 30 .11.8 1, the counsel for the Corporation made a request to the R.T.A. that certain other matters pertaining to renewals of permits in the Bikaner region were coming up for consideration on 16.12.81 and that, therefore, the orders in the instant cases may be deferred till after the other matters were also heard by the R.T.A. This request of the counsel for the Corporation was accepted by the R.T.A. The other 645 matters referred to could not be heard on 16.12.1981 but got adjourned from time to time.
The order sheet of the R.T.A. in the present case shows that the decision in the present cases was deferred on three subsequent occasions upto 22.03.1982.
The records do not indicate what happened thereafter but it appears that the decision was postponed on subsequent occasions also for the same reason and ultimately announced by the R.T.A. On the 27th of November, 1982, after the connected matters had been heard.
This is clear from the order of the R.T.A. which, in arriving at its final decision, has followed the orders passed by it on 15.9.82 & 24.11.82 in certain other matters and the orders passed by the R.T.A., Jaipur on 7.4.82 & 10.9.82 in relation to two routes falling within its jurisdiction.
The short grievance of the petitioners was that, by adopting the above procedure, the R.T.A. has imported into its final decision and order various transactions, facts, events and arguments of which they had no notice and which they had not been given a proper opportunity to rebut.
The STAT dealt with the argument by simply observing that "for considering the obtainable facts a fresh opportunity to appellants in my opinion was not very much required, as there would not be any end to it." The learned Single Judge in the High Court recognised that: "If such long spell time has lapsed and such new material has come into existence the proper course for the RTA should have been to get the case listed back for comments of both the parties but did not think that "the case warranted any interference on this aspect.
" The Division Bench observed: "It was urged on behalf of the appellants that the Regional Transport Authority took into account events after hearing and closing the cases without giving any opportunity to the appellants to rebut that material.
It was also urged that out of 83 documents filed by the appellants before the Regional Transport Authority in rebuttal of this material, only 2 were accepted, while remaining 81 were rejected.
There is no merit in this contention.
The mere fact that the appellants filed these documents out of which two were taken into account shows that they had the knowledge of the subsequent material being used for the purpose of deciding these cases and it is for this reason that they filed these documents out of which two were also taken into account.
Moreover, the subsequent events relate only to matters of record pertaining to operation of the existing routes by the 646 State Transport Undertaking.
There is thus no prejudice to A the appellants.
This argument is, therefore devoid of any merit.
In our opinion the approach of the STAT as well as the High Court was erroneous.
There is no doubt that the R.T.A. in deciding the present case has been influenced not merely by the discussions which took place during the hearing of the applications of these petitioners and the Corporation but also the facts circumstances, and arguments that surfaced at the meetings held by it in relation to various other permits in the State.
It is true that the point that arose for consideration viz. whether the Corporation had placed sufficient material on record to satisfy the R.T.A. concerned that the grant of a further permit or further permits to it would not prejudicially affect the nationalised services already run by it was, in a sense, a point common to all the meetings.
Nevertheless, the grant of a permit in each case is a separate issue to be decided on the facts and circumstances placed on record in relation to that case.
In support of their claims for permits, the petitioners had placed some material before the R.T.A. and so also the Corporation.
If, in reaching its decision, the R.T.A. desires to take into account circumstances and facts placed by other petitioners or by the Corporation at other meetings, the petitioners should atleast have had an opportunity of knowing what that material was.
This could have been done either by allowing the petitioners to participate at the other meetings or by giving the substance of that material to the petitioners, and giving them an opportunity of rebutting it before passing the final order.
In this context it is important to remember that the Corporation was a party at all the meetings and was aware of all the materials that had been placed on record by other operators as well as by themselves thereat.
On the contrary, the petitioners were handicapped in that they had no knowledge of the material placed at the other meetings.
In our opinion, the requirements of natural justice were flouted by the failure of the RTA to apprise the petitioners, atleast broadly, of what had transpired at the other meetings.
The High Court has observed that the petitioners had not been prejudiced as is seen from the fact that they had placed several documents on record in rebuttal of the Corporation 's case.
It may be, as pointed out by the High Court, that the petitioners were vaguely aware of the nature of the general contentions urged as well as the evidence placed by the Corporation and also tried to put in some documents to controvert the material placed on record by the Corporation but they 647 had no direct knowledge of such material.
Further, the petitioners ' grievance is that out of 83 documents placed by the petitioners only two were considered.
We are not able to appreciate the High Court 's answer to this contention in the extract we have quoted above.
We could have understood it if the other 81 documents which the petitioners relied upon had been found to be irrelevant.
The R.T.A. has not discussed this evidence.
Nor does the STAT appear to have considered the material or given the petitioners an opportunity, atleast at the appellate stage to attempt to substantiate its contentions by reference to these documents.
In the Special Leave Petitions before us, the petitioners have catalogued several circumstances to substantiate a contention that the Corporation was not in a position to undertake the plying of buses on the routes in question without prejudice to the efficiency of the nationalised services already being run by it.
We express no opinion on the correctness of these averments or the effect they can have on the satisfaction to be reached by the Regional Transport Authority but it appears manifest that the impugned order rejecting the renewal applications of the petitioners has been passed without there being reasonable opportunity given to the petitioners to counter the case put forward by the Corporation.
On this short ground that the procedural requirements of natural justice have not been complied with, we think, the impugned order should be set aside and the R.T.A. directed to pass a fresh order after giving the opportunity to the Petitioners to put forward their contentions.
Shri Shanti Bhushan, learned counsel for the Corporation, raised two contentions.
He urged, firstly, that the present case was governed by section 58(2) and not by section 47( 1H) and that the Corporation was rightly granted precedence over the private operators.
We are unable to accept this contention for two reasons.
In the first place the grant of a permit for an inter State route is governed by the special provision contained in section 47( lH) and not by section 58 which is a general provision.
Secondly, even under Section 58, the Corporation is not entitled to a permit automatically by reason of the fact that it is a State Road Transport Undertaking.
It is entitled to a priority over private operators only on "other things being equal".
In other words, even if section 58 is to apply, the RTA has to apply its mind to the relative merits of the private operators on the one hand and the Corporation on the other and it is only if both of them stand on the same footing that the Corporation would be entitled to a preference.
This would necessarily involve a hearing by the RTA of the merits of both the contending parties.
648 The second contention of counsel is based on an interpretation of A section 47(1 H).
The principle and ratio of this provision has been discussed and approved by this Court in Sher Singh vs Union of India, A.I.R. 1984 SC 209.
This provision no doubt enables the Corporation to have a preference over private operators and individuals but this is subject to a condition precedent that it should satisfy the Authority that it E3 would be able to operate the inter State route for which permit is sought without detriment to the efficiency and adequacy of the nationalised services it is already running in the State.
Shri Shanti Bhushan would contend that this is a matter on which the Regional Transport Authority has to reach a subjective satisfaction in the light of such material as it may be able to gather and that it is not necessary that it should be arrived at after giving an opportunity to all the persons appearing before the Authority.
We cannot accept this interpretation.
Like analogous provisions contained in several statutes which require or permit certain action to be taken on the satisfaction of a particular specified authority, the provision in section 47( lH) also requires the R.T.A. to arrive at its satisfaction not subjectively but on an objective consideration of the various facts and circumstances placed before it.
It will at once be obvious that such a satisfaction cannot be reached by the Authority without hearing the various operators.
The matter comes up before the Authority on a contest between an application for a permit or a renewal application of a private operator and an application for permit by the Corporation.
Naturally, the Corporation will place before the Authority some material to satisfy the Tribunal that the condition mentioned in the proviso to section 47(1H) is satisfied.
The R.T.A.
On its own can have no method of assessing the merits of this plea.
It is only the private operators, who are seeking permits for themselves that may be in a position to place material which would show that the Corporation does not have the capacity to take up this additional responsibility of running buses on the inter State route for which it seeks a permit.
It is clearly the duty of the R.T.A. to consider the evidence placed by both the parties, allow each party an opportunity to rebut the material placed by the other and arrive at its satisfaction one way or the other.
The satisfaction contemplated under section 47( lH) is a satisfaction to be arrived at on the basis of such a quasi judicial enquiry conducted by the R.T.A. It is, therefore, not possible to accept the contention that the petitioners were not required to be heard before the R.T.A. reached its conclusion in favour of the Corporation.
For the reasons discussed above, we hold that the petitioners ' applications for renewal of permits as well as the Corporation 's appli 649 cation for fresh permits on the inter State route Bhadra to Hissar via Adampur require to be considered afresh.
We, therefore, set aside the order of Regional Transport Authority dated 27.11.1982, the order of the State Transport Appellate Tribunal dated 20.1. ]983 as well as the order of the Single Judge of the High Court dated 21st July, 1986 and the order of the Division Bench of the High Court dated 8.12.1986.
The matter will stand remanded to the file of the R.T.A., Bikaner, for being disposed of afresh in the light of the above observations.
The appeals are allowed but in the circumstances we make no order as to costs.
S.L. Appeals allowed.
|
% The appellants filed applications for renewal of their stage carriage permits on a route in Rajasthan, under section 58 of the Motor Vehicles Act.
At the same time, the Rajasthan State Road Corporation(Corporation) moved applications for the grant of fresh permits to it for the same route.
Both the applications for renewal of permits and the applications for fresh permits, were heard together by the Regional Transport Authority (R.T.A.) which reserved its orders thereon.
The R.T.A. passed orders in the matters after a year of the hearing, rejecting the renewal applications of the appellants and granting fresh permits to the Corporation.
The R.T.A. had, during the intervening period of one year, held several other proceedings and meetings in connected matters of which no notice and no opportunity had been given to the appellants whereas the Corporation was a party to all those meetings and discussions before the R.T.A.
Against the orders of the R.T.A., the appellants filed appeals before the State Transport Appellate Tribunal (S.T.A.T.).
The S.T.A.T. dismissed the appeals.
The appellants moved the High Court by writ petitions against the order of the S.T.A.T.
The High Court (Single Judge) dismissed the writ petitions.
Further appeals by the appellants to the Division Bench of the High Court were also dismissed.
The appellants moved this Court by special leave.
Allowing the appeals, the Court, ^ HELD: The principal issue to be decided by the R.T.A. was whether the claims of the Corporation for fresh permits had precedence over the claims of the appellants for the renewal of their permits.
[643E] 642 The appellants have not had an opportunity of putting forward their contentions and of being heard before the R.T.A. in the various proceedings meetings held by the R.T.A. during the period of one year following the reservation of orders by it on the applications of the Appellants and the Corporation.
The principles of natural justice were flouted by the R.T.A. by its failure to apprise the appellants of what had transpired at the meetings/discussions held in their absence.
[646D F] The appellants ' applications and the applications of the Corporation require to be considered and disposed of afresh by the R.T.A. in the light of the observations made by the Court.
[648H, 649A] Sher Singh vs Union of India, AIR 1984 SC 200, referred to.
|
Civil Appeal No. 2603 2605 of 1987.
From the Judgment and order dated 8.12.1986 of the Rajasthan High Court in D.B. Special Appeal No. 889, 975 and 1135 of 1986.
G.L. Sanghi and Mrs. Rani Chhabra for the Appellants.
Shanti Bhushan and S.K. Jain for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
Special Leave granted.
Appeals are disposed of by this order.
The three appellants had been granted permits on a route from Bhadra to Hissar via Adampur.
This route lay both in the State of Rajasthan and in the State of Haryana and was thus an inter State route.
When the permits were about to expire the petitioners filed applications for their renewal in accordance with the provisions of section 58 of the Motor Vehicles Act (hereinafter called 'the Act ').
At the same time, the Rajasthan State Road Transport Corporation (hereinafter referred to as 'the Corporation ') also moved applications before the Regional Transport Authority, Bikaner, for the grant of fresh permits to it on the same route.
The applications for renewal of permits made by the petitioners as well as the applications for the grant of permits by the Corporation were heard together by the Re gional Transport Authority, Bikaner (R.T.A.) on several dates, the 643 last of which was the 6th of November, 1981.
On that date, orders were reserved by the R.T.A. The R.T.A., however, passed its order only on 27th November, 1982, about a year after the date of the hearing.
It rejected the renewal applications of the petitioners and granted permits to the Corporation in respect of the above route.
Aggrieved by the orders of the R.T.A., the petitioners filed appeals before the State Transport Appellate Tribunal (S.T.A.T.) The STAT dismissed the appeals preferred by the petitioners and confirmed the order of the R.T.A. The petitioners filed writ petitions in the High Court of Rajasthan, which were dismissed by a Single Judge on 2 1st July, 1986.
Further appeals preferred by the petitioners and certain other operators were dismissed by a Division Bench of the High Court of Rajasthan by its judgment and order dated 8th December, 1986.
These Special Leave Petitions have been preferred against the order of the Division Bench dated 8th December, 1986.
We have come to the conclusion that the order of the R.T.A. (and consequently the orders of the STAT and the High Court) should be set aside and the matter should be remitted back to the R.T.A. for fresh consideration on the short ground that the petitioners have not had a fair opportunity of putting forward and being heard on their contentions relevant to the issue before the R.T.A. The principal issue that had to be considered by the R.T.A. was whether the claims of the Corporation for the grant of a permit had precedence over the claims of the petitioners for renewal.
This issue had to be decided in the context of two statutory provisions.
The first is section 47( 1H) of the Act which reads as follows: Notwithstanding anything contained in this section, an application for a stage carriage permit from a State transport undertaking for operating in any inter State route shall be given preference over all other applications: Provided that the authority shall not grant a permit under this sub section unless it is satisfied that the State transport undertaking would be able to operate in the inter State route without detriment to its responsibility for providing efficient and adequate road transport service in any notified area or notified route as is referred to in subsection (3) of section 68D where the undertaking operates the service.
644 Explanation For the purposes of this sub section, "inter State route" means any route lying contiguously in two or more States.
The second relevant provision is the third proviso inserted in section 58(2) of the Act by an amendment applicable to the State of Rajasthan.
This sub section, in so far it is material for our present purposes, reads: . "(2) A permit may be renewed on an application made and disposed of as if it were an application for a permit: Provided further that, other conditions being equal, an application for stage carriage permit by a State transport undertaking as defined in section 68(A), shall be given preference over applications from individual owners and cooperative societies.
" The arguments before the R.T.A. primarily ranged round the question whether the terms of the proviso to section 47(1H) were fulfilled in the present case or not.
The petitioners (as well as operators on several other routes whose requests for renewal had also been countered by applications for permits by the Corporation) con tended that the Corporation was not in a position to operate in the inter State routes in question without detriment to its responsibility for providing efficient and adequate road transport service in routes which had already been nationalized under Chapter IV A of the Act.
The R.T.A. has applied its mind to this contention in what may be described as a piecemeal manner.
This was because applications made by several private operators and the corporation in regard to various routes came up for consideration by it in separate meetings held at different places on different occasions.
In fact it is this which also explains the delay in the passing of its order by the R.T.A. in the present case.
In course of the hearing before us, we called upon the respondents to produce the original records.
These show that the mat ter relating to renewal of permits of six operators (including the preG sent petitioners) was heard on 6.11.1981 and orders reserved.
On 30 .11.8 1, the counsel for the Corporation made a request to the R.T.A. that certain other matters pertaining to renewals of permits in the Bikaner region were coming up for consideration on 16.12.81 and that, therefore, the orders in the instant cases may be deferred till after the other matters were also heard by the R.T.A. This request of the counsel for the Corporation was accepted by the R.T.A. The other 645 matters referred to could not be heard on 16.12.1981 but got adjourned from time to time.
The order sheet of the R.T.A. in the present case shows that the decision in the present cases was deferred on three subsequent occasions upto 22.03.1982.
The records do not indicate what happened thereafter but it appears that the decision was postponed on subsequent occasions also for the same reason and ultimately announced by the R.T.A. On the 27th of November, 1982, after the connected matters had been heard.
This is clear from the order of the R.T.A. which, in arriving at its final decision, has followed the orders passed by it on 15.9.82 & 24.11.82 in certain other matters and the orders passed by the R.T.A., Jaipur on 7.4.82 & 10.9.82 in relation to two routes falling within its jurisdiction.
The short grievance of the petitioners was that, by adopting the above procedure, the R.T.A. has imported into its final decision and order various transactions, facts, events and arguments of which they had no notice and which they had not been given a proper opportunity to rebut.
The STAT dealt with the argument by simply observing that "for considering the obtainable facts a fresh opportunity to appellants in my opinion was not very much required, as there would not be any end to it." The learned Single Judge in the High Court recognised that: "If such long spell time has lapsed and such new material has come into existence the proper course for the RTA should have been to get the case listed back for comments of both the parties but did not think that "the case warranted any interference on this aspect.
" The Division Bench observed: "It was urged on behalf of the appellants that the Regional Transport Authority took into account events after hearing and closing the cases without giving any opportunity to the appellants to rebut that material.
It was also urged that out of 83 documents filed by the appellants before the Regional Transport Authority in rebuttal of this material, only 2 were accepted, while remaining 81 were rejected.
There is no merit in this contention.
The mere fact that the appellants filed these documents out of which two were taken into account shows that they had the knowledge of the subsequent material being used for the purpose of deciding these cases and it is for this reason that they filed these documents out of which two were also taken into account.
Moreover, the subsequent events relate only to matters of record pertaining to operation of the existing routes by the 646 State Transport Undertaking.
There is thus no prejudice to A the appellants.
This argument is, therefore devoid of any merit.
In our opinion the approach of the STAT as well as the High Court was erroneous.
There is no doubt that the R.T.A. in deciding the present case has been influenced not merely by the discussions which took place during the hearing of the applications of these petitioners and the Corporation but also the facts circumstances, and arguments that surfaced at the meetings held by it in relation to various other permits in the State.
It is true that the point that arose for consideration viz. whether the Corporation had placed sufficient material on record to satisfy the R.T.A. concerned that the grant of a further permit or further permits to it would not prejudicially affect the nationalised services already run by it was, in a sense, a point common to all the meetings.
Nevertheless, the grant of a permit in each case is a separate issue to be decided on the facts and circumstances placed on record in relation to that case.
In support of their claims for permits, the petitioners had placed some material before the R.T.A. and so also the Corporation.
If, in reaching its decision, the R.T.A. desires to take into account circumstances and facts placed by other petitioners or by the Corporation at other meetings, the petitioners should atleast have had an opportunity of knowing what that material was.
This could have been done either by allowing the petitioners to participate at the other meetings or by giving the substance of that material to the petitioners, and giving them an opportunity of rebutting it before passing the final order.
In this context it is important to remember that the Corporation was a party at all the meetings and was aware of all the materials that had been placed on record by other operators as well as by themselves thereat.
On the contrary, the petitioners were handicapped in that they had no knowledge of the material placed at the other meetings.
In our opinion, the requirements of natural justice were flouted by the failure of the RTA to apprise the petitioners, atleast broadly, of what had transpired at the other meetings.
The High Court has observed that the petitioners had not been prejudiced as is seen from the fact that they had placed several documents on record in rebuttal of the Corporation 's case.
It may be, as pointed out by the High Court, that the petitioners were vaguely aware of the nature of the general contentions urged as well as the evidence placed by the Corporation and also tried to put in some documents to controvert the material placed on record by the Corporation but they 647 had no direct knowledge of such material.
Further, the petitioners ' grievance is that out of 83 documents placed by the petitioners only two were considered.
We are not able to appreciate the High Court 's answer to this contention in the extract we have quoted above.
We could have understood it if the other 81 documents which the petitioners relied upon had been found to be irrelevant.
The R.T.A. has not discussed this evidence.
Nor does the STAT appear to have considered the material or given the petitioners an opportunity, atleast at the appellate stage to attempt to substantiate its contentions by reference to these documents.
In the Special Leave Petitions before us, the petitioners have catalogued several circumstances to substantiate a contention that the Corporation was not in a position to undertake the plying of buses on the routes in question without prejudice to the efficiency of the nationalised services already being run by it.
We express no opinion on the correctness of these averments or the effect they can have on the satisfaction to be reached by the Regional Transport Authority but it appears manifest that the impugned order rejecting the renewal applications of the petitioners has been passed without there being reasonable opportunity given to the petitioners to counter the case put forward by the Corporation.
On this short ground that the procedural requirements of natural justice have not been complied with, we think, the impugned order should be set aside and the R.T.A. directed to pass a fresh order after giving the opportunity to the Petitioners to put forward their contentions.
Shri Shanti Bhushan, learned counsel for the Corporation, raised two contentions.
He urged, firstly, that the present case was governed by section 58(2) and not by section 47( 1H) and that the Corporation was rightly granted precedence over the private operators.
We are unable to accept this contention for two reasons.
In the first place the grant of a permit for an inter State route is governed by the special provision contained in section 47( lH) and not by section 58 which is a general provision.
Secondly, even under Section 58, the Corporation is not entitled to a permit automatically by reason of the fact that it is a State Road Transport Undertaking.
It is entitled to a priority over private operators only on "other things being equal".
In other words, even if section 58 is to apply, the RTA has to apply its mind to the relative merits of the private operators on the one hand and the Corporation on the other and it is only if both of them stand on the same footing that the Corporation would be entitled to a preference.
This would necessarily involve a hearing by the RTA of the merits of both the contending parties.
648 The second contention of counsel is based on an interpretation of A section 47(1 H).
The principle and ratio of this provision has been discussed and approved by this Court in Sher Singh vs Union of India, A.I.R. 1984 SC 209.
This provision no doubt enables the Corporation to have a preference over private operators and individuals but this is subject to a condition precedent that it should satisfy the Authority that it E3 would be able to operate the inter State route for which permit is sought without detriment to the efficiency and adequacy of the nationalised services it is already running in the State.
Shri Shanti Bhushan would contend that this is a matter on which the Regional Transport Authority has to reach a subjective satisfaction in the light of such material as it may be able to gather and that it is not necessary that it should be arrived at after giving an opportunity to all the persons appearing before the Authority.
We cannot accept this interpretation.
Like analogous provisions contained in several statutes which require or permit certain action to be taken on the satisfaction of a particular specified authority, the provision in section 47( lH) also requires the R.T.A. to arrive at its satisfaction not subjectively but on an objective consideration of the various facts and circumstances placed before it.
It will at once be obvious that such a satisfaction cannot be reached by the Authority without hearing the various operators.
The matter comes up before the Authority on a contest between an application for a permit or a renewal application of a private operator and an application for permit by the Corporation.
Naturally, the Corporation will place before the Authority some material to satisfy the Tribunal that the condition mentioned in the proviso to section 47(1H) is satisfied.
The R.T.A.
On its own can have no method of assessing the merits of this plea.
It is only the private operators, who are seeking permits for themselves that may be in a position to place material which would show that the Corporation does not have the capacity to take up this additional responsibility of running buses on the inter State route for which it seeks a permit.
It is clearly the duty of the R.T.A. to consider the evidence placed by both the parties, allow each party an opportunity to rebut the material placed by the other and arrive at its satisfaction one way or the other.
The satisfaction contemplated under section 47( lH) is a satisfaction to be arrived at on the basis of such a quasi judicial enquiry conducted by the R.T.A. It is, therefore, not possible to accept the contention that the petitioners were not required to be heard before the R.T.A. reached its conclusion in favour of the Corporation.
For the reasons discussed above, we hold that the petitioners ' applications for renewal of permits as well as the Corporation 's appli 649 cation for fresh permits on the inter State route Bhadra to Hissar via Adampur require to be considered afresh.
We, therefore, set aside the order of Regional Transport Authority dated 27.11.1982, the order of the State Transport Appellate Tribunal dated 20.1. ]983 as well as the order of the Single Judge of the High Court dated 21st July, 1986 and the order of the Division Bench of the High Court dated 8.12.1986.
The matter will stand remanded to the file of the R.T.A., Bikaner, for being disposed of afresh in the light of the above observations.
The appeals are allowed but in the circumstances we make no order as to costs.
S.L. Appeals allowed.
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Civil Appeal No. 2603 2605 of 1987.
From the Judgment and order dated 8.12.1986 of the Rajasthan High Court in D.B. Special Appeal No. 889, 975 and 1135 of 1986.
G.L. Sanghi and Mrs. Rani Chhabra for the Appellants.
Shanti Bhushan and S.K. Jain for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
Special Leave granted.
Appeals are disposed of by this order.
The three appellants had been granted permits on a route from Bhadra to Hissar via Adampur.
This route lay both in the State of Rajasthan and in the State of Haryana and was thus an inter State route.
When the permits were about to expire the petitioners filed applications for their renewal in accordance with the provisions of section 58 of the Motor Vehicles Act (hereinafter called 'the Act ').
At the same time, the Rajasthan State Road Transport Corporation (hereinafter referred to as 'the Corporation ') also moved applications before the Regional Transport Authority, Bikaner, for the grant of fresh permits to it on the same route.
The applications for renewal of permits made by the petitioners as well as the applications for the grant of permits by the Corporation were heard together by the Re gional Transport Authority, Bikaner (R.T.A.) on several dates, the 643 last of which was the 6th of November, 1981.
On that date, orders were reserved by the R.T.A. The R.T.A., however, passed its order only on 27th November, 1982, about a year after the date of the hearing.
It rejected the renewal applications of the petitioners and granted permits to the Corporation in respect of the above route.
Aggrieved by the orders of the R.T.A., the petitioners filed appeals before the State Transport Appellate Tribunal (S.T.A.T.) The STAT dismissed the appeals preferred by the petitioners and confirmed the order of the R.T.A. The petitioners filed writ petitions in the High Court of Rajasthan, which were dismissed by a Single Judge on 2 1st July, 1986.
Further appeals preferred by the petitioners and certain other operators were dismissed by a Division Bench of the High Court of Rajasthan by its judgment and order dated 8th December, 1986.
These Special Leave Petitions have been preferred against the order of the Division Bench dated 8th December, 1986.
We have come to the conclusion that the order of the R.T.A. (and consequently the orders of the STAT and the High Court) should be set aside and the matter should be remitted back to the R.T.A. for fresh consideration on the short ground that the petitioners have not had a fair opportunity of putting forward and being heard on their contentions relevant to the issue before the R.T.A. The principal issue that had to be considered by the R.T.A. was whether the claims of the Corporation for the grant of a permit had precedence over the claims of the petitioners for renewal.
This issue had to be decided in the context of two statutory provisions.
The first is section 47( 1H) of the Act which reads as follows: Notwithstanding anything contained in this section, an application for a stage carriage permit from a State transport undertaking for operating in any inter State route shall be given preference over all other applications: Provided that the authority shall not grant a permit under this sub section unless it is satisfied that the State transport undertaking would be able to operate in the inter State route without detriment to its responsibility for providing efficient and adequate road transport service in any notified area or notified route as is referred to in subsection (3) of section 68D where the undertaking operates the service.
644 Explanation For the purposes of this sub section, "inter State route" means any route lying contiguously in two or more States.
The second relevant provision is the third proviso inserted in section 58(2) of the Act by an amendment applicable to the State of Rajasthan.
This sub section, in so far it is material for our present purposes, reads: . "(2) A permit may be renewed on an application made and disposed of as if it were an application for a permit: Provided further that, other conditions being equal, an application for stage carriage permit by a State transport undertaking as defined in section 68(A), shall be given preference over applications from individual owners and cooperative societies.
" The arguments before the R.T.A. primarily ranged round the question whether the terms of the proviso to section 47(1H) were fulfilled in the present case or not.
The petitioners (as well as operators on several other routes whose requests for renewal had also been countered by applications for permits by the Corporation) con tended that the Corporation was not in a position to operate in the inter State routes in question without detriment to its responsibility for providing efficient and adequate road transport service in routes which had already been nationalized under Chapter IV A of the Act.
The R.T.A. has applied its mind to this contention in what may be described as a piecemeal manner.
This was because applications made by several private operators and the corporation in regard to various routes came up for consideration by it in separate meetings held at different places on different occasions.
In fact it is this which also explains the delay in the passing of its order by the R.T.A. in the present case.
In course of the hearing before us, we called upon the respondents to produce the original records.
These show that the mat ter relating to renewal of permits of six operators (including the preG sent petitioners) was heard on 6.11.1981 and orders reserved.
On 30 .11.8 1, the counsel for the Corporation made a request to the R.T.A. that certain other matters pertaining to renewals of permits in the Bikaner region were coming up for consideration on 16.12.81 and that, therefore, the orders in the instant cases may be deferred till after the other matters were also heard by the R.T.A. This request of the counsel for the Corporation was accepted by the R.T.A. The other 645 matters referred to could not be heard on 16.12.1981 but got adjourned from time to time.
The order sheet of the R.T.A. in the present case shows that the decision in the present cases was deferred on three subsequent occasions upto 22.03.1982.
The records do not indicate what happened thereafter but it appears that the decision was postponed on subsequent occasions also for the same reason and ultimately announced by the R.T.A. On the 27th of November, 1982, after the connected matters had been heard.
This is clear from the order of the R.T.A. which, in arriving at its final decision, has followed the orders passed by it on 15.9.82 & 24.11.82 in certain other matters and the orders passed by the R.T.A., Jaipur on 7.4.82 & 10.9.82 in relation to two routes falling within its jurisdiction.
The short grievance of the petitioners was that, by adopting the above procedure, the R.T.A. has imported into its final decision and order various transactions, facts, events and arguments of which they had no notice and which they had not been given a proper opportunity to rebut.
The STAT dealt with the argument by simply observing that "for considering the obtainable facts a fresh opportunity to appellants in my opinion was not very much required, as there would not be any end to it." The learned Single Judge in the High Court recognised that: "If such long spell time has lapsed and such new material has come into existence the proper course for the RTA should have been to get the case listed back for comments of both the parties but did not think that "the case warranted any interference on this aspect.
" The Division Bench observed: "It was urged on behalf of the appellants that the Regional Transport Authority took into account events after hearing and closing the cases without giving any opportunity to the appellants to rebut that material.
It was also urged that out of 83 documents filed by the appellants before the Regional Transport Authority in rebuttal of this material, only 2 were accepted, while remaining 81 were rejected.
There is no merit in this contention.
The mere fact that the appellants filed these documents out of which two were taken into account shows that they had the knowledge of the subsequent material being used for the purpose of deciding these cases and it is for this reason that they filed these documents out of which two were also taken into account.
Moreover, the subsequent events relate only to matters of record pertaining to operation of the existing routes by the 646 State Transport Undertaking.
There is thus no prejudice to A the appellants.
This argument is, therefore devoid of any merit.
In our opinion the approach of the STAT as well as the High Court was erroneous.
There is no doubt that the R.T.A. in deciding the present case has been influenced not merely by the discussions which took place during the hearing of the applications of these petitioners and the Corporation but also the facts circumstances, and arguments that surfaced at the meetings held by it in relation to various other permits in the State.
It is true that the point that arose for consideration viz. whether the Corporation had placed sufficient material on record to satisfy the R.T.A. concerned that the grant of a further permit or further permits to it would not prejudicially affect the nationalised services already run by it was, in a sense, a point common to all the meetings.
Nevertheless, the grant of a permit in each case is a separate issue to be decided on the facts and circumstances placed on record in relation to that case.
In support of their claims for permits, the petitioners had placed some material before the R.T.A. and so also the Corporation.
If, in reaching its decision, the R.T.A. desires to take into account circumstances and facts placed by other petitioners or by the Corporation at other meetings, the petitioners should atleast have had an opportunity of knowing what that material was.
This could have been done either by allowing the petitioners to participate at the other meetings or by giving the substance of that material to the petitioners, and giving them an opportunity of rebutting it before passing the final order.
In this context it is important to remember that the Corporation was a party at all the meetings and was aware of all the materials that had been placed on record by other operators as well as by themselves thereat.
On the contrary, the petitioners were handicapped in that they had no knowledge of the material placed at the other meetings.
In our opinion, the requirements of natural justice were flouted by the failure of the RTA to apprise the petitioners, atleast broadly, of what had transpired at the other meetings.
The High Court has observed that the petitioners had not been prejudiced as is seen from the fact that they had placed several documents on record in rebuttal of the Corporation 's case.
It may be, as pointed out by the High Court, that the petitioners were vaguely aware of the nature of the general contentions urged as well as the evidence placed by the Corporation and also tried to put in some documents to controvert the material placed on record by the Corporation but they 647 had no direct knowledge of such material.
Further, the petitioners ' grievance is that out of 83 documents placed by the petitioners only two were considered.
We are not able to appreciate the High Court 's answer to this contention in the extract we have quoted above.
We could have understood it if the other 81 documents which the petitioners relied upon had been found to be irrelevant.
The R.T.A. has not discussed this evidence.
Nor does the STAT appear to have considered the material or given the petitioners an opportunity, atleast at the appellate stage to attempt to substantiate its contentions by reference to these documents.
In the Special Leave Petitions before us, the petitioners have catalogued several circumstances to substantiate a contention that the Corporation was not in a position to undertake the plying of buses on the routes in question without prejudice to the efficiency of the nationalised services already being run by it.
We express no opinion on the correctness of these averments or the effect they can have on the satisfaction to be reached by the Regional Transport Authority but it appears manifest that the impugned order rejecting the renewal applications of the petitioners has been passed without there being reasonable opportunity given to the petitioners to counter the case put forward by the Corporation.
On this short ground that the procedural requirements of natural justice have not been complied with, we think, the impugned order should be set aside and the R.T.A. directed to pass a fresh order after giving the opportunity to the Petitioners to put forward their contentions.
Shri Shanti Bhushan, learned counsel for the Corporation, raised two contentions.
He urged, firstly, that the present case was governed by section 58(2) and not by section 47( 1H) and that the Corporation was rightly granted precedence over the private operators.
We are unable to accept this contention for two reasons.
In the first place the grant of a permit for an inter State route is governed by the special provision contained in section 47( lH) and not by section 58 which is a general provision.
Secondly, even under Section 58, the Corporation is not entitled to a permit automatically by reason of the fact that it is a State Road Transport Undertaking.
It is entitled to a priority over private operators only on "other things being equal".
In other words, even if section 58 is to apply, the RTA has to apply its mind to the relative merits of the private operators on the one hand and the Corporation on the other and it is only if both of them stand on the same footing that the Corporation would be entitled to a preference.
This would necessarily involve a hearing by the RTA of the merits of both the contending parties.
648 The second contention of counsel is based on an interpretation of A section 47(1 H).
The principle and ratio of this provision has been discussed and approved by this Court in Sher Singh vs Union of India, A.I.R. 1984 SC 209.
This provision no doubt enables the Corporation to have a preference over private operators and individuals but this is subject to a condition precedent that it should satisfy the Authority that it E3 would be able to operate the inter State route for which permit is sought without detriment to the efficiency and adequacy of the nationalised services it is already running in the State.
Shri Shanti Bhushan would contend that this is a matter on which the Regional Transport Authority has to reach a subjective satisfaction in the light of such material as it may be able to gather and that it is not necessary that it should be arrived at after giving an opportunity to all the persons appearing before the Authority.
We cannot accept this interpretation.
Like analogous provisions contained in several statutes which require or permit certain action to be taken on the satisfaction of a particular specified authority, the provision in section 47( lH) also requires the R.T.A. to arrive at its satisfaction not subjectively but on an objective consideration of the various facts and circumstances placed before it.
It will at once be obvious that such a satisfaction cannot be reached by the Authority without hearing the various operators.
The matter comes up before the Authority on a contest between an application for a permit or a renewal application of a private operator and an application for permit by the Corporation.
Naturally, the Corporation will place before the Authority some material to satisfy the Tribunal that the condition mentioned in the proviso to section 47(1H) is satisfied.
The R.T.A.
On its own can have no method of assessing the merits of this plea.
It is only the private operators, who are seeking permits for themselves that may be in a position to place material which would show that the Corporation does not have the capacity to take up this additional responsibility of running buses on the inter State route for which it seeks a permit.
It is clearly the duty of the R.T.A. to consider the evidence placed by both the parties, allow each party an opportunity to rebut the material placed by the other and arrive at its satisfaction one way or the other.
The satisfaction contemplated under section 47( lH) is a satisfaction to be arrived at on the basis of such a quasi judicial enquiry conducted by the R.T.A. It is, therefore, not possible to accept the contention that the petitioners were not required to be heard before the R.T.A. reached its conclusion in favour of the Corporation.
For the reasons discussed above, we hold that the petitioners ' applications for renewal of permits as well as the Corporation 's appli 649 cation for fresh permits on the inter State route Bhadra to Hissar via Adampur require to be considered afresh.
We, therefore, set aside the order of Regional Transport Authority dated 27.11.1982, the order of the State Transport Appellate Tribunal dated 20.1. ]983 as well as the order of the Single Judge of the High Court dated 21st July, 1986 and the order of the Division Bench of the High Court dated 8.12.1986.
The matter will stand remanded to the file of the R.T.A., Bikaner, for being disposed of afresh in the light of the above observations.
The appeals are allowed but in the circumstances we make no order as to costs.
S.L. Appeals allowed.
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% The appellants filed applications for renewal of their stage carriage permits on a route in Rajasthan, under section 58 of the Motor Vehicles Act.
At the same time, the Rajasthan State Road Corporation(Corporation) moved applications for the grant of fresh permits to it for the same route.
Both the applications for renewal of permits and the applications for fresh permits, were heard together by the Regional Transport Authority (R.T.A.) which reserved its orders thereon.
The R.T.A. passed orders in the matters after a year of the hearing, rejecting the renewal applications of the appellants and granting fresh permits to the Corporation.
The R.T.A. had, during the intervening period of one year, held several other proceedings and meetings in connected matters of which no notice and no opportunity had been given to the appellants whereas the Corporation was a party to all those meetings and discussions before the R.T.A.
Against the orders of the R.T.A., the appellants filed appeals before the State Transport Appellate Tribunal (S.T.A.T.).
The S.T.A.T. dismissed the appeals.
The appellants moved the High Court by writ petitions against the order of the S.T.A.T.
The High Court (Single Judge) dismissed the writ petitions.
Further appeals by the appellants to the Division Bench of the High Court were also dismissed.
The appellants moved this Court by special leave.
Allowing the appeals, the Court, ^ HELD: The principal issue to be decided by the R.T.A. was whether the claims of the Corporation for fresh permits had precedence over the claims of the appellants for the renewal of their permits.
[643E] 642 The appellants have not had an opportunity of putting forward their contentions and of being heard before the R.T.A. in the various proceedings meetings held by the R.T.A. during the period of one year following the reservation of orders by it on the applications of the Appellants and the Corporation.
The principles of natural justice were flouted by the R.T.A. by its failure to apprise the appellants of what had transpired at the meetings/discussions held in their absence.
[646D F] The appellants ' applications and the applications of the Corporation require to be considered and disposed of afresh by the R.T.A. in the light of the observations made by the Court.
[648H, 649A] Sher Singh vs Union of India, AIR 1984 SC 200, referred to.
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% The appellants filed applications for renewal of their stage carriage permits on a route in Rajasthan, under section 58 of the Motor Vehicles Act.
At the same time, the Rajasthan State Road Corporation(Corporation) moved applications for the grant of fresh permits to it for the same route.
Both the applications for renewal of permits and the applications for fresh permits, were heard together by the Regional Transport Authority (R.T.A.) which reserved its orders thereon.
The R.T.A. passed orders in the matters after a year of the hearing, rejecting the renewal applications of the appellants and granting fresh permits to the Corporation.
The R.T.A. had, during the intervening period of one year, held several other proceedings and meetings in connected matters of which no notice and no opportunity had been given to the appellants whereas the Corporation was a party to all those meetings and discussions before the R.T.A.
Against the orders of the R.T.A., the appellants filed appeals before the State Transport Appellate Tribunal (S.T.A.T.).
The S.T.A.T. dismissed the appeals.
The appellants moved the High Court by writ petitions against the order of the S.T.A.T.
The High Court (Single Judge) dismissed the writ petitions.
Further appeals by the appellants to the Division Bench of the High Court were also dismissed.
The appellants moved this Court by special leave.
Allowing the appeals, the Court, ^ HELD: The principal issue to be decided by the R.T.A. was whether the claims of the Corporation for fresh permits had precedence over the claims of the appellants for the renewal of their permits.
[643E] 642 The appellants have not had an opportunity of putting forward their contentions and of being heard before the R.T.A. in the various proceedings meetings held by the R.T.A. during the period of one year following the reservation of orders by it on the applications of the Appellants and the Corporation.
The principles of natural justice were flouted by the R.T.A. by its failure to apprise the appellants of what had transpired at the meetings/discussions held in their absence.
[646D F] The appellants ' applications and the applications of the Corporation require to be considered and disposed of afresh by the R.T.A. in the light of the observations made by the Court.
[648H, 649A] Sher Singh vs Union of India, AIR 1984 SC 200, referred to.
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Civil Appeal No. 1177 (NCE) of 1986.
From the Judgment and order dated 17.1.1986 of the Allahabad High Court (Election Tribunal) in Election Petition No. 54 of 1985.
R.K. Garg and Ravi Parkash Gupta for the Appellant.
Qamarrudin and Mrs. Qamarrudin for the Respondents.
The Judgment of the Court was delivered by 633 VENKATARAMIAH, J.
This appeal is filed under section 116A of the Representation of the People Act, 195 l (hereinafter referred A to as 'the Act ') by the appellant against the Judgment dated January 17, 1986 of the High Court of Allahabad in Election Petition No. 34 of 1985 dismissing the Election Petition.
The election to the Uttar Pradesh State Legislative Assembly from Constituenc No. 41 Gunnaur, Village Mirzapur, District Baduan took place in early March, 1985.
16 candidates contested at the said election.
Respondent No. I Smt.
Pushpa Devi was declared elected having secured 23006 votes.
The next highest number of votes was secured by Shri Naurangi Singh.
He secured 20735 votes.
The difference between the votes secured by Respondent No. l and the votes secured by Respondent No. 2 was in the order of 227 l votes.
Respondent No. 8, who was working as a teacher in the Babu Ram Singh Intermediate College, Baburala, Baduan was also one of the candidates in the election.
He secured 3606 votes, which were more than the difference between the votes secured by Respondent No., and by Respondent No. 2.
The appellant, who was an elector at the said election, filed the Election Petition, out of which this appeal arises, contending that Respondent No. 8, who was working as a teacher in the Babu Ram Singh Intermediate College, Baburala, Baduan, was holding an office of profit under the State Government and, therefore, the acceptance of his nomination by the Returning officer was illegal.
Since Respondent No. 8 secured 3606 votes, which were higher than the difference between the votes secured by Respondent No. I and the votes secured by Respondent No. 2, the election of Respondent No. I should be considered as having been materially affected by the wrongful acceptance of the nomination paper of Respondent No. 8 and the election of Respondent No. 1 was liable to be set aside.
The Election Petition was contested by Respondent No. 1.
It was pleaded by Respondent No. 1 that the acceptance of the nomination paper of Respondent No. 8 was not illegal since Respondent No. 8 was not holding an office of profit under the State Government and secondly even if the acceptance of the nomination paper of Respondent No. 8 was illegal, the election could not be set aside since the result of the election was not materially affected thereby.
The High Court held that the acceptance of the nomination paper of Respondent No. 8 was not illegal as Respondent No. 8 was not holding an office of profit under the State Government and it further held that even if the acceptance of the nomination paper of Respondent No. 8 was illegal, the appellant had not established that the result of the election of Respondent No. I had been materially affected on the facts and in the H 634 circumstances of the case.
The High Court accordingly dismissed the petition.
Aggrieved by the judgment of the High Court the appellant has filed this appeal.
Since it is possible to dispose of this appeal on the second ground we do not propose to express any opinion in this case on the question whether Respondent No. 8 was, in fact, holding an office of profit under the State Government or not on the date on which the nomination paper was filed or on the date of the election.
We leave the said question open.
In order to decide the second question it is necessary to set out the relevant part of section 100 of the Act which reads thus: "100.
Grounds for declaring election to be void (1) Subject to the provisions of sub section (2) if the High Court is of opinion . . . . . . . . . (c) that any nomination has been improperly rejected; or (d) that the result of the election, in so far as it concerns a returned candidate, has been materially affected (i) by the improper acceptance of any nomination, or. . " Section 100 of the Act makes a distinction between the effect of improper rejection of any nomination and the effect of the improper acceptance of any nomination on the election.
If a nomination of any person at an election has been improperly rejected the election of the returned candidate is liable to be set aside without any further proof because it is difficult to visualise the number of votes which the person whose nomination has been rejected would have secured at the election and there is every likelihood of the returned candidate not securing the highest number of votes.
It is for this reason clause (c) of section 100(1) of the Act states that if the High Court is of the opinion that any nomination has been improperly rejected it shall declare the election of the returned candidate to be void.
Sub clause (i) of clause (d) of sub section (1) of section 100 of the Act is, however, worded differently.
It says that if the High Court is of opinion that the result of the election insofar as it concerns the returned candidate has been materially affected by the improper acceptance of any nomination it 635 shall declare the election of the returned candidate as void.
Sub clause (i) of clause (d) of section 100( I) of the Act requires a petitioner in an election petition to establish two grounds in order to get the election of the returned candidate set aside, namely, (i) that there has been improper acceptance of any nomination; and (ii) that by reason of the entry of the candidate whose nomination has been improperly accepted into the contest the result of the election insofar as the returned candidate is concerned has been materially affected.
The reason for making a distinction between a case falling under clause (c) of section 100(1) of the Act and a case falling under sub clause (i) of clause (d) of section 100( I) of the Act can be explained with reference to a hypothetical case.
Let us assume that the returned candidate has secured at an election 30,000 votes and 20,000 votes have been secured by a candidate who has secured the next highest number of votes.
We shall assume that a third candidate, whose nomination paper had been improperly accepted has secured just 1000 votes.
In this case even if it is held while deciding an election petition that the nomination of the third candidate has been improperly accepted, there is no justification to set aside the election of the successful candidate because even if all the votes secured by the third candidate are added to the candidate who has secured the next highest number of votes he would be a person who has secured 21000 votes and the successful candidate would still be a person who has secured the highest number of votes at the election.
In this hypothetical case it has to be held that the result of the election has not been materially affected at all.
Such election petition has necessarily to be rejected.
This Court was called upon to decide a case similar to the present one in Vashist Narain Sharma vs Dev Chandra and others.
; In that case the returned candidate Vashist Narain Sharma had secured 12868 votes and Vireshwar Nath Rai secured the next highest number of votes, i.e.,10,996.
The difference in the number of votes secured by these two candidates was 1872.
Another candidate by name Dudh Nath at the election, whose validity was in issue in that case, had secured 1983 votes.
There were also two other candidates in the field.
One of the grounds in the election petition, out of which the above case arose, was that the election of the returned candidate was liable to be set aside since the nomination paper of Dudh Nath had been improperly accepted by the Election Commissioner.
The Court in that case held that the burden of proving that the result of the election had been materially affected on account of the improper acceptance of a nomination was on the petitioner and that even if there was wrongful acceptance of the nomination having regard to the number of votes secured by the several candidates it was not possible to hold that the 636 result of the election had been materially affected.
In Samant N. Balakrishna etc.
vs George Fernandez and Ors etc.
; , section 100( l)(d)(i)) of the Act again arose for consideration.
In that case this Court commented at pages 643 644 on the decision in Vashist Narain Sharma 's case (supra) thus: "Mr. Chari relies upon the rulings of this Court where it has been laid down how the burden of proving the effect on the election must be discharged.
He referred to the case reported in Vashist Narain Sharma vs Dev Chandra and Surendra Nath Khosla vs Dilip Singh and the later rulings of this Court in which Vashist Narain 's case has been fol.
lowed and applied.
In our opinion the matter cannot be considered on possibility.
Vashist Narain 's case insists on proof.
If the margin of votes were small something might be made of the points mentioned by Mr. Jethmalani.
But the margin is large and the number of votes earned by the remaining candidates also sufficiently huge.
There is no room, there fore, for a reasonably judicial guess.
The law requires proof.
How far that proof should go or what it should contain is not provided by the Legislature.
In Vashist 's case and in Inayatullah vs Diwanchand Mahajan, the provision was held to prescribe an impossible burden.
The law has however remained as before.
we are bound by the rulings of this Court and must say that the burden has not been successfully discharged.
We cannot overlook the rulings of this Court and follow the English rulings cited to us.
" The very same question was considered by this Court in Chhedi Ram vs Jhilmit Ram and others, by a bench of which one of us (Venkataramiah, J.) was a member.
The judgment in that case was delivered by Chinnappa Reddy, J.
In that case the returned candidate Jhilmit Ram had secured 17, 822 votes and Chhedi Ram, the runner up had secured 17449 votes.
Thus the difference between the successful candidate and the candidate who secured next highest votes was 373 votes.
There were four other candidates, of whom Moti Ram secured 6710 votes.
Chhedi Ram challenged the election of Jhilmit Ram on the ground that Moti Ram was a Kahar by caste, not entitled to seek election from the reserved constituency, i.e., his nomination had been improperly accepted and the result of election was materially affected.
The High Court found that Moti Ram was a Kahar by caste 637 and not a member of the scheduled Castes.
Having arrived at the conclusion that Moti Ram 's nomination had been accepted improperly, the High Court was not prepared to set aside the election of Jhilmit Ram as it took the view that the result of the election had not been shown to have been affected in view of the improper acceptance of the nomination of Moti Ram.
The election petition in that case was, therefore, dismissed.
Chhedi Ram then preferred an appeal to this Court against the judgment of the High Court.
This Court allowed the appeal.
In the course of the judgment Chinnappa Reddy, J. Observed thus "2.
We are afraid the appeal has to be allowed.
Under section l00(1)(d) of the Representation of the People Act, 195 1, the election of a returned candidate shall be declared to be void if the High Court is of opinion that the result of the election, in so far as it concerns the returned candidate, has been materially affected by the improper acceptance of any nomination.
True, the burden of establishing that the result of the election has been materially affected as a result of the improper acceptance of a nomination is on the person impeaching the election.
The burden is readily discharged if the nomination which has been improperly accepted was that of the successful candidate himself.
On the other hand, the burden is wholly incapable of being discharged if the candidate whose nomination was improperly accepted obtained a less number of votes than the difference between the number of votes secured by the candidate who got the next highest number of votes.
In both these situations, the answers are obvious.
The complication arises only in cases where the candidate, whose nomination was improperly accepted, has secured a large number of votes than the difference between the number of votes secured by the successful candidate and the number of votes got by the candidate securing the next highest number of votes.
The complication is because of the possibility that a sufficient number of votes actually cast for the candidate whose nomination was improperly accepted might have been cast for the candidate who secured the highest number of votes next to the successful candidate, so as to upset the result of the election, but whether a sufficient number of voters would have so done, would ordinarily remain a speculative possibility only.
In this situation, the answer to the question whether the result of the 638 election could be said to have been materially affected must depend on the facts, circumstances and reasonable probabilities of the case, particularly on the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes, as compared with the number of votes secured by the candidate whose nomination was improperly accepted and the proportion which the number of wasted votes (the votes secured by the candidate whose nomination was improperly accepted) bears to the number of votes secured by the successful candidate.
If the number of votes secured by the candidate whose nomination was rejected is not disproportionately large as compared with the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes, it would be next to impossible to conclude that the result of the election has been materially affected.
But, on the other hand, if the number of votes secured by the candidate whose nomination was improperly accepted is disproportinately large as compared with the difference between the votes secured by the successful candidate and the candidate securing the next highest number of votes and if the votes secured by the candidate whose nomination was improperly accepted bears a fairly high proportion to the votes secured by the successful candidate, the reasonable probability is that the result of the election has been materially affected and one may venture to hold the fact as proved.
Under the Indian Evidence Act, a fact is said to he proved when after considering the matters before it, the court either believes it to exist or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists.
If having regard to the facts and circumstances of a case, the reasonable probability is all one way, a court must not lay down an impossible standard of proof and hold a fact is not proved.
In the present case, the candidate whose nomination was improperly accepted had obtained 67 10 votes, that is, almost 20 times the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes.
Not merely that.
Th number of votes secured by the candidate whose nomination was improperly accepted bore a fairly high proportion to the number 639 Of votes secured by the successful candidate it was a little over one third.
Surely, in that situation, the result of the election may safely be said to have been affected.
" In the case before us Respondent No. I had secured 23006 votes and Respondent No. 2 had secured 20735 votes.
The margin thus was of 22371 votes.
Respondent No. 8, the validity of whose nomination was questioned, had secured 3606 votes.
It is no doubt true that if we assume that all the 3606 votes secured by Respondent No. 8 would have gone to Respondent No. 2, Respondent No. 2 would have been the successful candidate.
at the election.
Having regard to the facts of this case we feel that it is not possible to hold that the appellant in this appeal has established that the result of the election of the returned candidate had been materially affected because the difference between the votes secured by Respondent No. 1 and the votes secured by Respondent No. 2 was 2272 votes.
Respondent No. 8 had secured only about 1 7th of the number of votes polled by the Respondent No. l and there were 15 candidates (excluding respondent No. 8) contesting the election.
It is not possible to reach a finding in this case by making a judicial guess that all the 3606 voters who had voted in favour of Respondent No. 8 would have cast their votes in favour of Respondent No. 2 alone.
Even if about 1350 of them had cast their votes in favour of any of the other 14 candidates (including the returned candidate) Respondent No. 2 could not have become the candidate who had secured the highest number of votes at the election.
At this stage it is relevant to refer to the observation of Gulam Hasan, J. In Vashist Narain Sharma 's, case (supra) which run thus: "But we are not prepared to hold that the mere fact that the wasted votes are greater than the margin of votes between the returned candidate and the candidate securing the next highest number of votes must lead to the necessary inference that the result of the election has been materially affected.
That is a matter which has to be proved and the onus of proving it lies upon the petitioner.
It will not do merely to say that all or majority of the wasted votes might have gone to the next highest candidate.
The casting of votes at an election depends upon a variety of factors and it is not possible for any one to predicate how many or which proportion of the votes will go to one or the other of the candidates.
While it must be recognised that the petitioner in such a case of confronted with a difficult situation, it is not possible to relieve him of the duty imposed upon him H 640 by section 100(1)(c) and hold without evidence that the duty has been discharged.
Should the petitioner fail to adduce satisfactory evidence to enable the Court to find in his favour on this point, the inevitable result would be that the Tribunal would not interfere in his favour and would allow the election to stand.
" In the case before us we are of the view that the High Court was right in observing that the appellant or any other party had not placed satisfactory evidence to reach the conclusion that all or a sufficient number of the wasted votes which had been cast in favour of Respondent No. 8 would have gone in favour of Respondent No. 2, had Respondent No. 8 not been one of the candidates at the election.
The High Court has on the evidence before it held that "in the context particularly of the poll being heavy and the contestants being large in number 16 in all it remains unreasonable to guess that if the respondent No. 8 were excluded from the arena of contest the wasted votes would have gone to the respondent No. 2 thereby enabling him to succeed.
The burden Iying upon the petitioner remains clearly undischarged and the speculative possibility does not attain the level of proof.
" We agree with the above observation of the High Court since the appellant has not discharged the burden which clearly lay on him or proving that the result of the election had been materially affected even assuming that the nomination of Respondent No. 8 had been improperly accepted.
This appeal should, therefore, fail.
We accordingly dismiss it.
We, however, make no order as to costs.
N.P.V. Appeal dismissed.
|
% In the election to the Uttar Pradesh State Legislative Assembly from constituency No. 41 held in early March, 1985, 16 candidates contested.
Respondent No. 1 was declared elected having secured 23,006 votes.
Respondent No. 2 secured 20,735 votes being the next highest.
The difference of votes secured by them was in the order of 2,271 votes.
Respondent No. 8 who was working as a teacher in a college and who was one of the candidates secured 3,606 votes which were more than the difference between the votes secured by respondent No. 1 and 2.
The appellant who was an elector at the said election filed an election petition contending that respondent No. 8 was holding an 'office of profit ' under the State Government as he was working as a teacher in a college and therefore, the acceptance of his nomination by the returning officer was illegal, that since respondent No. 8 secured 3,606 votes which were higher than the difference between the votes secured by respondent No. 1 and respondent No. 2, the election of respondent No. 1 should be considered as having been materially affected by the wrongful acceptance of the nomination paper of respondent No. 8, and the election of the respondent No. 1 was, therefore, liable to be set aside.
Respondent No.1 contested the election petition pleading that the acceptance of the nomination paper of respondent No. 8 was not illegal since he was not holding an office of profit under the State Government, and that even if the acceptance was illegal the election could not be set aside since the result of the election was not materially affected thereby.
Dismissing the petition, the High Court held that the acceptance of the nomination paper of respondent No. 8 was not illegal as he was not holding an office of profit under the State Government and that 631 even if the acceptance of the nomination paper was illegal, the appellant had not established that the result of the election of respondent No. 1 had been materially affected on the facts and in the circumstances of the case.
In the appeal to this Court on the question: whether the appellant had established that the result of the election of respondent No. 1 had been materially affected by the wrongful acceptance of the nomination paper of respondent No. 8.
Dismissing the appeal to this Court, ^ HELD: The appellant has not discharged the burden which clearly lay on him of proving that the result of the election had been materially affected, even assuming that the nomination of respondent No. 8 had been improperly accepted.
[640E] Section 100 of the Representation of the People Act makes a distinction between the effect of improper rejection of any nomination, and the effect of the improper acceptance of any nomination on the election.
If a nomination of any person at an election had been improperly rejected the election of the returned candidate is liable to be set aside without any further proof because it is difficult to visualise the number of votes which the person whose nomination has been rejected would have secured at the election and there is every likelihood of the returned candidate not securing the highest number of votes.
[634E G] Clause (c) of sub section (1) states that if the High Court is of the opinion that any nomination has been improperly rejected it shall declare the election of the returned candidate to be void.
[634Gl Sub clause (i) of clause (d) of sub section (1) requires a petitioner in an election petition to establish two grounds in order to get the election of the returned candidate set aside.
namely (i) that there has been improper acceptance of any nomination and (ii) that by reason of entry of the candidate whose nomination has been improperly accepted into the contest the result of the election insofar as the returned candidate is concerned has been materially affected.
[635A B] Having regard to the facts of the instant case it is not possible to hold that the appellant has established that the result of the election of the returned candidate had been materially affected because the dif 632 ference between the votes secured by respondent No. 1, the returned candidate and respondent No. 2, the candidate who secured next highest votes was 2,271 votes.
Respondent No. 8, the validity of whose nomination was questioned, had secured only about 1/7th of the number of votes polled by respondent No. 1 and there were 15 candidates (excluding respondent No. 8) contesting the election.
It is not possible to reach a finding in this case by making a judicial guess that all the 3606 voters who had voted in favour of respondent No. 8 would have cast their votes in favour of respondent No. 2 alone.
Even if about 1350 of them had cast their votes in favour of any of the other 14 candidates (including the returned candidate) respondent No. 2 could not have become the candidate who had secured the highest number of votes at the election.
[639C E] The High Court was, therefore, right in taking the view that the appellant or any other party had not placed any satisfactory evidence to reach the conclusion that all or sufficient number of wasted votes which had been cast in favour of respondent No. 8 would have gone in favour of respondent No. 2, had respondent No. 8 not been one of the candidates at the election, that in the context particularly of the poll being heavy and the contestants being large in number, 16 in all It was unreasonable to guess that if the respondent No. 8 were excluded from the arena of contest the wasted votes would have gone to the respondent No. 2 thereby enabling him to succeed, and that the burden Iying upon the petitioner remained clearly undischarged and the speculative possibility did not attain the level of proof.
[640B D] Vashist Narain Sharma vs Dev Chandra and others, ]1955] 1 S.C.R. 509; Samant N. Balakrishna etc.
vs George Fernandez and Ors.
; , and Chhedi Ram vs Jhilmit Ram and others, p ] , referred to.
|
Civil Appeal No. 1177 (NCE) of 1986.
From the Judgment and order dated 17.1.1986 of the Allahabad High Court (Election Tribunal) in Election Petition No. 54 of 1985.
R.K. Garg and Ravi Parkash Gupta for the Appellant.
Qamarrudin and Mrs. Qamarrudin for the Respondents.
The Judgment of the Court was delivered by 633 VENKATARAMIAH, J.
This appeal is filed under section 116A of the Representation of the People Act, 195 l (hereinafter referred A to as 'the Act ') by the appellant against the Judgment dated January 17, 1986 of the High Court of Allahabad in Election Petition No. 34 of 1985 dismissing the Election Petition.
The election to the Uttar Pradesh State Legislative Assembly from Constituenc No. 41 Gunnaur, Village Mirzapur, District Baduan took place in early March, 1985.
16 candidates contested at the said election.
Respondent No. I Smt.
Pushpa Devi was declared elected having secured 23006 votes.
The next highest number of votes was secured by Shri Naurangi Singh.
He secured 20735 votes.
The difference between the votes secured by Respondent No. l and the votes secured by Respondent No. 2 was in the order of 227 l votes.
Respondent No. 8, who was working as a teacher in the Babu Ram Singh Intermediate College, Baburala, Baduan was also one of the candidates in the election.
He secured 3606 votes, which were more than the difference between the votes secured by Respondent No., and by Respondent No. 2.
The appellant, who was an elector at the said election, filed the Election Petition, out of which this appeal arises, contending that Respondent No. 8, who was working as a teacher in the Babu Ram Singh Intermediate College, Baburala, Baduan, was holding an office of profit under the State Government and, therefore, the acceptance of his nomination by the Returning officer was illegal.
Since Respondent No. 8 secured 3606 votes, which were higher than the difference between the votes secured by Respondent No. I and the votes secured by Respondent No. 2, the election of Respondent No. I should be considered as having been materially affected by the wrongful acceptance of the nomination paper of Respondent No. 8 and the election of Respondent No. 1 was liable to be set aside.
The Election Petition was contested by Respondent No. 1.
It was pleaded by Respondent No. 1 that the acceptance of the nomination paper of Respondent No. 8 was not illegal since Respondent No. 8 was not holding an office of profit under the State Government and secondly even if the acceptance of the nomination paper of Respondent No. 8 was illegal, the election could not be set aside since the result of the election was not materially affected thereby.
The High Court held that the acceptance of the nomination paper of Respondent No. 8 was not illegal as Respondent No. 8 was not holding an office of profit under the State Government and it further held that even if the acceptance of the nomination paper of Respondent No. 8 was illegal, the appellant had not established that the result of the election of Respondent No. I had been materially affected on the facts and in the H 634 circumstances of the case.
The High Court accordingly dismissed the petition.
Aggrieved by the judgment of the High Court the appellant has filed this appeal.
Since it is possible to dispose of this appeal on the second ground we do not propose to express any opinion in this case on the question whether Respondent No. 8 was, in fact, holding an office of profit under the State Government or not on the date on which the nomination paper was filed or on the date of the election.
We leave the said question open.
In order to decide the second question it is necessary to set out the relevant part of section 100 of the Act which reads thus: "100.
Grounds for declaring election to be void (1) Subject to the provisions of sub section (2) if the High Court is of opinion . . . . . . . . . (c) that any nomination has been improperly rejected; or (d) that the result of the election, in so far as it concerns a returned candidate, has been materially affected (i) by the improper acceptance of any nomination, or. . " Section 100 of the Act makes a distinction between the effect of improper rejection of any nomination and the effect of the improper acceptance of any nomination on the election.
If a nomination of any person at an election has been improperly rejected the election of the returned candidate is liable to be set aside without any further proof because it is difficult to visualise the number of votes which the person whose nomination has been rejected would have secured at the election and there is every likelihood of the returned candidate not securing the highest number of votes.
It is for this reason clause (c) of section 100(1) of the Act states that if the High Court is of the opinion that any nomination has been improperly rejected it shall declare the election of the returned candidate to be void.
Sub clause (i) of clause (d) of sub section (1) of section 100 of the Act is, however, worded differently.
It says that if the High Court is of opinion that the result of the election insofar as it concerns the returned candidate has been materially affected by the improper acceptance of any nomination it 635 shall declare the election of the returned candidate as void.
Sub clause (i) of clause (d) of section 100( I) of the Act requires a petitioner in an election petition to establish two grounds in order to get the election of the returned candidate set aside, namely, (i) that there has been improper acceptance of any nomination; and (ii) that by reason of the entry of the candidate whose nomination has been improperly accepted into the contest the result of the election insofar as the returned candidate is concerned has been materially affected.
The reason for making a distinction between a case falling under clause (c) of section 100(1) of the Act and a case falling under sub clause (i) of clause (d) of section 100( I) of the Act can be explained with reference to a hypothetical case.
Let us assume that the returned candidate has secured at an election 30,000 votes and 20,000 votes have been secured by a candidate who has secured the next highest number of votes.
We shall assume that a third candidate, whose nomination paper had been improperly accepted has secured just 1000 votes.
In this case even if it is held while deciding an election petition that the nomination of the third candidate has been improperly accepted, there is no justification to set aside the election of the successful candidate because even if all the votes secured by the third candidate are added to the candidate who has secured the next highest number of votes he would be a person who has secured 21000 votes and the successful candidate would still be a person who has secured the highest number of votes at the election.
In this hypothetical case it has to be held that the result of the election has not been materially affected at all.
Such election petition has necessarily to be rejected.
This Court was called upon to decide a case similar to the present one in Vashist Narain Sharma vs Dev Chandra and others.
; In that case the returned candidate Vashist Narain Sharma had secured 12868 votes and Vireshwar Nath Rai secured the next highest number of votes, i.e.,10,996.
The difference in the number of votes secured by these two candidates was 1872.
Another candidate by name Dudh Nath at the election, whose validity was in issue in that case, had secured 1983 votes.
There were also two other candidates in the field.
One of the grounds in the election petition, out of which the above case arose, was that the election of the returned candidate was liable to be set aside since the nomination paper of Dudh Nath had been improperly accepted by the Election Commissioner.
The Court in that case held that the burden of proving that the result of the election had been materially affected on account of the improper acceptance of a nomination was on the petitioner and that even if there was wrongful acceptance of the nomination having regard to the number of votes secured by the several candidates it was not possible to hold that the 636 result of the election had been materially affected.
In Samant N. Balakrishna etc.
vs George Fernandez and Ors etc.
; , section 100( l)(d)(i)) of the Act again arose for consideration.
In that case this Court commented at pages 643 644 on the decision in Vashist Narain Sharma 's case (supra) thus: "Mr. Chari relies upon the rulings of this Court where it has been laid down how the burden of proving the effect on the election must be discharged.
He referred to the case reported in Vashist Narain Sharma vs Dev Chandra and Surendra Nath Khosla vs Dilip Singh and the later rulings of this Court in which Vashist Narain 's case has been fol.
lowed and applied.
In our opinion the matter cannot be considered on possibility.
Vashist Narain 's case insists on proof.
If the margin of votes were small something might be made of the points mentioned by Mr. Jethmalani.
But the margin is large and the number of votes earned by the remaining candidates also sufficiently huge.
There is no room, there fore, for a reasonably judicial guess.
The law requires proof.
How far that proof should go or what it should contain is not provided by the Legislature.
In Vashist 's case and in Inayatullah vs Diwanchand Mahajan, the provision was held to prescribe an impossible burden.
The law has however remained as before.
we are bound by the rulings of this Court and must say that the burden has not been successfully discharged.
We cannot overlook the rulings of this Court and follow the English rulings cited to us.
" The very same question was considered by this Court in Chhedi Ram vs Jhilmit Ram and others, by a bench of which one of us (Venkataramiah, J.) was a member.
The judgment in that case was delivered by Chinnappa Reddy, J.
In that case the returned candidate Jhilmit Ram had secured 17, 822 votes and Chhedi Ram, the runner up had secured 17449 votes.
Thus the difference between the successful candidate and the candidate who secured next highest votes was 373 votes.
There were four other candidates, of whom Moti Ram secured 6710 votes.
Chhedi Ram challenged the election of Jhilmit Ram on the ground that Moti Ram was a Kahar by caste, not entitled to seek election from the reserved constituency, i.e., his nomination had been improperly accepted and the result of election was materially affected.
The High Court found that Moti Ram was a Kahar by caste 637 and not a member of the scheduled Castes.
Having arrived at the conclusion that Moti Ram 's nomination had been accepted improperly, the High Court was not prepared to set aside the election of Jhilmit Ram as it took the view that the result of the election had not been shown to have been affected in view of the improper acceptance of the nomination of Moti Ram.
The election petition in that case was, therefore, dismissed.
Chhedi Ram then preferred an appeal to this Court against the judgment of the High Court.
This Court allowed the appeal.
In the course of the judgment Chinnappa Reddy, J. Observed thus "2.
We are afraid the appeal has to be allowed.
Under section l00(1)(d) of the Representation of the People Act, 195 1, the election of a returned candidate shall be declared to be void if the High Court is of opinion that the result of the election, in so far as it concerns the returned candidate, has been materially affected by the improper acceptance of any nomination.
True, the burden of establishing that the result of the election has been materially affected as a result of the improper acceptance of a nomination is on the person impeaching the election.
The burden is readily discharged if the nomination which has been improperly accepted was that of the successful candidate himself.
On the other hand, the burden is wholly incapable of being discharged if the candidate whose nomination was improperly accepted obtained a less number of votes than the difference between the number of votes secured by the candidate who got the next highest number of votes.
In both these situations, the answers are obvious.
The complication arises only in cases where the candidate, whose nomination was improperly accepted, has secured a large number of votes than the difference between the number of votes secured by the successful candidate and the number of votes got by the candidate securing the next highest number of votes.
The complication is because of the possibility that a sufficient number of votes actually cast for the candidate whose nomination was improperly accepted might have been cast for the candidate who secured the highest number of votes next to the successful candidate, so as to upset the result of the election, but whether a sufficient number of voters would have so done, would ordinarily remain a speculative possibility only.
In this situation, the answer to the question whether the result of the 638 election could be said to have been materially affected must depend on the facts, circumstances and reasonable probabilities of the case, particularly on the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes, as compared with the number of votes secured by the candidate whose nomination was improperly accepted and the proportion which the number of wasted votes (the votes secured by the candidate whose nomination was improperly accepted) bears to the number of votes secured by the successful candidate.
If the number of votes secured by the candidate whose nomination was rejected is not disproportionately large as compared with the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes, it would be next to impossible to conclude that the result of the election has been materially affected.
But, on the other hand, if the number of votes secured by the candidate whose nomination was improperly accepted is disproportinately large as compared with the difference between the votes secured by the successful candidate and the candidate securing the next highest number of votes and if the votes secured by the candidate whose nomination was improperly accepted bears a fairly high proportion to the votes secured by the successful candidate, the reasonable probability is that the result of the election has been materially affected and one may venture to hold the fact as proved.
Under the Indian Evidence Act, a fact is said to he proved when after considering the matters before it, the court either believes it to exist or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists.
If having regard to the facts and circumstances of a case, the reasonable probability is all one way, a court must not lay down an impossible standard of proof and hold a fact is not proved.
In the present case, the candidate whose nomination was improperly accepted had obtained 67 10 votes, that is, almost 20 times the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes.
Not merely that.
Th number of votes secured by the candidate whose nomination was improperly accepted bore a fairly high proportion to the number 639 Of votes secured by the successful candidate it was a little over one third.
Surely, in that situation, the result of the election may safely be said to have been affected.
" In the case before us Respondent No. I had secured 23006 votes and Respondent No. 2 had secured 20735 votes.
The margin thus was of 22371 votes.
Respondent No. 8, the validity of whose nomination was questioned, had secured 3606 votes.
It is no doubt true that if we assume that all the 3606 votes secured by Respondent No. 8 would have gone to Respondent No. 2, Respondent No. 2 would have been the successful candidate.
at the election.
Having regard to the facts of this case we feel that it is not possible to hold that the appellant in this appeal has established that the result of the election of the returned candidate had been materially affected because the difference between the votes secured by Respondent No. 1 and the votes secured by Respondent No. 2 was 2272 votes.
Respondent No. 8 had secured only about 1 7th of the number of votes polled by the Respondent No. l and there were 15 candidates (excluding respondent No. 8) contesting the election.
It is not possible to reach a finding in this case by making a judicial guess that all the 3606 voters who had voted in favour of Respondent No. 8 would have cast their votes in favour of Respondent No. 2 alone.
Even if about 1350 of them had cast their votes in favour of any of the other 14 candidates (including the returned candidate) Respondent No. 2 could not have become the candidate who had secured the highest number of votes at the election.
At this stage it is relevant to refer to the observation of Gulam Hasan, J. In Vashist Narain Sharma 's, case (supra) which run thus: "But we are not prepared to hold that the mere fact that the wasted votes are greater than the margin of votes between the returned candidate and the candidate securing the next highest number of votes must lead to the necessary inference that the result of the election has been materially affected.
That is a matter which has to be proved and the onus of proving it lies upon the petitioner.
It will not do merely to say that all or majority of the wasted votes might have gone to the next highest candidate.
The casting of votes at an election depends upon a variety of factors and it is not possible for any one to predicate how many or which proportion of the votes will go to one or the other of the candidates.
While it must be recognised that the petitioner in such a case of confronted with a difficult situation, it is not possible to relieve him of the duty imposed upon him H 640 by section 100(1)(c) and hold without evidence that the duty has been discharged.
Should the petitioner fail to adduce satisfactory evidence to enable the Court to find in his favour on this point, the inevitable result would be that the Tribunal would not interfere in his favour and would allow the election to stand.
" In the case before us we are of the view that the High Court was right in observing that the appellant or any other party had not placed satisfactory evidence to reach the conclusion that all or a sufficient number of the wasted votes which had been cast in favour of Respondent No. 8 would have gone in favour of Respondent No. 2, had Respondent No. 8 not been one of the candidates at the election.
The High Court has on the evidence before it held that "in the context particularly of the poll being heavy and the contestants being large in number 16 in all it remains unreasonable to guess that if the respondent No. 8 were excluded from the arena of contest the wasted votes would have gone to the respondent No. 2 thereby enabling him to succeed.
The burden Iying upon the petitioner remains clearly undischarged and the speculative possibility does not attain the level of proof.
" We agree with the above observation of the High Court since the appellant has not discharged the burden which clearly lay on him or proving that the result of the election had been materially affected even assuming that the nomination of Respondent No. 8 had been improperly accepted.
This appeal should, therefore, fail.
We accordingly dismiss it.
We, however, make no order as to costs.
N.P.V. Appeal dismissed.
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From the Judgment and order dated 17.1.1986 of the Allahabad High Court (Election Tribunal) in Election Petition No. R.K. Garg and Ravi Parkash Gupta for the Appellant. Qamarrudin and Mrs. Qamarrudin for the Respondents. The Judgment of the Court was delivered by 633 VENKATARAMIAH, J.
This appeal is filed under section 116A of the Representation of the People Act, 195 l (hereinafter referred A to as 'the Act ') by the appellant against the Judgment dated January 17, 1986 of the High Court of Allahabad in Election Petition No. 34 of 1985 dismissing the Election Petition. The election to the Uttar Pradesh State Legislative Assembly from Constituenc No. 41 Gunnaur, Village Mirzapur, District Baduan took place in early March, 1985. 16 candidates contested at the said election. Pushpa Devi was declared elected having secured 23006 votes. The next highest number of votes was secured by Shri Naurangi Singh. The difference between the votes secured by Respondent No. l and the votes secured by Respondent No. 8, who was working as a teacher in the Babu Ram Singh Intermediate College, Baburala, Baduan was also one of the candidates in the election. The appellant, who was an elector at the said election, filed the Election Petition, out of which this appeal arises, contending that Respondent No. 8, who was working as a teacher in the Babu Ram Singh Intermediate College, Baburala, Baduan, was holding an office of profit under the State Government and, therefore, the acceptance of his nomination by the Returning officer was illegal. 8 secured 3606 votes, which were higher than the difference between the votes secured by Respondent No. I should be considered as having been materially affected by the wrongful acceptance of the nomination paper of Respondent No. The Election Petition was contested by Respondent No. 1 that the acceptance of the nomination paper of Respondent No. 8 was not holding an office of profit under the State Government and secondly even if the acceptance of the nomination paper of Respondent No. 8 was illegal, the election could not be set aside since the result of the election was not materially affected thereby. The High Court held that the acceptance of the nomination paper of Respondent No. 8 was illegal, the appellant had not established that the result of the election of Respondent No. I had been materially affected on the facts and in the H 634 circumstances of the case. The High Court accordingly dismissed the petition. Aggrieved by the judgment of the High Court the appellant has filed this appeal. Since it is possible to dispose of this appeal on the second ground we do not propose to express any opinion in this case on the question whether Respondent No. 8 was, in fact, holding an office of profit under the State Government or not on the date on which the nomination paper was filed or on the date of the election. In order to decide the second question it is necessary to set out the relevant part of section 100 of the Act which reads thus: "100. Grounds for declaring election to be void (1) Subject to the provisions of sub section (2) if the High Court is of opinion . . . . . . . . . ( c) that any nomination has been improperly rejected; or (d) that the result of the election, in so far as it concerns a returned candidate, has been materially affected (i) by the improper acceptance of any nomination, or. . " Section 100 of the Act makes a distinction between the effect of improper rejection of any nomination and the effect of the improper acceptance of any nomination on the election. If a nomination of any person at an election has been improperly rejected the election of the returned candidate is liable to be set aside without any further proof because it is difficult to visualise the number of votes which the person whose nomination has been rejected would have secured at the election and there is every likelihood of the returned candidate not securing the highest number of votes. It is for this reason clause (c) of section 100(1) of the Act states that if the High Court is of the opinion that any nomination has been improperly rejected it shall declare the election of the returned candidate to be void. Sub clause (i) of clause (d) of sub section (1) of section 100 of the Act is, however, worded differently. It says that if the High Court is of opinion that the result of the election insofar as it concerns the returned candidate has been materially affected by the improper acceptance of any nomination it 635 shall declare the election of the returned candidate as void. Sub clause (i) of clause (d) of section 100( I) of the Act requires a petitioner in an election petition to establish two grounds in order to get the election of the returned candidate set aside, namely, (i) that there has been improper acceptance of any nomination; and (ii) that by reason of the entry of the candidate whose nomination has been improperly accepted into the contest the result of the election insofar as the returned candidate is concerned has been materially affected. The reason for making a distinction between a case falling under clause (c) of section 100(1) of the Act and a case falling under sub clause (i) of clause (d) of section 100( I) of the Act can be explained with reference to a hypothetical case. Let us assume that the returned candidate has secured at an election 30,000 votes and 20,000 votes have been secured by a candidate who has secured the next highest number of votes. We shall assume that a third candidate, whose nomination paper had been improperly accepted has secured just 1000 votes. In this hypothetical case it has to be held that the result of the election has not been materially affected at all. Such election petition has necessarily to be rejected. This Court was called upon to decide a case similar to the present one in Vashist Narain Sharma vs Dev Chandra and others. ; In that case the returned candidate Vashist Narain Sharma had secured 12868 votes and Vireshwar Nath Rai secured the next highest number of votes, i.e.,10,996. The difference in the number of votes secured by these two candidates was 1872. Another candidate by name Dudh Nath at the election, whose validity was in issue in that case, had secured 1983 votes. There were also two other candidates in the field. One of the grounds in the election petition, out of which the above case arose, was that the election of the returned candidate was liable to be set aside since the nomination paper of Dudh Nath had been improperly accepted by the Election Commissioner. The Court in that case held that the burden of proving that the result of the election had been materially affected on account of the improper acceptance of a nomination was on the petitioner and that even if there was wrongful acceptance of the nomination having regard to the number of votes secured by the several candidates it was not possible to hold that the 636 result of the election had been materially affected. ; , section 100( l)(d)(i)) of the Act again arose for consideration. In that case this Court commented at pages 643 644 on the decision in Vashist Narain Sharma 's case (supra) thus: "Mr. Chari relies upon the rulings of this Court where it has been laid down how the burden of proving the effect on the election must be discharged. He referred to the case reported in Vashist Narain Sharma vs Dev Chandra and Surendra Nath Khosla vs Dilip Singh and the later rulings of this Court in which Vashist Narain 's case has been fol. In our opinion the matter cannot be considered on possibility. If the margin of votes were small something might be made of the points mentioned by Mr. Jethmalani. But the margin is large and the number of votes earned by the remaining candidates also sufficiently huge. There is no room, there fore, for a reasonably judicial guess. How far that proof should go or what it should contain is not provided by the Legislature. In Vashist 's case and in Inayatullah vs Diwanchand Mahajan, the provision was held to prescribe an impossible burden. we are bound by the rulings of this Court and must say that the burden has not been successfully discharged. We cannot overlook the rulings of this Court and follow the English rulings cited to us. " The very same question was considered by this Court in Chhedi Ram vs Jhilmit Ram and others, by a bench of which one of us (Venkataramiah, J.) was a member. The judgment in that case was delivered by Chinnappa Reddy, J.
In that case the returned candidate Jhilmit Ram had secured 17, 822 votes and Chhedi Ram, the runner up had secured 17449 votes. Thus the difference between the successful candidate and the candidate who secured next highest votes was 373 votes. There were four other candidates, of whom Moti Ram secured 6710 votes. Chhedi Ram challenged the election of Jhilmit Ram on the ground that Moti Ram was a Kahar by caste, not entitled to seek election from the reserved constituency, i.e., his nomination had been improperly accepted and the result of election was materially affected. The High Court found that Moti Ram was a Kahar by caste 637 and not a member of the scheduled Castes. Having arrived at the conclusion that Moti Ram 's nomination had been accepted improperly, the High Court was not prepared to set aside the election of Jhilmit Ram as it took the view that the result of the election had not been shown to have been affected in view of the improper acceptance of the nomination of Moti Ram. The election petition in that case was, therefore, dismissed. Chhedi Ram then preferred an appeal to this Court against the judgment of the High Court. In the course of the judgment Chinnappa Reddy, J. Observed thus "2. We are afraid the appeal has to be allowed. True, the burden of establishing that the result of the election has been materially affected as a result of the improper acceptance of a nomination is on the person impeaching the election. The burden is readily discharged if the nomination which has been improperly accepted was that of the successful candidate himself. On the other hand, the burden is wholly incapable of being discharged if the candidate whose nomination was improperly accepted obtained a less number of votes than the difference between the number of votes secured by the candidate who got the next highest number of votes. In both these situations, the answers are obvious. The complication arises only in cases where the candidate, whose nomination was improperly accepted, has secured a large number of votes than the difference between the number of votes secured by the successful candidate and the number of votes got by the candidate securing the next highest number of votes. The complication is because of the possibility that a sufficient number of votes actually cast for the candidate whose nomination was improperly accepted might have been cast for the candidate who secured the highest number of votes next to the successful candidate, so as to upset the result of the election, but whether a sufficient number of voters would have so done, would ordinarily remain a speculative possibility only. If the number of votes secured by the candidate whose nomination was rejected is not disproportionately large as compared with the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes, it would be next to impossible to conclude that the result of the election has been materially affected. But, on the other hand, if the number of votes secured by the candidate whose nomination was improperly accepted is disproportinately large as compared with the difference between the votes secured by the successful candidate and the candidate securing the next highest number of votes and if the votes secured by the candidate whose nomination was improperly accepted bears a fairly high proportion to the votes secured by the successful candidate, the reasonable probability is that the result of the election has been materially affected and one may venture to hold the fact as proved. Under the Indian Evidence Act, a fact is said to he proved when after considering the matters before it, the court either believes it to exist or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists. If having regard to the facts and circumstances of a case, the reasonable probability is all one way, a court must not lay down an impossible standard of proof and hold a fact is not proved. In the present case, the candidate whose nomination was improperly accepted had obtained 67 10 votes, that is, almost 20 times the difference between the number of votes secured by the successful candidate and the candidate securing the next highest number of votes. Th number of votes secured by the candidate whose nomination was improperly accepted bore a fairly high proportion to the number 639 Of votes secured by the successful candidate it was a little over one third. Surely, in that situation, the result of the election may safely be said to have been affected. I had secured 23006 votes and Respondent No. 8, the validity of whose nomination was questioned, had secured 3606 votes. It is no doubt true that if we assume that all the 3606 votes secured by Respondent No. 2 would have been the successful candidate. Having regard to the facts of this case we feel that it is not possible to hold that the appellant in this appeal has established that the result of the election of the returned candidate had been materially affected because the difference between the votes secured by Respondent No. 8 had secured only about 1 7th of the number of votes polled by the Respondent No. l and there were 15 candidates (excluding respondent No. It is not possible to reach a finding in this case by making a judicial guess that all the 3606 voters who had voted in favour of Respondent No. 8 would have cast their votes in favour of Respondent No. Even if about 1350 of them had cast their votes in favour of any of the other 14 candidates (including the returned candidate) Respondent No. 2 could not have become the candidate who had secured the highest number of votes at the election. That is a matter which has to be proved and the onus of proving it lies upon the petitioner. It will not do merely to say that all or majority of the wasted votes might have gone to the next highest candidate. The casting of votes at an election depends upon a variety of factors and it is not possible for any one to predicate how many or which proportion of the votes will go to one or the other of the candidates. While it must be recognised that the petitioner in such a case of confronted with a difficult situation, it is not possible to relieve him of the duty imposed upon him H 640 by section 100(1)(c) and hold without evidence that the duty has been discharged. Should the petitioner fail to adduce satisfactory evidence to enable the Court to find in his favour on this point, the inevitable result would be that the Tribunal would not interfere in his favour and would allow the election to stand. " In the case before us we are of the view that the High Court was right in observing that the appellant or any other party had not placed satisfactory evidence to reach the conclusion that all or a sufficient number of the wasted votes which had been cast in favour of Respondent No. 8 would have gone in favour of Respondent No. 8 not been one of the candidates at the election. The High Court has on the evidence before it held that "in the context particularly of the poll being heavy and the contestants being large in number 16 in all it remains unreasonable to guess that if the respondent No. 8 were excluded from the arena of contest the wasted votes would have gone to the respondent No. The burden Iying upon the petitioner remains clearly undischarged and the speculative possibility does not attain the level of proof. " We agree with the above observation of the High Court since the appellant has not discharged the burden which clearly lay on him or proving that the result of the election had been materially affected even assuming that the nomination of Respondent No.
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% In the election to the Uttar Pradesh State Legislative Assembly from constituency No. 41 held in early March, 1985, 16 candidates contested.
Respondent No. 1 was declared elected having secured 23,006 votes.
Respondent No. 2 secured 20,735 votes being the next highest.
The difference of votes secured by them was in the order of 2,271 votes.
Respondent No. 8 who was working as a teacher in a college and who was one of the candidates secured 3,606 votes which were more than the difference between the votes secured by respondent No. 1 and 2.
The appellant who was an elector at the said election filed an election petition contending that respondent No. 8 was holding an 'office of profit ' under the State Government as he was working as a teacher in a college and therefore, the acceptance of his nomination by the returning officer was illegal, that since respondent No. 8 secured 3,606 votes which were higher than the difference between the votes secured by respondent No. 1 and respondent No. 2, the election of respondent No. 1 should be considered as having been materially affected by the wrongful acceptance of the nomination paper of respondent No. 8, and the election of the respondent No. 1 was, therefore, liable to be set aside.
Respondent No.1 contested the election petition pleading that the acceptance of the nomination paper of respondent No. 8 was not illegal since he was not holding an office of profit under the State Government, and that even if the acceptance was illegal the election could not be set aside since the result of the election was not materially affected thereby.
Dismissing the petition, the High Court held that the acceptance of the nomination paper of respondent No. 8 was not illegal as he was not holding an office of profit under the State Government and that 631 even if the acceptance of the nomination paper was illegal, the appellant had not established that the result of the election of respondent No. 1 had been materially affected on the facts and in the circumstances of the case.
In the appeal to this Court on the question: whether the appellant had established that the result of the election of respondent No. 1 had been materially affected by the wrongful acceptance of the nomination paper of respondent No. 8.
Dismissing the appeal to this Court, ^ HELD: The appellant has not discharged the burden which clearly lay on him of proving that the result of the election had been materially affected, even assuming that the nomination of respondent No. 8 had been improperly accepted.
[640E] Section 100 of the Representation of the People Act makes a distinction between the effect of improper rejection of any nomination, and the effect of the improper acceptance of any nomination on the election.
If a nomination of any person at an election had been improperly rejected the election of the returned candidate is liable to be set aside without any further proof because it is difficult to visualise the number of votes which the person whose nomination has been rejected would have secured at the election and there is every likelihood of the returned candidate not securing the highest number of votes.
[634E G] Clause (c) of sub section (1) states that if the High Court is of the opinion that any nomination has been improperly rejected it shall declare the election of the returned candidate to be void.
[634Gl Sub clause (i) of clause (d) of sub section (1) requires a petitioner in an election petition to establish two grounds in order to get the election of the returned candidate set aside.
namely (i) that there has been improper acceptance of any nomination and (ii) that by reason of entry of the candidate whose nomination has been improperly accepted into the contest the result of the election insofar as the returned candidate is concerned has been materially affected.
[635A B] Having regard to the facts of the instant case it is not possible to hold that the appellant has established that the result of the election of the returned candidate had been materially affected because the dif 632 ference between the votes secured by respondent No. 1, the returned candidate and respondent No. 2, the candidate who secured next highest votes was 2,271 votes.
Respondent No. 8, the validity of whose nomination was questioned, had secured only about 1/7th of the number of votes polled by respondent No. 1 and there were 15 candidates (excluding respondent No. 8) contesting the election.
It is not possible to reach a finding in this case by making a judicial guess that all the 3606 voters who had voted in favour of respondent No. 8 would have cast their votes in favour of respondent No. 2 alone.
Even if about 1350 of them had cast their votes in favour of any of the other 14 candidates (including the returned candidate) respondent No. 2 could not have become the candidate who had secured the highest number of votes at the election.
[639C E] The High Court was, therefore, right in taking the view that the appellant or any other party had not placed any satisfactory evidence to reach the conclusion that all or sufficient number of wasted votes which had been cast in favour of respondent No. 8 would have gone in favour of respondent No. 2, had respondent No. 8 not been one of the candidates at the election, that in the context particularly of the poll being heavy and the contestants being large in number, 16 in all It was unreasonable to guess that if the respondent No. 8 were excluded from the arena of contest the wasted votes would have gone to the respondent No. 2 thereby enabling him to succeed, and that the burden Iying upon the petitioner remained clearly undischarged and the speculative possibility did not attain the level of proof.
[640B D] Vashist Narain Sharma vs Dev Chandra and others, ]1955] 1 S.C.R. 509; Samant N. Balakrishna etc.
vs George Fernandez and Ors.
; , and Chhedi Ram vs Jhilmit Ram and others, p ] , referred to.
|
% In the election to the Uttar Pradesh State Legislative Assembly from constituency No. 41 held in early March, 1985, 16 candidates contested. 1 was declared elected having secured 23,006 votes. 2 secured 20,735 votes being the next highest. The difference of votes secured by them was in the order of 2,271 votes. 8 who was working as a teacher in a college and who was one of the candidates secured 3,606 votes which were more than the difference between the votes secured by respondent No. The appellant who was an elector at the said election filed an election petition contending that respondent No. 8 was holding an 'office of profit ' under the State Government as he was working as a teacher in a college and therefore, the acceptance of his nomination by the returning officer was illegal, that since respondent No. 8 secured 3,606 votes which were higher than the difference between the votes secured by respondent No. 1 should be considered as having been materially affected by the wrongful acceptance of the nomination paper of respondent No. 8, and the election of the respondent No. 1 was, therefore, liable to be set aside. Respondent No.1 contested the election petition pleading that the acceptance of the nomination paper of respondent No. 8 was not illegal since he was not holding an office of profit under the State Government, and that even if the acceptance was illegal the election could not be set aside since the result of the election was not materially affected thereby. 1 had been materially affected on the facts and in the circumstances of the case. Dismissing the appeal to this Court, ^ HELD: The appellant has not discharged the burden which clearly lay on him of proving that the result of the election had been materially affected, even assuming that the nomination of respondent No. [640E] Section 100 of the Representation of the People Act makes a distinction between the effect of improper rejection of any nomination, and the effect of the improper acceptance of any nomination on the election. If a nomination of any person at an election had been improperly rejected the election of the returned candidate is liable to be set aside without any further proof because it is difficult to visualise the number of votes which the person whose nomination has been rejected would have secured at the election and there is every likelihood of the returned candidate not securing the highest number of votes. [634Gl Sub clause (i) of clause (d) of sub section (1) requires a petitioner in an election petition to establish two grounds in order to get the election of the returned candidate set aside. 1, the returned candidate and respondent No. 2, the candidate who secured next highest votes was 2,271 votes. 1 and there were 15 candidates (excluding respondent No. It is not possible to reach a finding in this case by making a judicial guess that all the 3606 voters who had voted in favour of respondent No. 8 would have cast their votes in favour of respondent No. 2 could not have become the candidate who had secured the highest number of votes at the election. 8 would have gone in favour of respondent No. 8 were excluded from the arena of contest the wasted votes would have gone to the respondent No. [640B D] Vashist Narain Sharma vs Dev Chandra and others, ]1955] 1 S.C.R. 509; Samant N. Balakrishna etc. ; , and Chhedi Ram vs Jhilmit Ram and others, p ] , referred to.
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Appeal No. 124 of 1962.
Appeal by special leave from the judgment and order dated November 14, 1960, of the Punjab High Court (Circuit Bench), Delhi in Civil Revision Case No. 224 D of 1959.
Janardan Sharma, for the appellant.
R.Ganapathy Iyer and P. D. Menon, for the respondents.
September 25.
The judgment of the Court was delivered by 231 DAS GUPTA J.
This appeal by special leave raises the question of validity of r. 12(4) of the Central Civil Services (Classification, Control and Appeal) Rules, 1957, that were framed by the President and published by a notification dated February 28, 1957.
Rule 12(4) is in these words : "12(4).
Where a penalty of dismissal, removal or compulsory retirement from service imposed upon a Government servant is set aside or declared or rendered void in consequence of or by a decision of a court of law and the disciplinary authority on a consideration of the circumstances of the case, decides to hold a further inquiry against him, on the allegations on which the penalty of dismissal, removal or compulsory retirement was originally imposed, the Government servant shall be deemed to have been placed under suspension by the Appointing Authority from the date of the original order of dismissal, removal or compulsory retirement and shall continue to remain under suspension until further orders.
" The question arises in this way.
On July 1, 1949, the appellant, who was a permanent Sub Inspector of Co operative Societies, Delhi, was suspended by the Deputy Commissioner, Delhi,.
On July 9 he was served with a charge sheet under r. 6(1) of the Rules which had been framed by the Chief Commissioner, Delhi.
On a consideration of the report made by the officers, who had held an enquiry into the several charges against him the Deputy Commissioner, Delhi, made an order on December 17, 1951, dismissing this appellant.
The appellant filed a suit on May 20, 1953, praying for a declaration that the order of dismissal made against him was invalid in law being in violation of article 311 of the Constitution of India and for a further declaration that, he still continued to be in service of the Government.
232 The Trial Court decreed the suit on May 3 1, 1954, declaring that the plaintiff 's dismissal was void and inoperative and that the plaintiff continued to be in service of the State of Delhi at the date of the institution of the suit.
The appeal by the Government of India was dismissed by the Senior Subordinate judge, Delhi on December 31, 1954.
The decree was however set aside by the Punjab High Court on November 1, 1955, in Second Appeal by the State and the suit was dismissed.
Against this decision of the High Court, the appellant preferred an appeal by special leave to this Court.
This Court held that the provisions of article 311(2) had not been fully complied with and the appellant had not had the benefit of all the constitutional protections and accordingly, his dismissal could not be supported.
The Court then passed the following order : "We, therefore, accept this appeal and set aside the order of the Single judge and decree the appellant 's suit by making a declaration that the order of dismissal passed by the Deputy Commissioner on December 17, 1951 purporting to dismiss the appellant from service was inoperative that the appellant was a member the service at the date of the institution of the suit out of which, this appeal has arisen.
The appellant will get costs throughout in all courts.
Under Order XIV Rule 7 of the Supreme Court Rules, we direct that the appellant should be paid his fees which we assess at Rs. 250".
The judgment of this Court wag delivered on December 13, 1957, and is reported in [1958] Supreme Court Reports at page 1080.
233 On April 20, 1955, i.e., shortly after the Government appeal had been dismissed by the Senior Subordinate judge, the appellant instituted a suit in the Court of the Senior Sub judge, Delhi, out of which the present appeal has arisen.
The defendants in this suit are: 1.
The Union of India; 2.
The State of Delhi; and 3.
The Collector and Registrar, Co operative Societies, Delhi.
In this suit the plaintiff claims, on the basis of the decree obtained by him in the earlier suit, a sum of Rs. 14,042/8/ as arrears of salary 'and allowances.
The hearing of the suit was however stayed by the Trial Court on December 26, 1955, in view of the pendency of the appellant 's appeal in this Court against the decision of the Punjab High Court dismissing the earlier suit.
As already stated, this Court delivered the judgment in that appeal on December 13, 1957.
On December 26, 1957, the appellant made an application to the Trial Court praying that the hearing of the suit be taken up.
Before, however, the suit could be disposed of, the defendants made an application to the Subordinate judge, on August 7, 1958 stating that the disciplinary authority had on a consideration of the circumstances of the case, decided to hold a further enquiries against this appellant on the allegations on which he had been originally dismissed and that, consequently, the appellant should be deemed to have been placed under suspension by the appointing authority from December 17, 1951, the date of the original order of dismissal.
Accordingly, it was contended by the defendants that the plaintiff 's claim in the present suit was untenable.
On February 14, 1959, the Trial Court made an order in these terms " 'It is hereby ordered that the proceedings in the case shall remain stayed until the time the order of suspension is revoked under Rule (5) of the Central Civil Service (Classification, Control and Appeal) Rules, 1957 referred to above 234 or its being set aside by a competent tribunal or authority whichever event occurs earlier.
The hearing of the suit is adjourned sine die and the proceedings shall be revived on the application of the plaintiff after the occurrence of any of the two events referred to above.
" Against this order the appellant filed a revisional application in the Punjab High Court challenging the validity of r. 12(4) of the Central Civil Service (Classi fication, Control and Appeal) Rules, 1957.
A Division Bench of the High Court dismissed the revision petition rejecting the appellant 's contention against the validity of r. 12(4).
Against that decision of the High Court the appellant has filed the present appeal after obtaining special leave from this Court.
It is clear that if r. 12(4) of the Central Civil Service (Classification, Control and Appeal) Rules, 1957,is valid the appellant must be deemed to have been placed under suspension from December 17, 1951.
For, it is not disputed that after the penalty, of dismissal imposed on him had been rendered void by the decision of this Court, the disciplinary authority did in fact decide to hold a further enquiry against him on the allegations on which this penalty of dismissal had originally been imposed.
It is equally clear that if the appellant be deemed to have been placed under suspension from December 17, 1951, the order made by the Trial Court staying the hearing of the suit and the order of the High Court rejecting the revisional application are not open to challenge.
The sole question therefore is whether r. 12(4) is valid in law.
This rule forms part of the rules made by the President in exercise of the powers conferred on him by the proviso to article 309 and cl. 5 of article 148; of the Constitution.
The main provisions of article 309 is that subject to the provisions of the Constitution, Acts of the appropriate Legislature may regulate the recruitment, and conditions of service of per sons appointed, to public services and posts in connection 235 with the affairs of the Union or of any State.
The proviso to this Article makes it competent for the President or such other person as he may direct, in the case of services and posts in connection with the affairs of the Union, to make rules regulating the recruitment and the conditions of service of persons appointed to such services and posts until provision in that behalf is made by or under an Act of the appropriate Legislature under this Article.
Clause 5 of article 148 makes a similar provision in respect of ' the conditions of service in the Indian Audit and Accounts Department and provides inter alia that subject to the provisions of the Constitution and of any law made by Parliament, the conditions of service of persons serving in the Indian Audit and Accounts Department shall be such as may be prescribed by rules made by the President after consultation with the Comptroller and Auditor General.
Mr. janardan Sharma rightly contends that this lower of the President to make rules is subject to all the provisions of the Constitution and consequently if in making the rule the rule making authority has contravened any of the provisions of the Constitution the rule is invalid to the extent of such contravention.
According to Mr. Sharma r. 12(4) contravenes the provisions of article 142, article 144, article 19(1) (f), article 31 and also article 14 of the Constitution.
The argument that the impugned Rule contravenes article 142 and article 144 is practically the same.
Article 142 provides inter alia that any decree passed by the Supreme Court in the exercise of its jurisdiction shall be enforceable throughout the, territory of India in such manner as may be prescribed by or under any law made by Parliament and until provision in that behalf is so made, in such manner as the President may by order prescribe.
Article 144 provides that all authorities, civil and judicial, in the territory of India shall act in aid of the Supreme Court.
Mr. Sharma 's argument as far as we could 236 understand it is that under these provisions of articles 142 and 144 a duty lay on the President to do all that was necessary to give effect to the decree made by this Court in the earlier appeal and that by framing r. 12(4) the President has, in effect, gone against the directions of this Court as contained in that decree.
In our judgment, there is no substance in this contention.
If the decree of this Court had directed payment of arrears of appellant 's salary and allowances and the effect of the rule made by the President was to deprive him of that right there might perhaps have been scope for an argument that the rule contravened the provisions of article 144.
The decree made by this Court did not however contain any direction as regards payment of salary and allowances.
It did contain a direction that the appellant will get his costs throughout in all courts.
Quite clearly, however, the impugned rule does not in any way affect that right of the appellant.
The only other relief granted by the decree was the making of a declaration that the order of dismissal passed by the Deputy Commissioner, Delhi, on December 17, 1951, purporting to dismiss the appellant from service was inoperative and that the appellant was a member of the service at the date of the institution of the suit out of which the appeal had arisen.
Does the impugned rule go against this declaration? The answer, in our opinion, must be in the negative.
The provision in the rule that the Government servant shall be deemed to have been placed under suspension from the date of the original order of dismissal does not seek to affect the position that the order of dismissal previously passed was inoperative and that the appellant was a member of the service on May 25, 1953, when the first, suit was instituted by the appellant.
An order of suspension of a government servant does not put an end to his service under the Government.
He continues to be a member of the service inspite of the order of suspension.
There was a termination of the appellant '$ service when the order of dismissal was I 'made on 237 December 17, 1951.
When that order of dismissal was act aside: the appellant 's service revived; and so long as another order of dismissal is not made or the service of the appellant is not terminated by some other means, the appellant continues to be a member of the service and the order of suspension in no way affects this position.
The real effect of the order of suspension is that though he continued to be a member of the Government service he was not permitted to work, and further, during the period of his suspension he was paid only some allowance generally called, ""subsistence allowance" which is normally less than his salary instead of the pay and allowances he would have been entitled to if he had not been suspended.
There is no doubt that the order of suspension affects a government servant injuriously.
There is no basis for thinking however that because of the order of suspension he ceases to be a member of the service.
The provision in r. 12(4) that in certain circumstances the Government servant shall be deemed to have been placed under suspension from the date of the original order of dismissal and shall continue to remain under suspension until further orders, does not in any way go against the declaration made by this Court.
The contention that the impugned Rule contravenes articles 142 or 144 is therefore untenable.
Equally untenable is the appellant 's next contention that the impugned rule contravenes the provisions of article 19(1)(f) of the Constitution.
The argument is that as a result of this Court 's decree the appellant had a right to his arrears of pay and allowances.
This right constituted his property; and as the effect of the impugned Rule is that he would not, for some time at least, get those arrears it restricts his right.
It may be conceded that the right to arrears of pay and allowances constituted property within the meaning of article 19(1)(f) of the Constitution and further, that the effect of r. 12(4) is a 238 substantial restriction of his right in respect of that property under article 19(1)(f).
The question remains whether this restriction is a reasonable restriction in the interests of the general public.
No body can seriously doubt the importance and necessity of proper disciplinary action being taken against government servants for inefficiency, dishonesty or other suitable reasons.
Such action is certainly against the immediate interests of the Government servant concerned; but is absolutely necessary in the interests.
of the general public for serving whose interests the government machinery exists and functions.
Suspension of a government servant pending an enquiry is a necessary part of the procedure for taking disciplinary action against him.
It follows, therefore, that when the penalty of dismissal has been set aside but the disciplinary authority decides to hold a further enquiry on the same facts against him a fresh order of suspension till the enquiry can be completed, in accordance with law, is a reasonable step of the, procedure.
We have no hesitation in holding, therefore, that in so far as r.12(4) restricts the appellant 's right under article 19(1)(f) of the Constitution, it is a reasonable restriction in the interests of the general public.
Rule 12(4) is therefore within the saving provisions of article 19(6), so that there is no contravention of the constitutional provisions.
Mr. Sharma drew our attention to the decision of this Court in Devendra Pratap vs State of Uttar Pradesh(1) where the effect of r. 54 of the Fundamental Rules framed by the State of U. P. under article 309 was considered.
It was held that while r. 54 undoubtedly enabled the State Government to fix the pay of a public servant where dismissal is set aside in a departmental appeal, the rule has no application to cases in which the dismissal of a public servant is declared invalid by a civil court and he is reinstated and that it would not in such a contingency be open to the authority to deprive the (1) [1962] Supp. 1 section C. R. 315.
239 public servant of the remuneration which he would have earned had he been permitted to work.
This decision has however no application to a case like the present, where because of the operation of r. 12 (4) of ,the Central Civil Service (Classification, Control & Appeal) Rules, 1957, the public servant is deemed to be placed under suspension from the date of the original order of dismissal.
This brings us to the attack on the rule on the basis of article 14.
According to Mr. Sharma the result of the impugned rule is that where a penalty of dismissal, removal or compulsory retirement from service imposed on a government servant is set aside or declared or rendered void in consequence of or by a decision of a court of law and the disciplinary authority decides to hold a further enquiry against 'him on the allegations on which the penalty was originally imposed, the consequence will follow that the government servant shall be deemed to have been placed under suspension from the date of the original imposition of penalty, whereas no such consequence will follow where a similar penalty is set aside not by a court of law but by the departmental disciplinary authority.
According to Mr. Sharma, therefore, there is a discrimination between a government servant the penalty of dismissal, removal or com pulsory retirement on whom is set aside by a decision of a court of law and another government servant a similar,penalty on whom is set aside on appeal by the departmental disciplinary authority.
The argument however ignores the result of rule 30 (2) and rule 12 (3) of these rules.
Rule 30 (2) provides inter alia that in the case of an appeal against an order imposing any of the penalties specified in rule 13, i.e., the penalty of dismissal, removal or compulsory retirement and certain other penalties, the appellate authority shall pass orders: "(1)setting aside, reducing, confirming or enhancing the penalty; or (ii) remitting the case to.
the authority which imposed the penalty 240 or to any other authority with such direction as it may deem fit in the circumstances of the case.
" Rule 12 (3) provides that "where a penalty of dismissal, removal or compulsory retirement from service imposed upon a Government servant under suspension is set aside in appeal or on review under 'these rules and the case is remitted for further enquiry or action or with any other directions, the order of his suspension shall be deemed to have continued in force on and from the date of the original order of dismissal, removal or compulsory retirement and shall remain in force until further orders.
" Where a penalty of dismissal, removal or compulsory retirement imposed upon a government servant is set aside by the departmental authority on appeal, it may or may not order further enquiry; just as where a similar penalty is set aside by a decision of a court of law the disciplinary authority may or may not direct a further enquiry.
Where the appellate authority after setting aside a penalty of dismissal, removal or compulsory retirement makes an order under r. 30 (2) (ii) remitting the case to the authority which imposed the penalty, for further enquiry, rule 12 (3) will come into operation and so the order of suspension which in almost all cases is likely to be made where a disciplinary proceeding is contemplated or is pending r. 12 (3) shall be deemed to have continued in force on and from the date of the original order of dismissal and shall remain in force until further orders.
There is therefore no difference worth the name between the effect of rule 12 (4) on a government servant the penalty of dismissal, removal or compulsory retirement on whom is set aside by a decision of a court of law and a further enquiry is decided upon and the effect of r. 12 (4) on an other government servant a similar penalty on whom is set aside in appeal or on review by the departmental authority and a further enquiry is decided upon.
In both cases the government servant will be deemed to be under suspension from the date of the.
original order of dismissal, except 241 that where in a departmental enquiry a government servant was not placed under suspension prior to the date when the penalty was imposed, this result will not follow, as r. 12 (3) would not then have any operation.
It is entirely unlikely however that ordinarily a government servant will not be placed under suspension prior to the date of his dismissal.
Rule 12 (1) provides that the appointing authority or any authority to which it is subordinate or any other authority empowered by the President in that behalf may place a government servant under suspension : (a) where a disciplinary proceeding against him is contemplated or is pending, or (b) where a case against him in respect of any criminal offence is under investigation or trial.
Mr. Sharma does not say that ordinarily any cases occur where a government servant is visited with a penalty of dismissal, removal or compulsory retirement, in a departmental proceeding, without there being a previous order of suspension under the provisions of r. 12(1) and we do not think any such case ordinarily occurs.
Consequently, the effect of r. 12(3) will be the same on a government servant a penalty of dismissal, removal or compulsory retirement on whom is set aside in appeal by the departmental authority as the effect of r. 12(4) on a government servant a similar penalty on whom is set aside by a decision of a court of law.
The contention that r. 12(4) contravenes article 14 of the Constitution must therefore be rejected.
As we find that all the above attacks on the validity of r. 12(4) fail, the further attack on the Rule on the basis of article 31(1) of the Constitution also necessarily fails.
For, whatever deprivation of property may result from r. 12(4) would be by authority of law the law being r. 12(4).
We have therefore come to the conclusion that the High Court.
is right in holding that r. 12(4) is 242 valid and consequently, in rejecting the appellant 's revisional application.
The appeal is dismissed.
But, in view of the circumstances of the case we make no order as to costs.
Though the appellant has failed in this appeal which was brought by him as a pauper, we make no order against him to pay the court fee which would have been paid by him if he had not been permitted to appeal as a pauper.
Appeal dismissed.
|
The appellant a public servant was served with a charge sheet and after enquiry was dismissed.
The filed a suit for a declaration that the order of dismissal was invalid and for a further declaration that he still continued to be in service.
The suit was ultimately decreed by the Supreme Court by making the declarations sought.
In the meantime the appellant filed another suit for recovery of arrears of salary and allowances.
The suit was stayed pending the disposal of the appeal before the Supreme Court.
After the judgment of the Supreme Court, the authorities decided to hold a further enquiry against the appellant on the original allegations.
In view of r. 12(4) Central Civil Services (Classification, Control and Appeal) Rules, 1957, the trial court ordered that the proceedings shall remain stayed till the order of suspension was revoked or set aside.
Rule 12(4) provides that where a penalty of dismissal, removal or compulsory retirement is set aside by a court of law and the authorities decide to hold a further enquiry on the same allegations, the public servant shall be deemed to have been placed under suspension from the date of the original order of dismissal, removal or compulsory retirement.
The appellant contended that r. 12 (4) offended articles 14, 19 (1) (f), 31, 142 and 144 of the Constitution and was void.
Held, that r. 12(4) did not offend any of the Articles of the Constitution and 'was valid.
Article 142 provides that decrees passed by the Supreme Court shall be enforceable throughout the territory of India, and article 144 provides that all authorities, civil and judicial shall act in aid of the Supreme Court.
Rule 12 (4) did not go against the decree of the Supreme Court.
and accordingly it did not contravene articles 142 and 144.
The declaration by the 230 Supreme Court that the appellant was a member of the service at the date of the institution of the suit was not affected by the appellant being placed under suspension.
The only things affected by r. 12(4) were the salary and allowances of the appellant as to which the Supreme Court decree contained no directions.
Rule 12(4) did not contravene article 19(1) (f).
Conceding that the right to receive arrears of salary constituted the appellant 's property and that r. 12(4) placed substantial restrictions on the exercise of that right, the restrictions were in the interest of the general public.
The taking of disciplinary action against public servants for inefficiency, dishonesty etc.
was absolutely necessary in the interests of the general public.
Suspension of the public servant pending enquiry was a necessary and reaso nable part of the procedure.
Devendra Pratap vs State of U. P., [1962] Sapp.
1. section C. R. 315.1334, distinguished.
The argument that there was discrimination between a public servant the penalty of dismissal etc.
on whom was set aside by a court and another public servant a similar penalty on whom was set aside on appeal by the departmental disciplinary authority was incorrect.
Rule 12(3) provided that in the latter case also the suspension of the public servant shall be deemed to have continued in force from the date of the original order of dismissal etc.
Only in the case of a public servant who had not been placed under suspension pending enquiry, would r. 12 (3) not be operative.
But such cases were rare.
Rule 12(4) did n;t ' offend article 31 (1) and whatever deprivation of property resulted from r. 12 (4) was by authority of law.
|
Appeal No. 124 of 1962.
Appeal by special leave from the judgment and order dated November 14, 1960, of the Punjab High Court (Circuit Bench), Delhi in Civil Revision Case No. 224 D of 1959.
Janardan Sharma, for the appellant.
R.Ganapathy Iyer and P. D. Menon, for the respondents.
September 25.
The judgment of the Court was delivered by 231 DAS GUPTA J.
This appeal by special leave raises the question of validity of r. 12(4) of the Central Civil Services (Classification, Control and Appeal) Rules, 1957, that were framed by the President and published by a notification dated February 28, 1957.
Rule 12(4) is in these words : "12(4).
Where a penalty of dismissal, removal or compulsory retirement from service imposed upon a Government servant is set aside or declared or rendered void in consequence of or by a decision of a court of law and the disciplinary authority on a consideration of the circumstances of the case, decides to hold a further inquiry against him, on the allegations on which the penalty of dismissal, removal or compulsory retirement was originally imposed, the Government servant shall be deemed to have been placed under suspension by the Appointing Authority from the date of the original order of dismissal, removal or compulsory retirement and shall continue to remain under suspension until further orders.
" The question arises in this way.
On July 1, 1949, the appellant, who was a permanent Sub Inspector of Co operative Societies, Delhi, was suspended by the Deputy Commissioner, Delhi,.
On July 9 he was served with a charge sheet under r. 6(1) of the Rules which had been framed by the Chief Commissioner, Delhi.
On a consideration of the report made by the officers, who had held an enquiry into the several charges against him the Deputy Commissioner, Delhi, made an order on December 17, 1951, dismissing this appellant.
The appellant filed a suit on May 20, 1953, praying for a declaration that the order of dismissal made against him was invalid in law being in violation of article 311 of the Constitution of India and for a further declaration that, he still continued to be in service of the Government.
232 The Trial Court decreed the suit on May 3 1, 1954, declaring that the plaintiff 's dismissal was void and inoperative and that the plaintiff continued to be in service of the State of Delhi at the date of the institution of the suit.
The appeal by the Government of India was dismissed by the Senior Subordinate judge, Delhi on December 31, 1954.
The decree was however set aside by the Punjab High Court on November 1, 1955, in Second Appeal by the State and the suit was dismissed.
Against this decision of the High Court, the appellant preferred an appeal by special leave to this Court.
This Court held that the provisions of article 311(2) had not been fully complied with and the appellant had not had the benefit of all the constitutional protections and accordingly, his dismissal could not be supported.
The Court then passed the following order : "We, therefore, accept this appeal and set aside the order of the Single judge and decree the appellant 's suit by making a declaration that the order of dismissal passed by the Deputy Commissioner on December 17, 1951 purporting to dismiss the appellant from service was inoperative that the appellant was a member the service at the date of the institution of the suit out of which, this appeal has arisen.
The appellant will get costs throughout in all courts.
Under Order XIV Rule 7 of the Supreme Court Rules, we direct that the appellant should be paid his fees which we assess at Rs. 250".
The judgment of this Court wag delivered on December 13, 1957, and is reported in [1958] Supreme Court Reports at page 1080.
233 On April 20, 1955, i.e., shortly after the Government appeal had been dismissed by the Senior Subordinate judge, the appellant instituted a suit in the Court of the Senior Sub judge, Delhi, out of which the present appeal has arisen.
The defendants in this suit are: 1.
The Union of India; 2.
The State of Delhi; and 3.
The Collector and Registrar, Co operative Societies, Delhi.
In this suit the plaintiff claims, on the basis of the decree obtained by him in the earlier suit, a sum of Rs. 14,042/8/ as arrears of salary 'and allowances.
The hearing of the suit was however stayed by the Trial Court on December 26, 1955, in view of the pendency of the appellant 's appeal in this Court against the decision of the Punjab High Court dismissing the earlier suit.
As already stated, this Court delivered the judgment in that appeal on December 13, 1957.
On December 26, 1957, the appellant made an application to the Trial Court praying that the hearing of the suit be taken up.
Before, however, the suit could be disposed of, the defendants made an application to the Subordinate judge, on August 7, 1958 stating that the disciplinary authority had on a consideration of the circumstances of the case, decided to hold a further enquiries against this appellant on the allegations on which he had been originally dismissed and that, consequently, the appellant should be deemed to have been placed under suspension by the appointing authority from December 17, 1951, the date of the original order of dismissal.
Accordingly, it was contended by the defendants that the plaintiff 's claim in the present suit was untenable.
On February 14, 1959, the Trial Court made an order in these terms " 'It is hereby ordered that the proceedings in the case shall remain stayed until the time the order of suspension is revoked under Rule (5) of the Central Civil Service (Classification, Control and Appeal) Rules, 1957 referred to above 234 or its being set aside by a competent tribunal or authority whichever event occurs earlier.
The hearing of the suit is adjourned sine die and the proceedings shall be revived on the application of the plaintiff after the occurrence of any of the two events referred to above.
" Against this order the appellant filed a revisional application in the Punjab High Court challenging the validity of r. 12(4) of the Central Civil Service (Classi fication, Control and Appeal) Rules, 1957.
A Division Bench of the High Court dismissed the revision petition rejecting the appellant 's contention against the validity of r. 12(4).
Against that decision of the High Court the appellant has filed the present appeal after obtaining special leave from this Court.
It is clear that if r. 12(4) of the Central Civil Service (Classification, Control and Appeal) Rules, 1957,is valid the appellant must be deemed to have been placed under suspension from December 17, 1951.
For, it is not disputed that after the penalty, of dismissal imposed on him had been rendered void by the decision of this Court, the disciplinary authority did in fact decide to hold a further enquiry against him on the allegations on which this penalty of dismissal had originally been imposed.
It is equally clear that if the appellant be deemed to have been placed under suspension from December 17, 1951, the order made by the Trial Court staying the hearing of the suit and the order of the High Court rejecting the revisional application are not open to challenge.
The sole question therefore is whether r. 12(4) is valid in law.
This rule forms part of the rules made by the President in exercise of the powers conferred on him by the proviso to article 309 and cl. 5 of article 148; of the Constitution.
The main provisions of article 309 is that subject to the provisions of the Constitution, Acts of the appropriate Legislature may regulate the recruitment, and conditions of service of per sons appointed, to public services and posts in connection 235 with the affairs of the Union or of any State.
The proviso to this Article makes it competent for the President or such other person as he may direct, in the case of services and posts in connection with the affairs of the Union, to make rules regulating the recruitment and the conditions of service of persons appointed to such services and posts until provision in that behalf is made by or under an Act of the appropriate Legislature under this Article.
Clause 5 of article 148 makes a similar provision in respect of ' the conditions of service in the Indian Audit and Accounts Department and provides inter alia that subject to the provisions of the Constitution and of any law made by Parliament, the conditions of service of persons serving in the Indian Audit and Accounts Department shall be such as may be prescribed by rules made by the President after consultation with the Comptroller and Auditor General.
Mr. janardan Sharma rightly contends that this lower of the President to make rules is subject to all the provisions of the Constitution and consequently if in making the rule the rule making authority has contravened any of the provisions of the Constitution the rule is invalid to the extent of such contravention.
According to Mr. Sharma r. 12(4) contravenes the provisions of article 142, article 144, article 19(1) (f), article 31 and also article 14 of the Constitution.
The argument that the impugned Rule contravenes article 142 and article 144 is practically the same.
Article 142 provides inter alia that any decree passed by the Supreme Court in the exercise of its jurisdiction shall be enforceable throughout the, territory of India in such manner as may be prescribed by or under any law made by Parliament and until provision in that behalf is so made, in such manner as the President may by order prescribe.
Article 144 provides that all authorities, civil and judicial, in the territory of India shall act in aid of the Supreme Court.
Mr. Sharma 's argument as far as we could 236 understand it is that under these provisions of articles 142 and 144 a duty lay on the President to do all that was necessary to give effect to the decree made by this Court in the earlier appeal and that by framing r. 12(4) the President has, in effect, gone against the directions of this Court as contained in that decree.
In our judgment, there is no substance in this contention.
If the decree of this Court had directed payment of arrears of appellant 's salary and allowances and the effect of the rule made by the President was to deprive him of that right there might perhaps have been scope for an argument that the rule contravened the provisions of article 144.
The decree made by this Court did not however contain any direction as regards payment of salary and allowances.
It did contain a direction that the appellant will get his costs throughout in all courts.
Quite clearly, however, the impugned rule does not in any way affect that right of the appellant.
The only other relief granted by the decree was the making of a declaration that the order of dismissal passed by the Deputy Commissioner, Delhi, on December 17, 1951, purporting to dismiss the appellant from service was inoperative and that the appellant was a member of the service at the date of the institution of the suit out of which the appeal had arisen.
Does the impugned rule go against this declaration? The answer, in our opinion, must be in the negative.
The provision in the rule that the Government servant shall be deemed to have been placed under suspension from the date of the original order of dismissal does not seek to affect the position that the order of dismissal previously passed was inoperative and that the appellant was a member of the service on May 25, 1953, when the first, suit was instituted by the appellant.
An order of suspension of a government servant does not put an end to his service under the Government.
He continues to be a member of the service inspite of the order of suspension.
There was a termination of the appellant '$ service when the order of dismissal was I 'made on 237 December 17, 1951.
When that order of dismissal was act aside: the appellant 's service revived; and so long as another order of dismissal is not made or the service of the appellant is not terminated by some other means, the appellant continues to be a member of the service and the order of suspension in no way affects this position.
The real effect of the order of suspension is that though he continued to be a member of the Government service he was not permitted to work, and further, during the period of his suspension he was paid only some allowance generally called, ""subsistence allowance" which is normally less than his salary instead of the pay and allowances he would have been entitled to if he had not been suspended.
There is no doubt that the order of suspension affects a government servant injuriously.
There is no basis for thinking however that because of the order of suspension he ceases to be a member of the service.
The provision in r. 12(4) that in certain circumstances the Government servant shall be deemed to have been placed under suspension from the date of the original order of dismissal and shall continue to remain under suspension until further orders, does not in any way go against the declaration made by this Court.
The contention that the impugned Rule contravenes articles 142 or 144 is therefore untenable.
Equally untenable is the appellant 's next contention that the impugned rule contravenes the provisions of article 19(1)(f) of the Constitution.
The argument is that as a result of this Court 's decree the appellant had a right to his arrears of pay and allowances.
This right constituted his property; and as the effect of the impugned Rule is that he would not, for some time at least, get those arrears it restricts his right.
It may be conceded that the right to arrears of pay and allowances constituted property within the meaning of article 19(1)(f) of the Constitution and further, that the effect of r. 12(4) is a 238 substantial restriction of his right in respect of that property under article 19(1)(f).
The question remains whether this restriction is a reasonable restriction in the interests of the general public.
No body can seriously doubt the importance and necessity of proper disciplinary action being taken against government servants for inefficiency, dishonesty or other suitable reasons.
Such action is certainly against the immediate interests of the Government servant concerned; but is absolutely necessary in the interests.
of the general public for serving whose interests the government machinery exists and functions.
Suspension of a government servant pending an enquiry is a necessary part of the procedure for taking disciplinary action against him.
It follows, therefore, that when the penalty of dismissal has been set aside but the disciplinary authority decides to hold a further enquiry on the same facts against him a fresh order of suspension till the enquiry can be completed, in accordance with law, is a reasonable step of the, procedure.
We have no hesitation in holding, therefore, that in so far as r.12(4) restricts the appellant 's right under article 19(1)(f) of the Constitution, it is a reasonable restriction in the interests of the general public.
Rule 12(4) is therefore within the saving provisions of article 19(6), so that there is no contravention of the constitutional provisions.
Mr. Sharma drew our attention to the decision of this Court in Devendra Pratap vs State of Uttar Pradesh(1) where the effect of r. 54 of the Fundamental Rules framed by the State of U. P. under article 309 was considered.
It was held that while r. 54 undoubtedly enabled the State Government to fix the pay of a public servant where dismissal is set aside in a departmental appeal, the rule has no application to cases in which the dismissal of a public servant is declared invalid by a civil court and he is reinstated and that it would not in such a contingency be open to the authority to deprive the (1) [1962] Supp. 1 section C. R. 315.
239 public servant of the remuneration which he would have earned had he been permitted to work.
This decision has however no application to a case like the present, where because of the operation of r. 12 (4) of ,the Central Civil Service (Classification, Control & Appeal) Rules, 1957, the public servant is deemed to be placed under suspension from the date of the original order of dismissal.
This brings us to the attack on the rule on the basis of article 14.
According to Mr. Sharma the result of the impugned rule is that where a penalty of dismissal, removal or compulsory retirement from service imposed on a government servant is set aside or declared or rendered void in consequence of or by a decision of a court of law and the disciplinary authority decides to hold a further enquiry against 'him on the allegations on which the penalty was originally imposed, the consequence will follow that the government servant shall be deemed to have been placed under suspension from the date of the original imposition of penalty, whereas no such consequence will follow where a similar penalty is set aside not by a court of law but by the departmental disciplinary authority.
According to Mr. Sharma, therefore, there is a discrimination between a government servant the penalty of dismissal, removal or com pulsory retirement on whom is set aside by a decision of a court of law and another government servant a similar,penalty on whom is set aside on appeal by the departmental disciplinary authority.
The argument however ignores the result of rule 30 (2) and rule 12 (3) of these rules.
Rule 30 (2) provides inter alia that in the case of an appeal against an order imposing any of the penalties specified in rule 13, i.e., the penalty of dismissal, removal or compulsory retirement and certain other penalties, the appellate authority shall pass orders: "(1)setting aside, reducing, confirming or enhancing the penalty; or (ii) remitting the case to.
the authority which imposed the penalty 240 or to any other authority with such direction as it may deem fit in the circumstances of the case.
" Rule 12 (3) provides that "where a penalty of dismissal, removal or compulsory retirement from service imposed upon a Government servant under suspension is set aside in appeal or on review under 'these rules and the case is remitted for further enquiry or action or with any other directions, the order of his suspension shall be deemed to have continued in force on and from the date of the original order of dismissal, removal or compulsory retirement and shall remain in force until further orders.
" Where a penalty of dismissal, removal or compulsory retirement imposed upon a government servant is set aside by the departmental authority on appeal, it may or may not order further enquiry; just as where a similar penalty is set aside by a decision of a court of law the disciplinary authority may or may not direct a further enquiry.
Where the appellate authority after setting aside a penalty of dismissal, removal or compulsory retirement makes an order under r. 30 (2) (ii) remitting the case to the authority which imposed the penalty, for further enquiry, rule 12 (3) will come into operation and so the order of suspension which in almost all cases is likely to be made where a disciplinary proceeding is contemplated or is pending r. 12 (3) shall be deemed to have continued in force on and from the date of the original order of dismissal and shall remain in force until further orders.
There is therefore no difference worth the name between the effect of rule 12 (4) on a government servant the penalty of dismissal, removal or compulsory retirement on whom is set aside by a decision of a court of law and a further enquiry is decided upon and the effect of r. 12 (4) on an other government servant a similar penalty on whom is set aside in appeal or on review by the departmental authority and a further enquiry is decided upon.
In both cases the government servant will be deemed to be under suspension from the date of the.
original order of dismissal, except 241 that where in a departmental enquiry a government servant was not placed under suspension prior to the date when the penalty was imposed, this result will not follow, as r. 12 (3) would not then have any operation.
It is entirely unlikely however that ordinarily a government servant will not be placed under suspension prior to the date of his dismissal.
Rule 12 (1) provides that the appointing authority or any authority to which it is subordinate or any other authority empowered by the President in that behalf may place a government servant under suspension : (a) where a disciplinary proceeding against him is contemplated or is pending, or (b) where a case against him in respect of any criminal offence is under investigation or trial.
Mr. Sharma does not say that ordinarily any cases occur where a government servant is visited with a penalty of dismissal, removal or compulsory retirement, in a departmental proceeding, without there being a previous order of suspension under the provisions of r. 12(1) and we do not think any such case ordinarily occurs.
Consequently, the effect of r. 12(3) will be the same on a government servant a penalty of dismissal, removal or compulsory retirement on whom is set aside in appeal by the departmental authority as the effect of r. 12(4) on a government servant a similar penalty on whom is set aside by a decision of a court of law.
The contention that r. 12(4) contravenes article 14 of the Constitution must therefore be rejected.
As we find that all the above attacks on the validity of r. 12(4) fail, the further attack on the Rule on the basis of article 31(1) of the Constitution also necessarily fails.
For, whatever deprivation of property may result from r. 12(4) would be by authority of law the law being r. 12(4).
We have therefore come to the conclusion that the High Court.
is right in holding that r. 12(4) is 242 valid and consequently, in rejecting the appellant 's revisional application.
The appeal is dismissed.
But, in view of the circumstances of the case we make no order as to costs.
Though the appellant has failed in this appeal which was brought by him as a pauper, we make no order against him to pay the court fee which would have been paid by him if he had not been permitted to appeal as a pauper.
Appeal dismissed.
|
Appeal by special leave from the judgment and order dated November 14, 1960, of the Punjab High Court (Circuit Bench), Delhi in Civil Revision Case No. R.Ganapathy Iyer and P. D. Menon, for the respondents. On July 1, 1949, the appellant, who was a permanent Sub Inspector of Co operative Societies, Delhi, was suspended by the Deputy Commissioner, Delhi,. On July 9 he was served with a charge sheet under r. 6(1) of the Rules which had been framed by the Chief Commissioner, Delhi. On a consideration of the report made by the officers, who had held an enquiry into the several charges against him the Deputy Commissioner, Delhi, made an order on December 17, 1951, dismissing this appellant. 232 The Trial Court decreed the suit on May 3 1, 1954, declaring that the plaintiff 's dismissal was void and inoperative and that the plaintiff continued to be in service of the State of Delhi at the date of the institution of the suit. The appeal by the Government of India was dismissed by the Senior Subordinate judge, Delhi on December 31, 1954. The decree was however set aside by the Punjab High Court on November 1, 1955, in Second Appeal by the State and the suit was dismissed. Against this decision of the High Court, the appellant preferred an appeal by special leave to this Court. This Court held that the provisions of article 311(2) had not been fully complied with and the appellant had not had the benefit of all the constitutional protections and accordingly, his dismissal could not be supported. The appellant will get costs throughout in all courts. Under Order XIV Rule 7 of the Supreme Court Rules, we direct that the appellant should be paid his fees which we assess at Rs. The judgment of this Court wag delivered on December 13, 1957, and is reported in [1958] Supreme Court Reports at page 1080. The Collector and Registrar, Co operative Societies, Delhi. In this suit the plaintiff claims, on the basis of the decree obtained by him in the earlier suit, a sum of Rs. 14,042/8/ as arrears of salary 'and allowances. The hearing of the suit was however stayed by the Trial Court on December 26, 1955, in view of the pendency of the appellant 's appeal in this Court against the decision of the Punjab High Court dismissing the earlier suit. As already stated, this Court delivered the judgment in that appeal on December 13, 1957. On December 26, 1957, the appellant made an application to the Trial Court praying that the hearing of the suit be taken up. Before, however, the suit could be disposed of, the defendants made an application to the Subordinate judge, on August 7, 1958 stating that the disciplinary authority had on a consideration of the circumstances of the case, decided to hold a further enquiries against this appellant on the allegations on which he had been originally dismissed and that, consequently, the appellant should be deemed to have been placed under suspension by the appointing authority from December 17, 1951, the date of the original order of dismissal. Accordingly, it was contended by the defendants that the plaintiff 's claim in the present suit was untenable. On February 14, 1959, the Trial Court made an order in these terms " 'It is hereby ordered that the proceedings in the case shall remain stayed until the time the order of suspension is revoked under Rule (5) of the Central Civil Service (Classification, Control and Appeal) Rules, 1957 referred to above 234 or its being set aside by a competent tribunal or authority whichever event occurs earlier. The hearing of the suit is adjourned sine die and the proceedings shall be revived on the application of the plaintiff after the occurrence of any of the two events referred to above. " Against this order the appellant filed a revisional application in the Punjab High Court challenging the validity of r. 12(4) of the Central Civil Service (Classi fication, Control and Appeal) Rules, 1957. Against that decision of the High Court the appellant has filed the present appeal after obtaining special leave from this Court. The sole question therefore is whether r. 12(4) is valid in law. This rule forms part of the rules made by the President in exercise of the powers conferred on him by the proviso to article 309 and cl. The main provisions of article 309 is that subject to the provisions of the Constitution, Acts of the appropriate Legislature may regulate the recruitment, and conditions of service of per sons appointed, to public services and posts in connection 235 with the affairs of the Union or of any State. The proviso to this Article makes it competent for the President or such other person as he may direct, in the case of services and posts in connection with the affairs of the Union, to make rules regulating the recruitment and the conditions of service of persons appointed to such services and posts until provision in that behalf is made by or under an Act of the appropriate Legislature under this Article. According to Mr. Sharma r. 12(4) contravenes the provisions of article 142, article 144, article 19(1) (f), article 31 and also article 14 of the Constitution. The argument that the impugned Rule contravenes article 142 and article 144 is practically the same. Article 144 provides that all authorities, civil and judicial, in the territory of India shall act in aid of the Supreme Court. Mr. Sharma 's argument as far as we could 236 understand it is that under these provisions of articles 142 and 144 a duty lay on the President to do all that was necessary to give effect to the decree made by this Court in the earlier appeal and that by framing r. 12(4) the President has, in effect, gone against the directions of this Court as contained in that decree. In our judgment, there is no substance in this contention. The decree made by this Court did not however contain any direction as regards payment of salary and allowances. It did contain a direction that the appellant will get his costs throughout in all courts. Quite clearly, however, the impugned rule does not in any way affect that right of the appellant. The only other relief granted by the decree was the making of a declaration that the order of dismissal passed by the Deputy Commissioner, Delhi, on December 17, 1951, purporting to dismiss the appellant from service was inoperative and that the appellant was a member of the service at the date of the institution of the suit out of which the appeal had arisen. Does the impugned rule go against this declaration? The answer, in our opinion, must be in the negative. The provision in the rule that the Government servant shall be deemed to have been placed under suspension from the date of the original order of dismissal does not seek to affect the position that the order of dismissal previously passed was inoperative and that the appellant was a member of the service on May 25, 1953, when the first, suit was instituted by the appellant. An order of suspension of a government servant does not put an end to his service under the Government. He continues to be a member of the service inspite of the order of suspension. There was a termination of the appellant '$ service when the order of dismissal was I 'made on 237 December 17, 1951. When that order of dismissal was act aside: the appellant 's service revived; and so long as another order of dismissal is not made or the service of the appellant is not terminated by some other means, the appellant continues to be a member of the service and the order of suspension in no way affects this position. The real effect of the order of suspension is that though he continued to be a member of the Government service he was not permitted to work, and further, during the period of his suspension he was paid only some allowance generally called, ""subsistence allowance" which is normally less than his salary instead of the pay and allowances he would have been entitled to if he had not been suspended. There is no doubt that the order of suspension affects a government servant injuriously. There is no basis for thinking however that because of the order of suspension he ceases to be a member of the service. The provision in r. 12(4) that in certain circumstances the Government servant shall be deemed to have been placed under suspension from the date of the original order of dismissal and shall continue to remain under suspension until further orders, does not in any way go against the declaration made by this Court. The contention that the impugned Rule contravenes articles 142 or 144 is therefore untenable. Equally untenable is the appellant 's next contention that the impugned rule contravenes the provisions of article 19(1)(f) of the Constitution. The argument is that as a result of this Court 's decree the appellant had a right to his arrears of pay and allowances. This right constituted his property; and as the effect of the impugned Rule is that he would not, for some time at least, get those arrears it restricts his right. It may be conceded that the right to arrears of pay and allowances constituted property within the meaning of article 19(1)(f) of the Constitution and further, that the effect of r. 12(4) is a 238 substantial restriction of his right in respect of that property under article 19(1)(f). The question remains whether this restriction is a reasonable restriction in the interests of the general public. No body can seriously doubt the importance and necessity of proper disciplinary action being taken against government servants for inefficiency, dishonesty or other suitable reasons. Such action is certainly against the immediate interests of the Government servant concerned; but is absolutely necessary in the interests. of the general public for serving whose interests the government machinery exists and functions. Suspension of a government servant pending an enquiry is a necessary part of the procedure for taking disciplinary action against him. It follows, therefore, that when the penalty of dismissal has been set aside but the disciplinary authority decides to hold a further enquiry on the same facts against him a fresh order of suspension till the enquiry can be completed, in accordance with law, is a reasonable step of the, procedure. Rule 12(4) is therefore within the saving provisions of article 19(6), so that there is no contravention of the constitutional provisions. Mr. Sharma drew our attention to the decision of this Court in Devendra Pratap vs State of Uttar Pradesh(1) where the effect of r. 54 of the Fundamental Rules framed by the State of U. P. under article 309 was considered. 239 public servant of the remuneration which he would have earned had he been permitted to work. This decision has however no application to a case like the present, where because of the operation of r. 12 (4) of ,the Central Civil Service (Classification, Control & Appeal) Rules, 1957, the public servant is deemed to be placed under suspension from the date of the original order of dismissal. This brings us to the attack on the rule on the basis of article 14. According to Mr. Sharma, therefore, there is a discrimination between a government servant the penalty of dismissal, removal or com pulsory retirement on whom is set aside by a decision of a court of law and another government servant a similar,penalty on whom is set aside on appeal by the departmental disciplinary authority. The argument however ignores the result of rule 30 (2) and rule 12 (3) of these rules. the authority which imposed the penalty 240 or to any other authority with such direction as it may deem fit in the circumstances of the case. " Where a penalty of dismissal, removal or compulsory retirement imposed upon a government servant is set aside by the departmental authority on appeal, it may or may not order further enquiry; just as where a similar penalty is set aside by a decision of a court of law the disciplinary authority may or may not direct a further enquiry. Where the appellate authority after setting aside a penalty of dismissal, removal or compulsory retirement makes an order under r. 30 (2) (ii) remitting the case to the authority which imposed the penalty, for further enquiry, rule 12 (3) will come into operation and so the order of suspension which in almost all cases is likely to be made where a disciplinary proceeding is contemplated or is pending r. 12 (3) shall be deemed to have continued in force on and from the date of the original order of dismissal and shall remain in force until further orders. There is therefore no difference worth the name between the effect of rule 12 (4) on a government servant the penalty of dismissal, removal or compulsory retirement on whom is set aside by a decision of a court of law and a further enquiry is decided upon and the effect of r. 12 (4) on an other government servant a similar penalty on whom is set aside in appeal or on review by the departmental authority and a further enquiry is decided upon. In both cases the government servant will be deemed to be under suspension from the date of the. original order of dismissal, except 241 that where in a departmental enquiry a government servant was not placed under suspension prior to the date when the penalty was imposed, this result will not follow, as r. 12 (3) would not then have any operation. It is entirely unlikely however that ordinarily a government servant will not be placed under suspension prior to the date of his dismissal. Rule 12 (1) provides that the appointing authority or any authority to which it is subordinate or any other authority empowered by the President in that behalf may place a government servant under suspension : (a) where a disciplinary proceeding against him is contemplated or is pending, or (b) where a case against him in respect of any criminal offence is under investigation or trial. Mr. Sharma does not say that ordinarily any cases occur where a government servant is visited with a penalty of dismissal, removal or compulsory retirement, in a departmental proceeding, without there being a previous order of suspension under the provisions of r. 12(1) and we do not think any such case ordinarily occurs. Consequently, the effect of r. 12(3) will be the same on a government servant a penalty of dismissal, removal or compulsory retirement on whom is set aside in appeal by the departmental authority as the effect of r. 12(4) on a government servant a similar penalty on whom is set aside by a decision of a court of law. The contention that r. 12(4) contravenes article 14 of the Constitution must therefore be rejected. As we find that all the above attacks on the validity of r. 12(4) fail, the further attack on the Rule on the basis of article 31(1) of the Constitution also necessarily fails. For, whatever deprivation of property may result from r. 12(4) would be by authority of law the law being r. 12(4). We have therefore come to the conclusion that the High Court. is right in holding that r. 12(4) is 242 valid and consequently, in rejecting the appellant 's revisional application. But, in view of the circumstances of the case we make no order as to costs. Though the appellant has failed in this appeal which was brought by him as a pauper, we make no order against him to pay the court fee which would have been paid by him if he had not been permitted to appeal as a pauper.
|
The appellant a public servant was served with a charge sheet and after enquiry was dismissed.
The filed a suit for a declaration that the order of dismissal was invalid and for a further declaration that he still continued to be in service.
The suit was ultimately decreed by the Supreme Court by making the declarations sought.
In the meantime the appellant filed another suit for recovery of arrears of salary and allowances.
The suit was stayed pending the disposal of the appeal before the Supreme Court.
After the judgment of the Supreme Court, the authorities decided to hold a further enquiry against the appellant on the original allegations.
In view of r. 12(4) Central Civil Services (Classification, Control and Appeal) Rules, 1957, the trial court ordered that the proceedings shall remain stayed till the order of suspension was revoked or set aside.
Rule 12(4) provides that where a penalty of dismissal, removal or compulsory retirement is set aside by a court of law and the authorities decide to hold a further enquiry on the same allegations, the public servant shall be deemed to have been placed under suspension from the date of the original order of dismissal, removal or compulsory retirement.
The appellant contended that r. 12 (4) offended articles 14, 19 (1) (f), 31, 142 and 144 of the Constitution and was void.
Held, that r. 12(4) did not offend any of the Articles of the Constitution and 'was valid.
Article 142 provides that decrees passed by the Supreme Court shall be enforceable throughout the territory of India, and article 144 provides that all authorities, civil and judicial shall act in aid of the Supreme Court.
Rule 12 (4) did not go against the decree of the Supreme Court.
and accordingly it did not contravene articles 142 and 144.
The declaration by the 230 Supreme Court that the appellant was a member of the service at the date of the institution of the suit was not affected by the appellant being placed under suspension.
The only things affected by r. 12(4) were the salary and allowances of the appellant as to which the Supreme Court decree contained no directions.
Rule 12(4) did not contravene article 19(1) (f).
Conceding that the right to receive arrears of salary constituted the appellant 's property and that r. 12(4) placed substantial restrictions on the exercise of that right, the restrictions were in the interest of the general public.
The taking of disciplinary action against public servants for inefficiency, dishonesty etc.
was absolutely necessary in the interests of the general public.
Suspension of the public servant pending enquiry was a necessary and reaso nable part of the procedure.
Devendra Pratap vs State of U. P., [1962] Sapp.
1. section C. R. 315.1334, distinguished.
The argument that there was discrimination between a public servant the penalty of dismissal etc.
on whom was set aside by a court and another public servant a similar penalty on whom was set aside on appeal by the departmental disciplinary authority was incorrect.
Rule 12(3) provided that in the latter case also the suspension of the public servant shall be deemed to have continued in force from the date of the original order of dismissal etc.
Only in the case of a public servant who had not been placed under suspension pending enquiry, would r. 12 (3) not be operative.
But such cases were rare.
Rule 12(4) did n;t ' offend article 31 (1) and whatever deprivation of property resulted from r. 12 (4) was by authority of law.
|
The appellant a public servant was served with a charge sheet and after enquiry was dismissed.
The filed a suit for a declaration that the order of dismissal was invalid and for a further declaration that he still continued to be in service.
The suit was ultimately decreed by the Supreme Court by making the declarations sought.
In the meantime the appellant filed another suit for recovery of arrears of salary and allowances.
The suit was stayed pending the disposal of the appeal before the Supreme Court.
After the judgment of the Supreme Court, the authorities decided to hold a further enquiry against the appellant on the original allegations.
In view of r. 12(4) Central Civil Services (Classification, Control and Appeal) Rules, 1957, the trial court ordered that the proceedings shall remain stayed till the order of suspension was revoked or set aside.
Rule 12(4) provides that where a penalty of dismissal, removal or compulsory retirement is set aside by a court of law and the authorities decide to hold a further enquiry on the same allegations, the public servant shall be deemed to have been placed under suspension from the date of the original order of dismissal, removal or compulsory retirement.
The appellant contended that r. 12 (4) offended articles 14, 19 (1) (f), 31, 142 and 144 of the Constitution and was void.
Held, that r. 12(4) did not offend any of the Articles of the Constitution and 'was valid.
Article 142 provides that decrees passed by the Supreme Court shall be enforceable throughout the territory of India, and article 144 provides that all authorities, civil and judicial shall act in aid of the Supreme Court.
Rule 12 (4) did not go against the decree of the Supreme Court.
and accordingly it did not contravene articles 142 and 144.
The declaration by the 230 Supreme Court that the appellant was a member of the service at the date of the institution of the suit was not affected by the appellant being placed under suspension.
The only things affected by r. 12(4) were the salary and allowances of the appellant as to which the Supreme Court decree contained no directions.
Rule 12(4) did not contravene article 19(1) (f).
Conceding that the right to receive arrears of salary constituted the appellant 's property and that r. 12(4) placed substantial restrictions on the exercise of that right, the restrictions were in the interest of the general public.
The taking of disciplinary action against public servants for inefficiency, dishonesty etc.
was absolutely necessary in the interests of the general public.
Suspension of the public servant pending enquiry was a necessary and reaso nable part of the procedure.
Devendra Pratap vs State of U. P., [1962] Sapp.
1. section C. R. 315.1334, distinguished.
The argument that there was discrimination between a public servant the penalty of dismissal etc.
on whom was set aside by a court and another public servant a similar penalty on whom was set aside on appeal by the departmental disciplinary authority was incorrect.
Rule 12(3) provided that in the latter case also the suspension of the public servant shall be deemed to have continued in force from the date of the original order of dismissal etc.
Only in the case of a public servant who had not been placed under suspension pending enquiry, would r. 12 (3) not be operative.
But such cases were rare.
Rule 12(4) did n;t ' offend article 31 (1) and whatever deprivation of property resulted from r. 12 (4) was by authority of law.
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| 1
| 1
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Civil Appeal No. 6626 of 1983.
From the Judgment and order dated 18.5.1983 of the Allahabad High Court in C.M.W.P. No. 13741 of 1982.
H 620 S.N. Kacker and R.B. Mehrotra for the Appellant.
B.D. Agarwala and Miss Asha Rani for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by the tenant against an order upholding the order of eviction.
The ground of eviction was on the landlord 's bona fide need and requirement.
The appeal arises out of the judgment and order of the High Court of Allahabad dated 18th of May, 1983 and also against the order dated 23rd of May, 1983 dismissing a review application by the said High Court.
Shri P.K. Mukerjee, respondent No. 1 herein had filed an application under section 3 of the U.P. Act No. 3 of 1947 (Temporary Control of Rent and Eviction Act), hereinafter referred to as the old Act, seeking permission to file the suit for eviction of the tenant, the father of the appellant herein, on the ground that accommodation in dispute was bona fide required by the landlord for his personal need.
In September, 1971 the Rent Control and Eviction officer rejected the application of the landlord and held that his requirement was not bona fide.
On 12th of November, 1971 the Commissioner allowed the revision filed by respondent No. 1 against the order of the Rent Control and Eviction officer dated 5th of September, 1971.
It may be mentioned that on 15th of July, 1972 the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 hereinafter referred to as the new Act came into effect.
On 2nd of August, 1972 the State Government rejected the representation of the tenant namely, the father of the appellant filed under section 7 of the old Act against the order of the Commissioner dated 2nd of November, 1971.
On or about 7th of February, 1975 the learned Single Judge of the High Court of Allahabad allowed the writ petition of the tenant and set aside the orders of the Commissioner and the State Government hereinbefore mentioned.
On 3rd of August, 1978 a Division Bench of the High Court of Allahabad allowed the appeal of respondent No. 1 and set aside the judgment of the learned Single Judge of the High Court dated 7th of February, 1975 and upheld the orders of the Commissioner and the State Government allowing the eviction of the tenant.
In September, 1978 respondent No. 1 moved an application under section 21 read with section 43(2)(rr) of the new Act.
Thereafter it is alleged that respondent No. 1 had executed an agreement to sell the disputed premises in favour of the appellant 's wife namely, Smt.
Madhu Soni.
It is material to refer to the said agreement in brief.
The agreement is dated as mentioned hereinbefore 7th of November, 1978 621 and was entered into between Shri P.K. Mukerjee, the landlord and Smt.
Madhu Soni wife of Shri D.K. Soni (son of Shri Harbans Lal Soni) the then tenant.
It was stated that the landlord had filed an application against Shri H.L. Soni the father in law of vendee for permission to file a suit for eviction against him on account of his personal need for the aforesaid premises and permission had been granted.
It also recited that a portion of the said land which was demarcated in the site plan measuring about 121 ' x 101.5 ' of the vendor which would be for the construction of a house would be in exclusive possession of the vendor and the rest of the property at 8, Panna Lal Road, Allahabad being the disputed premises would be sold to Smt.
It also recited that the vendee or his family members would have no right of whatsoever nature and the vendee, that is to say, the appellant had given up his tenancy right in respect of the same, that is to say, the portion to be kept with the vendor and the premises will be built on the vacant land with the money that would be obtained by selling the property to Smt.
Madhu Soni.
The property was sold for Rs. 1,00,000 out of which Rs.5,000 was paid as earnest money and it was stipulated that the rest of the money would be paid at the time of the registration.
It was further agreed that the parties would move the proper authorities as early as possible for permission to transfer and the sale deed would be executed within one month of the grant of the permission and notice to the vendee.
It was further stated that if the vendee failed to get the sale deed executed after one month from the date of permission and notice to the vendee by the vendor, the earnest money of Rs.5,000 would be forfeited and the right of the vendor would be as it subsisted prior to the agreement.
It was further provided that in the event of non execution of the sale deed on account of any act or failure on the part of the vendee in pursuance of the agreement to sell, the property would stand released in favour of the vendor and the earnest money of Rs.5,000 would be forfeited.
It was clearly stipulated that the need of the vendor for the premises still subsisted and this agreement was being entered into since it would be possible for the vendor to construct a house for himself on the land not agreed to be transferred measuring 121 ' x 101.5 ' .
On that basis the parties had signed agreement on 7th November, 1978.
On 12th of December, 1978 the father of the present appellant Shri H.L. Soni who was the original tenant died leaving behind his widow and two sons including the appellant and one daughter.
It was alleged that on 18th of December, 1978 respondent No. l sent a letter of condolence to the appellant on the death of appellant 's father.
On 622 22nd of December, 1978 appellant informed the Prescribed Authority before whom the application under section 2 1(1)(a) of the new Act red with section 43(2)(rr) was pending about the death of Shri H.L Soni.
On 23rd of March, 1979 respondent No. 1 moved an application for substitution in Case No. 53 of 1978 for bringing on record the heirs of deceased Shri H.L. Soni along with application under section 5 of the Limitation Act.
On 10th of November, 1979, the Prescribed Authority rejected the petitioners application for substitution and held that respondent No. 1 had full knowledge of the death of Shri H.L. Soni and he did not move the application within time.
On 11th of December, 1979 respondent No. 1 moved a second application under section 2 1(1)(a) read with section 43(2)(rr) of the new Act on the same ground on which the first application was moved.
The second application was registered as Case No. 68 of 1979.
It is alleged further that on 12th of March, 1981 respondent No. 1 executed two separate agreements to sell the property in dispute in favour of R.P. Kanodia and P.K. Kanodia respectively.
The Prescribed Authority on 7th of July, 198 1 held that the second application under section 2 1(1)(a) read with section 43(2)(rr) of the new Act being Case No. 68 of 1979 was within time and directed the tenant to be evicted from the premises in dispute.
The Additional District Judge, Allahabad on 25th of October, 1982 dismissed the appeal of the tenant filed against the order of the Prescribed Authority dated 7th of July, 1981.
On 11th of March, 1983 the appellant 's wife Smt.
Madhu Soni filed a suit for injunction restraining Respondent No. 1 from dispossessing her from the premises in dispute on the strength of registered agreement and she asserted that she resided in the accommodation as a result of part performance under section 53A of the .
Initially injunction was granted ex parte by the Trial Court and thereafter it was vacated after hearing respondent No. 1.
Aggrieved thereby an appeal } was filed by Smt.
Madhu Soni in which the High Court had stayed dispossession.
The High Court thereafter dismissed the writ petition of the tenant against the orders of the Prescribed Authority for eviction and the order of the Additional District Judge.
A review petition was filed by the appellant and the same was dismissed.
This appeal by special leave is against that decision of the High Court dated 18th of May, 1983 Behind this long tale of dates the questions involved in this appeal are short, namely, firstly in view of the provisions of section 43(2)(rr) was the High Court right, in the facts and circumstances of the case specially the death of original tenant being alleged, and in view of the fact that the execution of the order passed for eviction had 623 become final before coming into operation of the new Act the order was proper and secondly, how far the subsequent events, namely, the A agreement with the wife of one of the sons of the original tenant to purchase property as well as the agreement with the Kanodias mentioned hereinbefore demolish or destroy the case of a bona fide need of the landlord.
In other words are these not sufficient subsequent events which destroy the landlord 's bona fide need and as such should be taken note of by the appropriate courts in ordering eviction.
In this appeal, therefore, we have to keep in mind two aspects of law namely, the finality of the decisions and secondly, how far and to what extent subsequent events should be taken note of in order to do justice between the parties.
Before we refer to the judgment of the High Court and the submissions made before us, it is necessary for us to bear in mind certain decisions of this Court on these aspects on which reliance was placed.
This Court in Pasupuleti Venkateswarlu vs The Motor & General Traders, ; dealing with the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, dealt with the question as to how far the subsequent events can be taken note of.
This Court held that for making the right or remedy, claimed by a party justly and meaningfully as also legally and factually in accordance with the current realities, the court can, and in many cases must, take cautious cognizance of events and developments subsequent to the institution of the proceeding provided the rules of fairness to both sides are scrupulously obeyed.
In the facts of that case, this Court said that the High Court was right in taking into consideration the facts which came into being subsequent to the commencement of the proceedings.
Therefore the fact that in determining what justice required the Court was bound to consider any change, either in fact or in law, which had supervened since the judgment was given.
F This general principle and proposition of law was of ancient vintage.
See the observations of the U.S. Supreme Court in Pattersion vs State of Alabama, ; at page 607).
The actual facts, however, of this case were entirely different, and so it was not necessary to refer to those facts.
In Ramji Dayawala & Sons (P) Ltd. vs Invest Import, ; , this principle was again reiterated entirely under different context.
This Court also reiterated the same principle in Hasmat Rai and another vs Raghunath Prasad; , where referring to Pasupuleti Venkateswarlu vs The Motor and General Traders (supra), this Court held that when an action was brought by the landlord under Rent Restriction Act for eviction on the H 624 ground of personal requirement, his need must not only be shown to A exist at the date of the suit, but must exist on the date of appellate decree, or the date when a higher court dealt with the matter.
It was emphasised by this Court that if during the progress and passage of proceeding from court to court subsequent events had occurred which if noticed would non suit the plaintiff, the court had to examine and evaluate the same and mould the decree accordingly.
The tenant was entitled to show that the need or requirement no more existed by pointing out such subsequent events, to the court including the appellate court.
Otherwise the landlord would derive an unfair advantage, and it would be against the spirit or intendment of Rent Restriction Act which was enacted to fetter the unfettered right of re entry.
In such a situation, it was reiterated that, it would be incorrect to say that as the decree or order for eviction was passed against the tenant he could not invite the court to take into consideration subsequent events.
But the tenant could be precluded from so contending when decree or order for eviction had become final.
(Emphasis supplied see the observations of Desai, J. at page 617(G.H) of the report).
In Syed Asadullah Kazmi vs The Addl.
District Judge, Allahabad and others; , , this Court was concerned with a residence at Allahabad.
It was held by this Court that the order dated 25th March, 1977 of the appellate authority releasing a portion of the premises in favour of the third respondent therein and leaving the remaining portion in the tenancy of the appellant therein acquired finality when the proceedings taken against it by the appellant had failed.
The Prescribed Authority was bound to give effect to that final order and was not acting outside its jurisdiction or contrary to law where he ordered eviction.
This Court reiterated that it was true that subsequent events had to be taken into account by a statutory authority or court when considering proceeding arising out of a landlord 's petition for ejectment of a tenant on the ground of the landlord 's personal need.
But in that case the order for release of a portion of the accommodation had acquired finality before the death of the landlord and the controversy concluded by it could not be reopened thereafter.
This Court further reiterated that inasmuch as the question which arose before the Prescribed Authority on the application of the appellant after the proceedings for release had acquired finality, it was not open even for this Court to reopen the proceeding for release.
Not quite relevant to the present controversy, there is, however, just an observation in Sher Singh & Ors.
vs The State of Punjab; , It was a decision dealing with Article 21 of the Constitution.
There is an observation that traditionally, subsequent events had to be taken into account in the area of civil law.
It is necessary, however, to refer to a 625 decision of the special bench of the Allahabad high Court in Bansilal Sahu vs The Prescribed Authority and another, [ 19801 ALL.
L.J. 331 which arose under the new Act.
It was held therein that the question whether the eviction of the tenant had to be ordered from any specified part of the building under tenancy was not within the jurisdiction of the Prescribed Authority, while acting under clause (rr) of section 43(2), irrespective of the occurrence of subsequent events which might make it improper to order the eviction from the entire building or which might tend to establish that the need set up by the landlord could be satisfied by ordering eviction of the tenant from a specified part of the building under tenancy.
It was held that subsequent events or facts could not be considered so as to defeat the final order and the Prescribed Authority was bound to order eviction.
The Special Bench of the Allahabad High Court overruled another Bench decision of the Allahabad High Court in the case of Smt.
Sarju Devi vs Prescribed Authority, Kanpur, [19771 All.
L.J. 251 and accepted the proposition laid down in Tara Chand Khandelwal vs Prescribed Authority, Agra, [1976] All L.J. 708.
Satish Chandra, C.J. speaking for the Allahabad High Court observed that the opening clause of this provision entitled the Prescribed Authority to find out whether permission under section 3 of the old Act had been obtained on any ground specified in subsection (1) or sub section (2) of section 21 of the present Act and that the same had become final.
It was, therefore, according to the Chief Justice, the beginning as well as the end of his jurisdiction to record findings.
If the conclusion was in the affirmative the Prescribed Authority had no discretion but to order the eviction of the tenant from the building under tenancy.
It was further held that the jurisdiction of the Prescribed Authority was to order the eviction of the tenant from the building under tenancy.
It had not expressly been conferred any power to order eviction from a portion or part of the building under tenancy.
It was further held that the jurisdiction of the Prescribed Authority while deciding an application under section 2 1 of the present Act could not be equated with the jurisdiction which had been conferred for giving effect to the permission granted under section 3 of the old Act.
The two situations were different.
Clause (rr) of section 43(2) of the present Act specifically prohibited the Prescribed Authority from satisfying itself afresh that the grounds existed.
We are of the opinion that this is the correct state of law and if that is the position the so called subsequent events are not germane to the question to be decided by the High Court.
In the aforesaid light, in our opinion, in the facts of this case the High Court was right.
626 It may be mentioned that clause (rr) of section 43(2) of the new Act provides as follows: "where any permission referred to in Section 3 of the old Act has been obtained on any ground specified in sub section (1) or sub section (2) of section 21 and has become final, either before the commencement of this Act or in accordance with the provisions of this sub section after the commencement of this Act (whether or not a suit for the eviction of the tenant has been instituted), the landlord may apply to the prescribed authority for his eviction under section 21, and thereupon the prescribed authority shall order the eviction of the tenant from the building under tenancy, and it shall not be necessary for prescribed authority to satisfy itself afresh as to the existence of any ground as aforesaid, and such order shall be final and shall not be open to appeal under section 22: Provided that no application under this clause shall be maintainable on the basis of a permission granted under section 3 of the old Act, where such permission became final more than three years before the commencement of this Act: Provided further that in computing the period of three years, the time during which the applicant has been prosecuting with due diligence any civil proceeding whether in a court of first instance or appeal or revision shall be excluded" All these aspects were considered by the High Court.
We recognise that unless the statute expressly prohibits as it did in the instant case, by the aforesaid clause, cautious recognition of subsequent events to mould the relief should be taken note of.
In the instant case in substance the need was there of the landlord for his occupation of his own premises.
The landlord was a Government servant and wanted to reside in Allahabad and for this purpose he sought eviction and had obtained an order of eviction prior to coming into operation of the new Act.
The hope of the landlord to come back to his origin was not defeated by the provisions of the new Act.
In vain he moved from court to court and in the meantime there has been escalation of prices and restrictions on alienation of land and in order to save himself from this situation the landlord tried to sell part of the premises in question 627 subsequent to the decree to the wife of one of the sons of the tenant.
This is not material.
The agreement in question further stipulated that the present need of the landlord subsisted, and out of this agreement only Rs.5,000 was advanced in 1978 and nothing was paid thereafter.
The agreement for sale to Smt.
Madhu Soni reads as follows: "That it is made clear that the need of the vendor for the premises still subsists and this agreement is being entered into since it will be possible for the vendor to construct a house for himself on the land not agreed to be transferred measuring 121 ' x 101.5 '.
The parties, therefore, have signed this Deed on the 7th day of November, 1978 In view of the subsequent events, namely, non permission of the Urban Ceiling Authorities, failure to register and execute the document, delay for permission on the part of the vendee and the escalation of prices, that is to say, if in 1979 perhaps it was possible to build some kind of accommodation with the amount of sale price to be obtained from the execution of the document which it is not possible in 1987 and further there is no readiness or willingness on the part of the vendee to execute the document, after the existence of the basic need of the landlord, for which originally the proceedings were taken and finalised, we do not find it possible to hold that subsequent events have so materially altered as to defeat the original order for possession passed in favour of the respondents.
We do not find perusing the records that there was any failure for substitution on the part of the landlord to take steps.
The other son of the deceased was not residing with the deceased in the premises in question, therefore, there was no need to substitute him.
The other agreements to which reference had been made was the alleged agreement with R.P. Kanodia and P.K. Kanodia respectively.
Nothing was proved before us that agreement is valid today or given effect to in view of the provisions of the Land Ceiling Act.
It may be mentioned that the Competent Authority under the Urban Land (Ceiling & Regulation) Act, 1976 by the order dated 20th of April, 1979 refused permission to sell in favour of Smt.
Madhu Soni.
On 7th November, 1978 the wife of the appellant and the landlord had entered into an agreement to sell a portion of the land as well as the house in dispute to the appellant 's wife, and for that purpose a sum of 628 Rs.5,000 had been paid as earnest money as mentioned hereinbefore, A and in the agreement, it was clearly stated that the parties would move the proper authorities as early as possible for permission to transfer the property and the sale deed would be executed within one month of the grant of such permission and notice to the vendee.
Clause 6 of the agreement further stipulated that if the vendee failed to get the agreement executed after one month from the date of permission and notice to the vendee the earnest money of Rs.5,000 would be forfeited and the right of the vendor will be as it subsisted prior to the agreement.
The requisite permission in terms of the agreement was obtained by the landlord in the year 1979 and a registered notice consequently was also sent to the appellant 's wife requiring her to get the sale deed executed in accordance with the agreement.
Thereafter a reply dated 2 1st September, 1979 was also received by the landlord.
However, the appellant 's wife failed to get the sale deed executed and consequently the agreement itself became infructuous and the earnest money stood forefeited.
The need as it has been reiterated in the agreement of the landlord for his own purpose still subsisted.
There was no delay in bringing the heirs of the deceased tenant on record.
In the aforesaid view of the matter there was no substance in the objection filed against the execution of the order of eviction in terms of clause (rr) of section 43(2) of the new Act.
In any event such events were frivolous after the order had become final.
The subsequent events which we have examined do not in any way effect the decision of need for possession of the premises in question of the respondent landlord.
It may be mentioned that there was an application by the respondent for the review.
This was heard and no order was made on that application.
It was reiterated in the counter affidavit filed by the respondent that since 1st of December, 1978 till todate the appellant had not paid any money to the landlord nor deposited the damages in the court.
At the time of his death late H.L. Soni was residing in the house in dispute with his eldest son Shri D.K. Soni, the appellant, his wife, Smt.
Madhu Soni and Mrs. Kailash Soni, the widow.
Other son Shri A.K. Soni and daughter Mrs. Kangan Khanna were not residing with Late Shri H.L. Soni at the time of his death and as such they were not heirs as contemplated by section 3(g) of the new Act.
The landlord was a Government servant and was posted at Lucknow and as such during his tenure he had to reside at Lucknow but after his retirement he wanted to settle down at his ancestral house at Allahabad and it was for this reason that the proceedings for eviction were taken.
629 It was not proved to the satisfaction of the authorities below that any agreement to sell the premises to Kanodias has been given effect to and had been acted upon or can be acted upon.
It that view of the matter the need indubitably succeeds and even if the allegations made are taken into consideration do not merit any revision of the order which had become final.
Finality of the judicial decisions is one of the essential ingredients upon which the administration of justice must rest.
In that view of the matter we are of the opinion, even if the contentions advanced on behalf of the respondents are taken into consideration and a new look is taken because of the subsequent events, which in our opinion cannot be done in view of the specific prohibition in clause (rr) of section 43(2) of the new Act, the appellant hac no case.
In the aforesaid view of the matter we are of the opinion that the High Court was right in not interfering with the order of the Prescribed Authority.
After all finality of the decisions of the authorities under the Act has to be given due reverence and place in the judicial administration.
Taking cautious note of the relevant subsequent events, we find no merit in the appellant 's contentions inasmuch as there is nothing on record to show that the landlord 's bona fide need for his residence in Allahabad has been met or can be met in the state of affairs except by the order which is impugned in this appeal.
In the premises, the appeal must fail and is accordingly dismissed without any order as to costs.
Since, however, the appellant has been staying in the disputed premises for quite some time, we grant time till 30th of April, 1988 to deliver vacant possession of the premises subject to filing usual undertaking within four weeks from today.
In default in filing undertaking the order would become executable forthwith.
S.L. Appeal dismissed.
|
% Respondent No. 1, Shri P.K. Mukerjee, filed an application under the U.P. Act No. 3 of 1947 (Temporary Control of Rent and Eviction Act) (OLD Act), seeking permission to file a suit for eviction of his tenant, Harbans Lal Soni, the father of the appellant, D.K. Soni, on the grounds of his bona fide requirement for his personal need.
The Rent Control and Eviction officer rejected the application, holding that the respondent 's requirement was not bona fide.
A revision was filed by the respondent No. 1 before the Commissioner who allowed the same.
The U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (new Act) came into effect on July 15, 1972.
On August 2, 1972, the State Government rejected the representation of the tenant (father of the appellant) filed under section 7 of the old Act against the order of the Commissioner aforementioned.
The tenant then moved a writ petition in the High Court.
A Single Judge of the High Court allowed the petition and set aside the abovesaid orders of the Commissioner and the State Government.
Upon an appeal being filed by the respondent (No. 1) against the order of the Single Judge, a Division Bench of the High Court allowed the same, setting aside the order of the Single Judge and upholding the above said orders of the commissioner and the State Government, allowing the eviction of the tenant.
In September, 1978, the respondent No. 1 moved an application under section 21, read with section 43(2)(rr) of the new Act.
Thereafter, the respondent executed an agreement as vendor to sell the permises in dispute in favour of the vendee, the wife of the appellant, Smt.
Madhu Soni daughter in law of the tenant, Harbans Lal.
The agreement was dated November 7, 1978, and it mentioned therein that the landlord, respondent No. 1 had filed an application against the tenant above 617 named.
The father in law of the vendee for permission to file a suit for eviction of the tenant from the premises in dispute on account of the respondent 's personal need, and that the permission had been granted.
The agreement recited that a vacant portion of the land of the disputed premises, would be in the exclusive possession of the vendor and the rest of the property the disputed premises would be sold to the vendee, Smt.
Madhu Soni.
The agreement stipulated that the vendee or the other members of the family had no right over the portion of the land to be kept with the vendor, and that the appellant had given up his tenancy rights in respect of the same, and also that premises would be built on the said vacant land with the money to be obtained by selling the disputed house to Smt.
Madhu Soni.
The price of the house was settled at Rs.1,00,000 out of which a sum of Rs.5000 was paid as earnest money, and it was stipulated that the rest of the amount would be paid at the time of registration.
It was agreed that the parties would move the authorities for permission to transfer as early as possible and the saledeed would be executed within one month of the grant of permission and notice to the vendee.
It was stated that if the vendee failed to get the sale deed executed within the time stipulated, the earnest money of Rs.5000 would be forfeited and the property would stand released in favour of the vendor.
It was also stipulated that the need of the vendor for the premises subsisted and the agreement had been entered into to enable the vendor to get money out of the sale to construct a house for himself on the vacant piece of land.
On December 12, 1978, the father of the appellant, who was the tenant, died, leaving behind a widow, two sons, including the appellant, and a daughter.
On December 22, 1978, the appellant informed the Prescribed Authority before whom the application under section 21(1)(a) of the New Act, read with section 43(2)(rr), was pending, about the death of the tenant, Shri Harbans Lal Soni.
On March 23, 1979, the respondent No. 1 filed an application (in Case No. 53 of 1978) for substitution of the legal heirs of the deceased tenant, along with an application under section 5 of the Limitation Act.
The Prescribed Authority rejected the application for substitution on grounds of delay.
On December 11, 1979, the respondent No. 1 moved a second application under section 21(1)(a), read with section 43(2)(rr) of the new Act (on the ground as in his earlier application), which was registered as Case No. 68 of 1979.
On March 12, 1981, the respondent No. 1 executed two separate agreements for sale of the property in dispute, in favour of R.P. Kanodia and P.K. Kanodia, respectively.
618 The Prescribed Authority decided the Case No. 68 of 1979 abovementioned on July 7, 1981, directing the tenant to be evicted from the premises in dispute.
The Additional District Judge dismissed the appeal against the order of eviction passed by the Prescribed Authority.
On March 11, 1983, the appellant 's wife, Smt.
Madhu Soni filed a suit for injunction, restraining the respondent No. 1 from dispossessing her from the premises in dispute on the strength of the registered agreement, asserting that she resided in the premises in part performance of the agreement under section 53A of the Transfer of Property Act.
The trial Court dismissed the suit.
The High Court was then moved for relief by a writ petition against the orders of the Prescribed Authority for eviction and the order of the Additional District Judge.
The writ petition was dismissed, followed by the dismissal of a Review Petition too.
Aggrieved thereby the appellant has appealed to this Court by special leave.
Dismissing the appeal, the Court, ^ HELD: The questions involved in the appeal are: Firstly, in view of the provisions of section 43(2)(rr), was the High Court right in its decision, in the facts and circumstances of the case, specially the factum of the death of the (original) tenant being alleged, and in view of the fact that the execution of the order for eviction had become final before the new Act came into operation? Secondly, how far do the subsequent events, namely, the agreements by the respondent No. 1 with the wife of one of the sons of the tenant and with the Kanodias to sell the property in dispute, demolish or destroy the case of a bona fide need of the landlord? [622G H; 623A] In substance, the need was there of the landlord for his occupation of his premises as he wanted to reside in his house after his retirement from Government service, and for this purpose he had sought eviction and obtained the order of eviction prior to the coming into operation of the new Act.
The object of the landlord was not defeated by the provisions of the New Act.
[626G H] Considering the subsequent events, namely, the refusal of permission by the Urban Ceiling Authorities, the escalation of building cost (upto 1987), failure on the part of the vendee to register and execute the document, it is not possible to hold that the subsequent events have so materially altered the position as to defeat the original order for possession passed in favour of the landlord.
The subsequent events do not in 619 any way affect the existence of the need of the landlord for possession of premises in question.
[627C E] There was no failure on the part of the landlord to take steps for the substitution.
Nothing was proved before the Court that the agreements with R.P. Kanodia and P.K. Kanodia were valid today or given effect to in view of the provision of the Land ceiling Act.
It was not proved to the satisfaction of the authorities below that any agreement to sell the premises to Kanodias had been given effect to and acted upon and in that view of the matter, the need of the landlord indubitably succeeds, and any allegations made do not merit any revision of the order which had become final.
Finality of the judicial decisions is one of the essential ingredients upon which the administration of justice must rest.
In that view of the matter, even if the contentions advanced on behalf of the respondents are taken into consideration and a new look is taken because of the subsequent events, which cannot be done in view of the specific provisions in clause (rr) of section 43(2) of the new Act, the appellant has no case.
The High Court was right in not interfering with the order of the Prescribed Authority.
Finality of the decisions of the authorities under the Act has to be given due reverence and place in the judicial administration.
[629A C] The appeal fails.
As the appellant had been staying in the premises for quite some time, time till April 30, 1988 granted to him to deliver vacant possession of the house to the landlord, subject to his filing usual undertaking within four weeks.
[629E F] Pasupuleti Venkateswarlu vs The motor and general Traders; , ; Pattersion vs State of Alabama, ; at 607; Ramji Dayawala and Sons(P) Ltd. vs Invest Import; , ; Hasmat Rai and Anr.
vs Raghunath Prasad; , ; Syed Asadullah Kazmi vs The Addl.
District Judge, Allahabad and Ors.
, ; ; Sher Singh and Ors.
vs The State of Punjab, ; ; Bansilal Sahu vs The Prescribed Authority and Anr, [1980] All L.J. 331; Smt.
Sarju Devi vs Prescribed Authority, Kanpur, [1977] All L.J. 251 and Tara Chand Khandelwal vs Prescribed Authority, Agra, [1976] All L.J. 708, referred to.
|
Civil Appeal No. 6626 of 1983.
From the Judgment and order dated 18.5.1983 of the Allahabad High Court in C.M.W.P. No. 13741 of 1982.
H 620 S.N. Kacker and R.B. Mehrotra for the Appellant.
B.D. Agarwala and Miss Asha Rani for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an appeal by the tenant against an order upholding the order of eviction.
The ground of eviction was on the landlord 's bona fide need and requirement.
The appeal arises out of the judgment and order of the High Court of Allahabad dated 18th of May, 1983 and also against the order dated 23rd of May, 1983 dismissing a review application by the said High Court.
Shri P.K. Mukerjee, respondent No. 1 herein had filed an application under section 3 of the U.P. Act No. 3 of 1947 (Temporary Control of Rent and Eviction Act), hereinafter referred to as the old Act, seeking permission to file the suit for eviction of the tenant, the father of the appellant herein, on the ground that accommodation in dispute was bona fide required by the landlord for his personal need.
In September, 1971 the Rent Control and Eviction officer rejected the application of the landlord and held that his requirement was not bona fide.
On 12th of November, 1971 the Commissioner allowed the revision filed by respondent No. 1 against the order of the Rent Control and Eviction officer dated 5th of September, 1971.
It may be mentioned that on 15th of July, 1972 the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 hereinafter referred to as the new Act came into effect.
On 2nd of August, 1972 the State Government rejected the representation of the tenant namely, the father of the appellant filed under section 7 of the old Act against the order of the Commissioner dated 2nd of November, 1971.
On or about 7th of February, 1975 the learned Single Judge of the High Court of Allahabad allowed the writ petition of the tenant and set aside the orders of the Commissioner and the State Government hereinbefore mentioned.
On 3rd of August, 1978 a Division Bench of the High Court of Allahabad allowed the appeal of respondent No. 1 and set aside the judgment of the learned Single Judge of the High Court dated 7th of February, 1975 and upheld the orders of the Commissioner and the State Government allowing the eviction of the tenant.
In September, 1978 respondent No. 1 moved an application under section 21 read with section 43(2)(rr) of the new Act.
Thereafter it is alleged that respondent No. 1 had executed an agreement to sell the disputed premises in favour of the appellant 's wife namely, Smt.
Madhu Soni.
It is material to refer to the said agreement in brief.
The agreement is dated as mentioned hereinbefore 7th of November, 1978 621 and was entered into between Shri P.K. Mukerjee, the landlord and Smt.
Madhu Soni wife of Shri D.K. Soni (son of Shri Harbans Lal Soni) the then tenant.
It was stated that the landlord had filed an application against Shri H.L. Soni the father in law of vendee for permission to file a suit for eviction against him on account of his personal need for the aforesaid premises and permission had been granted.
It also recited that a portion of the said land which was demarcated in the site plan measuring about 121 ' x 101.5 ' of the vendor which would be for the construction of a house would be in exclusive possession of the vendor and the rest of the property at 8, Panna Lal Road, Allahabad being the disputed premises would be sold to Smt.
It also recited that the vendee or his family members would have no right of whatsoever nature and the vendee, that is to say, the appellant had given up his tenancy right in respect of the same, that is to say, the portion to be kept with the vendor and the premises will be built on the vacant land with the money that would be obtained by selling the property to Smt.
Madhu Soni.
The property was sold for Rs. 1,00,000 out of which Rs.5,000 was paid as earnest money and it was stipulated that the rest of the money would be paid at the time of the registration.
It was further agreed that the parties would move the proper authorities as early as possible for permission to transfer and the sale deed would be executed within one month of the grant of the permission and notice to the vendee.
It was further stated that if the vendee failed to get the sale deed executed after one month from the date of permission and notice to the vendee by the vendor, the earnest money of Rs.5,000 would be forfeited and the right of the vendor would be as it subsisted prior to the agreement.
It was further provided that in the event of non execution of the sale deed on account of any act or failure on the part of the vendee in pursuance of the agreement to sell, the property would stand released in favour of the vendor and the earnest money of Rs.5,000 would be forfeited.
It was clearly stipulated that the need of the vendor for the premises still subsisted and this agreement was being entered into since it would be possible for the vendor to construct a house for himself on the land not agreed to be transferred measuring 121 ' x 101.5 ' .
On that basis the parties had signed agreement on 7th November, 1978.
On 12th of December, 1978 the father of the present appellant Shri H.L. Soni who was the original tenant died leaving behind his widow and two sons including the appellant and one daughter.
It was alleged that on 18th of December, 1978 respondent No. l sent a letter of condolence to the appellant on the death of appellant 's father.
On 622 22nd of December, 1978 appellant informed the Prescribed Authority before whom the application under section 2 1(1)(a) of the new Act red with section 43(2)(rr) was pending about the death of Shri H.L Soni.
On 23rd of March, 1979 respondent No. 1 moved an application for substitution in Case No. 53 of 1978 for bringing on record the heirs of deceased Shri H.L. Soni along with application under section 5 of the Limitation Act.
On 10th of November, 1979, the Prescribed Authority rejected the petitioners application for substitution and held that respondent No. 1 had full knowledge of the death of Shri H.L. Soni and he did not move the application within time.
On 11th of December, 1979 respondent No. 1 moved a second application under section 2 1(1)(a) read with section 43(2)(rr) of the new Act on the same ground on which the first application was moved.
The second application was registered as Case No. 68 of 1979.
It is alleged further that on 12th of March, 1981 respondent No. 1 executed two separate agreements to sell the property in dispute in favour of R.P. Kanodia and P.K. Kanodia respectively.
The Prescribed Authority on 7th of July, 198 1 held that the second application under section 2 1(1)(a) read with section 43(2)(rr) of the new Act being Case No. 68 of 1979 was within time and directed the tenant to be evicted from the premises in dispute.
The Additional District Judge, Allahabad on 25th of October, 1982 dismissed the appeal of the tenant filed against the order of the Prescribed Authority dated 7th of July, 1981.
On 11th of March, 1983 the appellant 's wife Smt.
Madhu Soni filed a suit for injunction restraining Respondent No. 1 from dispossessing her from the premises in dispute on the strength of registered agreement and she asserted that she resided in the accommodation as a result of part performance under section 53A of the .
Initially injunction was granted ex parte by the Trial Court and thereafter it was vacated after hearing respondent No. 1.
Aggrieved thereby an appeal } was filed by Smt.
Madhu Soni in which the High Court had stayed dispossession.
The High Court thereafter dismissed the writ petition of the tenant against the orders of the Prescribed Authority for eviction and the order of the Additional District Judge.
A review petition was filed by the appellant and the same was dismissed.
This appeal by special leave is against that decision of the High Court dated 18th of May, 1983 Behind this long tale of dates the questions involved in this appeal are short, namely, firstly in view of the provisions of section 43(2)(rr) was the High Court right, in the facts and circumstances of the case specially the death of original tenant being alleged, and in view of the fact that the execution of the order passed for eviction had 623 become final before coming into operation of the new Act the order was proper and secondly, how far the subsequent events, namely, the A agreement with the wife of one of the sons of the original tenant to purchase property as well as the agreement with the Kanodias mentioned hereinbefore demolish or destroy the case of a bona fide need of the landlord.
In other words are these not sufficient subsequent events which destroy the landlord 's bona fide need and as such should be taken note of by the appropriate courts in ordering eviction.
In this appeal, therefore, we have to keep in mind two aspects of law namely, the finality of the decisions and secondly, how far and to what extent subsequent events should be taken note of in order to do justice between the parties.
Before we refer to the judgment of the High Court and the submissions made before us, it is necessary for us to bear in mind certain decisions of this Court on these aspects on which reliance was placed.
This Court in Pasupuleti Venkateswarlu vs The Motor & General Traders, ; dealing with the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, dealt with the question as to how far the subsequent events can be taken note of.
This Court held that for making the right or remedy, claimed by a party justly and meaningfully as also legally and factually in accordance with the current realities, the court can, and in many cases must, take cautious cognizance of events and developments subsequent to the institution of the proceeding provided the rules of fairness to both sides are scrupulously obeyed.
In the facts of that case, this Court said that the High Court was right in taking into consideration the facts which came into being subsequent to the commencement of the proceedings.
Therefore the fact that in determining what justice required the Court was bound to consider any change, either in fact or in law, which had supervened since the judgment was given.
F This general principle and proposition of law was of ancient vintage.
See the observations of the U.S. Supreme Court in Pattersion vs State of Alabama, ; at page 607).
The actual facts, however, of this case were entirely different, and so it was not necessary to refer to those facts.
In Ramji Dayawala & Sons (P) Ltd. vs Invest Import, ; , this principle was again reiterated entirely under different context.
This Court also reiterated the same principle in Hasmat Rai and another vs Raghunath Prasad; , where referring to Pasupuleti Venkateswarlu vs The Motor and General Traders (supra), this Court held that when an action was brought by the landlord under Rent Restriction Act for eviction on the H 624 ground of personal requirement, his need must not only be shown to A exist at the date of the suit, but must exist on the date of appellate decree, or the date when a higher court dealt with the matter.
It was emphasised by this Court that if during the progress and passage of proceeding from court to court subsequent events had occurred which if noticed would non suit the plaintiff, the court had to examine and evaluate the same and mould the decree accordingly.
The tenant was entitled to show that the need or requirement no more existed by pointing out such subsequent events, to the court including the appellate court.
Otherwise the landlord would derive an unfair advantage, and it would be against the spirit or intendment of Rent Restriction Act which was enacted to fetter the unfettered right of re entry.
In such a situation, it was reiterated that, it would be incorrect to say that as the decree or order for eviction was passed against the tenant he could not invite the court to take into consideration subsequent events.
But the tenant could be precluded from so contending when decree or order for eviction had become final.
(Emphasis supplied see the observations of Desai, J. at page 617(G.H) of the report).
In Syed Asadullah Kazmi vs The Addl.
District Judge, Allahabad and others; , , this Court was concerned with a residence at Allahabad.
It was held by this Court that the order dated 25th March, 1977 of the appellate authority releasing a portion of the premises in favour of the third respondent therein and leaving the remaining portion in the tenancy of the appellant therein acquired finality when the proceedings taken against it by the appellant had failed.
The Prescribed Authority was bound to give effect to that final order and was not acting outside its jurisdiction or contrary to law where he ordered eviction.
This Court reiterated that it was true that subsequent events had to be taken into account by a statutory authority or court when considering proceeding arising out of a landlord 's petition for ejectment of a tenant on the ground of the landlord 's personal need.
But in that case the order for release of a portion of the accommodation had acquired finality before the death of the landlord and the controversy concluded by it could not be reopened thereafter.
This Court further reiterated that inasmuch as the question which arose before the Prescribed Authority on the application of the appellant after the proceedings for release had acquired finality, it was not open even for this Court to reopen the proceeding for release.
Not quite relevant to the present controversy, there is, however, just an observation in Sher Singh & Ors.
vs The State of Punjab; , It was a decision dealing with Article 21 of the Constitution.
There is an observation that traditionally, subsequent events had to be taken into account in the area of civil law.
It is necessary, however, to refer to a 625 decision of the special bench of the Allahabad high Court in Bansilal Sahu vs The Prescribed Authority and another, [ 19801 ALL.
L.J. 331 which arose under the new Act.
It was held therein that the question whether the eviction of the tenant had to be ordered from any specified part of the building under tenancy was not within the jurisdiction of the Prescribed Authority, while acting under clause (rr) of section 43(2), irrespective of the occurrence of subsequent events which might make it improper to order the eviction from the entire building or which might tend to establish that the need set up by the landlord could be satisfied by ordering eviction of the tenant from a specified part of the building under tenancy.
It was held that subsequent events or facts could not be considered so as to defeat the final order and the Prescribed Authority was bound to order eviction.
The Special Bench of the Allahabad High Court overruled another Bench decision of the Allahabad High Court in the case of Smt.
Sarju Devi vs Prescribed Authority, Kanpur, [19771 All.
L.J. 251 and accepted the proposition laid down in Tara Chand Khandelwal vs Prescribed Authority, Agra, [1976] All L.J. 708.
Satish Chandra, C.J. speaking for the Allahabad High Court observed that the opening clause of this provision entitled the Prescribed Authority to find out whether permission under section 3 of the old Act had been obtained on any ground specified in subsection (1) or sub section (2) of section 21 of the present Act and that the same had become final.
It was, therefore, according to the Chief Justice, the beginning as well as the end of his jurisdiction to record findings.
If the conclusion was in the affirmative the Prescribed Authority had no discretion but to order the eviction of the tenant from the building under tenancy.
It was further held that the jurisdiction of the Prescribed Authority was to order the eviction of the tenant from the building under tenancy.
It had not expressly been conferred any power to order eviction from a portion or part of the building under tenancy.
It was further held that the jurisdiction of the Prescribed Authority while deciding an application under section 2 1 of the present Act could not be equated with the jurisdiction which had been conferred for giving effect to the permission granted under section 3 of the old Act.
The two situations were different.
Clause (rr) of section 43(2) of the present Act specifically prohibited the Prescribed Authority from satisfying itself afresh that the grounds existed.
We are of the opinion that this is the correct state of law and if that is the position the so called subsequent events are not germane to the question to be decided by the High Court.
In the aforesaid light, in our opinion, in the facts of this case the High Court was right.
626 It may be mentioned that clause (rr) of section 43(2) of the new Act provides as follows: "where any permission referred to in Section 3 of the old Act has been obtained on any ground specified in sub section (1) or sub section (2) of section 21 and has become final, either before the commencement of this Act or in accordance with the provisions of this sub section after the commencement of this Act (whether or not a suit for the eviction of the tenant has been instituted), the landlord may apply to the prescribed authority for his eviction under section 21, and thereupon the prescribed authority shall order the eviction of the tenant from the building under tenancy, and it shall not be necessary for prescribed authority to satisfy itself afresh as to the existence of any ground as aforesaid, and such order shall be final and shall not be open to appeal under section 22: Provided that no application under this clause shall be maintainable on the basis of a permission granted under section 3 of the old Act, where such permission became final more than three years before the commencement of this Act: Provided further that in computing the period of three years, the time during which the applicant has been prosecuting with due diligence any civil proceeding whether in a court of first instance or appeal or revision shall be excluded" All these aspects were considered by the High Court.
We recognise that unless the statute expressly prohibits as it did in the instant case, by the aforesaid clause, cautious recognition of subsequent events to mould the relief should be taken note of.
In the instant case in substance the need was there of the landlord for his occupation of his own premises.
The landlord was a Government servant and wanted to reside in Allahabad and for this purpose he sought eviction and had obtained an order of eviction prior to coming into operation of the new Act.
The hope of the landlord to come back to his origin was not defeated by the provisions of the new Act.
In vain he moved from court to court and in the meantime there has been escalation of prices and restrictions on alienation of land and in order to save himself from this situation the landlord tried to sell part of the premises in question 627 subsequent to the decree to the wife of one of the sons of the tenant.
This is not material.
The agreement in question further stipulated that the present need of the landlord subsisted, and out of this agreement only Rs.5,000 was advanced in 1978 and nothing was paid thereafter.
The agreement for sale to Smt.
Madhu Soni reads as follows: "That it is made clear that the need of the vendor for the premises still subsists and this agreement is being entered into since it will be possible for the vendor to construct a house for himself on the land not agreed to be transferred measuring 121 ' x 101.5 '.
The parties, therefore, have signed this Deed on the 7th day of November, 1978 In view of the subsequent events, namely, non permission of the Urban Ceiling Authorities, failure to register and execute the document, delay for permission on the part of the vendee and the escalation of prices, that is to say, if in 1979 perhaps it was possible to build some kind of accommodation with the amount of sale price to be obtained from the execution of the document which it is not possible in 1987 and further there is no readiness or willingness on the part of the vendee to execute the document, after the existence of the basic need of the landlord, for which originally the proceedings were taken and finalised, we do not find it possible to hold that subsequent events have so materially altered as to defeat the original order for possession passed in favour of the respondents.
We do not find perusing the records that there was any failure for substitution on the part of the landlord to take steps.
The other son of the deceased was not residing with the deceased in the premises in question, therefore, there was no need to substitute him.
The other agreements to which reference had been made was the alleged agreement with R.P. Kanodia and P.K. Kanodia respectively.
Nothing was proved before us that agreement is valid today or given effect to in view of the provisions of the Land Ceiling Act.
It may be mentioned that the Competent Authority under the Urban Land (Ceiling & Regulation) Act, 1976 by the order dated 20th of April, 1979 refused permission to sell in favour of Smt.
Madhu Soni.
On 7th November, 1978 the wife of the appellant and the landlord had entered into an agreement to sell a portion of the land as well as the house in dispute to the appellant 's wife, and for that purpose a sum of 628 Rs.5,000 had been paid as earnest money as mentioned hereinbefore, A and in the agreement, it was clearly stated that the parties would move the proper authorities as early as possible for permission to transfer the property and the sale deed would be executed within one month of the grant of such permission and notice to the vendee.
Clause 6 of the agreement further stipulated that if the vendee failed to get the agreement executed after one month from the date of permission and notice to the vendee the earnest money of Rs.5,000 would be forfeited and the right of the vendor will be as it subsisted prior to the agreement.
The requisite permission in terms of the agreement was obtained by the landlord in the year 1979 and a registered notice consequently was also sent to the appellant 's wife requiring her to get the sale deed executed in accordance with the agreement.
Thereafter a reply dated 2 1st September, 1979 was also received by the landlord.
However, the appellant 's wife failed to get the sale deed executed and consequently the agreement itself became infructuous and the earnest money stood forefeited.
The need as it has been reiterated in the agreement of the landlord for his own purpose still subsisted.
There was no delay in bringing the heirs of the deceased tenant on record.
In the aforesaid view of the matter there was no substance in the objection filed against the execution of the order of eviction in terms of clause (rr) of section 43(2) of the new Act.
In any event such events were frivolous after the order had become final.
The subsequent events which we have examined do not in any way effect the decision of need for possession of the premises in question of the respondent landlord.
It may be mentioned that there was an application by the respondent for the review.
This was heard and no order was made on that application.
It was reiterated in the counter affidavit filed by the respondent that since 1st of December, 1978 till todate the appellant had not paid any money to the landlord nor deposited the damages in the court.
At the time of his death late H.L. Soni was residing in the house in dispute with his eldest son Shri D.K. Soni, the appellant, his wife, Smt.
Madhu Soni and Mrs. Kailash Soni, the widow.
Other son Shri A.K. Soni and daughter Mrs. Kangan Khanna were not residing with Late Shri H.L. Soni at the time of his death and as such they were not heirs as contemplated by section 3(g) of the new Act.
The landlord was a Government servant and was posted at Lucknow and as such during his tenure he had to reside at Lucknow but after his retirement he wanted to settle down at his ancestral house at Allahabad and it was for this reason that the proceedings for eviction were taken.
629 It was not proved to the satisfaction of the authorities below that any agreement to sell the premises to Kanodias has been given effect to and had been acted upon or can be acted upon.
It that view of the matter the need indubitably succeeds and even if the allegations made are taken into consideration do not merit any revision of the order which had become final.
Finality of the judicial decisions is one of the essential ingredients upon which the administration of justice must rest.
In that view of the matter we are of the opinion, even if the contentions advanced on behalf of the respondents are taken into consideration and a new look is taken because of the subsequent events, which in our opinion cannot be done in view of the specific prohibition in clause (rr) of section 43(2) of the new Act, the appellant hac no case.
In the aforesaid view of the matter we are of the opinion that the High Court was right in not interfering with the order of the Prescribed Authority.
After all finality of the decisions of the authorities under the Act has to be given due reverence and place in the judicial administration.
Taking cautious note of the relevant subsequent events, we find no merit in the appellant 's contentions inasmuch as there is nothing on record to show that the landlord 's bona fide need for his residence in Allahabad has been met or can be met in the state of affairs except by the order which is impugned in this appeal.
In the premises, the appeal must fail and is accordingly dismissed without any order as to costs.
Since, however, the appellant has been staying in the disputed premises for quite some time, we grant time till 30th of April, 1988 to deliver vacant possession of the premises subject to filing usual undertaking within four weeks from today.
In default in filing undertaking the order would become executable forthwith.
S.L. Appeal dismissed.
|
From the Judgment and order dated 18.5.1983 of the Allahabad High Court in C.M.W.P. No. H 620 S.N. Kacker and R.B. Mehrotra for the Appellant. B.D. Agarwala and Miss Asha Rani for the Respondents. The ground of eviction was on the landlord 's bona fide need and requirement. 1 herein had filed an application under section 3 of the U.P. Act No. On 12th of November, 1971 the Commissioner allowed the revision filed by respondent No. 1 against the order of the Rent Control and Eviction officer dated 5th of September, 1971. It may be mentioned that on 15th of July, 1972 the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 hereinafter referred to as the new Act came into effect. On or about 7th of February, 1975 the learned Single Judge of the High Court of Allahabad allowed the writ petition of the tenant and set aside the orders of the Commissioner and the State Government hereinbefore mentioned. On 3rd of August, 1978 a Division Bench of the High Court of Allahabad allowed the appeal of respondent No. 1 and set aside the judgment of the learned Single Judge of the High Court dated 7th of February, 1975 and upheld the orders of the Commissioner and the State Government allowing the eviction of the tenant. Thereafter it is alleged that respondent No. It is material to refer to the said agreement in brief. The agreement is dated as mentioned hereinbefore 7th of November, 1978 621 and was entered into between Shri P.K. Mukerjee, the landlord and Smt. Madhu Soni wife of Shri D.K. Soni (son of Shri Harbans Lal Soni) the then tenant. 1,00,000 out of which Rs.5,000 was paid as earnest money and it was stipulated that the rest of the money would be paid at the time of the registration. It was further agreed that the parties would move the proper authorities as early as possible for permission to transfer and the sale deed would be executed within one month of the grant of the permission and notice to the vendee. It was further stated that if the vendee failed to get the sale deed executed after one month from the date of permission and notice to the vendee by the vendor, the earnest money of Rs.5,000 would be forfeited and the right of the vendor would be as it subsisted prior to the agreement. On that basis the parties had signed agreement on 7th November, 1978. On 12th of December, 1978 the father of the present appellant Shri H.L. Soni who was the original tenant died leaving behind his widow and two sons including the appellant and one daughter. It was alleged that on 18th of December, 1978 respondent No. l sent a letter of condolence to the appellant on the death of appellant 's father. 1 moved an application for substitution in Case No. On 10th of November, 1979, the Prescribed Authority rejected the petitioners application for substitution and held that respondent No. 1 had full knowledge of the death of Shri H.L. Soni and he did not move the application within time. 1 moved a second application under section 2 1(1)(a) read with section 43(2)(rr) of the new Act on the same ground on which the first application was moved. The second application was registered as Case No. 1 executed two separate agreements to sell the property in dispute in favour of R.P. Kanodia and P.K. Kanodia respectively. The Prescribed Authority on 7th of July, 198 1 held that the second application under section 2 1(1)(a) read with section 43(2)(rr) of the new Act being Case No. 68 of 1979 was within time and directed the tenant to be evicted from the premises in dispute. The Additional District Judge, Allahabad on 25th of October, 1982 dismissed the appeal of the tenant filed against the order of the Prescribed Authority dated 7th of July, 1981. On 11th of March, 1983 the appellant 's wife Smt. Madhu Soni filed a suit for injunction restraining Respondent No. Initially injunction was granted ex parte by the Trial Court and thereafter it was vacated after hearing respondent No. Aggrieved thereby an appeal } was filed by Smt. Madhu Soni in which the High Court had stayed dispossession. A review petition was filed by the appellant and the same was dismissed. In this appeal, therefore, we have to keep in mind two aspects of law namely, the finality of the decisions and secondly, how far and to what extent subsequent events should be taken note of in order to do justice between the parties. Therefore the fact that in determining what justice required the Court was bound to consider any change, either in fact or in law, which had supervened since the judgment was given. F This general principle and proposition of law was of ancient vintage. See the observations of the U.S. Supreme Court in Pattersion vs State of Alabama, ; at page 607). The actual facts, however, of this case were entirely different, and so it was not necessary to refer to those facts. In Ramji Dayawala & Sons (P) Ltd. vs Invest Import, ; , this principle was again reiterated entirely under different context. This Court also reiterated the same principle in Hasmat Rai and another vs Raghunath Prasad; , where referring to Pasupuleti Venkateswarlu vs The Motor and General Traders (supra), this Court held that when an action was brought by the landlord under Rent Restriction Act for eviction on the H 624 ground of personal requirement, his need must not only be shown to A exist at the date of the suit, but must exist on the date of appellate decree, or the date when a higher court dealt with the matter. It was emphasised by this Court that if during the progress and passage of proceeding from court to court subsequent events had occurred which if noticed would non suit the plaintiff, the court had to examine and evaluate the same and mould the decree accordingly. The tenant was entitled to show that the need or requirement no more existed by pointing out such subsequent events, to the court including the appellate court. In such a situation, it was reiterated that, it would be incorrect to say that as the decree or order for eviction was passed against the tenant he could not invite the court to take into consideration subsequent events. But the tenant could be precluded from so contending when decree or order for eviction had become final. (Emphasis supplied see the observations of Desai, J. at page 617(G.H) of the report). District Judge, Allahabad and others; , , this Court was concerned with a residence at Allahabad. The Prescribed Authority was bound to give effect to that final order and was not acting outside its jurisdiction or contrary to law where he ordered eviction. But in that case the order for release of a portion of the accommodation had acquired finality before the death of the landlord and the controversy concluded by it could not be reopened thereafter. This Court further reiterated that inasmuch as the question which arose before the Prescribed Authority on the application of the appellant after the proceedings for release had acquired finality, it was not open even for this Court to reopen the proceeding for release. Not quite relevant to the present controversy, there is, however, just an observation in Sher Singh & Ors. vs The State of Punjab; , It was a decision dealing with Article 21 of the Constitution. There is an observation that traditionally, subsequent events had to be taken into account in the area of civil law. It is necessary, however, to refer to a 625 decision of the special bench of the Allahabad high Court in Bansilal Sahu vs The Prescribed Authority and another, [ 19801 ALL. It was held that subsequent events or facts could not be considered so as to defeat the final order and the Prescribed Authority was bound to order eviction. The Special Bench of the Allahabad High Court overruled another Bench decision of the Allahabad High Court in the case of Smt. Sarju Devi vs Prescribed Authority, Kanpur, [19771 All. L.J. 251 and accepted the proposition laid down in Tara Chand Khandelwal vs Prescribed Authority, Agra, [1976] All L.J. 708. It was, therefore, according to the Chief Justice, the beginning as well as the end of his jurisdiction to record findings. If the conclusion was in the affirmative the Prescribed Authority had no discretion but to order the eviction of the tenant from the building under tenancy. It had not expressly been conferred any power to order eviction from a portion or part of the building under tenancy. It was further held that the jurisdiction of the Prescribed Authority while deciding an application under section 2 1 of the present Act could not be equated with the jurisdiction which had been conferred for giving effect to the permission granted under section 3 of the old Act. Clause (rr) of section 43(2) of the present Act specifically prohibited the Prescribed Authority from satisfying itself afresh that the grounds existed. We are of the opinion that this is the correct state of law and if that is the position the so called subsequent events are not germane to the question to be decided by the High Court. In the aforesaid light, in our opinion, in the facts of this case the High Court was right. In the instant case in substance the need was there of the landlord for his occupation of his own premises. The hope of the landlord to come back to his origin was not defeated by the provisions of the new Act. In vain he moved from court to court and in the meantime there has been escalation of prices and restrictions on alienation of land and in order to save himself from this situation the landlord tried to sell part of the premises in question 627 subsequent to the decree to the wife of one of the sons of the tenant. Madhu Soni reads as follows: "That it is made clear that the need of the vendor for the premises still subsists and this agreement is being entered into since it will be possible for the vendor to construct a house for himself on the land not agreed to be transferred measuring 121 ' x 101.5 '. We do not find perusing the records that there was any failure for substitution on the part of the landlord to take steps. The other son of the deceased was not residing with the deceased in the premises in question, therefore, there was no need to substitute him. Nothing was proved before us that agreement is valid today or given effect to in view of the provisions of the Land Ceiling Act. It may be mentioned that the Competent Authority under the Urban Land (Ceiling & Regulation) Act, 1976 by the order dated 20th of April, 1979 refused permission to sell in favour of Smt. On 7th November, 1978 the wife of the appellant and the landlord had entered into an agreement to sell a portion of the land as well as the house in dispute to the appellant 's wife, and for that purpose a sum of 628 Rs.5,000 had been paid as earnest money as mentioned hereinbefore, A and in the agreement, it was clearly stated that the parties would move the proper authorities as early as possible for permission to transfer the property and the sale deed would be executed within one month of the grant of such permission and notice to the vendee. The requisite permission in terms of the agreement was obtained by the landlord in the year 1979 and a registered notice consequently was also sent to the appellant 's wife requiring her to get the sale deed executed in accordance with the agreement. Thereafter a reply dated 2 1st September, 1979 was also received by the landlord. The need as it has been reiterated in the agreement of the landlord for his own purpose still subsisted. There was no delay in bringing the heirs of the deceased tenant on record. In any event such events were frivolous after the order had become final. The subsequent events which we have examined do not in any way effect the decision of need for possession of the premises in question of the respondent landlord. It may be mentioned that there was an application by the respondent for the review. This was heard and no order was made on that application. Madhu Soni and Mrs. Kailash Soni, the widow. Other son Shri A.K. Soni and daughter Mrs. Kangan Khanna were not residing with Late Shri H.L. Soni at the time of his death and as such they were not heirs as contemplated by section 3(g) of the new Act. The landlord was a Government servant and was posted at Lucknow and as such during his tenure he had to reside at Lucknow but after his retirement he wanted to settle down at his ancestral house at Allahabad and it was for this reason that the proceedings for eviction were taken. 629 It was not proved to the satisfaction of the authorities below that any agreement to sell the premises to Kanodias has been given effect to and had been acted upon or can be acted upon. Finality of the judicial decisions is one of the essential ingredients upon which the administration of justice must rest. In that view of the matter we are of the opinion, even if the contentions advanced on behalf of the respondents are taken into consideration and a new look is taken because of the subsequent events, which in our opinion cannot be done in view of the specific prohibition in clause (rr) of section 43(2) of the new Act, the appellant hac no case. Taking cautious note of the relevant subsequent events, we find no merit in the appellant 's contentions inasmuch as there is nothing on record to show that the landlord 's bona fide need for his residence in Allahabad has been met or can be met in the state of affairs except by the order which is impugned in this appeal. In the premises, the appeal must fail and is accordingly dismissed without any order as to costs. In default in filing undertaking the order would become executable forthwith.
|
% Respondent No. 1, Shri P.K. Mukerjee, filed an application under the U.P. Act No. 3 of 1947 (Temporary Control of Rent and Eviction Act) (OLD Act), seeking permission to file a suit for eviction of his tenant, Harbans Lal Soni, the father of the appellant, D.K. Soni, on the grounds of his bona fide requirement for his personal need.
The Rent Control and Eviction officer rejected the application, holding that the respondent 's requirement was not bona fide.
A revision was filed by the respondent No. 1 before the Commissioner who allowed the same.
The U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (new Act) came into effect on July 15, 1972.
On August 2, 1972, the State Government rejected the representation of the tenant (father of the appellant) filed under section 7 of the old Act against the order of the Commissioner aforementioned.
The tenant then moved a writ petition in the High Court.
A Single Judge of the High Court allowed the petition and set aside the abovesaid orders of the Commissioner and the State Government.
Upon an appeal being filed by the respondent (No. 1) against the order of the Single Judge, a Division Bench of the High Court allowed the same, setting aside the order of the Single Judge and upholding the above said orders of the commissioner and the State Government, allowing the eviction of the tenant.
In September, 1978, the respondent No. 1 moved an application under section 21, read with section 43(2)(rr) of the new Act.
Thereafter, the respondent executed an agreement as vendor to sell the permises in dispute in favour of the vendee, the wife of the appellant, Smt.
Madhu Soni daughter in law of the tenant, Harbans Lal.
The agreement was dated November 7, 1978, and it mentioned therein that the landlord, respondent No. 1 had filed an application against the tenant above 617 named.
The father in law of the vendee for permission to file a suit for eviction of the tenant from the premises in dispute on account of the respondent 's personal need, and that the permission had been granted.
The agreement recited that a vacant portion of the land of the disputed premises, would be in the exclusive possession of the vendor and the rest of the property the disputed premises would be sold to the vendee, Smt.
Madhu Soni.
The agreement stipulated that the vendee or the other members of the family had no right over the portion of the land to be kept with the vendor, and that the appellant had given up his tenancy rights in respect of the same, and also that premises would be built on the said vacant land with the money to be obtained by selling the disputed house to Smt.
Madhu Soni.
The price of the house was settled at Rs.1,00,000 out of which a sum of Rs.5000 was paid as earnest money, and it was stipulated that the rest of the amount would be paid at the time of registration.
It was agreed that the parties would move the authorities for permission to transfer as early as possible and the saledeed would be executed within one month of the grant of permission and notice to the vendee.
It was stated that if the vendee failed to get the sale deed executed within the time stipulated, the earnest money of Rs.5000 would be forfeited and the property would stand released in favour of the vendor.
It was also stipulated that the need of the vendor for the premises subsisted and the agreement had been entered into to enable the vendor to get money out of the sale to construct a house for himself on the vacant piece of land.
On December 12, 1978, the father of the appellant, who was the tenant, died, leaving behind a widow, two sons, including the appellant, and a daughter.
On December 22, 1978, the appellant informed the Prescribed Authority before whom the application under section 21(1)(a) of the New Act, read with section 43(2)(rr), was pending, about the death of the tenant, Shri Harbans Lal Soni.
On March 23, 1979, the respondent No. 1 filed an application (in Case No. 53 of 1978) for substitution of the legal heirs of the deceased tenant, along with an application under section 5 of the Limitation Act.
The Prescribed Authority rejected the application for substitution on grounds of delay.
On December 11, 1979, the respondent No. 1 moved a second application under section 21(1)(a), read with section 43(2)(rr) of the new Act (on the ground as in his earlier application), which was registered as Case No. 68 of 1979.
On March 12, 1981, the respondent No. 1 executed two separate agreements for sale of the property in dispute, in favour of R.P. Kanodia and P.K. Kanodia, respectively.
618 The Prescribed Authority decided the Case No. 68 of 1979 abovementioned on July 7, 1981, directing the tenant to be evicted from the premises in dispute.
The Additional District Judge dismissed the appeal against the order of eviction passed by the Prescribed Authority.
On March 11, 1983, the appellant 's wife, Smt.
Madhu Soni filed a suit for injunction, restraining the respondent No. 1 from dispossessing her from the premises in dispute on the strength of the registered agreement, asserting that she resided in the premises in part performance of the agreement under section 53A of the Transfer of Property Act.
The trial Court dismissed the suit.
The High Court was then moved for relief by a writ petition against the orders of the Prescribed Authority for eviction and the order of the Additional District Judge.
The writ petition was dismissed, followed by the dismissal of a Review Petition too.
Aggrieved thereby the appellant has appealed to this Court by special leave.
Dismissing the appeal, the Court, ^ HELD: The questions involved in the appeal are: Firstly, in view of the provisions of section 43(2)(rr), was the High Court right in its decision, in the facts and circumstances of the case, specially the factum of the death of the (original) tenant being alleged, and in view of the fact that the execution of the order for eviction had become final before the new Act came into operation? Secondly, how far do the subsequent events, namely, the agreements by the respondent No. 1 with the wife of one of the sons of the tenant and with the Kanodias to sell the property in dispute, demolish or destroy the case of a bona fide need of the landlord? [622G H; 623A] In substance, the need was there of the landlord for his occupation of his premises as he wanted to reside in his house after his retirement from Government service, and for this purpose he had sought eviction and obtained the order of eviction prior to the coming into operation of the new Act.
The object of the landlord was not defeated by the provisions of the New Act.
[626G H] Considering the subsequent events, namely, the refusal of permission by the Urban Ceiling Authorities, the escalation of building cost (upto 1987), failure on the part of the vendee to register and execute the document, it is not possible to hold that the subsequent events have so materially altered the position as to defeat the original order for possession passed in favour of the landlord.
The subsequent events do not in 619 any way affect the existence of the need of the landlord for possession of premises in question.
[627C E] There was no failure on the part of the landlord to take steps for the substitution.
Nothing was proved before the Court that the agreements with R.P. Kanodia and P.K. Kanodia were valid today or given effect to in view of the provision of the Land ceiling Act.
It was not proved to the satisfaction of the authorities below that any agreement to sell the premises to Kanodias had been given effect to and acted upon and in that view of the matter, the need of the landlord indubitably succeeds, and any allegations made do not merit any revision of the order which had become final.
Finality of the judicial decisions is one of the essential ingredients upon which the administration of justice must rest.
In that view of the matter, even if the contentions advanced on behalf of the respondents are taken into consideration and a new look is taken because of the subsequent events, which cannot be done in view of the specific provisions in clause (rr) of section 43(2) of the new Act, the appellant has no case.
The High Court was right in not interfering with the order of the Prescribed Authority.
Finality of the decisions of the authorities under the Act has to be given due reverence and place in the judicial administration.
[629A C] The appeal fails.
As the appellant had been staying in the premises for quite some time, time till April 30, 1988 granted to him to deliver vacant possession of the house to the landlord, subject to his filing usual undertaking within four weeks.
[629E F] Pasupuleti Venkateswarlu vs The motor and general Traders; , ; Pattersion vs State of Alabama, ; at 607; Ramji Dayawala and Sons(P) Ltd. vs Invest Import; , ; Hasmat Rai and Anr.
vs Raghunath Prasad; , ; Syed Asadullah Kazmi vs The Addl.
District Judge, Allahabad and Ors.
, ; ; Sher Singh and Ors.
vs The State of Punjab, ; ; Bansilal Sahu vs The Prescribed Authority and Anr, [1980] All L.J. 331; Smt.
Sarju Devi vs Prescribed Authority, Kanpur, [1977] All L.J. 251 and Tara Chand Khandelwal vs Prescribed Authority, Agra, [1976] All L.J. 708, referred to.
|
1, Shri P.K. Mukerjee, filed an application under the U.P. Act No. 3 of 1947 (Temporary Control of Rent and Eviction Act) (OLD Act), seeking permission to file a suit for eviction of his tenant, Harbans Lal Soni, the father of the appellant, D.K. Soni, on the grounds of his bona fide requirement for his personal need. A revision was filed by the respondent No. 1 before the Commissioner who allowed the same. The tenant then moved a writ petition in the High Court. A Single Judge of the High Court allowed the petition and set aside the abovesaid orders of the Commissioner and the State Government. Upon an appeal being filed by the respondent (No. Madhu Soni daughter in law of the tenant, Harbans Lal. 1 had filed an application against the tenant above 617 named. The father in law of the vendee for permission to file a suit for eviction of the tenant from the premises in dispute on account of the respondent 's personal need, and that the permission had been granted. The price of the house was settled at Rs.1,00,000 out of which a sum of Rs.5000 was paid as earnest money, and it was stipulated that the rest of the amount would be paid at the time of registration. It was agreed that the parties would move the authorities for permission to transfer as early as possible and the saledeed would be executed within one month of the grant of permission and notice to the vendee. On December 12, 1978, the father of the appellant, who was the tenant, died, leaving behind a widow, two sons, including the appellant, and a daughter. The Prescribed Authority rejected the application for substitution on grounds of delay. 618 The Prescribed Authority decided the Case No. 68 of 1979 abovementioned on July 7, 1981, directing the tenant to be evicted from the premises in dispute. The Additional District Judge dismissed the appeal against the order of eviction passed by the Prescribed Authority. The writ petition was dismissed, followed by the dismissal of a Review Petition too. Secondly, how far do the subsequent events, namely, the agreements by the respondent No. 622G H; 623A] In substance, the need was there of the landlord for his occupation of his premises as he wanted to reside in his house after his retirement from Government service, and for this purpose he had sought eviction and obtained the order of eviction prior to the coming into operation of the new Act. The object of the landlord was not defeated by the provisions of the New Act. Finality of the judicial decisions is one of the essential ingredients upon which the administration of justice must rest. vs Raghunath Prasad; , ; Syed Asadullah Kazmi vs The Addl. vs The State of Punjab, ; ; Bansilal Sahu vs The Prescribed Authority and Anr, [1980] All L.J. 331; Smt.
| 0.392468
| 0.687068
| 0.090247
| 0.458058
|
No. 3130 of 1981.
(Under Article 32 of the Constitution of India).
Soli J. Sorabjee, Harish N. Salve, K.K. Patel, Ujwal Rana, Rajiv Dutta and K.K. Mohan for the Petitioners.
369 K. Parasaran, Attorney General, B. Datta, Additional Solicitor General, Kuldip Singh, Additional Solicitor Gener al, Ms. A. Subhashini, C.V. Subba Rao, Mrs. Sushma Suri, A. Subba Rao, A.K. Srivastava and P.P. Singh for the Respond ents.
The Judgment of the Court was delivered by PATHAK, CJ.
By this writ petition under article 32 of the Constitution the petitioners seek relief against the imposi tion of customs duty at 150 per cent on their import of edible oils into India.
The petitioners entered into a contract with foreign sellers for the supply of edible oils.
The consignment of edible oils was sent by the ocean going vessel M.V. Kotta Ratu.
The vessel approached Bombay and made its "prior entry" on 4 July, 1981.
It actually arrived and registered in the Port of Bombay on 11 July, 1981.
The petitioners say that the Port authorities at Bombay were unable to allot a berth to the vessel, and as she was under heavy pressure from the parties whose goods she was carrying she left Bombay for Karachi for unloading other cargo intended for that port.
It is alleged that the vessel set out on its return journey from Karachi and arrived in the Port of Bombay on 23 July, 1981 and waited for a berth.
On 4 August, 1981 she was allowed to berth in Princess Docks 'C ' Shed and the Customs Authorities made the "final entry" on that date.
The petitioners point out that when the vessel made its original journey to Bombay and was waiting in the waters of the Port the petitioners presented the Bill of Entry to the Customs authorities on 9 July, 1981, that the Bill of Entry was accepted by the Import Department and an order was passed by the Customs Officer on the Bill of Entry on 18 July, 1981 directing the examination of the consignment.
It is stated that the Customs authorities have imposed customs duty on the import of the edible oils effected by the petitioners at the rate of 150 per cent on the footing that the import was made on 31 July, 1981, the date of "Inward Entry".
The case of the petitioners is that the rate of duty leviable on the import should be that ruling on 11 July, 198 1, when the vessel actually arrived and registered in the Port of Bombay, and that but for the fact that a berth was not available the vessel would have discharged its cargo at Bombay, and would not have left that Port and proceeded to Karachi to return to Bombay towards the end of July, 1981.
Alternatively, the case of the petitioners is that if it be found that the rate of customs duty attracted by the import effected by the petitioners is 150 per cent the levy is unconstitutional 370 and void as a violation of article 14 of the Constitution inasmuch as customs duty at 5 per cent only was levied on the State Trading Corporation on similar Imports of edible oils made by it as an importer.
The petitioners have also challenged the validity of section 15 of the Customs Act, 1961 under which the rate of duty and tariff valuation is deter mined.
To resolve the issue between the parties it is necessary to ascertain the effective date with reference to which customs duty becomes payable on imports into India.
Section 15(1) of the provides: "(1) The rate of duty and tariff valuation, if any, applicable to any imported goods, shall be the rate and valuation in force , (a) in the case of goods entered for home consumption under section 46, on the date on which a bill of entry in respect of such goods is presented under that section; (b) in the case of goods cleared from a warehouse under section 68, on the date on which the goods are actually removed from the warehouse; (c) in the case of any other goods, on the date of payment of duty: Provided that if a bill of entry has been presented before the date of entry in wards of the vessel by which the goods are imported, the bill of entry shall be deemed to have been presented on the date of such entry inwards.
" The rate of duty and tariff valuation applicable to the imported goods is governed by cl.
(a) of section 15(1).
In the case of goods entered for home consumption under section 46, it is the date on which the Bill of Entry in respect of such goods is presented under that section.
section 46 provides that the importer of any goods shall make entry thereof by pre senting to the proper officer a Bill of Entry for home consumption in the prescribed form, and it is further pro vided that a Bill of Entry may be presented at any time after delivery of the Import Manifest or an Import report.
The Bill of Entry may be presented even before the delivery of such Manifest if the vessel by which the goods have been 371 shipped for importation into India is expected to arrive within a week from the date of such presentation.
Section 47 empowers the proper officer, on being satisfied that the goods entered for home consumption are not prohibited goods and that the importers had paid the import duty assessed thereon as well as charges in respect of the same, to make an order permitting clearance of the goods for home consump tion.
According to the petitioners, the cargo of edible oil could not be unloaded in Bombay during the original entry of the ship into the Port for want of an available berth, and it is for no fault of the petitioners that the vessel had to proceed to Karachi for unloading other cargo.
Section 15, the petitioners contend, is arbitrary and vague and there fore unconstitutional because it provides no definite stand ard or norm for determining the rate of duty and tariff valuation and does not take into account situation which are uncertain and beyond the control of an importer.
The peti tioners contend that the rate of customs duty chargeable on the import of goods in India is the rate in force on the date when the vessel carrying the goods enters the territo rial waters of India.
The petitioners point out that section 12(1) declares that customs .duty will be levied at the rates in force on goods imported into India, and the expres sion 'India ', they urge, is defined by section 2(27) as including the 'territorial waters of India '.
In other words, the petitioners contend that when the vessel entered the terri torial waters on 11 July, 1981 the rate of customs duty at 12.5 per cent ruling on that date was the rate which was attracted to the import.
In any event, the petitioners contend, the rate should not have been more than 42.5 per cent because that was the rate of customs duty ruling on 23 July, 1981 when the vessel entered the port of Bombay.
To preserve the validity of section 15 the petitioners urge, we must read the expression "the date of entry inwards" in the proviso to section 15(1) as the date on which the vessel enters the territorial waters of India.
Learned counsel for the petitioners says that if this interpretation cannot reasona bly be given to the provisions of section 15(1) then it becomes necessary to question the constitutional validity of section 15 on the ground that the terms of that section are vague and arbitrary, and therefore no recourse can be had to section 15(1).
Considerable reliance has been placed by the peti tioner on Shawney vs M/s. Sylvania and Laxman Ltd., 77 Bom.
L.R. 380 in support of the submission that the taxable event occurs when the vessel enters the territorial waters of India and it is that date which should determine the rate at which import duty can be levied.
It is desirable, 372 we think, to appreciate what was said in that case.
The Bombay High Court held there that the date on which the vessel enters the territorial waters is the relevant date for determining whether the import of goods carried by it falls within the scope of the .
If the import of the goods is exempt from the operation of the Act on that date, the learned Judges said, the provisions of section 15 of the Act will not come into play, and therefore the import will be free from duty.
A distinction was made between a case where the import of goods stands exempted on the date when the vessel enters the territorial waters of India and a case where the import falls within the operation of the Act on that date but the duty is rated at nil or at a certain figure.
The distinction was discussed by a Full Bench of the Bombay High Court in Apar Private Ltd. and Others vs Union of India and others, where Madhava Reddy, C.J., speaking for the Court, observed: "If the goods were wholly exempt from basic customs duty leviable under the , when they entered the territorial waters of India, no basic duty of customs would be leviable thereon even if such exemption were withdrawn under Section 25(1) of the before the goods are releasedfor home c o n s u m p t i o n . . . . . .
. . . . . . . . .Only if the goods were chargeable to some basic customs duty under the , when they entered the territorial waters of India, than the rates in force at the time when the bill of entry is presented or at the time when the goods are sought to be cleared for home con sumption, as the case may be, would be ap plicable and the basic duty would be quanti fied and demanded at those rates." And in Jain Shudh Vanaspati Limited vs S.R. Patankar, Asstt.
Collector of Customs, Bombay and Others, the Bombay High Court proceeded on the basis that where the imported goods were totally exempt from payment of customs duty on the date when the vessel entered the terri torial waters of India, the taxable event was not postponed to the date when the goods were cleared for human consump tion.
In the present case.
there is no dispute that on the date when the vessel first entered the territorial waters of India by July, 198 1 the rate of customs duty was 12.5% on the import of the goods in question and thereafter when the vessel returned from Karachi and entered the 373 territorial waters of India the rate of duty was 42.5%.
We express no opinion on the soundness of the view taken by the Bombay High Court in the cases mentioned above; it is sufficient to point out that on the facts they afford no assistance to the petitioners.
The rate of duty and tariff valuation has to be deter mined in accordance with section 15(1) of the .
Under section 15(1)(a), the rate and valuation is the rate and valua tion in force on the date on which the Bill of Entry is presented under section 46.
According to the proviso, however, if the Bill of Entry has been presented before the entry in wards of the vessel by which the goods are imported, the Bill of Entry shall be deemed to have been presented on the date of such entry inwards.
In the present case the Bill of Entry was presented on 9 July, 1981.
What is "the date of entry inwards" of the vessel? We may refer to the detailed procedure in this matter set forth in the counteraffidavit of Shri R.S. Siddhu, then under Secretary to the Government of India.
Before the arrival of the vessel the Master of the vessel or his Agent informs the Port authorities and the Customs authorities of the probable date of arrival of the vessel.
This information is technically known as presenta tion of the Import General Manifest.
In this Manifest the Master intimates the details with regard to the cargo car ried by the vessel.
In the instant case the Manifest was conveyed by the Steamer Agent on 6 July, 1981 by his letter No. IM/394/81/1116.
Admittedly this intimation or presenta tion of the Manifest on 6 July, 1981 was prior to the arriv al of the vessel.
The presentation of the Manifest can be effected either before the arrival of the vessel or after its arrival in the usual course.
In the forwarding letter dated 6 July, 1981 mentioned above, the Shipping Agent informed the authorities that the ship would be arriving at Bombay 12 July, 1981.
According to the normal procedure, if the intimation or presentation of the Manifest is made on the arrival of the vessel it is accompanied by an applica tion for Entry Inward within 24 hours of arrival.
In the instant case since the vessel was to arrive later there was no application accompanying the letter dated 6 July, 1981.
The vessel arrived on 11 July, 1981.
On receipt of the Manifest a "prior entry" is made in the Register, which is called the Register of Inward/Outward Entry of vessels.
Upon the recording of the "prior entry" a rotation number is given and conveyed to the Shipping Agent or the Master of the vessel.
In the instant case the "prior entry" or rota tion number allotted was 743/PE.
The Customs authorities display daily, on receipt of the Import General 374 Manifests, the details of the vessels on a notice board for the information of importers.
On noticing the arrival or expected arrival of the vessel from the Import General Manifest the importer or his clearing agent files his Bill of Entry.
In this case the Bill of Entry was filed on 9 July, 1981.
An entry with regard to presentation of the Bill of Entry is made in the Import General Manifest against the entry with regard to the consignment belonging to the im porter.
The procedure thereafter is as follows.
A vessel on arrival in the territorial waters has to await the allotment of a berth by the Port Trust.
The Port Trust authorities, on receipt of information about the arrival of a ship, allot a berth, if it is available, for the discharge of the cargo.
In the instant case, since no berth was available, the vessel left for Karachi to dis charge the cargo meant for that Port.
The vessel arrived at Bombay on 23 July, 1981.
Before its arrival, the Steamer Agent had presented a supplementary Manifest on 18 July, 1981 under cover of his letter No. IM/394/81/ 1223.
The "prior entry" made earlier in the Register of Inward Entry remained the same and the rotation number also continued to remain the same.
Against the rotation No. 743 in column No. 3 of the Register of Inward Entry the date of the arrival of the vessel was indicated as 23 July, 1981, and in column No. 2 the date of Inward Entry was mentioned as 31 July, 1981.
On 30 July, 1981 the Master of the vessel had made a decla ration certifying that the vessel could discharge its cargo on 31 July, 1981, and it is on this basis that the Customs authorities granted the Entry Inward to the vessel for the purposes of discharging its cargo.
It is urged on behalf of the petitioners that the import of the goods must be deemed to have taken place on '11 July, 1981, when the ship originally arrived in Bombay Port and registered itself.
The rate of customs duty prevailing on that date was 12.5 per cent, and that, learned counsel contends, should be the rate applicable to the edible oil consignment under section 15 of the Act.
The circumstance that the vessel was unable to secure a berth in the Port of Bombay compelled it to proceed to Karachi to discharge the cargo pertaining to that Port, and but for the non avail ability of the berth she would not have undertaken that voyage but would have continued in Bombay and discharged the edible oil consignment there.
The customs duty which could have been levied then would have been 12.5 per cent.
It is pointed out that the vessel was unable to do so for no fault of the petitioners and a reasonable construction must be given to section 15 taking 375 into account the particular circumstances of the case, so that the vessel must be deemed to have made the "Entry Inwards" on 11 July, 1981.
We do not find it possible to accept this submission.
The provisions of section 15 are clear in themselves.
The date on which a Bill of Entry is presented under section 46 is, in the case of goods entered for home con sumption, the date relevant for determining the rate of duty and tariff valuation.
Where the Bill of Entry is presented before the date of Entry Inwards of the vessel, the Bill of Entry is deemed to have been presented on the date of such Entry Inwards.
In M/s. Omega Insulated Cable Co., (India) Limited vs The Collector of Customs, Madras, Writ Appeal No. 537 of 1969 decided by the Hon 'ble Kailasam and Paul, JJ.
on 9 July, 1975 the Madras High Court addressed itself to the question whether the words in section 15(1)(a) of the Act, viz. "date of entry inwards of the vessel by which the goods are imported" mean "the actual entry of the vessel inwards or the date of entry in the register kept by the department permitting the entry inwards of the vessel." The learned Judges examined the corresponding provisions of the earlier statute and after comparing the provisions of section 15 with those of section 16 of the , and the amendments made from time to time, held that the date of entry inward for the purpose of section 15(1)(a) and the proviso thereto is the date when the entry is made in the Customs register.
We have considered the matter carefully and given due heed to the submissions of learned counsel for the petition ers rounded, inter alia, on the provisions of the Sea Cus toms Act and the amendment made in section 16 of the and we are of opinion that the view taken by the Madras High Court in M/s. Omega Insulated Cable Co. Ltd., (supra) repre sents the correct view.
The amendment made in section 16 of the Act appears to have been made by way of clarification and, in our opinion, does not detract from the conclusion that "the date of entry inwards of the vessel" is the date re corded as such in the Customs register.
In the present case, "the date of inwards entry" is mentioned as 31 July, 1981.1n the absence of anything else, we may take it that the entry was recorded on the date itself.
Accordingly, the rate of import duty and the tariff valuation shall be that in force on 31 July, 1981.
The contention of the petitioners that the rate of import duty and tariff valuation will be that ruling on 11 July, 1981 cannot be sustained and is rejected.
As to the question whether section 15 of the is ultra vires on the ground that arbitrary discretion has been conferred on the 376 customs authorities in the matter of determining the date of inward entry, it seems to us that having regard to the procedure detailed above there is no scope for the submis sion that the provision is invalid.
An entire series of consecutive acts makes up the procedure, and it is reasona ble to presume that each step in the series is completed on time.
In that view of the matter, the challenge to the validity of section 15 must fail.
It is true that an amendment has been made in section 16 in the case of the export of goods, and the rate of duty and tariff valuation applicable to export goods are now specifically referable to "the date on which the proper officer makes an order permitting clearance and loading of the goods for exportation", and it is appar ent that no such amendment has been made in the provisions of section 15.
The omission, it seems to us, is of no consequence when the procedure outlined above is being followed regular ly and consistently.
There is nothing before us to show that in following the procedure the Customs authorities act arbitrarily.
Accordingly, we are of opinion that the claim made by the petitioners must be rejected.
Finally, there remains the contention of the petitioners that the differential treatment meted out to the petitioners by the imposition of a rate of 150 per cent constitutes a violation of Article 14 of the Constitution on the ground that the rate applied to corresponding imports by the State Trading Corporation is 5 per cent only.
This point has already been considered by us, and the contention has been rejected, in our judgment in M. Jhangir Bhatusha etc.
vs Union of India & Ors. etc.
; , pronounced today.
The Writ Petition is dismissed with costs.
R.N.J. Petition dismissed.
|
By way of writ petition under Article 32 of the Consti tution the petitioners sought relief against the imposition of customs duty at 150 per cent on their import of edible oils into India.
Pursuant to the contract entered into by the petitioners with foreign sellers for the supply of edible oils the consignment of edible oils was sent by the ocean going vessel M.V. Kotta Ratu.
The vessel approached Bombay and made its "prior entry" on 4 July, 1981.
It actu ally arrived and registered on 11 July, 1981.
As the port authorities at Bombay were unable to allot a berth to the vessel, the vessel left for Karachi for unloading other cargo intended for that port.
The vessel returned on 23 July 1981 and waited for berth.
On August 4, 1981 she was allowed to berth in Princess Docks 'C ' shed and the Customs authori ties made the "final entry" on that date.
Customs authorities are stated to have imposed duty on the import of edible oil at the rate of 150 per cent on the footing that the import was made on 31 July, 1981, the date of "Inward Entry".
The case of the petitioners was that the rate of duty leviable on the imports should be that ruling on 11 July, 1981, when the vessel actually arrived and registered in the Port Bombay and that but for the fact that berth was not available the vessel would have discharged its cargo at Bombay and would have been liable to pay customs duty at the rate of 12.5% which was the ruling rate on that date i.e., 11 July, 1981.
The petitioners contended that the rate should not have been more than 42.5% because that was the rate of customs duty ruling on 23 July, 1981 when the vessel entered the port of Bombay.
The Court rejecting the claim of petitioners, 368 HELD: The rate of duty and tariff valuation has to be determined in accordance with section 15(1) of the Customs Act.
Under section 15(1)(a), the rate and valuation is the rate and valuation in force on the date on which the Bill of Entry is presented u/s 46.
According to the proviso, however, if the Bill of Entry has been presented before the entry inwards of the vessel by which the goods are imported, the Bill of Entry shall be deemed to have been presented on the date of such entry inwards.
[373B C] The date on which a Bill Entry is presented under section 46 is, in the case of goods entered for home consumption, the date relevant for determining the rate of duty and tariff valuation.
Where the Bill of Entry is presented before the date of Entry Inwards of the Vessel, the Bill of Entry is deemed to have been presented on the date of such Entry Inwards.
[375B] The amendment made in section 16 of the Act appears to have been made by way of clarification and does not detract from the conclusion that "the date of entry inwards of the ves sel" is the date recorded as such in the Customs register.
[375F] In the present case, "the date of inwards entry" is mentioned as 31st July, 1981.
In the absence of anything else, it may be taken that the entry was recorded on that date itself.
Accordingly, the rate of import duty and the tariff valuation shall be that in force on 31st July 1981.
The contention of the petitioners that the rate of import duty and tariff valuation will be that ruling on July 11, 1981 cannot be sustained and is rejected.
[375G] (1)Shawney vs M/s. Sylvania & Laxman Ltd., 77 Bom.
L.R. 380; (2) Apar Private Ltd. & Ors.
vs Union of India & Ors., 185 ; (3) Jain Shudh Vanaspati Ltd. vs S.R. Patankar, Asstt.
Collector of Customs, Bombay & Ors., ; (4) M/s.
Omega Insulated Cable Co., (India) Ltd. vs The Collector of Customs, Madras, approved.
Writ Appeal No. 537 of 1969 decided by the Hon 'ble Kailasam and Paul, JJ.
on 9 July, 1975, referred to.
|
No. 3130 of 1981.
(Under Article 32 of the Constitution of India).
Soli J. Sorabjee, Harish N. Salve, K.K. Patel, Ujwal Rana, Rajiv Dutta and K.K. Mohan for the Petitioners.
369 K. Parasaran, Attorney General, B. Datta, Additional Solicitor General, Kuldip Singh, Additional Solicitor Gener al, Ms. A. Subhashini, C.V. Subba Rao, Mrs. Sushma Suri, A. Subba Rao, A.K. Srivastava and P.P. Singh for the Respond ents.
The Judgment of the Court was delivered by PATHAK, CJ.
By this writ petition under article 32 of the Constitution the petitioners seek relief against the imposi tion of customs duty at 150 per cent on their import of edible oils into India.
The petitioners entered into a contract with foreign sellers for the supply of edible oils.
The consignment of edible oils was sent by the ocean going vessel M.V. Kotta Ratu.
The vessel approached Bombay and made its "prior entry" on 4 July, 1981.
It actually arrived and registered in the Port of Bombay on 11 July, 1981.
The petitioners say that the Port authorities at Bombay were unable to allot a berth to the vessel, and as she was under heavy pressure from the parties whose goods she was carrying she left Bombay for Karachi for unloading other cargo intended for that port.
It is alleged that the vessel set out on its return journey from Karachi and arrived in the Port of Bombay on 23 July, 1981 and waited for a berth.
On 4 August, 1981 she was allowed to berth in Princess Docks 'C ' Shed and the Customs Authorities made the "final entry" on that date.
The petitioners point out that when the vessel made its original journey to Bombay and was waiting in the waters of the Port the petitioners presented the Bill of Entry to the Customs authorities on 9 July, 1981, that the Bill of Entry was accepted by the Import Department and an order was passed by the Customs Officer on the Bill of Entry on 18 July, 1981 directing the examination of the consignment.
It is stated that the Customs authorities have imposed customs duty on the import of the edible oils effected by the petitioners at the rate of 150 per cent on the footing that the import was made on 31 July, 1981, the date of "Inward Entry".
The case of the petitioners is that the rate of duty leviable on the import should be that ruling on 11 July, 198 1, when the vessel actually arrived and registered in the Port of Bombay, and that but for the fact that a berth was not available the vessel would have discharged its cargo at Bombay, and would not have left that Port and proceeded to Karachi to return to Bombay towards the end of July, 1981.
Alternatively, the case of the petitioners is that if it be found that the rate of customs duty attracted by the import effected by the petitioners is 150 per cent the levy is unconstitutional 370 and void as a violation of article 14 of the Constitution inasmuch as customs duty at 5 per cent only was levied on the State Trading Corporation on similar Imports of edible oils made by it as an importer.
The petitioners have also challenged the validity of section 15 of the Customs Act, 1961 under which the rate of duty and tariff valuation is deter mined.
To resolve the issue between the parties it is necessary to ascertain the effective date with reference to which customs duty becomes payable on imports into India.
Section 15(1) of the provides: "(1) The rate of duty and tariff valuation, if any, applicable to any imported goods, shall be the rate and valuation in force , (a) in the case of goods entered for home consumption under section 46, on the date on which a bill of entry in respect of such goods is presented under that section; (b) in the case of goods cleared from a warehouse under section 68, on the date on which the goods are actually removed from the warehouse; (c) in the case of any other goods, on the date of payment of duty: Provided that if a bill of entry has been presented before the date of entry in wards of the vessel by which the goods are imported, the bill of entry shall be deemed to have been presented on the date of such entry inwards.
" The rate of duty and tariff valuation applicable to the imported goods is governed by cl.
(a) of section 15(1).
In the case of goods entered for home consumption under section 46, it is the date on which the Bill of Entry in respect of such goods is presented under that section.
section 46 provides that the importer of any goods shall make entry thereof by pre senting to the proper officer a Bill of Entry for home consumption in the prescribed form, and it is further pro vided that a Bill of Entry may be presented at any time after delivery of the Import Manifest or an Import report.
The Bill of Entry may be presented even before the delivery of such Manifest if the vessel by which the goods have been 371 shipped for importation into India is expected to arrive within a week from the date of such presentation.
Section 47 empowers the proper officer, on being satisfied that the goods entered for home consumption are not prohibited goods and that the importers had paid the import duty assessed thereon as well as charges in respect of the same, to make an order permitting clearance of the goods for home consump tion.
According to the petitioners, the cargo of edible oil could not be unloaded in Bombay during the original entry of the ship into the Port for want of an available berth, and it is for no fault of the petitioners that the vessel had to proceed to Karachi for unloading other cargo.
Section 15, the petitioners contend, is arbitrary and vague and there fore unconstitutional because it provides no definite stand ard or norm for determining the rate of duty and tariff valuation and does not take into account situation which are uncertain and beyond the control of an importer.
The peti tioners contend that the rate of customs duty chargeable on the import of goods in India is the rate in force on the date when the vessel carrying the goods enters the territo rial waters of India.
The petitioners point out that section 12(1) declares that customs .duty will be levied at the rates in force on goods imported into India, and the expres sion 'India ', they urge, is defined by section 2(27) as including the 'territorial waters of India '.
In other words, the petitioners contend that when the vessel entered the terri torial waters on 11 July, 1981 the rate of customs duty at 12.5 per cent ruling on that date was the rate which was attracted to the import.
In any event, the petitioners contend, the rate should not have been more than 42.5 per cent because that was the rate of customs duty ruling on 23 July, 1981 when the vessel entered the port of Bombay.
To preserve the validity of section 15 the petitioners urge, we must read the expression "the date of entry inwards" in the proviso to section 15(1) as the date on which the vessel enters the territorial waters of India.
Learned counsel for the petitioners says that if this interpretation cannot reasona bly be given to the provisions of section 15(1) then it becomes necessary to question the constitutional validity of section 15 on the ground that the terms of that section are vague and arbitrary, and therefore no recourse can be had to section 15(1).
Considerable reliance has been placed by the peti tioner on Shawney vs M/s. Sylvania and Laxman Ltd., 77 Bom.
L.R. 380 in support of the submission that the taxable event occurs when the vessel enters the territorial waters of India and it is that date which should determine the rate at which import duty can be levied.
It is desirable, 372 we think, to appreciate what was said in that case.
The Bombay High Court held there that the date on which the vessel enters the territorial waters is the relevant date for determining whether the import of goods carried by it falls within the scope of the .
If the import of the goods is exempt from the operation of the Act on that date, the learned Judges said, the provisions of section 15 of the Act will not come into play, and therefore the import will be free from duty.
A distinction was made between a case where the import of goods stands exempted on the date when the vessel enters the territorial waters of India and a case where the import falls within the operation of the Act on that date but the duty is rated at nil or at a certain figure.
The distinction was discussed by a Full Bench of the Bombay High Court in Apar Private Ltd. and Others vs Union of India and others, where Madhava Reddy, C.J., speaking for the Court, observed: "If the goods were wholly exempt from basic customs duty leviable under the , when they entered the territorial waters of India, no basic duty of customs would be leviable thereon even if such exemption were withdrawn under Section 25(1) of the before the goods are releasedfor home c o n s u m p t i o n . . . . . .
. . . . . . . . .Only if the goods were chargeable to some basic customs duty under the , when they entered the territorial waters of India, than the rates in force at the time when the bill of entry is presented or at the time when the goods are sought to be cleared for home con sumption, as the case may be, would be ap plicable and the basic duty would be quanti fied and demanded at those rates." And in Jain Shudh Vanaspati Limited vs S.R. Patankar, Asstt.
Collector of Customs, Bombay and Others, the Bombay High Court proceeded on the basis that where the imported goods were totally exempt from payment of customs duty on the date when the vessel entered the terri torial waters of India, the taxable event was not postponed to the date when the goods were cleared for human consump tion.
In the present case.
there is no dispute that on the date when the vessel first entered the territorial waters of India by July, 198 1 the rate of customs duty was 12.5% on the import of the goods in question and thereafter when the vessel returned from Karachi and entered the 373 territorial waters of India the rate of duty was 42.5%.
We express no opinion on the soundness of the view taken by the Bombay High Court in the cases mentioned above; it is sufficient to point out that on the facts they afford no assistance to the petitioners.
The rate of duty and tariff valuation has to be deter mined in accordance with section 15(1) of the .
Under section 15(1)(a), the rate and valuation is the rate and valua tion in force on the date on which the Bill of Entry is presented under section 46.
According to the proviso, however, if the Bill of Entry has been presented before the entry in wards of the vessel by which the goods are imported, the Bill of Entry shall be deemed to have been presented on the date of such entry inwards.
In the present case the Bill of Entry was presented on 9 July, 1981.
What is "the date of entry inwards" of the vessel? We may refer to the detailed procedure in this matter set forth in the counteraffidavit of Shri R.S. Siddhu, then under Secretary to the Government of India.
Before the arrival of the vessel the Master of the vessel or his Agent informs the Port authorities and the Customs authorities of the probable date of arrival of the vessel.
This information is technically known as presenta tion of the Import General Manifest.
In this Manifest the Master intimates the details with regard to the cargo car ried by the vessel.
In the instant case the Manifest was conveyed by the Steamer Agent on 6 July, 1981 by his letter No. IM/394/81/1116.
Admittedly this intimation or presenta tion of the Manifest on 6 July, 1981 was prior to the arriv al of the vessel.
The presentation of the Manifest can be effected either before the arrival of the vessel or after its arrival in the usual course.
In the forwarding letter dated 6 July, 1981 mentioned above, the Shipping Agent informed the authorities that the ship would be arriving at Bombay 12 July, 1981.
According to the normal procedure, if the intimation or presentation of the Manifest is made on the arrival of the vessel it is accompanied by an applica tion for Entry Inward within 24 hours of arrival.
In the instant case since the vessel was to arrive later there was no application accompanying the letter dated 6 July, 1981.
The vessel arrived on 11 July, 1981.
On receipt of the Manifest a "prior entry" is made in the Register, which is called the Register of Inward/Outward Entry of vessels.
Upon the recording of the "prior entry" a rotation number is given and conveyed to the Shipping Agent or the Master of the vessel.
In the instant case the "prior entry" or rota tion number allotted was 743/PE.
The Customs authorities display daily, on receipt of the Import General 374 Manifests, the details of the vessels on a notice board for the information of importers.
On noticing the arrival or expected arrival of the vessel from the Import General Manifest the importer or his clearing agent files his Bill of Entry.
In this case the Bill of Entry was filed on 9 July, 1981.
An entry with regard to presentation of the Bill of Entry is made in the Import General Manifest against the entry with regard to the consignment belonging to the im porter.
The procedure thereafter is as follows.
A vessel on arrival in the territorial waters has to await the allotment of a berth by the Port Trust.
The Port Trust authorities, on receipt of information about the arrival of a ship, allot a berth, if it is available, for the discharge of the cargo.
In the instant case, since no berth was available, the vessel left for Karachi to dis charge the cargo meant for that Port.
The vessel arrived at Bombay on 23 July, 1981.
Before its arrival, the Steamer Agent had presented a supplementary Manifest on 18 July, 1981 under cover of his letter No. IM/394/81/ 1223.
The "prior entry" made earlier in the Register of Inward Entry remained the same and the rotation number also continued to remain the same.
Against the rotation No. 743 in column No. 3 of the Register of Inward Entry the date of the arrival of the vessel was indicated as 23 July, 1981, and in column No. 2 the date of Inward Entry was mentioned as 31 July, 1981.
On 30 July, 1981 the Master of the vessel had made a decla ration certifying that the vessel could discharge its cargo on 31 July, 1981, and it is on this basis that the Customs authorities granted the Entry Inward to the vessel for the purposes of discharging its cargo.
It is urged on behalf of the petitioners that the import of the goods must be deemed to have taken place on '11 July, 1981, when the ship originally arrived in Bombay Port and registered itself.
The rate of customs duty prevailing on that date was 12.5 per cent, and that, learned counsel contends, should be the rate applicable to the edible oil consignment under section 15 of the Act.
The circumstance that the vessel was unable to secure a berth in the Port of Bombay compelled it to proceed to Karachi to discharge the cargo pertaining to that Port, and but for the non avail ability of the berth she would not have undertaken that voyage but would have continued in Bombay and discharged the edible oil consignment there.
The customs duty which could have been levied then would have been 12.5 per cent.
It is pointed out that the vessel was unable to do so for no fault of the petitioners and a reasonable construction must be given to section 15 taking 375 into account the particular circumstances of the case, so that the vessel must be deemed to have made the "Entry Inwards" on 11 July, 1981.
We do not find it possible to accept this submission.
The provisions of section 15 are clear in themselves.
The date on which a Bill of Entry is presented under section 46 is, in the case of goods entered for home con sumption, the date relevant for determining the rate of duty and tariff valuation.
Where the Bill of Entry is presented before the date of Entry Inwards of the vessel, the Bill of Entry is deemed to have been presented on the date of such Entry Inwards.
In M/s. Omega Insulated Cable Co., (India) Limited vs The Collector of Customs, Madras, Writ Appeal No. 537 of 1969 decided by the Hon 'ble Kailasam and Paul, JJ.
on 9 July, 1975 the Madras High Court addressed itself to the question whether the words in section 15(1)(a) of the Act, viz. "date of entry inwards of the vessel by which the goods are imported" mean "the actual entry of the vessel inwards or the date of entry in the register kept by the department permitting the entry inwards of the vessel." The learned Judges examined the corresponding provisions of the earlier statute and after comparing the provisions of section 15 with those of section 16 of the , and the amendments made from time to time, held that the date of entry inward for the purpose of section 15(1)(a) and the proviso thereto is the date when the entry is made in the Customs register.
We have considered the matter carefully and given due heed to the submissions of learned counsel for the petition ers rounded, inter alia, on the provisions of the Sea Cus toms Act and the amendment made in section 16 of the and we are of opinion that the view taken by the Madras High Court in M/s. Omega Insulated Cable Co. Ltd., (supra) repre sents the correct view.
The amendment made in section 16 of the Act appears to have been made by way of clarification and, in our opinion, does not detract from the conclusion that "the date of entry inwards of the vessel" is the date re corded as such in the Customs register.
In the present case, "the date of inwards entry" is mentioned as 31 July, 1981.1n the absence of anything else, we may take it that the entry was recorded on the date itself.
Accordingly, the rate of import duty and the tariff valuation shall be that in force on 31 July, 1981.
The contention of the petitioners that the rate of import duty and tariff valuation will be that ruling on 11 July, 1981 cannot be sustained and is rejected.
As to the question whether section 15 of the is ultra vires on the ground that arbitrary discretion has been conferred on the 376 customs authorities in the matter of determining the date of inward entry, it seems to us that having regard to the procedure detailed above there is no scope for the submis sion that the provision is invalid.
An entire series of consecutive acts makes up the procedure, and it is reasona ble to presume that each step in the series is completed on time.
In that view of the matter, the challenge to the validity of section 15 must fail.
It is true that an amendment has been made in section 16 in the case of the export of goods, and the rate of duty and tariff valuation applicable to export goods are now specifically referable to "the date on which the proper officer makes an order permitting clearance and loading of the goods for exportation", and it is appar ent that no such amendment has been made in the provisions of section 15.
The omission, it seems to us, is of no consequence when the procedure outlined above is being followed regular ly and consistently.
There is nothing before us to show that in following the procedure the Customs authorities act arbitrarily.
Accordingly, we are of opinion that the claim made by the petitioners must be rejected.
Finally, there remains the contention of the petitioners that the differential treatment meted out to the petitioners by the imposition of a rate of 150 per cent constitutes a violation of Article 14 of the Constitution on the ground that the rate applied to corresponding imports by the State Trading Corporation is 5 per cent only.
This point has already been considered by us, and the contention has been rejected, in our judgment in M. Jhangir Bhatusha etc.
vs Union of India & Ors. etc.
; , pronounced today.
The Writ Petition is dismissed with costs.
R.N.J. Petition dismissed.
|
(Under Article 32 of the Constitution of India). Soli J. Sorabjee, Harish N. Salve, K.K. Patel, Ujwal Rana, Rajiv Dutta and K.K. Mohan for the Petitioners. 369 K. Parasaran, Attorney General, B. Datta, Additional Solicitor General, Kuldip Singh, Additional Solicitor Gener al, Ms. A. Subhashini, C.V. Subba Rao, Mrs. Sushma Suri, A. Subba Rao, A.K. Srivastava and P.P. Singh for the Respond ents. The Judgment of the Court was delivered by PATHAK, CJ. By this writ petition under article 32 of the Constitution the petitioners seek relief against the imposi tion of customs duty at 150 per cent on their import of edible oils into India. The petitioners entered into a contract with foreign sellers for the supply of edible oils. The consignment of edible oils was sent by the ocean going vessel M.V. Kotta Ratu. The vessel approached Bombay and made its "prior entry" on 4 July, 1981. It actually arrived and registered in the Port of Bombay on 11 July, 1981. The petitioners say that the Port authorities at Bombay were unable to allot a berth to the vessel, and as she was under heavy pressure from the parties whose goods she was carrying she left Bombay for Karachi for unloading other cargo intended for that port. It is alleged that the vessel set out on its return journey from Karachi and arrived in the Port of Bombay on 23 July, 1981 and waited for a berth. On 4 August, 1981 she was allowed to berth in Princess Docks 'C ' Shed and the Customs Authorities made the "final entry" on that date. The petitioners point out that when the vessel made its original journey to Bombay and was waiting in the waters of the Port the petitioners presented the Bill of Entry to the Customs authorities on 9 July, 1981, that the Bill of Entry was accepted by the Import Department and an order was passed by the Customs Officer on the Bill of Entry on 18 July, 1981 directing the examination of the consignment. It is stated that the Customs authorities have imposed customs duty on the import of the edible oils effected by the petitioners at the rate of 150 per cent on the footing that the import was made on 31 July, 1981, the date of "Inward Entry". Alternatively, the case of the petitioners is that if it be found that the rate of customs duty attracted by the import effected by the petitioners is 150 per cent the levy is unconstitutional 370 and void as a violation of article 14 of the Constitution inasmuch as customs duty at 5 per cent only was levied on the State Trading Corporation on similar Imports of edible oils made by it as an importer. The petitioners have also challenged the validity of section 15 of the Customs Act, 1961 under which the rate of duty and tariff valuation is deter mined. To resolve the issue between the parties it is necessary to ascertain the effective date with reference to which customs duty becomes payable on imports into India. " The rate of duty and tariff valuation applicable to the imported goods is governed by cl. In the case of goods entered for home consumption under section 46, it is the date on which the Bill of Entry in respect of such goods is presented under that section. section 46 provides that the importer of any goods shall make entry thereof by pre senting to the proper officer a Bill of Entry for home consumption in the prescribed form, and it is further pro vided that a Bill of Entry may be presented at any time after delivery of the Import Manifest or an Import report. The Bill of Entry may be presented even before the delivery of such Manifest if the vessel by which the goods have been 371 shipped for importation into India is expected to arrive within a week from the date of such presentation. Section 47 empowers the proper officer, on being satisfied that the goods entered for home consumption are not prohibited goods and that the importers had paid the import duty assessed thereon as well as charges in respect of the same, to make an order permitting clearance of the goods for home consump tion. According to the petitioners, the cargo of edible oil could not be unloaded in Bombay during the original entry of the ship into the Port for want of an available berth, and it is for no fault of the petitioners that the vessel had to proceed to Karachi for unloading other cargo. Section 15, the petitioners contend, is arbitrary and vague and there fore unconstitutional because it provides no definite stand ard or norm for determining the rate of duty and tariff valuation and does not take into account situation which are uncertain and beyond the control of an importer. The peti tioners contend that the rate of customs duty chargeable on the import of goods in India is the rate in force on the date when the vessel carrying the goods enters the territo rial waters of India. In other words, the petitioners contend that when the vessel entered the terri torial waters on 11 July, 1981 the rate of customs duty at 12.5 per cent ruling on that date was the rate which was attracted to the import. In any event, the petitioners contend, the rate should not have been more than 42.5 per cent because that was the rate of customs duty ruling on 23 July, 1981 when the vessel entered the port of Bombay. To preserve the validity of section 15 the petitioners urge, we must read the expression "the date of entry inwards" in the proviso to section 15(1) as the date on which the vessel enters the territorial waters of India. Learned counsel for the petitioners says that if this interpretation cannot reasona bly be given to the provisions of section 15(1) then it becomes necessary to question the constitutional validity of section 15 on the ground that the terms of that section are vague and arbitrary, and therefore no recourse can be had to section 15(1). Considerable reliance has been placed by the peti tioner on Shawney vs M/s. Sylvania and Laxman Ltd., 77 Bom. It is desirable, 372 we think, to appreciate what was said in that case. The Bombay High Court held there that the date on which the vessel enters the territorial waters is the relevant date for determining whether the import of goods carried by it falls within the scope of the . If the import of the goods is exempt from the operation of the Act on that date, the learned Judges said, the provisions of section 15 of the Act will not come into play, and therefore the import will be free from duty. A distinction was made between a case where the import of goods stands exempted on the date when the vessel enters the territorial waters of India and a case where the import falls within the operation of the Act on that date but the duty is rated at nil or at a certain figure. The distinction was discussed by a Full Bench of the Bombay High Court in Apar Private Ltd. and Others vs Union of India and others, where Madhava Reddy, C.J., speaking for the Court, observed: "If the goods were wholly exempt from basic customs duty leviable under the , when they entered the territorial waters of India, no basic duty of customs would be leviable thereon even if such exemption were withdrawn under Section 25(1) of the before the goods are releasedfor home c o n s u m p t i o n . . . . . . And in Jain Shudh Vanaspati Limited vs S.R. Patankar, Asstt. Collector of Customs, Bombay and Others, the Bombay High Court proceeded on the basis that where the imported goods were totally exempt from payment of customs duty on the date when the vessel entered the terri torial waters of India, the taxable event was not postponed to the date when the goods were cleared for human consump tion. there is no dispute that on the date when the vessel first entered the territorial waters of India by July, 198 1 the rate of customs duty was 12.5% on the import of the goods in question and thereafter when the vessel returned from Karachi and entered the 373 territorial waters of India the rate of duty was 42.5%. We express no opinion on the soundness of the view taken by the Bombay High Court in the cases mentioned above; it is sufficient to point out that on the facts they afford no assistance to the petitioners. The rate of duty and tariff valuation has to be deter mined in accordance with section 15(1) of the . Under section 15(1)(a), the rate and valuation is the rate and valua tion in force on the date on which the Bill of Entry is presented under section 46. According to the proviso, however, if the Bill of Entry has been presented before the entry in wards of the vessel by which the goods are imported, the Bill of Entry shall be deemed to have been presented on the date of such entry inwards. In the present case the Bill of Entry was presented on 9 July, 1981. What is "the date of entry inwards" of the vessel? We may refer to the detailed procedure in this matter set forth in the counteraffidavit of Shri R.S. Siddhu, then under Secretary to the Government of India. Before the arrival of the vessel the Master of the vessel or his Agent informs the Port authorities and the Customs authorities of the probable date of arrival of the vessel. This information is technically known as presenta tion of the Import General Manifest. In this Manifest the Master intimates the details with regard to the cargo car ried by the vessel. In the instant case the Manifest was conveyed by the Steamer Agent on 6 July, 1981 by his letter No. Admittedly this intimation or presenta tion of the Manifest on 6 July, 1981 was prior to the arriv al of the vessel. The presentation of the Manifest can be effected either before the arrival of the vessel or after its arrival in the usual course. In the forwarding letter dated 6 July, 1981 mentioned above, the Shipping Agent informed the authorities that the ship would be arriving at Bombay 12 July, 1981. According to the normal procedure, if the intimation or presentation of the Manifest is made on the arrival of the vessel it is accompanied by an applica tion for Entry Inward within 24 hours of arrival. In the instant case since the vessel was to arrive later there was no application accompanying the letter dated 6 July, 1981. On receipt of the Manifest a "prior entry" is made in the Register, which is called the Register of Inward/Outward Entry of vessels. Upon the recording of the "prior entry" a rotation number is given and conveyed to the Shipping Agent or the Master of the vessel. In the instant case the "prior entry" or rota tion number allotted was 743/PE. The Customs authorities display daily, on receipt of the Import General 374 Manifests, the details of the vessels on a notice board for the information of importers. On noticing the arrival or expected arrival of the vessel from the Import General Manifest the importer or his clearing agent files his Bill of Entry. In this case the Bill of Entry was filed on 9 July, 1981. An entry with regard to presentation of the Bill of Entry is made in the Import General Manifest against the entry with regard to the consignment belonging to the im porter. A vessel on arrival in the territorial waters has to await the allotment of a berth by the Port Trust. The Port Trust authorities, on receipt of information about the arrival of a ship, allot a berth, if it is available, for the discharge of the cargo. In the instant case, since no berth was available, the vessel left for Karachi to dis charge the cargo meant for that Port. The vessel arrived at Bombay on 23 July, 1981. Before its arrival, the Steamer Agent had presented a supplementary Manifest on 18 July, 1981 under cover of his letter No. The "prior entry" made earlier in the Register of Inward Entry remained the same and the rotation number also continued to remain the same. 3 of the Register of Inward Entry the date of the arrival of the vessel was indicated as 23 July, 1981, and in column No. 2 the date of Inward Entry was mentioned as 31 July, 1981. On 30 July, 1981 the Master of the vessel had made a decla ration certifying that the vessel could discharge its cargo on 31 July, 1981, and it is on this basis that the Customs authorities granted the Entry Inward to the vessel for the purposes of discharging its cargo. It is urged on behalf of the petitioners that the import of the goods must be deemed to have taken place on '11 July, 1981, when the ship originally arrived in Bombay Port and registered itself. The rate of customs duty prevailing on that date was 12.5 per cent, and that, learned counsel contends, should be the rate applicable to the edible oil consignment under section 15 of the Act. The customs duty which could have been levied then would have been 12.5 per cent. We do not find it possible to accept this submission. The provisions of section 15 are clear in themselves. The date on which a Bill of Entry is presented under section 46 is, in the case of goods entered for home con sumption, the date relevant for determining the rate of duty and tariff valuation. Where the Bill of Entry is presented before the date of Entry Inwards of the vessel, the Bill of Entry is deemed to have been presented on the date of such Entry Inwards. In M/s. Omega Insulated Cable Co., (India) Limited vs The Collector of Customs, Madras, Writ Appeal No. 537 of 1969 decided by the Hon 'ble Kailasam and Paul, JJ. on 9 July, 1975 the Madras High Court addressed itself to the question whether the words in section 15(1)(a) of the Act, viz. " date of entry inwards of the vessel by which the goods are imported" mean "the actual entry of the vessel inwards or the date of entry in the register kept by the department permitting the entry inwards of the vessel." The amendment made in section 16 of the Act appears to have been made by way of clarification and, in our opinion, does not detract from the conclusion that "the date of entry inwards of the vessel" is the date re corded as such in the Customs register. In the present case, "the date of inwards entry" is mentioned as 31 July, 1981.1n the absence of anything else, we may take it that the entry was recorded on the date itself. Accordingly, the rate of import duty and the tariff valuation shall be that in force on 31 July, 1981. The contention of the petitioners that the rate of import duty and tariff valuation will be that ruling on 11 July, 1981 cannot be sustained and is rejected. An entire series of consecutive acts makes up the procedure, and it is reasona ble to presume that each step in the series is completed on time. In that view of the matter, the challenge to the validity of section 15 must fail. It is true that an amendment has been made in section 16 in the case of the export of goods, and the rate of duty and tariff valuation applicable to export goods are now specifically referable to "the date on which the proper officer makes an order permitting clearance and loading of the goods for exportation", and it is appar ent that no such amendment has been made in the provisions of section 15. The omission, it seems to us, is of no consequence when the procedure outlined above is being followed regular ly and consistently. There is nothing before us to show that in following the procedure the Customs authorities act arbitrarily. Accordingly, we are of opinion that the claim made by the petitioners must be rejected. This point has already been considered by us, and the contention has been rejected, in our judgment in M. Jhangir Bhatusha etc. The Writ Petition is dismissed with costs.
|
By way of writ petition under Article 32 of the Consti tution the petitioners sought relief against the imposition of customs duty at 150 per cent on their import of edible oils into India.
Pursuant to the contract entered into by the petitioners with foreign sellers for the supply of edible oils the consignment of edible oils was sent by the ocean going vessel M.V. Kotta Ratu.
The vessel approached Bombay and made its "prior entry" on 4 July, 1981.
It actu ally arrived and registered on 11 July, 1981.
As the port authorities at Bombay were unable to allot a berth to the vessel, the vessel left for Karachi for unloading other cargo intended for that port.
The vessel returned on 23 July 1981 and waited for berth.
On August 4, 1981 she was allowed to berth in Princess Docks 'C ' shed and the Customs authori ties made the "final entry" on that date.
Customs authorities are stated to have imposed duty on the import of edible oil at the rate of 150 per cent on the footing that the import was made on 31 July, 1981, the date of "Inward Entry".
The case of the petitioners was that the rate of duty leviable on the imports should be that ruling on 11 July, 1981, when the vessel actually arrived and registered in the Port Bombay and that but for the fact that berth was not available the vessel would have discharged its cargo at Bombay and would have been liable to pay customs duty at the rate of 12.5% which was the ruling rate on that date i.e., 11 July, 1981.
The petitioners contended that the rate should not have been more than 42.5% because that was the rate of customs duty ruling on 23 July, 1981 when the vessel entered the port of Bombay.
The Court rejecting the claim of petitioners, 368 HELD: The rate of duty and tariff valuation has to be determined in accordance with section 15(1) of the Customs Act.
Under section 15(1)(a), the rate and valuation is the rate and valuation in force on the date on which the Bill of Entry is presented u/s 46.
According to the proviso, however, if the Bill of Entry has been presented before the entry inwards of the vessel by which the goods are imported, the Bill of Entry shall be deemed to have been presented on the date of such entry inwards.
[373B C] The date on which a Bill Entry is presented under section 46 is, in the case of goods entered for home consumption, the date relevant for determining the rate of duty and tariff valuation.
Where the Bill of Entry is presented before the date of Entry Inwards of the Vessel, the Bill of Entry is deemed to have been presented on the date of such Entry Inwards.
[375B] The amendment made in section 16 of the Act appears to have been made by way of clarification and does not detract from the conclusion that "the date of entry inwards of the ves sel" is the date recorded as such in the Customs register.
[375F] In the present case, "the date of inwards entry" is mentioned as 31st July, 1981.
In the absence of anything else, it may be taken that the entry was recorded on that date itself.
Accordingly, the rate of import duty and the tariff valuation shall be that in force on 31st July 1981.
The contention of the petitioners that the rate of import duty and tariff valuation will be that ruling on July 11, 1981 cannot be sustained and is rejected.
[375G] (1)Shawney vs M/s. Sylvania & Laxman Ltd., 77 Bom.
L.R. 380; (2) Apar Private Ltd. & Ors.
vs Union of India & Ors., 185 ; (3) Jain Shudh Vanaspati Ltd. vs S.R. Patankar, Asstt.
Collector of Customs, Bombay & Ors., ; (4) M/s.
Omega Insulated Cable Co., (India) Ltd. vs The Collector of Customs, Madras, approved.
Writ Appeal No. 537 of 1969 decided by the Hon 'ble Kailasam and Paul, JJ.
on 9 July, 1975, referred to.
|
By way of writ petition under Article 32 of the Consti tution the petitioners sought relief against the imposition of customs duty at 150 per cent on their import of edible oils into India.
Pursuant to the contract entered into by the petitioners with foreign sellers for the supply of edible oils the consignment of edible oils was sent by the ocean going vessel M.V. Kotta Ratu.
The vessel approached Bombay and made its "prior entry" on 4 July, 1981.
It actu ally arrived and registered on 11 July, 1981.
As the port authorities at Bombay were unable to allot a berth to the vessel, the vessel left for Karachi for unloading other cargo intended for that port.
The vessel returned on 23 July 1981 and waited for berth.
On August 4, 1981 she was allowed to berth in Princess Docks 'C ' shed and the Customs authori ties made the "final entry" on that date.
Customs authorities are stated to have imposed duty on the import of edible oil at the rate of 150 per cent on the footing that the import was made on 31 July, 1981, the date of "Inward Entry".
The case of the petitioners was that the rate of duty leviable on the imports should be that ruling on 11 July, 1981, when the vessel actually arrived and registered in the Port Bombay and that but for the fact that berth was not available the vessel would have discharged its cargo at Bombay and would have been liable to pay customs duty at the rate of 12.5% which was the ruling rate on that date i.e., 11 July, 1981.
The petitioners contended that the rate should not have been more than 42.5% because that was the rate of customs duty ruling on 23 July, 1981 when the vessel entered the port of Bombay.
The Court rejecting the claim of petitioners, 368 HELD: The rate of duty and tariff valuation has to be determined in accordance with section 15(1) of the Customs Act.
Under section 15(1)(a), the rate and valuation is the rate and valuation in force on the date on which the Bill of Entry is presented u/s 46.
According to the proviso, however, if the Bill of Entry has been presented before the entry inwards of the vessel by which the goods are imported, the Bill of Entry shall be deemed to have been presented on the date of such entry inwards.
[373B C] The date on which a Bill Entry is presented under section 46 is, in the case of goods entered for home consumption, the date relevant for determining the rate of duty and tariff valuation.
Where the Bill of Entry is presented before the date of Entry Inwards of the Vessel, the Bill of Entry is deemed to have been presented on the date of such Entry Inwards.
[375B] The amendment made in section 16 of the Act appears to have been made by way of clarification and does not detract from the conclusion that "the date of entry inwards of the ves sel" is the date recorded as such in the Customs register.
[375F] In the present case, "the date of inwards entry" is mentioned as 31st July, 1981.
In the absence of anything else, it may be taken that the entry was recorded on that date itself.
Accordingly, the rate of import duty and the tariff valuation shall be that in force on 31st July 1981.
The contention of the petitioners that the rate of import duty and tariff valuation will be that ruling on July 11, 1981 cannot be sustained and is rejected.
[375G] (1)Shawney vs M/s. Sylvania & Laxman Ltd., 77 Bom.
L.R. 380; (2) Apar Private Ltd. & Ors.
vs Union of India & Ors., 185 ; (3) Jain Shudh Vanaspati Ltd. vs S.R. Patankar, Asstt.
Collector of Customs, Bombay & Ors., ; (4) M/s.
Omega Insulated Cable Co., (India) Ltd. vs The Collector of Customs, Madras, approved.
Writ Appeal No. 537 of 1969 decided by the Hon 'ble Kailasam and Paul, JJ.
on 9 July, 1975, referred to.
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| 0.874433
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|
ition No. 373 of 1986.
(Under Article 32 of the Constitution of India).
A.K. Goel, E.X. Joseph and N.S. Das Bahl for the petitioners.
V.C. Mahajan, Girish Chandra, Mrs. Sushma Suri and Miss A. Subhashini for the Respondents.
The Judgment of the Court was delivered by VENKATARAMIAH, J.
These petitions are filed on behalf of persons who are working as 'Daily Rated Casual Labour ' in the Posts and Telegraphs Department.
The 'Daily Rated Casual Labour ' includes three broad categories of workers, namely, unskilled, semiskilled and skilled.
The unskilled labour consists of safai workers, helpers, peons etc.
and are mostly engaged in digging, carrying loads and other similar types of work.
The semi skilled labour consists of carpenters, wiremen, draftsmen, A.C. mechanics etc.
who have technical experience but do not hold any degree or diploma.
The skilled labour consists of labour doing technical work, who hold requisite degrees/diplomas.
The principal complaint of the petitioners is that even though 602 many of them have been working for the last ten years as casual A labourers, the wages paid to them are very low and far less than the salary and allowances paid to the regular employees of the Posts and Telegraphs Department belonging to each of the categories referred to above and secondly no scheme has been prepared by the Union of India to absorb them regularly in its service and consequently they have been denied the benefits, such as increments, pension, leave facilities etc.
which are enjoyed by those who have been recruited regularly.
They allege that they are being exploited by the Union of India.
They have produced the order of the Director General, Posts and Telegraphs Department bearing No. 28 II/77 SR/STN dated 15.5.1980 which prescribes the rate or rates of wages payable to the casual labour in the Telecommunication Wing of the Department.
The relevant part of the order reads thus: "No. 28 II/77 SR/STN Office of the Director General Posts and Telegraphs, New Delhi 1, 15.5.1980 To . . . . .
Subject: Increase in rate of daily wages for the casual labour employed in the Telecom.
Wing of P & T. The employment of casual labour in the Telecom.
Wing, who are working for a reasonably long period, on continuous basis was one of the items under discussion in the P & T Department council (JCM).
The potential of absorption of the large force of casual mazdoor in regular grade was limited on the Telecommunication side.
As an alternative to regular absorption it was proposed that a wage related to the minimum of the pay scale of Time Scale Group D cadre with the benefit of neutralisation for the rise in cost Index as applicable to regular employees may be effected.
603 2.
The President is now pleased to decide that the A rates of daily wages for the casual labour employed in the Telecom.
Wing of P & T will be as follows: (i) Casual labour who has not completed 720 days of service in a period of three years at the rate of 240 days per annum with the Department as on 1.4.80.
_________________________________________________ No change.
They will continue to be paid at the approved local rates.
(ii) Casual labour who having been working with the Department from 1.4.77 or earlier and have completed 720 days of service as on 1.4.80.
__________________________________________________ Daily wages equal to 75% of 1/30th of the minimum of Group time Scale plus admissible D.A. _________________________________________________ (iii) Casual labour who has been working in the Department from 1.4.1975 or earlier and has completed 1200 days of service as on 1.4.1980.
_________________________________________________ Daily wages equal to 1/30th of the minimum of the Group Time Scale plus 1/30th of the admissible D.A. (iv) All the casual labourers will, however, continue to be employed on daily wages only.
(v) These orders for enhanced rates for category (ii) & (iii) above will take effect from 1.5.80.
(vi) A review will be carried out every year as on the Ist of April for making officials eligible for wages indicated in paras (ii) and (iii) above.
(vii) The above arrangement of enhanced rates of daily wages will be without prejudice to absorption of causal mazdoors against regular vacancies as and they occur . . . . . . . . . 604 sd/ (M.S. Yegneshwaran) Asst.
Director General (Stn.)" The above order is followed by the another order bearing No. 10 4/83 R dated 26.7.1984 which reads as under: To All General Managers Telecom.
Subject: Increase in rates of daily wages for the casual/ semi skilled/skilled labour.
Sir, The employment of the casual semi skilled/skilled labour in the Telecom.
Wing who are working for a reasonably long period, on continuous basis has been engaging the attention of this Directorate for quite sometime past.
The potential of absorption of labour of the type in regular grade was limited on the Telecommunication side.
As an alternative to regular absorption the need was being felt that wage related to the minimum of the pay scale of semi skilled skilled casual labour with the benefit of neutralisation for the rise in cost index as applicable to regular employees may be effected as is at present available to casual un skilled labour working under the P & T Department.
The President is now pleased to decide that the rates of daily wages for the semi skilled/skilled casual labour employed in the Telecom.
Wing of the P & T Department will be as under: (i) Casual semi skilled/skilled labour who has not completed 720 days of service over a period of three years or more with the department.
_________________________________________________ No change.
They will continue to be paid at the approved local rates.
(ii) Casual semi skilled/skilled labour who has completed 605 720 days of service over a period of three years or more.
_________________________________________________ Daily wage equal to 75% of 1/30th of the minimum of the scale of semi skilled (Rs. 210 270) or skilled (Rs.260 350) as the case may be, plus admissible DA/ADA thereon.
(iii) Casual Labour who has completed 1200 days of service over a period of 5 years or more.
__________________________________________________ Daily wage equal to 1/30th of the minimum of the pay scale of semi skilled (Rs.210 270) skilled (Rs.260 350) as the case may be, plus DA/ADA admissible thereon.
(iv) All the casual semi skilled/skilled labour will, however continue to be employed on daily wages only.
(v) These orders for enhanced rates for category (ii) and (iii) above will take effect from 1.4.1984.
(vi) A review for making further officials eligible for wages vide (ii) and (iii) above will take effect as on Ist of April every year.
(vii) If the rates calculated vide (ii) and (iii) above happen to be less than the approved local rates, payment shall be made as per approved local rates for above categories of labour.
(viii) The above arrangements of enhanced rates of daily wages will be without prejudice to absorption of casual semi skilled/skilled labour against regular vacancies as and when they occur.
(ix) The benefit of increased rates of daily wages will not be admissible to the casual semi skilled/skilled labour in whose case the continuous spells of duty are intervened by a period of more than six months.
The absence of more than six months may, however, be condoned by the Divisional Engineer on one of the two grounds namely, prolonged illness on production of medical certificates or nonemployment due to non availability of work.
In the case of 606 absence beyond six months at a time on account of illness for the past years, the production of medical certificate may not be insisted upon and the period of break may be condoned if the Divisional Engineer is satisfied about the genuineness of the absence 4.
These enhanced rates of daily wages are applicable to the semi skilled/skilled casual labour who strictly conform to the job content of corresponding regular posts in scales of Rs.210 270 and Rs.260 350 as the case may be and that there should not be any variation in the respective job con tent.
In case of slight variation/doubt cases may be referred to the .
P. & T for review .
Yours faithfully, (V. Ramaswamy) Assistant Director General (Stn. )" Aggrieved by the discrimination made against them by these orders which very heavily weighed against them, the petitioners submitted a statement of demands through the Secretary General, BPTEF, New Delhi, of which they were members, claiming regularisation of casual labourers, payment of interim relief, payment of bonus, supply of dresses, leave and medical facilities etc.
They received a reply from the Department on January 10, 1986 which read as under : "Sub: Demands of casual labour daily rated workers.
Ref: Your letter No. PF/Casual Labour/86 dated 13.
12. 1985.
Please refer to your above cited letter.
The position regarding the various demands in your above cited letter is as below: (i) Regularisation of Casual Labour.
This is being done as per existing instructions of department of Personnel & Training as against the vacancies as and when they arise.
607 (ii) Payment of interim relief.
Revision of wages is done once in a year for casual labourers of category 1 (those who have not completed 720/120O days in 3/5 years) in the month of April taking into account the prevailing local rates in consultation with the local authorities.
However, in respect of categories (ii) and (iii) i.e. for those who have completed 720/1200 days in 3/5 years, the revision is done as and when DA/ADA.
Interim Reliefs are being granted to regular staff at the rate of 3/4th full of the minimum of the scale of regular class IV employees . . . (vii) Regularisation of skilled/semi/skilled/ unskilled labour in similar grade: Provision has been made in the recruitment rules whereever possible to give preference in recruitment for corresponding semi skilled/skilled workers.
Regarding unskilled labour, they will be taken as Group staff as and when vacancies arise, on their becoming eligible for absorption as per instruction of DGP & T. (section KRISHAN) DIRECTOR (ST) 10.1.1986.
" The petitioners were not satisfied with the above reply received by them.
They, therefore, filed the above petitions and the first of them bearing Writ Petition No. 302 of 1986 was filed on 5.2.1986 for the issue of a writ in the nature of mandamus to the Union of India to direct it to pay to the petitioners same salary and allowances and other benefits as are being paid to the regular and permanent employees of the Union of India in the corresponding cadres and to direct the Union of India to regularise the service of the casual labour who had been in continuous service for more than six months.
The allegation made in the petitions to the effect that the petitioners are being paid wages far less than the minimum pay payable under the pay scales applicable to the regular employees belonging to corresponding cadres is more or less admitted by the respondents.
The respondents, however, contend that since the petitioners belong to the category of casual labour and are not being regularly employed, they 608 are not entitled to the same privileges which the regular employees are enjoying.
It may be true that the petitioners have not been regularly recruited but many of them have been working continuously for more than a year in the Department and some of them have been engaged as casual labourers for nearly ten years.
They are rendering the same kind of service which is being rendered by the regular employees doing the same type of work.
Clause (2) of Article 38 of the Constitution of India which contains one of the Directive Principles of State Policy provides that "the State shall, in particular, strive to minimise the inequalities in income, and endeavour to eliminate inequalities in status, facilities and opportunities, not only amongst individuals but also amongst groups of people residing in different areas or engaged in different vacations." Even though the above Directive Principle may not be enforceable as such by virtue of Article 37 of the Constitution of India, it may be relied upon by the petitioners to show that in the instant case they have been subjected to hostile discrimination.
It is urged that the State cannot deny at least the minimum pay in the pay scales of regularly employed workmen even though the Government may not be compelled to extend all the benefits enjoyed by regularly recruited employees.
We are of the view that such denial amounts to exploitation of labour.
The Government cannot take advantage of its dominant position, and compel any worker to work even as a casual labourer on starving wages.
It may be that the casual labourer has agreed to work on such low wages.
That he has done because he has no other choice.
It is poverty that has driven him to that State.
The Government should be a model employer.
We are of the view that on the facts and in the circumstances of this case the classification of employees into regularly recruited employees and casual employees for the purpose of paying less than the minimum pay payable to employees in the corresponding regular cadres particularly in the lowest rungs of the department where the pay scales are the lowest is not tenable.
The further classification of casual labourers into three categories namely (i) those who have not completed 720 days of service; (ii) those who have completed 720 days of service and not completed 1200 days of service and (iii) those who have completed more than 1200 days of service for purpose of payment of different rates of wages is equally untenable.
There is clearly no justification for doing so.
Such a classification is violative of Articles 14 and 16 of the Constitution.
It is also opposed to the spirit of Article 7 of the International Covenant on Economic, Social and Cultural Rights, 1966 which exhorts all States parties to ensure fair wages and equal wages for equal work.
We feel that there is substance in the contention of the petitioners 609 In Dhirendra Chamoli and Another vs State of U.P., this Court has taken almost a similar view with regard to the employees working in the Nehru Yuvak Kendras who were considered to be performing the same duties as Class IV employees.
We accordingly direct the Union of India and the other respondents to pay wages to the workmen who are employed as casual labourers belonging to the several categories of employees referred to above in the Postal and Telegraphs Department at the rates equivalent to the minimum pay in the pay scales of the regularly employed workers in the corresponding cadres but without any increments with effect from 5th of February, 1986 on which date the first of the above two petitions, namely, Writ Petition No. 302 of 1986 was filed.
The petitioners are entitled to corresponding Dearness Allowance and Addl.
Dearness Allowance, if any, payable thereon.
Whatever other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them.
India is a socialist republic.
It implies the existence of certain important obligations which the State has to discharge.
The right to work, the right to free choice of employment, the right to just and favourable conditions of work, the right to protection against unemployment, the right of every one who works to just and favourable remuneration ensuring a decent living for himself and for family, the right of every one without discrimination of any kind to equal pay for equal work, the right to rest, leisure, reasonable limitation on working hours and periodic holidays with pay, the right to form trade unions.
and the right to join trade unions of one 's choice and the right to security of work are some of the rights which have to be ensured by appropriate legislative and executive measures.
It is true that all these rights cannot be extended simultaneously.
But they do indicate the socialist goal.
The degree of achievement in this direction depends upon the economic resources, willingness of the people to produce and more than all the existence of industrial peace throughout the country.
Of those rights the question of security of work is of utmost importance.
If a person does not have the feeling that he belongs to an organization engaged in production he will not put forward his best effort to produce more.
That sense of belonging arises only when he feels that he will not be turned out of employment the next day at the whim of the management.
It is for this reason it is being repeatedly observed by those who are in charge of economic affairs of the countries in different parts of the world that as far as possible security of work should be assured to the employees so that they may contribute to the maximisation of production.
It is again for this reason that managements and the Government agencies in particular should not allow 610 workers to remain as casual labourers or temporary employees for an unreasonably long period of time, where is any justification to keep persons as casual labourers for years as is being done in the Postal and Telegraphs Department? Is it for paying them lower wages? Then it amounts to exploitation of labour.
Is it because you do not know that there is enough work for the workers? It cannot be so because there is so much of development to be carried out in the communications department that you need more workers.
The employees belonging to skilled, semi skilled and unskilled classes can be shifted from one department to another even if there is no work to be done in a given place.
Administrators should realise that if any worker remains idle on any day, the country loses the wealth that he would have produced during that day.
Our wage structure is such that a worker is always paid less than what he produces.
So why allow people to remain idle? Anyway they have got to be fed and clothed.
Therefore, why don 't we provide them with work? There are several types of work such as road making, railway construction, house building, irrigation projects, communications etc.
which have to be undertaken on a large scale.
Development in these types of activities (even though they do not involve much foreign exchange) is not keeping pace with the needs of society.
We are saying all this only to make the people understand the need for better management of man power (which is a decaying asset) the non utilisation of which leads to the inevitable loss of valuable human resources.
Let us remember the slogan: "Produce or Perish".
It is not an empty slogan.
We fail to produce more at our own peril.
It is against this background that we say that non regularisation of temporary employees or casual labour for a long period is not a wise policy.
We, therefore, direct the respondents to prepare a scheme on a rational basis for absorbing as far as possible the casual labourers who have been continuously working for more than one year in the Posts and Telegraphs Department.
The arrears of wages payable to the casual labourers in accordance with this order shall be paid within four months from today.
The respondents shall prepare a scheme for absorbing the casual labourers, as directed above, within eight months from today.
These petitioners are accordingly disposed of.
N.P.V. Petitions disposed of.
|
% International Covenant on Economic, Social and Cultural Rights, 1966: Article 7 Casual labour Justifiable classification for payment of wages Necessity of Non regularisation of service Not wise policy Necessity for absorption as permanent workers.
The petitioners who were working as 'Daily Rated Casual Labour ' in the Posts and Telegraphs Department, were categorised as unskilled, semi skilled and skilled workers.
By the orders of the D.G., Post and Telegraphs Department No. 28 II/77 SR/STM dated 15.5.80 and 10 4/83 R dated 26.7.84 they were further classified into (i) those who had not completed 720 days of service; (ii) those who had comp leted 720 days and not completed 1200 days of service, and (iii) those who had completed more than 1200 days of service, and were granted different rates of wages as laid down therein.
Aggrieved by these orders, the petitioners submitted a statement of demands through their federation to the authorities, claiming regularisation, payment of interim relief and bonus, supply of dresses, leave and medical facilities etc.
Not satisfied with the reply received by them, the petitioners filed writ petitions, for the issue of a writ in the nature of mandamus to the Union of India and to direct it to pay them same salary, allowances, and other benefits as were being paid to regular and permanent employees of the Union of India in corresponding cadres and to regularise the 599 service of the casual labour who had been in continuous service for more than 6 months.
Their principal complaint was that even though many of them had been working for the last ten years as casual labourers, the wages paid to them were very low and far less than the salary and allowances paid to regular employees of the Posts and Telegraphs Department belonging to the equivalent categories and, secondly that no scheme had been prepared by the Union of India to absorb them regularly in its service and they had been denied the benefits of increments, pension, leave facilities etc.
which were enjoyed by those who had been recruited regularly.
The petitioners were opposed by the respondents contending that since the petitioners belonged to the category of casual labour and were not being regularly employed, they were not entitled to the same privileges which regular employees were enjoying.
Disposing of the writ petitions, ^ HELD: 1.1 The classification of employees in the present case into casual employees and regularly recruited employees for the purpose of paying less than the minimum pay payable to employees in the corresponding regular cadres particularly in the lowest rungs of the department, where the pay scales are the lowest is not tenable.
The further classification of casual labourers into three categories, namely, (i) those who have not completed 720 days of service; (ii) those who have completed 720 days of service and not completed 1200 days of service, and (iii) those who have completed more than 1200 days of service for the purpose of payment of different rates of wages is equally untenable.
There is clearly no justification for doing so.
Such a classification is violative of Articles 14 and 16 of the Constitution.
It is also opposed to the spirit of Article 7 of the International Covenant on Economic, Social and Cultural Rights, 1966 which exhorts all States, parties to the Covenant to ensure fair wages and equal wages for equal work.
[608E H] 1.2 The State cannot deny at least the minimum pay in the pay scales of regularly employed workmen even though the Government may not be compelled to extend all benefits enjoyed by regularly recruited employees.
Such denial amounts to exploitation of labour.
[608Dl 1.3 The Government should be a model employer.
It cannot take advantage of its dominant position, and compel any worker to work 600 even as a casual labourer on starving wages.
It may be that the casual labourer has agreed to work on such low wages.
That he has done, because he has no other choice.
It is poverty that has driven him to that state.
[608E Fl 1.4 It may be that the petitioners have not been regularly recruited, but many of them have been working continuously for more than a year in the Department, and some of them have been engaged as casual labourers for nearly ten years.
They are rendering the same kind of service which is being rendered by the regular employees doing the same type of work.
[608A B] 1.5 Even though the Directive Principle contained in Article 38(2) may not be enforceable as such by virtue of Article 37 of the Constitution of India, it may be relied upon to show that they have been subjected to hostile discrimination.
[608C ] Dhirendra Chamoli and Another vs State of U.P., [1986] 1 SCC V 637, relied on.
2.1 Non regularisation of temporary employees or casual labour for a long period is not a wise policy.
610E F] 2.2 India is a socialist republic.
It implies the existence of cer tain important obligations which the State has to discharge.
Many rights like right to work, equal pay for equal work, security of work, etc.
have to be ensured by appropriate legislation and executive measured.
[609D E] 2.3 If a person does not have the feeling that he belongs to an organisation engaged in production, he will not put forward his best effort to produce more.
That sense of belonging arises only when he feels that he will not be turned out of employment the next day at the whim of management.
Security of work should as far as possible be assured to the employees so that they may contribute to the maximisation of production.
Managements and the Governmental agencies in particular should not allow workers to remain as casual labourers or temporary employees for an unreasonably long period of time.
[609G H; 610A] 2.4 The employees belonging to skilled, semi skilled and unskilled classes can be shifted from one department to another even if there is no work to be done in a given place.
Administrators should realise even as a casual labourer on starving wages.
It may be that the casual labourer has agreed to work on such low wages.
That he has done, because he has no other choice.
It is poverty that has driven him to that state.
[608E F] 601 that if any worker remains idle on any day, the country loses the wealth that he would have produced during that day.
Our wage structure is such that a worker is always paid less than what he produces.
[610B C] 3.
The Union of India and the other respondents are directed to pay wages to the workmen who are employed as casual labourers at the rate equivalent to the minimum pay in the pay scales of the regularly employed workers in the corresponding cadres but without any increments with effect from 5th of February, 1986 and corresponding Dearness Allowance and Addl.
Dearness Allowances, if any, payable thereon.
Other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them.
The arrears of wages payable shall be paid within four months.
[609B C; 610G] The respondents are directed to prepare a scheme for absorbing as far as possible the casual labourers who have been continuously working for more than one year in the Posts and Telegraphs Departments 610 Fl
|
ition No. 373 of 1986.
(Under Article 32 of the Constitution of India).
A.K. Goel, E.X. Joseph and N.S. Das Bahl for the petitioners.
V.C. Mahajan, Girish Chandra, Mrs. Sushma Suri and Miss A. Subhashini for the Respondents.
The Judgment of the Court was delivered by VENKATARAMIAH, J.
These petitions are filed on behalf of persons who are working as 'Daily Rated Casual Labour ' in the Posts and Telegraphs Department.
The 'Daily Rated Casual Labour ' includes three broad categories of workers, namely, unskilled, semiskilled and skilled.
The unskilled labour consists of safai workers, helpers, peons etc.
and are mostly engaged in digging, carrying loads and other similar types of work.
The semi skilled labour consists of carpenters, wiremen, draftsmen, A.C. mechanics etc.
who have technical experience but do not hold any degree or diploma.
The skilled labour consists of labour doing technical work, who hold requisite degrees/diplomas.
The principal complaint of the petitioners is that even though 602 many of them have been working for the last ten years as casual A labourers, the wages paid to them are very low and far less than the salary and allowances paid to the regular employees of the Posts and Telegraphs Department belonging to each of the categories referred to above and secondly no scheme has been prepared by the Union of India to absorb them regularly in its service and consequently they have been denied the benefits, such as increments, pension, leave facilities etc.
which are enjoyed by those who have been recruited regularly.
They allege that they are being exploited by the Union of India.
They have produced the order of the Director General, Posts and Telegraphs Department bearing No. 28 II/77 SR/STN dated 15.5.1980 which prescribes the rate or rates of wages payable to the casual labour in the Telecommunication Wing of the Department.
The relevant part of the order reads thus: "No. 28 II/77 SR/STN Office of the Director General Posts and Telegraphs, New Delhi 1, 15.5.1980 To . . . . .
Subject: Increase in rate of daily wages for the casual labour employed in the Telecom.
Wing of P & T. The employment of casual labour in the Telecom.
Wing, who are working for a reasonably long period, on continuous basis was one of the items under discussion in the P & T Department council (JCM).
The potential of absorption of the large force of casual mazdoor in regular grade was limited on the Telecommunication side.
As an alternative to regular absorption it was proposed that a wage related to the minimum of the pay scale of Time Scale Group D cadre with the benefit of neutralisation for the rise in cost Index as applicable to regular employees may be effected.
603 2.
The President is now pleased to decide that the A rates of daily wages for the casual labour employed in the Telecom.
Wing of P & T will be as follows: (i) Casual labour who has not completed 720 days of service in a period of three years at the rate of 240 days per annum with the Department as on 1.4.80.
_________________________________________________ No change.
They will continue to be paid at the approved local rates.
(ii) Casual labour who having been working with the Department from 1.4.77 or earlier and have completed 720 days of service as on 1.4.80.
__________________________________________________ Daily wages equal to 75% of 1/30th of the minimum of Group time Scale plus admissible D.A. _________________________________________________ (iii) Casual labour who has been working in the Department from 1.4.1975 or earlier and has completed 1200 days of service as on 1.4.1980.
_________________________________________________ Daily wages equal to 1/30th of the minimum of the Group Time Scale plus 1/30th of the admissible D.A. (iv) All the casual labourers will, however, continue to be employed on daily wages only.
(v) These orders for enhanced rates for category (ii) & (iii) above will take effect from 1.5.80.
(vi) A review will be carried out every year as on the Ist of April for making officials eligible for wages indicated in paras (ii) and (iii) above.
(vii) The above arrangement of enhanced rates of daily wages will be without prejudice to absorption of causal mazdoors against regular vacancies as and they occur . . . . . . . . . 604 sd/ (M.S. Yegneshwaran) Asst.
Director General (Stn.)" The above order is followed by the another order bearing No. 10 4/83 R dated 26.7.1984 which reads as under: To All General Managers Telecom.
Subject: Increase in rates of daily wages for the casual/ semi skilled/skilled labour.
Sir, The employment of the casual semi skilled/skilled labour in the Telecom.
Wing who are working for a reasonably long period, on continuous basis has been engaging the attention of this Directorate for quite sometime past.
The potential of absorption of labour of the type in regular grade was limited on the Telecommunication side.
As an alternative to regular absorption the need was being felt that wage related to the minimum of the pay scale of semi skilled skilled casual labour with the benefit of neutralisation for the rise in cost index as applicable to regular employees may be effected as is at present available to casual un skilled labour working under the P & T Department.
The President is now pleased to decide that the rates of daily wages for the semi skilled/skilled casual labour employed in the Telecom.
Wing of the P & T Department will be as under: (i) Casual semi skilled/skilled labour who has not completed 720 days of service over a period of three years or more with the department.
_________________________________________________ No change.
They will continue to be paid at the approved local rates.
(ii) Casual semi skilled/skilled labour who has completed 605 720 days of service over a period of three years or more.
_________________________________________________ Daily wage equal to 75% of 1/30th of the minimum of the scale of semi skilled (Rs. 210 270) or skilled (Rs.260 350) as the case may be, plus admissible DA/ADA thereon.
(iii) Casual Labour who has completed 1200 days of service over a period of 5 years or more.
__________________________________________________ Daily wage equal to 1/30th of the minimum of the pay scale of semi skilled (Rs.210 270) skilled (Rs.260 350) as the case may be, plus DA/ADA admissible thereon.
(iv) All the casual semi skilled/skilled labour will, however continue to be employed on daily wages only.
(v) These orders for enhanced rates for category (ii) and (iii) above will take effect from 1.4.1984.
(vi) A review for making further officials eligible for wages vide (ii) and (iii) above will take effect as on Ist of April every year.
(vii) If the rates calculated vide (ii) and (iii) above happen to be less than the approved local rates, payment shall be made as per approved local rates for above categories of labour.
(viii) The above arrangements of enhanced rates of daily wages will be without prejudice to absorption of casual semi skilled/skilled labour against regular vacancies as and when they occur.
(ix) The benefit of increased rates of daily wages will not be admissible to the casual semi skilled/skilled labour in whose case the continuous spells of duty are intervened by a period of more than six months.
The absence of more than six months may, however, be condoned by the Divisional Engineer on one of the two grounds namely, prolonged illness on production of medical certificates or nonemployment due to non availability of work.
In the case of 606 absence beyond six months at a time on account of illness for the past years, the production of medical certificate may not be insisted upon and the period of break may be condoned if the Divisional Engineer is satisfied about the genuineness of the absence 4.
These enhanced rates of daily wages are applicable to the semi skilled/skilled casual labour who strictly conform to the job content of corresponding regular posts in scales of Rs.210 270 and Rs.260 350 as the case may be and that there should not be any variation in the respective job con tent.
In case of slight variation/doubt cases may be referred to the .
P. & T for review .
Yours faithfully, (V. Ramaswamy) Assistant Director General (Stn. )" Aggrieved by the discrimination made against them by these orders which very heavily weighed against them, the petitioners submitted a statement of demands through the Secretary General, BPTEF, New Delhi, of which they were members, claiming regularisation of casual labourers, payment of interim relief, payment of bonus, supply of dresses, leave and medical facilities etc.
They received a reply from the Department on January 10, 1986 which read as under : "Sub: Demands of casual labour daily rated workers.
Ref: Your letter No. PF/Casual Labour/86 dated 13.
12. 1985.
Please refer to your above cited letter.
The position regarding the various demands in your above cited letter is as below: (i) Regularisation of Casual Labour.
This is being done as per existing instructions of department of Personnel & Training as against the vacancies as and when they arise.
607 (ii) Payment of interim relief.
Revision of wages is done once in a year for casual labourers of category 1 (those who have not completed 720/120O days in 3/5 years) in the month of April taking into account the prevailing local rates in consultation with the local authorities.
However, in respect of categories (ii) and (iii) i.e. for those who have completed 720/1200 days in 3/5 years, the revision is done as and when DA/ADA.
Interim Reliefs are being granted to regular staff at the rate of 3/4th full of the minimum of the scale of regular class IV employees . . . (vii) Regularisation of skilled/semi/skilled/ unskilled labour in similar grade: Provision has been made in the recruitment rules whereever possible to give preference in recruitment for corresponding semi skilled/skilled workers.
Regarding unskilled labour, they will be taken as Group staff as and when vacancies arise, on their becoming eligible for absorption as per instruction of DGP & T. (section KRISHAN) DIRECTOR (ST) 10.1.1986.
" The petitioners were not satisfied with the above reply received by them.
They, therefore, filed the above petitions and the first of them bearing Writ Petition No. 302 of 1986 was filed on 5.2.1986 for the issue of a writ in the nature of mandamus to the Union of India to direct it to pay to the petitioners same salary and allowances and other benefits as are being paid to the regular and permanent employees of the Union of India in the corresponding cadres and to direct the Union of India to regularise the service of the casual labour who had been in continuous service for more than six months.
The allegation made in the petitions to the effect that the petitioners are being paid wages far less than the minimum pay payable under the pay scales applicable to the regular employees belonging to corresponding cadres is more or less admitted by the respondents.
The respondents, however, contend that since the petitioners belong to the category of casual labour and are not being regularly employed, they 608 are not entitled to the same privileges which the regular employees are enjoying.
It may be true that the petitioners have not been regularly recruited but many of them have been working continuously for more than a year in the Department and some of them have been engaged as casual labourers for nearly ten years.
They are rendering the same kind of service which is being rendered by the regular employees doing the same type of work.
Clause (2) of Article 38 of the Constitution of India which contains one of the Directive Principles of State Policy provides that "the State shall, in particular, strive to minimise the inequalities in income, and endeavour to eliminate inequalities in status, facilities and opportunities, not only amongst individuals but also amongst groups of people residing in different areas or engaged in different vacations." Even though the above Directive Principle may not be enforceable as such by virtue of Article 37 of the Constitution of India, it may be relied upon by the petitioners to show that in the instant case they have been subjected to hostile discrimination.
It is urged that the State cannot deny at least the minimum pay in the pay scales of regularly employed workmen even though the Government may not be compelled to extend all the benefits enjoyed by regularly recruited employees.
We are of the view that such denial amounts to exploitation of labour.
The Government cannot take advantage of its dominant position, and compel any worker to work even as a casual labourer on starving wages.
It may be that the casual labourer has agreed to work on such low wages.
That he has done because he has no other choice.
It is poverty that has driven him to that State.
The Government should be a model employer.
We are of the view that on the facts and in the circumstances of this case the classification of employees into regularly recruited employees and casual employees for the purpose of paying less than the minimum pay payable to employees in the corresponding regular cadres particularly in the lowest rungs of the department where the pay scales are the lowest is not tenable.
The further classification of casual labourers into three categories namely (i) those who have not completed 720 days of service; (ii) those who have completed 720 days of service and not completed 1200 days of service and (iii) those who have completed more than 1200 days of service for purpose of payment of different rates of wages is equally untenable.
There is clearly no justification for doing so.
Such a classification is violative of Articles 14 and 16 of the Constitution.
It is also opposed to the spirit of Article 7 of the International Covenant on Economic, Social and Cultural Rights, 1966 which exhorts all States parties to ensure fair wages and equal wages for equal work.
We feel that there is substance in the contention of the petitioners 609 In Dhirendra Chamoli and Another vs State of U.P., this Court has taken almost a similar view with regard to the employees working in the Nehru Yuvak Kendras who were considered to be performing the same duties as Class IV employees.
We accordingly direct the Union of India and the other respondents to pay wages to the workmen who are employed as casual labourers belonging to the several categories of employees referred to above in the Postal and Telegraphs Department at the rates equivalent to the minimum pay in the pay scales of the regularly employed workers in the corresponding cadres but without any increments with effect from 5th of February, 1986 on which date the first of the above two petitions, namely, Writ Petition No. 302 of 1986 was filed.
The petitioners are entitled to corresponding Dearness Allowance and Addl.
Dearness Allowance, if any, payable thereon.
Whatever other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them.
India is a socialist republic.
It implies the existence of certain important obligations which the State has to discharge.
The right to work, the right to free choice of employment, the right to just and favourable conditions of work, the right to protection against unemployment, the right of every one who works to just and favourable remuneration ensuring a decent living for himself and for family, the right of every one without discrimination of any kind to equal pay for equal work, the right to rest, leisure, reasonable limitation on working hours and periodic holidays with pay, the right to form trade unions.
and the right to join trade unions of one 's choice and the right to security of work are some of the rights which have to be ensured by appropriate legislative and executive measures.
It is true that all these rights cannot be extended simultaneously.
But they do indicate the socialist goal.
The degree of achievement in this direction depends upon the economic resources, willingness of the people to produce and more than all the existence of industrial peace throughout the country.
Of those rights the question of security of work is of utmost importance.
If a person does not have the feeling that he belongs to an organization engaged in production he will not put forward his best effort to produce more.
That sense of belonging arises only when he feels that he will not be turned out of employment the next day at the whim of the management.
It is for this reason it is being repeatedly observed by those who are in charge of economic affairs of the countries in different parts of the world that as far as possible security of work should be assured to the employees so that they may contribute to the maximisation of production.
It is again for this reason that managements and the Government agencies in particular should not allow 610 workers to remain as casual labourers or temporary employees for an unreasonably long period of time, where is any justification to keep persons as casual labourers for years as is being done in the Postal and Telegraphs Department? Is it for paying them lower wages? Then it amounts to exploitation of labour.
Is it because you do not know that there is enough work for the workers? It cannot be so because there is so much of development to be carried out in the communications department that you need more workers.
The employees belonging to skilled, semi skilled and unskilled classes can be shifted from one department to another even if there is no work to be done in a given place.
Administrators should realise that if any worker remains idle on any day, the country loses the wealth that he would have produced during that day.
Our wage structure is such that a worker is always paid less than what he produces.
So why allow people to remain idle? Anyway they have got to be fed and clothed.
Therefore, why don 't we provide them with work? There are several types of work such as road making, railway construction, house building, irrigation projects, communications etc.
which have to be undertaken on a large scale.
Development in these types of activities (even though they do not involve much foreign exchange) is not keeping pace with the needs of society.
We are saying all this only to make the people understand the need for better management of man power (which is a decaying asset) the non utilisation of which leads to the inevitable loss of valuable human resources.
Let us remember the slogan: "Produce or Perish".
It is not an empty slogan.
We fail to produce more at our own peril.
It is against this background that we say that non regularisation of temporary employees or casual labour for a long period is not a wise policy.
We, therefore, direct the respondents to prepare a scheme on a rational basis for absorbing as far as possible the casual labourers who have been continuously working for more than one year in the Posts and Telegraphs Department.
The arrears of wages payable to the casual labourers in accordance with this order shall be paid within four months from today.
The respondents shall prepare a scheme for absorbing the casual labourers, as directed above, within eight months from today.
These petitioners are accordingly disposed of.
N.P.V. Petitions disposed of.
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(Under Article 32 of the Constitution of India). A.K. Goel, E.X. Joseph and N.S. Das Bahl for the petitioners. V.C. Mahajan, Girish Chandra, Mrs. Sushma Suri and Miss A. Subhashini for the Respondents. The Judgment of the Court was delivered by VENKATARAMIAH, J.
These petitions are filed on behalf of persons who are working as 'Daily Rated Casual Labour ' in the Posts and Telegraphs Department. The 'Daily Rated Casual Labour ' includes three broad categories of workers, namely, unskilled, semiskilled and skilled. and are mostly engaged in digging, carrying loads and other similar types of work. The semi skilled labour consists of carpenters, wiremen, draftsmen, A.C. mechanics etc. who have technical experience but do not hold any degree or diploma. The skilled labour consists of labour doing technical work, who hold requisite degrees/diplomas. The principal complaint of the petitioners is that even though 602 many of them have been working for the last ten years as casual A labourers, the wages paid to them are very low and far less than the salary and allowances paid to the regular employees of the Posts and Telegraphs Department belonging to each of the categories referred to above and secondly no scheme has been prepared by the Union of India to absorb them regularly in its service and consequently they have been denied the benefits, such as increments, pension, leave facilities etc. which are enjoyed by those who have been recruited regularly. They allege that they are being exploited by the Union of India. They have produced the order of the Director General, Posts and Telegraphs Department bearing No. 28 II/77 SR/STN dated 15.5.1980 which prescribes the rate or rates of wages payable to the casual labour in the Telecommunication Wing of the Department. The relevant part of the order reads thus: "No. 28 II/77 SR/STN Office of the Director General Posts and Telegraphs, New Delhi 1, 15.5.1980 To . . . . . Subject: Increase in rate of daily wages for the casual labour employed in the Telecom. Wing of P & T. The employment of casual labour in the Telecom. Wing, who are working for a reasonably long period, on continuous basis was one of the items under discussion in the P & T Department council (JCM). The potential of absorption of the large force of casual mazdoor in regular grade was limited on the Telecommunication side. As an alternative to regular absorption it was proposed that a wage related to the minimum of the pay scale of Time Scale Group D cadre with the benefit of neutralisation for the rise in cost Index as applicable to regular employees may be effected. The President is now pleased to decide that the A rates of daily wages for the casual labour employed in the Telecom. Wing of P & T will be as follows: (i) Casual labour who has not completed 720 days of service in a period of three years at the rate of 240 days per annum with the Department as on 1.4.80. _________________________________________________ No change. They will continue to be paid at the approved local rates. (ii) Casual labour who having been working with the Department from 1.4.77 or earlier and have completed 720 days of service as on 1.4.80. __________________________________________________ Daily wages equal to 75% of 1/30th of the minimum of Group time Scale plus admissible D.A. _________________________________________________ (iii) Casual labour who has been working in the Department from 1.4.1975 or earlier and has completed 1200 days of service as on 1.4.1980. _________________________________________________ Daily wages equal to 1/30th of the minimum of the Group Time Scale plus 1/30th of the admissible D.A. (iv) All the casual labourers will, however, continue to be employed on daily wages only. (vi) A review will be carried out every year as on the Ist of April for making officials eligible for wages indicated in paras (ii) and (iii) above. (vii) The above arrangement of enhanced rates of daily wages will be without prejudice to absorption of causal mazdoors against regular vacancies as and they occur . . . . . . . . . The above order is followed by the another order bearing No. 10 4/83 R dated 26.7.1984 which reads as under: To All General Managers Telecom. Subject: Increase in rates of daily wages for the casual/ semi skilled/skilled labour. Sir, The employment of the casual semi skilled/skilled labour in the Telecom. Wing who are working for a reasonably long period, on continuous basis has been engaging the attention of this Directorate for quite sometime past. The potential of absorption of labour of the type in regular grade was limited on the Telecommunication side. As an alternative to regular absorption the need was being felt that wage related to the minimum of the pay scale of semi skilled skilled casual labour with the benefit of neutralisation for the rise in cost index as applicable to regular employees may be effected as is at present available to casual un skilled labour working under the P & T Department. (ii) Casual semi skilled/skilled labour who has completed 605 720 days of service over a period of three years or more. _________________________________________________ Daily wage equal to 75% of 1/30th of the minimum of the scale of semi skilled (Rs. 210 270) or skilled (Rs.260 350) as the case may be, plus admissible DA/ADA thereon. (iii) Casual Labour who has completed 1200 days of service over a period of 5 years or more. __________________________________________________ Daily wage equal to 1/30th of the minimum of the pay scale of semi skilled (Rs.210 270) skilled (Rs.260 350) as the case may be, plus DA/ADA admissible thereon. (iv) All the casual semi skilled/skilled labour will, however continue to be employed on daily wages only. (v) These orders for enhanced rates for category (ii) and (iii) above will take effect from 1.4.1984. (vi) A review for making further officials eligible for wages vide (ii) and (iii) above will take effect as on Ist of April every year. (vii) If the rates calculated vide (ii) and (iii) above happen to be less than the approved local rates, payment shall be made as per approved local rates for above categories of labour. (viii) The above arrangements of enhanced rates of daily wages will be without prejudice to absorption of casual semi skilled/skilled labour against regular vacancies as and when they occur. (ix) The benefit of increased rates of daily wages will not be admissible to the casual semi skilled/skilled labour in whose case the continuous spells of duty are intervened by a period of more than six months. The absence of more than six months may, however, be condoned by the Divisional Engineer on one of the two grounds namely, prolonged illness on production of medical certificates or nonemployment due to non availability of work. These enhanced rates of daily wages are applicable to the semi skilled/skilled casual labour who strictly conform to the job content of corresponding regular posts in scales of Rs.210 270 and Rs.260 350 as the case may be and that there should not be any variation in the respective job con tent. In case of slight variation/doubt cases may be referred to the . Yours faithfully, (V. Ramaswamy) Assistant Director General (Stn. )" They received a reply from the Department on January 10, 1986 which read as under : "Sub: Demands of casual labour daily rated workers. The position regarding the various demands in your above cited letter is as below: (i) Regularisation of Casual Labour. This is being done as per existing instructions of department of Personnel & Training as against the vacancies as and when they arise. Revision of wages is done once in a year for casual labourers of category 1 (those who have not completed 720/120O days in 3/5 years) in the month of April taking into account the prevailing local rates in consultation with the local authorities. However, in respect of categories (ii) and (iii) i.e. for those who have completed 720/1200 days in 3/5 years, the revision is done as and when DA/ADA. Interim Reliefs are being granted to regular staff at the rate of 3/4th full of the minimum of the scale of regular class IV employees . . . ( vii) Regularisation of skilled/semi/skilled/ unskilled labour in similar grade: Provision has been made in the recruitment rules whereever possible to give preference in recruitment for corresponding semi skilled/skilled workers. Regarding unskilled labour, they will be taken as Group staff as and when vacancies arise, on their becoming eligible for absorption as per instruction of DGP & T. (section KRISHAN) DIRECTOR (ST) 10.1.1986. " The petitioners were not satisfied with the above reply received by them. They, therefore, filed the above petitions and the first of them bearing Writ Petition No. The respondents, however, contend that since the petitioners belong to the category of casual labour and are not being regularly employed, they 608 are not entitled to the same privileges which the regular employees are enjoying. It may be true that the petitioners have not been regularly recruited but many of them have been working continuously for more than a year in the Department and some of them have been engaged as casual labourers for nearly ten years. They are rendering the same kind of service which is being rendered by the regular employees doing the same type of work. Clause (2) of Article 38 of the Constitution of India which contains one of the Directive Principles of State Policy provides that "the State shall, in particular, strive to minimise the inequalities in income, and endeavour to eliminate inequalities in status, facilities and opportunities, not only amongst individuals but also amongst groups of people residing in different areas or engaged in different vacations." Even though the above Directive Principle may not be enforceable as such by virtue of Article 37 of the Constitution of India, it may be relied upon by the petitioners to show that in the instant case they have been subjected to hostile discrimination. It is urged that the State cannot deny at least the minimum pay in the pay scales of regularly employed workmen even though the Government may not be compelled to extend all the benefits enjoyed by regularly recruited employees. We are of the view that such denial amounts to exploitation of labour. The Government cannot take advantage of its dominant position, and compel any worker to work even as a casual labourer on starving wages. It may be that the casual labourer has agreed to work on such low wages. That he has done because he has no other choice. It is poverty that has driven him to that State. The Government should be a model employer. We are of the view that on the facts and in the circumstances of this case the classification of employees into regularly recruited employees and casual employees for the purpose of paying less than the minimum pay payable to employees in the corresponding regular cadres particularly in the lowest rungs of the department where the pay scales are the lowest is not tenable. The further classification of casual labourers into three categories namely (i) those who have not completed 720 days of service; (ii) those who have completed 720 days of service and not completed 1200 days of service and (iii) those who have completed more than 1200 days of service for purpose of payment of different rates of wages is equally untenable. There is clearly no justification for doing so. Such a classification is violative of Articles 14 and 16 of the Constitution. It is also opposed to the spirit of Article 7 of the International Covenant on Economic, Social and Cultural Rights, 1966 which exhorts all States parties to ensure fair wages and equal wages for equal work. The petitioners are entitled to corresponding Dearness Allowance and Addl. Dearness Allowance, if any, payable thereon. Whatever other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them. It implies the existence of certain important obligations which the State has to discharge. The right to work, the right to free choice of employment, the right to just and favourable conditions of work, the right to protection against unemployment, the right of every one who works to just and favourable remuneration ensuring a decent living for himself and for family, the right of every one without discrimination of any kind to equal pay for equal work, the right to rest, leisure, reasonable limitation on working hours and periodic holidays with pay, the right to form trade unions. and the right to join trade unions of one 's choice and the right to security of work are some of the rights which have to be ensured by appropriate legislative and executive measures. It is true that all these rights cannot be extended simultaneously. The degree of achievement in this direction depends upon the economic resources, willingness of the people to produce and more than all the existence of industrial peace throughout the country. Of those rights the question of security of work is of utmost importance. If a person does not have the feeling that he belongs to an organization engaged in production he will not put forward his best effort to produce more. That sense of belonging arises only when he feels that he will not be turned out of employment the next day at the whim of the management. It is for this reason it is being repeatedly observed by those who are in charge of economic affairs of the countries in different parts of the world that as far as possible security of work should be assured to the employees so that they may contribute to the maximisation of production. It is again for this reason that managements and the Government agencies in particular should not allow 610 workers to remain as casual labourers or temporary employees for an unreasonably long period of time, where is any justification to keep persons as casual labourers for years as is being done in the Postal and Telegraphs Department? Then it amounts to exploitation of labour. Is it because you do not know that there is enough work for the workers? It cannot be so because there is so much of development to be carried out in the communications department that you need more workers. The employees belonging to skilled, semi skilled and unskilled classes can be shifted from one department to another even if there is no work to be done in a given place. Administrators should realise that if any worker remains idle on any day, the country loses the wealth that he would have produced during that day. Our wage structure is such that a worker is always paid less than what he produces. Anyway they have got to be fed and clothed. Therefore, why don 't we provide them with work? There are several types of work such as road making, railway construction, house building, irrigation projects, communications etc. which have to be undertaken on a large scale. Development in these types of activities (even though they do not involve much foreign exchange) is not keeping pace with the needs of society. We are saying all this only to make the people understand the need for better management of man power (which is a decaying asset) the non utilisation of which leads to the inevitable loss of valuable human resources. Let us remember the slogan: "Produce or Perish". We fail to produce more at our own peril. It is against this background that we say that non regularisation of temporary employees or casual labour for a long period is not a wise policy. We, therefore, direct the respondents to prepare a scheme on a rational basis for absorbing as far as possible the casual labourers who have been continuously working for more than one year in the Posts and Telegraphs Department. The arrears of wages payable to the casual labourers in accordance with this order shall be paid within four months from today. The respondents shall prepare a scheme for absorbing the casual labourers, as directed above, within eight months from today. These petitioners are accordingly disposed of.
|
% International Covenant on Economic, Social and Cultural Rights, 1966: Article 7 Casual labour Justifiable classification for payment of wages Necessity of Non regularisation of service Not wise policy Necessity for absorption as permanent workers.
The petitioners who were working as 'Daily Rated Casual Labour ' in the Posts and Telegraphs Department, were categorised as unskilled, semi skilled and skilled workers.
By the orders of the D.G., Post and Telegraphs Department No. 28 II/77 SR/STM dated 15.5.80 and 10 4/83 R dated 26.7.84 they were further classified into (i) those who had not completed 720 days of service; (ii) those who had comp leted 720 days and not completed 1200 days of service, and (iii) those who had completed more than 1200 days of service, and were granted different rates of wages as laid down therein.
Aggrieved by these orders, the petitioners submitted a statement of demands through their federation to the authorities, claiming regularisation, payment of interim relief and bonus, supply of dresses, leave and medical facilities etc.
Not satisfied with the reply received by them, the petitioners filed writ petitions, for the issue of a writ in the nature of mandamus to the Union of India and to direct it to pay them same salary, allowances, and other benefits as were being paid to regular and permanent employees of the Union of India in corresponding cadres and to regularise the 599 service of the casual labour who had been in continuous service for more than 6 months.
Their principal complaint was that even though many of them had been working for the last ten years as casual labourers, the wages paid to them were very low and far less than the salary and allowances paid to regular employees of the Posts and Telegraphs Department belonging to the equivalent categories and, secondly that no scheme had been prepared by the Union of India to absorb them regularly in its service and they had been denied the benefits of increments, pension, leave facilities etc.
which were enjoyed by those who had been recruited regularly.
The petitioners were opposed by the respondents contending that since the petitioners belonged to the category of casual labour and were not being regularly employed, they were not entitled to the same privileges which regular employees were enjoying.
Disposing of the writ petitions, ^ HELD: 1.1 The classification of employees in the present case into casual employees and regularly recruited employees for the purpose of paying less than the minimum pay payable to employees in the corresponding regular cadres particularly in the lowest rungs of the department, where the pay scales are the lowest is not tenable.
The further classification of casual labourers into three categories, namely, (i) those who have not completed 720 days of service; (ii) those who have completed 720 days of service and not completed 1200 days of service, and (iii) those who have completed more than 1200 days of service for the purpose of payment of different rates of wages is equally untenable.
There is clearly no justification for doing so.
Such a classification is violative of Articles 14 and 16 of the Constitution.
It is also opposed to the spirit of Article 7 of the International Covenant on Economic, Social and Cultural Rights, 1966 which exhorts all States, parties to the Covenant to ensure fair wages and equal wages for equal work.
[608E H] 1.2 The State cannot deny at least the minimum pay in the pay scales of regularly employed workmen even though the Government may not be compelled to extend all benefits enjoyed by regularly recruited employees.
Such denial amounts to exploitation of labour.
[608Dl 1.3 The Government should be a model employer.
It cannot take advantage of its dominant position, and compel any worker to work 600 even as a casual labourer on starving wages.
It may be that the casual labourer has agreed to work on such low wages.
That he has done, because he has no other choice.
It is poverty that has driven him to that state.
[608E Fl 1.4 It may be that the petitioners have not been regularly recruited, but many of them have been working continuously for more than a year in the Department, and some of them have been engaged as casual labourers for nearly ten years.
They are rendering the same kind of service which is being rendered by the regular employees doing the same type of work.
[608A B] 1.5 Even though the Directive Principle contained in Article 38(2) may not be enforceable as such by virtue of Article 37 of the Constitution of India, it may be relied upon to show that they have been subjected to hostile discrimination.
[608C ] Dhirendra Chamoli and Another vs State of U.P., [1986] 1 SCC V 637, relied on.
2.1 Non regularisation of temporary employees or casual labour for a long period is not a wise policy.
610E F] 2.2 India is a socialist republic.
It implies the existence of cer tain important obligations which the State has to discharge.
Many rights like right to work, equal pay for equal work, security of work, etc.
have to be ensured by appropriate legislation and executive measured.
[609D E] 2.3 If a person does not have the feeling that he belongs to an organisation engaged in production, he will not put forward his best effort to produce more.
That sense of belonging arises only when he feels that he will not be turned out of employment the next day at the whim of management.
Security of work should as far as possible be assured to the employees so that they may contribute to the maximisation of production.
Managements and the Governmental agencies in particular should not allow workers to remain as casual labourers or temporary employees for an unreasonably long period of time.
[609G H; 610A] 2.4 The employees belonging to skilled, semi skilled and unskilled classes can be shifted from one department to another even if there is no work to be done in a given place.
Administrators should realise even as a casual labourer on starving wages.
It may be that the casual labourer has agreed to work on such low wages.
That he has done, because he has no other choice.
It is poverty that has driven him to that state.
[608E F] 601 that if any worker remains idle on any day, the country loses the wealth that he would have produced during that day.
Our wage structure is such that a worker is always paid less than what he produces.
[610B C] 3.
The Union of India and the other respondents are directed to pay wages to the workmen who are employed as casual labourers at the rate equivalent to the minimum pay in the pay scales of the regularly employed workers in the corresponding cadres but without any increments with effect from 5th of February, 1986 and corresponding Dearness Allowance and Addl.
Dearness Allowances, if any, payable thereon.
Other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them.
The arrears of wages payable shall be paid within four months.
[609B C; 610G] The respondents are directed to prepare a scheme for absorbing as far as possible the casual labourers who have been continuously working for more than one year in the Posts and Telegraphs Departments 610 Fl
|
% International Covenant on Economic, Social and Cultural Rights, 1966: Article 7 Casual labour Justifiable classification for payment of wages Necessity of Non regularisation of service Not wise policy Necessity for absorption as permanent workers. By the orders of the D.G., Post and Telegraphs Department No. 28 II/77 SR/STM dated 15.5.80 and 10 4/83 R dated 26.7.84 they were further classified into (i) those who had not completed 720 days of service; (ii) those who had comp leted 720 days and not completed 1200 days of service, and (iii) those who had completed more than 1200 days of service, and were granted different rates of wages as laid down therein. Their principal complaint was that even though many of them had been working for the last ten years as casual labourers, the wages paid to them were very low and far less than the salary and allowances paid to regular employees of the Posts and Telegraphs Department belonging to the equivalent categories and, secondly that no scheme had been prepared by the Union of India to absorb them regularly in its service and they had been denied the benefits of increments, pension, leave facilities etc. which were enjoyed by those who had been recruited regularly. Disposing of the writ petitions, ^ HELD: 1.1 The classification of employees in the present case into casual employees and regularly recruited employees for the purpose of paying less than the minimum pay payable to employees in the corresponding regular cadres particularly in the lowest rungs of the department, where the pay scales are the lowest is not tenable. There is clearly no justification for doing so. Such a classification is violative of Articles 14 and 16 of the Constitution. Such denial amounts to exploitation of labour. [608Dl 1.3 The Government should be a model employer. It may be that the casual labourer has agreed to work on such low wages. That he has done, because he has no other choice. It is poverty that has driven him to that state. [608E Fl 1.4 It may be that the petitioners have not been regularly recruited, but many of them have been working continuously for more than a year in the Department, and some of them have been engaged as casual labourers for nearly ten years. [608A B] 1.5 Even though the Directive Principle contained in Article 38(2) may not be enforceable as such by virtue of Article 37 of the Constitution of India, it may be relied upon to show that they have been subjected to hostile discrimination. 2.1 Non regularisation of temporary employees or casual labour for a long period is not a wise policy. 610E F] 2.2 India is a socialist republic. It implies the existence of cer tain important obligations which the State has to discharge. Many rights like right to work, equal pay for equal work, security of work, etc. have to be ensured by appropriate legislation and executive measured. [609D E] 2.3 If a person does not have the feeling that he belongs to an organisation engaged in production, he will not put forward his best effort to produce more. Administrators should realise even as a casual labourer on starving wages. [608E F] 601 that if any worker remains idle on any day, the country loses the wealth that he would have produced during that day. Our wage structure is such that a worker is always paid less than what he produces. Dearness Allowances, if any, payable thereon. Other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them. The arrears of wages payable shall be paid within four months.
| 0.805904
| 0.906556
| 0.349928
| 0.665952
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Civil Appeal No. 1018 of 1987.
From the Judgment and order dated 3.1.1985 of the Rajasthan 682 High Court in D.B. Civil Special Appeal No. 20 of 1975.
Badri Das Sharma and B.N. Purohit for the Appellants.
Avadh Behari Rohtagi, S.N. Kumar and N.N. Sharma for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY,J.
In the town of Bikaner there is a Math known as 'Juna Math '.
The first appellant is the present Mahant of the Math.
The second appellant is the presiding deity of the Math.
For convenience and brevity we will refer to them collectively as 'the Math ' The primary question raised in this appeal, by special leave, relates to maintainability of the cross objection filed by the Math before the Division Bench of the High Court of Rajasthan (Jodhpur V Bench) in Civil Appeal No. 20 of 1975.
The Division Bench has dismissed the cross objection as not maintainable.
The background facts are these: One Lalgiri Maharaj was a previous Mahant of the Math.
He had several vices.
He mismanaged the Math and recklessly disposed of its properties.
On August 19, 1963 Lalgiri gave on lease the land measuring 2211 Sq. yards in favour of Madan Mohan.
The lease was for 99 years with monthly rent of Rs. 30.
Again on March 22, 1968 Lalgiri sold 446 sq.
yards of land to Madan Mohan.
It was out of the land which was already leased to Madan Mohan.
The sale was for Rs.4,000 Madan Mohan constructed some shops on a portion of the land purchased.
He first, rented the shops to Jankidas and Mohan Lal and later sold the same to them for Rs. 15,000.
Madan Mohan is the first respondent, Jankidas and Mohanlal are respondents 2 and 3 before us.
There was yet another transaction between the same parties.
On April 8, 1969 Madan Mohan sold a piece of land measuring 124 sq.
yards to respondents 2 and 3 for Rs. 1,500.
This piece of land forms part of the land which Madan Mohan purchased from Lalgiri.
In the meantime, there was change of guard in the Math.
Lalgiri was said to have abdicated Mahantship in favour of the first appellant.
683 The Math thereafter filed Suit No. 28 of 1971 challenging the alienations made by Lalgiri.
The suit was for declaration that the alienations were without authority and not binding on the Math.
It was also for possession of the property from respondents 1 to 3.
The trial court decreed the suit in part.
The trial court gave only a declaration that the lease deed dated August 19, 1963 was null and void.
But the relief for possession of the land demised was rejected.
The suit for recovery of possession of the land sold by Lalgiri was also dismissed.
Against the judgment and decree of the trial court, there were two appeals, before the High Court, one by the Math and another by Madan Mohan.
Both the appeals came for disposal before the learned single judge.
By a common judgment dated July 14, 1975 learned judge allowed the appeal of the Math in part.
He gave a simple declaration that the sale was void.
He, however, did not give a decree for possession of the land sold.
The learned judge also allowed the appeal of Madan Mohan.
There he gave him complete relief He held that the suit as to the lease was barred by time.
The result was that the Math could not get back even an inch of land.
D Against the judgment of learned single judge there was no appeal from the Math or Madan Mohan.
There was only one appeal by respondents 2 and 3 being the Appeal No 20 of 1975.
Madan Mohan was impleaded as the third respondent in that appeal.
The Math was impleaded as the first respondent.
The Math preferred cross objection.
Madan Mohan did not do anything.
He was perhaps completely satisfied with the judgment of learned single judge.
The Division Bench by judgment dated January 3, 1985 dismissed the appeal on the merits.
The Division Bench also dismissed the cross objection but on the ground of maintainability.
The correctness of the dismissal of the cross objection has been called into question in this appeal.
F The High Court gave two reasons for rejecting the cross objection.
The first reason relates to the absence of appeal from Madan Mohan or by the Math against the judgment of learned single Judge.
The High Court observed: "Thus the lease is good.
If Madan Mohan had filed an appeal, then the cross objection would be competent.
The cross objection filed by the plaintiffs are not competent, wherein it has been prayed that the lease deed may be declared invalid and ineffective against the rights of the plaintiffs.
" The second reason given by the High Court relates to 0.41 R. 33 CPC for giving relief to the Math.
The High Court said: "That having regard to the facts of the case 0.41 R. 33 CPC cannot be called into aid.
That provision H 684 should be applied with care and caution.
The Court should not lose sight of the other provisions in the Code of Civil Procedure.
It should not also forget the law limitation and the Court Fees Act.
" Before us, Mr. B.D. Sharma, learned counsel for the appellant pursued both the reasons given by the High Court.
Counsel asserted that the cross objection was maintainable not only against the appellants but also against Madan Mohan.
The counsel also urged that in any event, the cross objection ought to have been considered if not under 0.41 R. 22 but under 0.41 R. 33 of the CPC.
Mr. Rohtagi, learned counsel for the respondents, advanced an interesting submission.
He urged that the land sold was a part of the land already leased to Madan Mohan.
Even if the sale goes as invalid, the lease of the entire land revives and remains So long as the lease remains binding between the parties, Madan Mohan would be entitled to retain possession of the entire land demised.
The counsel urged that it would be, therefore, futile for the Math to seek possession of the property from the appellants in the cross objection.
The assumption of Mr. Rohtagi though logical if not legal should be subject to the decision in the cross objection.
We must, therefore, examine the validity of the cross objection and the contentions raised therein.
It will be seen that the cross objection filed by the Math was to the entire judgment of learned single judge.
Therein, the Math raised two principal grounds.
The first related to the denial of decree for possession of property which was the subject matter of sale.
It was contended that the Math would be entitled to possession of that property when the sale was declared as null and void.
The second ground was in regard to validity of the lease and the dismissal of the suit in respect thereof.
It was contended that the suit in regard to the lease was not barred by limitation.
Different considerations, however, apply to the different points raised in the cross objection.
We will first consider the right of the Math to file cross objection against the appellants.
The learned single judge has invalidated the sale of property to Madan Mohan while denying a decree for possession.
The appellants before the Division Bench wanted to get rid of the finding as to invalidity of the sale.
The Math in turn, wanted to recover possession of that property from the appellants and Madan Mohan.
The Math instead of filing an appeal for that relief could as well take the cross objection.
That would be clear from the provisions of R. 22 of O. 41 CPC.
That is as plain as plain can be.
The High Court was clearly in error in holding to the contrary.
685 The next question for consideration is whether the cross objection was maintainable against Madan Mohan, the co respondent, and if not, whether the Court could call into aid 0 41 R. 33 CPC.
For appreciating the contention it will be useful to set out hereunder R. 22 and R. 33 of order 41: "R. 22 Upon hearing, respondent may object to decree as if he had preferred separate appeal.
(1) Any respondent, though he may not have appealed from any part of the decree, may not only support the decree (but may also state that the finding against him in the Court below in respect of any issue ought to have been in his favour, and may also take any cross objection) to the decree which he could have taken by way of appeal, provided he has filed such objection in the Appellate Court within one month from the date of service on him or his pleader of notice of the day fixed for hearing the appeal, or within such further time as the Appellate Court may see fit to allow.
XXX XXX XXX XXX XXX R. 33 Power of Court of Appeal.
The Appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further other decree or order as the case may require, and this order may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties may not have filed any appeal or objection and may, where there have been decrees in cross suits or where two or more decrees are passed in one suit, be exercised in respect of all or any of the decrees, although an appeal may not have been filed against such decree.
xxx xxx xxx xxx xxx xxx Generally, the cross objection could be urged against the appellant.
It is only by way of exception to this general rule that one respondent may urge objection as against the other respondent.
The type of H 686 such exceptional cases are also very much limited.
We may just think of one or two such cases.
For instance, when the appeal by some of the parties cannot effectively be disposed of without opening of the matter as between the respondents interse.
Or in a case where the objections are common as against the appellant and co respondent.
The Court in such cases would entertain cross objection against the co respondent.
The law in this regard has been laid down by this Court as far back in 1964 in Panna Lal vs State of Bombay, ; at 991.
After reviewing all the decisions of different High Courts, there this Court observed .
"In our opinion, the view that has now been accepted by all the High Courts that order 41, r. 22 permits as a general rule, a respondent to prefer an objection directed only against the appellant and it is only in exceptional cases, such as where the relief sought against the appellant in such an objection is intermixed with the relief granted to the other respondents, so that the relief against the appellant cannot be granted without the question being re opened between the objecting respondent and other respondents, that an objection under 0.41 R. 22 can be directed against the other respondents, is correct.
Whatever may have been the position under the old S 561 the use of the word "cross objection" in 0.41 R. 22 expresses unmistakably the intention of the legislature that the objection has to be directed against the appellant.
As Rajamannar C.J said in Venkataswaralu vs Ramanna: "The legislature by describing the objection which could be taken by the respondent as a "cross objection" must have deliberately adopted the view of the other High Courts.
One cannot treat an objection by a respondent in which the appellant has no interest as a cross objection.
The appeal is by the appellant against a respondent, the cross objection must be an objection by a respondent against the appellant.
" We think, with respect, that these observations put the matter clearly and correctly.
That the legislature also wanted to give effect to the views held by the different High Courts that in exceptional cases as mentioned above an objection can be preferred by a respondent against a co respondent is indicated by the substitution of the word "appellant" in the third paragraph by the words "the party who may be affected by such objection. " 687 This view has been there as a guide for a little over two decades.
We should not add anything further at this stage.
The law should be A clear and certain as a guide to human behaviour.
No attempt should be made to unsettle the law unless there is compelling reason.
We do not find any such compelling reason and we, therefore, reiterate the above principles.
Basically, the first question raised in the cross objection relates to the right of Madan Mohan to retain the property under the sale deed.
The appellants are the second purchasers.
The Math, therefore, could urge the objection that the appellants and Madan Mohan have no right to retain the property after the sale deed was declared null and void.
But then the considerations as to the lease deed is quite different.
The validity of the lease deed and the possession of the land thereof has to be determined only against Madan Mohan.
It is not intermixed with the right of the appellants.
It has no relevance to the question raised in the appeal.
The High Court was, therefore, right in holding that the cross objection as to the lease was not maintainable against Madan Mohan.
D But that does not mean, that the Math should be left without remedy against the judgment of learned single judge.
If the cross objection filed under R. 22 of 0.41 CPC was not maintainable against the co respondent, the Court could consider it under R. 33 of 0.41 CPC.
R. 22 and R. 33 are not mutually exclusive They are closely related with each other.
If objection cannot be urged under R. 22 against co respondent, R. 33 could take over and come to the rescue of the objector.
The appellate court could exercise the power under R. 33 even if the appeal is only against a part of the decree of the lower court.
The appellate court could exercise that power in favour of all or any of the respondents although such respondent may not have filed any appeal or objection.
The sweep of the power under R. 33 is wide enough to determine any question not only between the appellant and respondent, but also between respondent and co respondents.
The appellate court could pass any decree or order which ought to have been passed in the circumstances of the case.
The appellate court could also pass such other decree or order as the case may require.
The words "as the case may require" used in R. 33 of O. 41 have been put in wide terms to enable the appellate court to pass any order or decree to meet the ends of justice.
What then should be the constraint? We do not find many.
We are not giving any liberal interpretation.
The rule itself is liberal enough.
The only constraint that we could see, may be these: That the parties before the lower court should be therebefore 688 the appellate court.
The question raised must properly arise out of the judgment of the lower court.
If these two requirements are there, the appellate Court could consider any objection against any part of the judgment or decree of the lower court.
It may be urged by any party to the appeal.
It is true that the power of the appellate court under R. 33 is discretionary.
But it is a proper exercise of judicial discretion to determine all questions urged in order to render complete justice between the parties.
The Court should not refuse to exercise that discretion on mere technicalities.
In the result, we allow the appeal and reverse the judgment and decree of Division Bench of the High Court.
The Division Bench shall now restore the appeal and cross objection of the parties and dispose of the same in accordance with law and in the light of observations made The appellants shall get the cost of this appeal.
S.L. Appeal allowed.
|
% There is a Math known as Juna Math in Bikaner.
The first appellant is the present Mahant of the Math and the second appellant is the presiding deity of the Math, both referred to collectively as 'the Math ', herein.
Previously, one Lalgiri Maharaj was the Mahant of the Math.
He mismanaged the Math and disposed of its properties.
On August 19, 1963, he gave on lease for 99 years land measuring 2211 sq.
yards in favour of Madan Mohan, the respondent No. 1.
On March 22, 1968, he sold to Madan Mohan 446 sq.
yards of land out of the land leased to him.
Madan Mohan constructed shops on the land purchased and sold them to Jankidas and Mohan Lal, who are respondents Nos. 2 and 3.
Then Madan Mohan sold another piece of land purchased from Lalgiri to the respondents Nos. 2 and 3.
Later, the first appellant became the Mahant of the Math, and the Math filed a suit, challenging the alienations made by Lalgiri, and for a declaration that the said alienations were without authority and not binding on the Math and for possession of the property from the respondents 1 to 3.
The trial Court decreed the suit in part only, as it gave a declaration that the lease deed dated August 19, 1963, was null and void, but the relief regarding possession of the land demised was rejected.
The suit for recovery of possession of the land sold by Lalgiri was also dismissed.
Against the judgment of the Trial Court, two appeals one by the Math and the other, by Madan Mohan were filed before the High Court.
By a common judgment in the two appeals, a single Judge of the High Court (i) allowed the appeal of the Math in part, giving a simple declaration that the sale of the land was void, but declining to pass a decree for possession of the land sold, and (ii) allowed the appeal of 680 Madan Mohan, giving him complete relief, while holding that the suit as to the lease was barred by time.
Against the judgment of the Single Judge, no appeal was filed either by the Math or by Madan Mohan.
There was only an appeal filed by respondents 2 and 3, who impleaded the Math as the first respondent and Madan Mohan, as the third respondent.
The Math Preferred cross objection.
Madan Mohan did not do any thing.
The Division Bench of High Court dismissed the appeal on the merits.
It also dismissed the cross objection on the ground of maintainability.
Aggrieved by the dismissal of the cross objection, the Math appealed to this Court for relief by special leave.
Allowing the appeal, the Court, ^ HELD: The Single Judge invalidated the sale of the property to Madan Mohan, while denying a decree for possession.
The appellants before the Division Bench wanted to get rid of the finding as to the invalidity of the sale.
The Math wanted to recover possession of the property from the appellants before the Division Bench, and Madan Mohan.
The Math instead of filing an appeal for that relief, could as well file the cross objection.
That is clear from the provisions of R. 22 of 0.41, C.P.C.
The High Court was clearly in error in holding to the contrary.
[684G H] The next question for consideration was whether the cross objection was maintainable against Madan Mohan, a co respondent, and if not, whether the Court could call into aid R. 33, 0.41 C.P.C. Generally, the cross objection could be urged against the appellant.
It is only by way of exception to this general rule that one respondent may urge objection as against the other respondent.
The type of such exceptional cases are very much limited when an appeal cannot be effectively disposed of without opening the matter as between the respondents inter se, or when there is a case where the objections are common as against the appellants and the co respondent.
This law has been laid down by this Court in Panna Lal vs State of Bombay, ; at 991.
This view has been accepted as a guide for more than two decades.
No attempt should be made to unsettle the law unless there is a compelling reason.
The Court does not find any such compellmg reason in the case.
[685A, H; 686A B; 687A B] The Math could urge the objection that the appellants before the Division Bench and Madan Mohan had no right to retain the property 681 after the sale deed had been declared null and void.
The validity of the lease deed and the possession of the land in pursuance thereof, has to be determined only against Madan Mohan.
It is not intermixed with the right of the appellants above said.
It has no relevance to the question raised in the appeal.
The High Court was right in holding that the cross objection as to the lease was not maintainable against Madan Mohan.
But that does not mean that the Math should be left without a remedy against the judgment of the Single Judge.
If the cross objection filed under R. 22 of 0.41, C.P.C. was not maintainable against the co respondent, the Court could consider it under R. 33, 0.41, C.P.C. R. 22 and R. 33 are not mutually exclusive.
They are closely related with each other.
If objection cannot be urged under R. 22 against corespondent, R. 33 could take over and help the objector.
The appellate Court could exercise that power in favour of all or any of the respondents even though such a respondent may not have filed any appeal or objection.
The sweep of the power under R. 33 is wide enough to determine any question not only between the appellant and the respondent but also between a respondent and co respondents.
The appellate Court could pass any decree or order which ought to have been passed in the circumstances of the case.
The appellate Court could also pass such other decree or order as the case may require.
The words "as the case may require" used in R. 33 of 0.41, have been put in wide terms to enable the appellate Court to pass any order or decree to meet the ends of justice.
This Court is not giving any liberal interpretation.
The rule itself is liberal enough.
The only constraint that could be seen, may be: that the parties before the lower Court should be there before the appellate Court, the question raised must properly arise out of the judgment of the lower Court; it may be urged by any party to the appeal.
It is true that the power of the appellate Court under R. 33 is discretionary, but it is a proper exercise of judicial discretion to determine all the questions urged in order to render complete justice between the parties.
The Court should not refuse to exercise that discretion on mere technicalities.
[687B H; 688A B] Appeal allowed.
The judgment and decree of the Division Bench of the High Court reversed.
The Division Bench to restore the appeal and cross objection of the parties and dispose of the same in accordance with law and in the light of the observations made.
[688C]
|
Civil Appeal No. 1018 of 1987.
From the Judgment and order dated 3.1.1985 of the Rajasthan 682 High Court in D.B. Civil Special Appeal No. 20 of 1975.
Badri Das Sharma and B.N. Purohit for the Appellants.
Avadh Behari Rohtagi, S.N. Kumar and N.N. Sharma for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY,J.
In the town of Bikaner there is a Math known as 'Juna Math '.
The first appellant is the present Mahant of the Math.
The second appellant is the presiding deity of the Math.
For convenience and brevity we will refer to them collectively as 'the Math ' The primary question raised in this appeal, by special leave, relates to maintainability of the cross objection filed by the Math before the Division Bench of the High Court of Rajasthan (Jodhpur V Bench) in Civil Appeal No. 20 of 1975.
The Division Bench has dismissed the cross objection as not maintainable.
The background facts are these: One Lalgiri Maharaj was a previous Mahant of the Math.
He had several vices.
He mismanaged the Math and recklessly disposed of its properties.
On August 19, 1963 Lalgiri gave on lease the land measuring 2211 Sq. yards in favour of Madan Mohan.
The lease was for 99 years with monthly rent of Rs. 30.
Again on March 22, 1968 Lalgiri sold 446 sq.
yards of land to Madan Mohan.
It was out of the land which was already leased to Madan Mohan.
The sale was for Rs.4,000 Madan Mohan constructed some shops on a portion of the land purchased.
He first, rented the shops to Jankidas and Mohan Lal and later sold the same to them for Rs. 15,000.
Madan Mohan is the first respondent, Jankidas and Mohanlal are respondents 2 and 3 before us.
There was yet another transaction between the same parties.
On April 8, 1969 Madan Mohan sold a piece of land measuring 124 sq.
yards to respondents 2 and 3 for Rs. 1,500.
This piece of land forms part of the land which Madan Mohan purchased from Lalgiri.
In the meantime, there was change of guard in the Math.
Lalgiri was said to have abdicated Mahantship in favour of the first appellant.
683 The Math thereafter filed Suit No. 28 of 1971 challenging the alienations made by Lalgiri.
The suit was for declaration that the alienations were without authority and not binding on the Math.
It was also for possession of the property from respondents 1 to 3.
The trial court decreed the suit in part.
The trial court gave only a declaration that the lease deed dated August 19, 1963 was null and void.
But the relief for possession of the land demised was rejected.
The suit for recovery of possession of the land sold by Lalgiri was also dismissed.
Against the judgment and decree of the trial court, there were two appeals, before the High Court, one by the Math and another by Madan Mohan.
Both the appeals came for disposal before the learned single judge.
By a common judgment dated July 14, 1975 learned judge allowed the appeal of the Math in part.
He gave a simple declaration that the sale was void.
He, however, did not give a decree for possession of the land sold.
The learned judge also allowed the appeal of Madan Mohan.
There he gave him complete relief He held that the suit as to the lease was barred by time.
The result was that the Math could not get back even an inch of land.
D Against the judgment of learned single judge there was no appeal from the Math or Madan Mohan.
There was only one appeal by respondents 2 and 3 being the Appeal No 20 of 1975.
Madan Mohan was impleaded as the third respondent in that appeal.
The Math was impleaded as the first respondent.
The Math preferred cross objection.
Madan Mohan did not do anything.
He was perhaps completely satisfied with the judgment of learned single judge.
The Division Bench by judgment dated January 3, 1985 dismissed the appeal on the merits.
The Division Bench also dismissed the cross objection but on the ground of maintainability.
The correctness of the dismissal of the cross objection has been called into question in this appeal.
F The High Court gave two reasons for rejecting the cross objection.
The first reason relates to the absence of appeal from Madan Mohan or by the Math against the judgment of learned single Judge.
The High Court observed: "Thus the lease is good.
If Madan Mohan had filed an appeal, then the cross objection would be competent.
The cross objection filed by the plaintiffs are not competent, wherein it has been prayed that the lease deed may be declared invalid and ineffective against the rights of the plaintiffs.
" The second reason given by the High Court relates to 0.41 R. 33 CPC for giving relief to the Math.
The High Court said: "That having regard to the facts of the case 0.41 R. 33 CPC cannot be called into aid.
That provision H 684 should be applied with care and caution.
The Court should not lose sight of the other provisions in the Code of Civil Procedure.
It should not also forget the law limitation and the Court Fees Act.
" Before us, Mr. B.D. Sharma, learned counsel for the appellant pursued both the reasons given by the High Court.
Counsel asserted that the cross objection was maintainable not only against the appellants but also against Madan Mohan.
The counsel also urged that in any event, the cross objection ought to have been considered if not under 0.41 R. 22 but under 0.41 R. 33 of the CPC.
Mr. Rohtagi, learned counsel for the respondents, advanced an interesting submission.
He urged that the land sold was a part of the land already leased to Madan Mohan.
Even if the sale goes as invalid, the lease of the entire land revives and remains So long as the lease remains binding between the parties, Madan Mohan would be entitled to retain possession of the entire land demised.
The counsel urged that it would be, therefore, futile for the Math to seek possession of the property from the appellants in the cross objection.
The assumption of Mr. Rohtagi though logical if not legal should be subject to the decision in the cross objection.
We must, therefore, examine the validity of the cross objection and the contentions raised therein.
It will be seen that the cross objection filed by the Math was to the entire judgment of learned single judge.
Therein, the Math raised two principal grounds.
The first related to the denial of decree for possession of property which was the subject matter of sale.
It was contended that the Math would be entitled to possession of that property when the sale was declared as null and void.
The second ground was in regard to validity of the lease and the dismissal of the suit in respect thereof.
It was contended that the suit in regard to the lease was not barred by limitation.
Different considerations, however, apply to the different points raised in the cross objection.
We will first consider the right of the Math to file cross objection against the appellants.
The learned single judge has invalidated the sale of property to Madan Mohan while denying a decree for possession.
The appellants before the Division Bench wanted to get rid of the finding as to invalidity of the sale.
The Math in turn, wanted to recover possession of that property from the appellants and Madan Mohan.
The Math instead of filing an appeal for that relief could as well take the cross objection.
That would be clear from the provisions of R. 22 of O. 41 CPC.
That is as plain as plain can be.
The High Court was clearly in error in holding to the contrary.
685 The next question for consideration is whether the cross objection was maintainable against Madan Mohan, the co respondent, and if not, whether the Court could call into aid 0 41 R. 33 CPC.
For appreciating the contention it will be useful to set out hereunder R. 22 and R. 33 of order 41: "R. 22 Upon hearing, respondent may object to decree as if he had preferred separate appeal.
(1) Any respondent, though he may not have appealed from any part of the decree, may not only support the decree (but may also state that the finding against him in the Court below in respect of any issue ought to have been in his favour, and may also take any cross objection) to the decree which he could have taken by way of appeal, provided he has filed such objection in the Appellate Court within one month from the date of service on him or his pleader of notice of the day fixed for hearing the appeal, or within such further time as the Appellate Court may see fit to allow.
XXX XXX XXX XXX XXX R. 33 Power of Court of Appeal.
The Appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further other decree or order as the case may require, and this order may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties may not have filed any appeal or objection and may, where there have been decrees in cross suits or where two or more decrees are passed in one suit, be exercised in respect of all or any of the decrees, although an appeal may not have been filed against such decree.
xxx xxx xxx xxx xxx xxx Generally, the cross objection could be urged against the appellant.
It is only by way of exception to this general rule that one respondent may urge objection as against the other respondent.
The type of H 686 such exceptional cases are also very much limited.
We may just think of one or two such cases.
For instance, when the appeal by some of the parties cannot effectively be disposed of without opening of the matter as between the respondents interse.
Or in a case where the objections are common as against the appellant and co respondent.
The Court in such cases would entertain cross objection against the co respondent.
The law in this regard has been laid down by this Court as far back in 1964 in Panna Lal vs State of Bombay, ; at 991.
After reviewing all the decisions of different High Courts, there this Court observed .
"In our opinion, the view that has now been accepted by all the High Courts that order 41, r. 22 permits as a general rule, a respondent to prefer an objection directed only against the appellant and it is only in exceptional cases, such as where the relief sought against the appellant in such an objection is intermixed with the relief granted to the other respondents, so that the relief against the appellant cannot be granted without the question being re opened between the objecting respondent and other respondents, that an objection under 0.41 R. 22 can be directed against the other respondents, is correct.
Whatever may have been the position under the old S 561 the use of the word "cross objection" in 0.41 R. 22 expresses unmistakably the intention of the legislature that the objection has to be directed against the appellant.
As Rajamannar C.J said in Venkataswaralu vs Ramanna: "The legislature by describing the objection which could be taken by the respondent as a "cross objection" must have deliberately adopted the view of the other High Courts.
One cannot treat an objection by a respondent in which the appellant has no interest as a cross objection.
The appeal is by the appellant against a respondent, the cross objection must be an objection by a respondent against the appellant.
" We think, with respect, that these observations put the matter clearly and correctly.
That the legislature also wanted to give effect to the views held by the different High Courts that in exceptional cases as mentioned above an objection can be preferred by a respondent against a co respondent is indicated by the substitution of the word "appellant" in the third paragraph by the words "the party who may be affected by such objection. " 687 This view has been there as a guide for a little over two decades.
We should not add anything further at this stage.
The law should be A clear and certain as a guide to human behaviour.
No attempt should be made to unsettle the law unless there is compelling reason.
We do not find any such compelling reason and we, therefore, reiterate the above principles.
Basically, the first question raised in the cross objection relates to the right of Madan Mohan to retain the property under the sale deed.
The appellants are the second purchasers.
The Math, therefore, could urge the objection that the appellants and Madan Mohan have no right to retain the property after the sale deed was declared null and void.
But then the considerations as to the lease deed is quite different.
The validity of the lease deed and the possession of the land thereof has to be determined only against Madan Mohan.
It is not intermixed with the right of the appellants.
It has no relevance to the question raised in the appeal.
The High Court was, therefore, right in holding that the cross objection as to the lease was not maintainable against Madan Mohan.
D But that does not mean, that the Math should be left without remedy against the judgment of learned single judge.
If the cross objection filed under R. 22 of 0.41 CPC was not maintainable against the co respondent, the Court could consider it under R. 33 of 0.41 CPC.
R. 22 and R. 33 are not mutually exclusive They are closely related with each other.
If objection cannot be urged under R. 22 against co respondent, R. 33 could take over and come to the rescue of the objector.
The appellate court could exercise the power under R. 33 even if the appeal is only against a part of the decree of the lower court.
The appellate court could exercise that power in favour of all or any of the respondents although such respondent may not have filed any appeal or objection.
The sweep of the power under R. 33 is wide enough to determine any question not only between the appellant and respondent, but also between respondent and co respondents.
The appellate court could pass any decree or order which ought to have been passed in the circumstances of the case.
The appellate court could also pass such other decree or order as the case may require.
The words "as the case may require" used in R. 33 of O. 41 have been put in wide terms to enable the appellate court to pass any order or decree to meet the ends of justice.
What then should be the constraint? We do not find many.
We are not giving any liberal interpretation.
The rule itself is liberal enough.
The only constraint that we could see, may be these: That the parties before the lower court should be therebefore 688 the appellate court.
The question raised must properly arise out of the judgment of the lower court.
If these two requirements are there, the appellate Court could consider any objection against any part of the judgment or decree of the lower court.
It may be urged by any party to the appeal.
It is true that the power of the appellate court under R. 33 is discretionary.
But it is a proper exercise of judicial discretion to determine all questions urged in order to render complete justice between the parties.
The Court should not refuse to exercise that discretion on mere technicalities.
In the result, we allow the appeal and reverse the judgment and decree of Division Bench of the High Court.
The Division Bench shall now restore the appeal and cross objection of the parties and dispose of the same in accordance with law and in the light of observations made The appellants shall get the cost of this appeal.
S.L. Appeal allowed.
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Civil Appeal No. 1018 of 1987.
From the Judgment and order dated 3.1.1985 of the Rajasthan 682 High Court in D.B. Civil Special Appeal No. 20 of 1975.
Badri Das Sharma and B.N. Purohit for the Appellants.
Avadh Behari Rohtagi, S.N. Kumar and N.N. Sharma for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY,J.
In the town of Bikaner there is a Math known as 'Juna Math '.
The first appellant is the present Mahant of the Math.
The second appellant is the presiding deity of the Math.
For convenience and brevity we will refer to them collectively as 'the Math ' The primary question raised in this appeal, by special leave, relates to maintainability of the cross objection filed by the Math before the Division Bench of the High Court of Rajasthan (Jodhpur V Bench) in Civil Appeal No. 20 of 1975.
The Division Bench has dismissed the cross objection as not maintainable.
The background facts are these: One Lalgiri Maharaj was a previous Mahant of the Math.
He had several vices.
He mismanaged the Math and recklessly disposed of its properties.
On August 19, 1963 Lalgiri gave on lease the land measuring 2211 Sq. yards in favour of Madan Mohan.
The lease was for 99 years with monthly rent of Rs. 30.
Again on March 22, 1968 Lalgiri sold 446 sq.
yards of land to Madan Mohan.
It was out of the land which was already leased to Madan Mohan.
The sale was for Rs.4,000 Madan Mohan constructed some shops on a portion of the land purchased.
He first, rented the shops to Jankidas and Mohan Lal and later sold the same to them for Rs. 15,000.
Madan Mohan is the first respondent, Jankidas and Mohanlal are respondents 2 and 3 before us.
There was yet another transaction between the same parties.
On April 8, 1969 Madan Mohan sold a piece of land measuring 124 sq.
yards to respondents 2 and 3 for Rs. 1,500.
This piece of land forms part of the land which Madan Mohan purchased from Lalgiri.
In the meantime, there was change of guard in the Math.
Lalgiri was said to have abdicated Mahantship in favour of the first appellant.
683 The Math thereafter filed Suit No. 28 of 1971 challenging the alienations made by Lalgiri.
The suit was for declaration that the alienations were without authority and not binding on the Math.
It was also for possession of the property from respondents 1 to 3.
The trial court decreed the suit in part.
The trial court gave only a declaration that the lease deed dated August 19, 1963 was null and void.
But the relief for possession of the land demised was rejected.
The suit for recovery of possession of the land sold by Lalgiri was also dismissed.
Against the judgment and decree of the trial court, there were two appeals, before the High Court, one by the Math and another by Madan Mohan.
Both the appeals came for disposal before the learned single judge.
By a common judgment dated July 14, 1975 learned judge allowed the appeal of the Math in part.
He gave a simple declaration that the sale was void.
He, however, did not give a decree for possession of the land sold.
The learned judge also allowed the appeal of Madan Mohan.
There he gave him complete relief He held that the suit as to the lease was barred by time.
The result was that the Math could not get back even an inch of land.
D Against the judgment of learned single judge there was no appeal from the Math or Madan Mohan.
There was only one appeal by respondents 2 and 3 being the Appeal No 20 of 1975.
Madan Mohan was impleaded as the third respondent in that appeal.
The Math was impleaded as the first respondent.
The Math preferred cross objection.
Madan Mohan did not do anything.
He was perhaps completely satisfied with the judgment of learned single judge.
The Division Bench by judgment dated January 3, 1985 dismissed the appeal on the merits.
The Division Bench also dismissed the cross objection but on the ground of maintainability.
The correctness of the dismissal of the cross objection has been called into question in this appeal.
F The High Court gave two reasons for rejecting the cross objection.
The first reason relates to the absence of appeal from Madan Mohan or by the Math against the judgment of learned single Judge.
The High Court observed: "Thus the lease is good.
If Madan Mohan had filed an appeal, then the cross objection would be competent.
The cross objection filed by the plaintiffs are not competent, wherein it has been prayed that the lease deed may be declared invalid and ineffective against the rights of the plaintiffs.
" The second reason given by the High Court relates to 0.41 R. 33 CPC for giving relief to the Math.
The High Court said: "That having regard to the facts of the case 0.41 R. 33 CPC cannot be called into aid.
That provision H 684 should be applied with care and caution.
The Court should not lose sight of the other provisions in the Code of Civil Procedure.
It should not also forget the law limitation and the Court Fees Act.
" Before us, Mr. B.D. Sharma, learned counsel for the appellant pursued both the reasons given by the High Court.
Counsel asserted that the cross objection was maintainable not only against the appellants but also against Madan Mohan.
The counsel also urged that in any event, the cross objection ought to have been considered if not under 0.41 R. 22 but under 0.41 R. 33 of the CPC.
Mr. Rohtagi, learned counsel for the respondents, advanced an interesting submission.
He urged that the land sold was a part of the land already leased to Madan Mohan.
Even if the sale goes as invalid, the lease of the entire land revives and remains So long as the lease remains binding between the parties, Madan Mohan would be entitled to retain possession of the entire land demised.
The counsel urged that it would be, therefore, futile for the Math to seek possession of the property from the appellants in the cross objection.
The assumption of Mr. Rohtagi though logical if not legal should be subject to the decision in the cross objection.
We must, therefore, examine the validity of the cross objection and the contentions raised therein.
It will be seen that the cross objection filed by the Math was to the entire judgment of learned single judge.
Therein, the Math raised two principal grounds.
The first related to the denial of decree for possession of property which was the subject matter of sale.
It was contended that the Math would be entitled to possession of that property when the sale was declared as null and void.
The second ground was in regard to validity of the lease and the dismissal of the suit in respect thereof.
It was contended that the suit in regard to the lease was not barred by limitation.
Different considerations, however, apply to the different points raised in the cross objection.
We will first consider the right of the Math to file cross objection against the appellants.
The learned single judge has invalidated the sale of property to Madan Mohan while denying a decree for possession.
The appellants before the Division Bench wanted to get rid of the finding as to invalidity of the sale.
The Math in turn, wanted to recover possession of that property from the appellants and Madan Mohan.
The Math instead of filing an appeal for that relief could as well take the cross objection.
That would be clear from the provisions of R. 22 of O. 41 CPC.
That is as plain as plain can be.
The High Court was clearly in error in holding to the contrary.
685 The next question for consideration is whether the cross objection was maintainable against Madan Mohan, the co respondent, and if not, whether the Court could call into aid 0 41 R. 33 CPC.
For appreciating the contention it will be useful to set out hereunder R. 22 and R. 33 of order 41: "R. 22 Upon hearing, respondent may object to decree as if he had preferred separate appeal.
(1) Any respondent, though he may not have appealed from any part of the decree, may not only support the decree (but may also state that the finding against him in the Court below in respect of any issue ought to have been in his favour, and may also take any cross objection) to the decree which he could have taken by way of appeal, provided he has filed such objection in the Appellate Court within one month from the date of service on him or his pleader of notice of the day fixed for hearing the appeal, or within such further time as the Appellate Court may see fit to allow.
XXX XXX XXX XXX XXX R. 33 Power of Court of Appeal.
The Appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further other decree or order as the case may require, and this order may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties may not have filed any appeal or objection and may, where there have been decrees in cross suits or where two or more decrees are passed in one suit, be exercised in respect of all or any of the decrees, although an appeal may not have been filed against such decree.
xxx xxx xxx xxx xxx xxx Generally, the cross objection could be urged against the appellant.
It is only by way of exception to this general rule that one respondent may urge objection as against the other respondent.
The type of H 686 such exceptional cases are also very much limited.
We may just think of one or two such cases.
For instance, when the appeal by some of the parties cannot effectively be disposed of without opening of the matter as between the respondents interse.
Or in a case where the objections are common as against the appellant and co respondent.
The Court in such cases would entertain cross objection against the co respondent.
The law in this regard has been laid down by this Court as far back in 1964 in Panna Lal vs State of Bombay, ; at 991.
After reviewing all the decisions of different High Courts, there this Court observed .
"In our opinion, the view that has now been accepted by all the High Courts that order 41, r. 22 permits as a general rule, a respondent to prefer an objection directed only against the appellant and it is only in exceptional cases, such as where the relief sought against the appellant in such an objection is intermixed with the relief granted to the other respondents, so that the relief against the appellant cannot be granted without the question being re opened between the objecting respondent and other respondents, that an objection under 0.41 R. 22 can be directed against the other respondents, is correct.
Whatever may have been the position under the old S 561 the use of the word "cross objection" in 0.41 R. 22 expresses unmistakably the intention of the legislature that the objection has to be directed against the appellant.
As Rajamannar C.J said in Venkataswaralu vs Ramanna: "The legislature by describing the objection which could be taken by the respondent as a "cross objection" must have deliberately adopted the view of the other High Courts.
One cannot treat an objection by a respondent in which the appellant has no interest as a cross objection.
The appeal is by the appellant against a respondent, the cross objection must be an objection by a respondent against the appellant.
" We think, with respect, that these observations put the matter clearly and correctly.
That the legislature also wanted to give effect to the views held by the different High Courts that in exceptional cases as mentioned above an objection can be preferred by a respondent against a co respondent is indicated by the substitution of the word "appellant" in the third paragraph by the words "the party who may be affected by such objection. " 687 This view has been there as a guide for a little over two decades.
We should not add anything further at this stage.
The law should be A clear and certain as a guide to human behaviour.
No attempt should be made to unsettle the law unless there is compelling reason.
We do not find any such compelling reason and we, therefore, reiterate the above principles.
Basically, the first question raised in the cross objection relates to the right of Madan Mohan to retain the property under the sale deed.
The appellants are the second purchasers.
The Math, therefore, could urge the objection that the appellants and Madan Mohan have no right to retain the property after the sale deed was declared null and void.
But then the considerations as to the lease deed is quite different.
The validity of the lease deed and the possession of the land thereof has to be determined only against Madan Mohan.
It is not intermixed with the right of the appellants.
It has no relevance to the question raised in the appeal.
The High Court was, therefore, right in holding that the cross objection as to the lease was not maintainable against Madan Mohan.
D But that does not mean, that the Math should be left without remedy against the judgment of learned single judge.
If the cross objection filed under R. 22 of 0.41 CPC was not maintainable against the co respondent, the Court could consider it under R. 33 of 0.41 CPC.
R. 22 and R. 33 are not mutually exclusive They are closely related with each other.
If objection cannot be urged under R. 22 against co respondent, R. 33 could take over and come to the rescue of the objector.
The appellate court could exercise the power under R. 33 even if the appeal is only against a part of the decree of the lower court.
The appellate court could exercise that power in favour of all or any of the respondents although such respondent may not have filed any appeal or objection.
The sweep of the power under R. 33 is wide enough to determine any question not only between the appellant and respondent, but also between respondent and co respondents.
The appellate court could pass any decree or order which ought to have been passed in the circumstances of the case.
The appellate court could also pass such other decree or order as the case may require.
The words "as the case may require" used in R. 33 of O. 41 have been put in wide terms to enable the appellate court to pass any order or decree to meet the ends of justice.
What then should be the constraint? We do not find many.
We are not giving any liberal interpretation.
The rule itself is liberal enough.
The only constraint that we could see, may be these: That the parties before the lower court should be therebefore 688 the appellate court.
The question raised must properly arise out of the judgment of the lower court.
If these two requirements are there, the appellate Court could consider any objection against any part of the judgment or decree of the lower court.
It may be urged by any party to the appeal.
It is true that the power of the appellate court under R. 33 is discretionary.
But it is a proper exercise of judicial discretion to determine all questions urged in order to render complete justice between the parties.
The Court should not refuse to exercise that discretion on mere technicalities.
In the result, we allow the appeal and reverse the judgment and decree of Division Bench of the High Court.
The Division Bench shall now restore the appeal and cross objection of the parties and dispose of the same in accordance with law and in the light of observations made The appellants shall get the cost of this appeal.
S.L. Appeal allowed.
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% There is a Math known as Juna Math in Bikaner.
The first appellant is the present Mahant of the Math and the second appellant is the presiding deity of the Math, both referred to collectively as 'the Math ', herein.
Previously, one Lalgiri Maharaj was the Mahant of the Math.
He mismanaged the Math and disposed of its properties.
On August 19, 1963, he gave on lease for 99 years land measuring 2211 sq.
yards in favour of Madan Mohan, the respondent No. 1.
On March 22, 1968, he sold to Madan Mohan 446 sq.
yards of land out of the land leased to him.
Madan Mohan constructed shops on the land purchased and sold them to Jankidas and Mohan Lal, who are respondents Nos. 2 and 3.
Then Madan Mohan sold another piece of land purchased from Lalgiri to the respondents Nos. 2 and 3.
Later, the first appellant became the Mahant of the Math, and the Math filed a suit, challenging the alienations made by Lalgiri, and for a declaration that the said alienations were without authority and not binding on the Math and for possession of the property from the respondents 1 to 3.
The trial Court decreed the suit in part only, as it gave a declaration that the lease deed dated August 19, 1963, was null and void, but the relief regarding possession of the land demised was rejected.
The suit for recovery of possession of the land sold by Lalgiri was also dismissed.
Against the judgment of the Trial Court, two appeals one by the Math and the other, by Madan Mohan were filed before the High Court.
By a common judgment in the two appeals, a single Judge of the High Court (i) allowed the appeal of the Math in part, giving a simple declaration that the sale of the land was void, but declining to pass a decree for possession of the land sold, and (ii) allowed the appeal of 680 Madan Mohan, giving him complete relief, while holding that the suit as to the lease was barred by time.
Against the judgment of the Single Judge, no appeal was filed either by the Math or by Madan Mohan.
There was only an appeal filed by respondents 2 and 3, who impleaded the Math as the first respondent and Madan Mohan, as the third respondent.
The Math Preferred cross objection.
Madan Mohan did not do any thing.
The Division Bench of High Court dismissed the appeal on the merits.
It also dismissed the cross objection on the ground of maintainability.
Aggrieved by the dismissal of the cross objection, the Math appealed to this Court for relief by special leave.
Allowing the appeal, the Court, ^ HELD: The Single Judge invalidated the sale of the property to Madan Mohan, while denying a decree for possession.
The appellants before the Division Bench wanted to get rid of the finding as to the invalidity of the sale.
The Math wanted to recover possession of the property from the appellants before the Division Bench, and Madan Mohan.
The Math instead of filing an appeal for that relief, could as well file the cross objection.
That is clear from the provisions of R. 22 of 0.41, C.P.C.
The High Court was clearly in error in holding to the contrary.
[684G H] The next question for consideration was whether the cross objection was maintainable against Madan Mohan, a co respondent, and if not, whether the Court could call into aid R. 33, 0.41 C.P.C. Generally, the cross objection could be urged against the appellant.
It is only by way of exception to this general rule that one respondent may urge objection as against the other respondent.
The type of such exceptional cases are very much limited when an appeal cannot be effectively disposed of without opening the matter as between the respondents inter se, or when there is a case where the objections are common as against the appellants and the co respondent.
This law has been laid down by this Court in Panna Lal vs State of Bombay, ; at 991.
This view has been accepted as a guide for more than two decades.
No attempt should be made to unsettle the law unless there is a compelling reason.
The Court does not find any such compellmg reason in the case.
[685A, H; 686A B; 687A B] The Math could urge the objection that the appellants before the Division Bench and Madan Mohan had no right to retain the property 681 after the sale deed had been declared null and void.
The validity of the lease deed and the possession of the land in pursuance thereof, has to be determined only against Madan Mohan.
It is not intermixed with the right of the appellants above said.
It has no relevance to the question raised in the appeal.
The High Court was right in holding that the cross objection as to the lease was not maintainable against Madan Mohan.
But that does not mean that the Math should be left without a remedy against the judgment of the Single Judge.
If the cross objection filed under R. 22 of 0.41, C.P.C. was not maintainable against the co respondent, the Court could consider it under R. 33, 0.41, C.P.C. R. 22 and R. 33 are not mutually exclusive.
They are closely related with each other.
If objection cannot be urged under R. 22 against corespondent, R. 33 could take over and help the objector.
The appellate Court could exercise that power in favour of all or any of the respondents even though such a respondent may not have filed any appeal or objection.
The sweep of the power under R. 33 is wide enough to determine any question not only between the appellant and the respondent but also between a respondent and co respondents.
The appellate Court could pass any decree or order which ought to have been passed in the circumstances of the case.
The appellate Court could also pass such other decree or order as the case may require.
The words "as the case may require" used in R. 33 of 0.41, have been put in wide terms to enable the appellate Court to pass any order or decree to meet the ends of justice.
This Court is not giving any liberal interpretation.
The rule itself is liberal enough.
The only constraint that could be seen, may be: that the parties before the lower Court should be there before the appellate Court, the question raised must properly arise out of the judgment of the lower Court; it may be urged by any party to the appeal.
It is true that the power of the appellate Court under R. 33 is discretionary, but it is a proper exercise of judicial discretion to determine all the questions urged in order to render complete justice between the parties.
The Court should not refuse to exercise that discretion on mere technicalities.
[687B H; 688A B] Appeal allowed.
The judgment and decree of the Division Bench of the High Court reversed.
The Division Bench to restore the appeal and cross objection of the parties and dispose of the same in accordance with law and in the light of the observations made.
[688C]
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% There is a Math known as Juna Math in Bikaner. Previously, one Lalgiri Maharaj was the Mahant of the Math. He mismanaged the Math and disposed of its properties. yards in favour of Madan Mohan, the respondent No. On March 22, 1968, he sold to Madan Mohan 446 sq. yards of land out of the land leased to him. Madan Mohan constructed shops on the land purchased and sold them to Jankidas and Mohan Lal, who are respondents Nos. Later, the first appellant became the Mahant of the Math, and the Math filed a suit, challenging the alienations made by Lalgiri, and for a declaration that the said alienations were without authority and not binding on the Math and for possession of the property from the respondents 1 to 3. Against the judgment of the Trial Court, two appeals one by the Math and the other, by Madan Mohan were filed before the High Court. Against the judgment of the Single Judge, no appeal was filed either by the Math or by Madan Mohan. There was only an appeal filed by respondents 2 and 3, who impleaded the Math as the first respondent and Madan Mohan, as the third respondent. The Division Bench of High Court dismissed the appeal on the merits. It also dismissed the cross objection on the ground of maintainability. Aggrieved by the dismissal of the cross objection, the Math appealed to this Court for relief by special leave. Allowing the appeal, the Court, ^ HELD: The Single Judge invalidated the sale of the property to Madan Mohan, while denying a decree for possession. The appellants before the Division Bench wanted to get rid of the finding as to the invalidity of the sale. The Math instead of filing an appeal for that relief, could as well file the cross objection. That is clear from the provisions of R. 22 of 0.41, C.P.C.
The High Court was clearly in error in holding to the contrary. This view has been accepted as a guide for more than two decades. No attempt should be made to unsettle the law unless there is a compelling reason. The Court does not find any such compellmg reason in the case. It has no relevance to the question raised in the appeal. If the cross objection filed under R. 22 of 0.41, C.P.C. was not maintainable against the co respondent, the Court could consider it under R. 33, 0.41, C.P.C. R. 22 and R. 33 are not mutually exclusive. They are closely related with each other. The appellate Court could exercise that power in favour of all or any of the respondents even though such a respondent may not have filed any appeal or objection. The appellate Court could also pass such other decree or order as the case may require. The words "as the case may require" used in R. 33 of 0.41, have been put in wide terms to enable the appellate Court to pass any order or decree to meet the ends of justice. This Court is not giving any liberal interpretation. The only constraint that could be seen, may be: that the parties before the lower Court should be there before the appellate Court, the question raised must properly arise out of the judgment of the lower Court; it may be urged by any party to the appeal. The Court should not refuse to exercise that discretion on mere technicalities. The judgment and decree of the Division Bench of the High Court reversed.
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ivil Appeal No. 2 107 of 1979.
From the Judgment and order dated 22.9.
1978 of the Allahabad High Court in C.M.W. No. 3857 of 1978.
Gobinda Mukhoty, Ali Ahmad, Mrs. Jayshree Ahmad, Tanveer Ahmad, S S Hussain for the appellants.
R.K. Garg and D.K. Garg for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is a tenant 's appeal by special leave.
After perusing the judgment impugned and grounds urged, we are of the opinion, that there is no substance in this appeal 843 On merit, though there are one or two technical breaches.
This is certainly not a decision which should be interfered with in the exercise of jurisdiction under Article 136 of the Constitution by this Court.
The appeal arises from the judgment and order dated 22nd September, 1978 of the High Court of Allahabad The respondent No. 2 herein, Smt.
Murtaza Begum filed an application under section 3 of the U.P Temporary) Control of Rent and Eviction Act, 1947 being U.P. Act No. 3 of 1947, hereinafter called the old Act, against the appellants Section 3 of the said Act provides that subject to any order passed under sub section (3) of that section, no suit shall, without the permission of the District Magistrate be filed in any court against any tenant for his eviction from any accommodation except on the grounds mentioned therein.
Sub section (2) of section 3 provided for revision to the Commissioner against the order of the District Magistrate Subsection (3) of section 3 empowered the Commissioner to hear the application and if he was not satisfied as to the correctness, legality or propriety of the order passed by the District Magistrate or as to regularity of proceedings held before him, alter or reverse his order or make such other order as might be just and proper.
By sub section (4) of section 3 the order of the Commissioner has been made final subject to any other order passed by the State Government under section 7 of the said Act.
Section 7 F of the said Act empowered the State Government to call for the record of any case granting or refusing to grant permission for the filing of a suit for eviction referred to and authorised him to make such order as appeared to it necessary for the ends of justice.
The application for eviction was granted by the Commissioner in this case on the 17th April, 1971.
The appellants went in revision to the State Government.
The revision was, however, rejected by the State Government on 7th February, 1972 The permission thereafter became final.
In pursuance of the aforesaid permission the respondent landlord filed a suit being suit No 464 of 1972 in the court of Judge, Small Causes, Meerut for eviction of the appellants Thereafter in 1973 the landlord filed an application for withdrawal of the suit on the ground that as U P Urban Buildings (Regulation of Letting Rent and Eviction) Act of 972 being U P Act no 3 of 972.
hereinafter called the New Act, had been amended, he would file an application for the enforcement of the permission obtained under section 3 of the old Act.
On that application the court found that as the cause of action on which the suit had been filed was rendered infructuous, the suit was liable to be dismissed.
After the suit was dismissed, the landlord being respondent no 2 herein filed an application under 844 section 43(2)(rr) of the New Act for eviction of the appellants from the premises in question.
It was resisted on the ground that the permission had been dismissed and the application under section 43(2)(rr) was not maintainable.
The Prescribed Authority upheld the said objection of the appellants and rejected the application filed by the landlord on the ground that since permission obtained by the landlord under section 3 of the U.P. Act has been exhausted, the application filed by the landlord was not maintainable.
It appears to us that the Prescribed Authority was clearly in error in so holding because the permission granted had not been exhausted because the suit as dismissed on a technical plea and not on the merit of the contentions Reference may be made to the observations in the decision of the Allahabad High Court in the case of Pahlad Das vs Ganga Saran and Another, AIR 1958 Allahabad 774, where the division bench of that court held that the obvious purpose of the permission under section 3 of the old Act was to enable the plaintiff, the landlord to evict the tenant from the premises and as long as that purpose was not fulfilled, the permission could not obviously exhaust itself Where it was not shown that the permission was granted to file a single suit or that it had been specified in it that a second suit could not be filed, the permission could not exhaust itself simply because the first suit filed on its basis was dismissed on some technical ground and the permission obtained could be availed of for filing the second suit.
In that view, the High Court affirmed the previous decision of that court.
It appears, however, that an appeal was filed against the order of the Prescribed Authority and the appeal was allowed by the order of the District Judge dated 28th April, 1978.
Aggrieved thereby the tenants filed a writ petition before the High Court.
The controversy in the High Court was whether the application filed by the landlord under section 43(2)(rr) of the New Act was not maintainable.
The basis of the claim of the tenant was that as the permission had been utilised by filing the suit, another proceeding on the basis of the said permission could not be initiated The High Court noted that section 43(2)(rr) was added by U.P. Act No. 37 of 1972.
By the addition of the new provision, the legislature conferred a right on a landlord who had obtained permission under the old Act and had filed an application under new provision to get the tenant evicted.
Section 43(2)(rr) of the New Act was again amended by the U.P. Act No. 28 of 1976.
By that amendment the words "whether or not a suit for the eviction of the tenant has been instituted" were inserted.
The amending Act laid down that the amendment in the provision shall be deemed to have always been substituted.
In other words, the amendment caused amendment to be retrospective in operation.
845 It is, therefore, apparent as the High Court in our opinion in the judgment under appeal rightly held that section 43(2)(rr) i.e. in 1973 permitted the landlord to file an application for the enforcement of the permission obtained by him.
After the aforesaid provision was amended, the landlord was not required to file a suit to avail of the permission.
The High Court in the judgment under appeal rejected the contention that once an application for permission had been filed, the second application would not lie.
The High Court held that where the first suit was not decided on merits subsequent action was not precluded.
The High Court noted that merits of the case were not examined by the Court.
The Court in this appeal on this occasion did not find that the permission obtained by the landlord was invalid or illegal.
The judgment of dismissal was thus on technical ground and not on merits.
The High Court held that the landlord had right to file the second application.
In our opinion, the High Court was right for the reasons mentioned hereinbefore.
It is next contended that since the suit was dismissed on the ground that the cause of action did not survive to the landlord, it should be held that the landlord had no right left to file an application under section 43(2)(rr).
This was, in our opinion, rightly rejected by the High Court.
The High Court negatived the contention of the tenant that dismissal of the first action taken by the landlord after obtaining permission under the old Act precluded the landlord from taking the second action under section 43(2)(rr) of the Act.
We are of the opinion that the High Court was right.
It will be appropriate at this stage to refer to the provisions of section 43(2)(rr) or the New Act which are as follows: "Where any permission referred to in Section 3 of the old Act has been obtained on any ground specified in subsection (1) or sub section (2) of Section 21, and has become final, either before the commencement of this Act, or in accordance with the provisions of this sub section, after the commencement of this Act, (whether or not a suit for the eviction of the tenant has been instituted), the landlord may apply to the prescribed authority for his eviction under Section 21, and thereupon the prescribed authority shall order the eviction of the tenant from the building under tenancy, and it shall not be necessary for the prescribed authority to satisfy itself afresh as to the existence of any ground as aforesaid, and such order shall be final and shall 846 not be open to appeal under Section 22: Provided that no application under this clause.
shall be maintainable on the basis of a permission granted under Section 3 of the old Act, where such permission became final more than three years before the commencement of the Act: Provided further that in computing the period of three years, the time during which the applicant has been prosecuting with due diligence any civil proceeding whether in a court of first instance or appeal or revision shall be excluded.
In view of the aforesaid, we are of the opinion that the Prescribed Authority was clearly in error in upholding the objection of the tenant that as the previous suit had been filed by the tenant on the basis of permission and the same had been dismissed, the application under section 43(2)(rr) of the Act 13 of 1972, was not maintainable.
It was clearly erroneous contention.
It would frustrate the very purpose of the express provision of section 43(2)(rr).
Finality of order in judicial proceeding is one of the essential principles which the scheme of the administration of justice, must strive for.
See in this connection the observations of D.K Soni vs P.K. Mukherjee & Ors., (Civil Appeal No. 6626/83 Judgment dated 27.
10. 1987).
It was contended before the High Court that no appeal lay from the decision of the Prescribed Authority to the District Judge.
The High Court accepted this contention.
The High Court finally held that though no appeal lay before the District Judge, the order of the Prescribed Authority was invalid and was rightly set aside by the District Judge.
On that ground the High Court declined to interfere with the order of the learned District Judge.
It is true that there has been some technical breach because if there is no appeal maintainable before the learned District Judge, in the appeal before the learned District Judge, the order of the Prescribed Authority could not be set aside.
But the High Court was exercising its jurisdiction under Article 226 of the Constitution.
The High Court had come to the conclusion that the order of the Prescribed Authority was invalid and improper.
The High Court itself could have set it aside.
Therefore in the facts and circumstances of the case justice has been done though, as mentioned hereinbefore, technically the appellant had a point that the order of the District Judge was illegal and improper.
If we reiterate the order of 847 the High Court as it is setting aside the order of the Prescribed Authority in exercise of the jurisdiction under Article 226 of the Constitution then no exception can be taken.
As mentioned hereinbefore, justice has been done and as the improper order of the Prescribed Authority has been set aside, on objection can be taken.
In the premises there is no scope for interference under Article 136 of the Constitution.
Our attention was drawn to certain observations of this Court about the power of the State Government under section 7 F of the old Act in Shri Bhagwan and Anr.
vs Ram Chand and Anr.
, [ ; In the view, we have taken of the facts of this case, it is not necessary to deal with this decision in any detail.
In the aforesaid view of the matter, this appeal must fail and is accordingly dismissed.
In the facts and circumstances of the case, we however, make no order as to costs.
P.S.S. Appeal dismissed.
|
% Sub section (1) of section 3 of the U.P. (Temporary) Control of Rent and Eviction Act, 1947 barred suits without the permission of the District Magistrate against tenants for eviction except on the grounds mentioned therein.
Sub section (2) provided for revision to the Commissioner, and sub section (4) made the order of the Commissioner final.
Section 7 F empowered the State Government to interfere with such orders.
That Act was repealed by the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972.
Section 43(2)(rr) of the new Act, inserted therein by U.P. Act 37 of 1972, provided that where any permission obtained under section 3 of the old Act had become final either before the commencement of the Act or in accordance with the provisions of the sub section after the commencement of the Act, the landlord may apply to the Prescribed Authority for tenant 's eviction.
This section was against amended in 1976 by insertion of the words "whether or not a suit for the eviction of the tenant has been instituted", and giving it retrospective operation.
The order of the Prescribed Authority in such cases was made final.
The landlord 's application under section 3 of the 1947 Act for eviction 'of the tenants appellants was granted by the Commissioner in April, 197I.
The revision preferred by them was rejected by the State Government in February, 1972 and the permission became final.
In pursuance 841 Of the said permission the landlord filed a suit for eviction of the appellants.
Thereafter in 1973 he filed an application for withdrawal of the said suit on the ground that as the 1972 Act had been amended, he would file an application for enforcement of the permission.
The Court of Small Causes found that as the cause of action on which the suit had been filed was rendered infructuous, the suit was liable to be dismissed.
The application filed by the landlord under section 43(2)(rr) of the new Act for eviction of the appellants, was rejected by the Prescribed Authority on the ground that since permission obtained under section 3 of the old Act had been exhausted, the application was not maintainable.
An appeal against that order was allowed by the District Judge.
In the writ petition filed by the appellants tenants under article 226 of the Constitution it was contended that the permission obtained by the landlord having been utilised by filing the suit, another proceeding on the basis of the said permission could not be initiated, and that no appeal lay from the decision of the Prescribed Authority to the District Judge.
The High Court held that the landlord had right to file the second application.
It took the view that dismissal of the first action taken by the landlord after obtaining permission under the old Act did not preclude him from taking the second action under section 43(2)(rr) of the Act.
It further held that since the first suit was not decided on merits subsequent action was not precluded.
Dismissing the appeal by special leave, ^ HELD: 1.
Section 43(2)(rr) of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 as it stood in 1973, permitted a landlord to file an application for the enforcement of the permission obtained by him under section 3 of the 1947 Act.
After the aforesaid provision was amended in 1976, the landlord was not required to file a suit to avail of the permission.
The amendment was retrospective in operation.
[844G H] 2.
The Prescribed Authority was in error in taking the view that as the previous suit had been filed by the landlord on the basis of permission and the same had been dismissed, the application under section 43(2)(rr) of the 1972 Act was not maintainable.
Such a view would frustrate the very purpose of the express provision of the section which conferred a right on a landlord who had obtained permission under the old Act and has filed an application under the new provision, to get the 842 tenant evicted.
More so, when the permission granted had not been exhausted because the suit was dismissed on a technical plea and not on the merit of the contentions.
[846C D; 845C] Pahlad Das vs Ganga Saran and Another, AIR 1958 Allahabad 774, approved.
3.1 Finality of order in judicial proceeding is one of the essential principles which the scheme of the administration of justice must strive for.
[846D] D.K. Soni vs P.K. Mukherjee & Ors.
C.A. No. 6626 of 1983 decided on October 27, 1987.
referred to. 3.2 In the instant case, through no appeal lay before the District Judge, the High Court came to the conclusion that the order of the Prescribed Authority was invalid and improper.
On that ground it declined to interfere with the order of the District Judge in exercise of its jurisdiction under article 226 of the Constitution.
Since justice has been done by setting aside the improper order of the Prescribed Authority, no exception can be taken to the order of the High Court.
There is, therefore, no scope for interference under article 136 of the Constitution.
[847A B] 1 Shri Bhagwan and Anr.
vs Ram Chand and Anr., ; , inapplicable.
|
ivil Appeal No. 2 107 of 1979.
From the Judgment and order dated 22.9.
1978 of the Allahabad High Court in C.M.W. No. 3857 of 1978.
Gobinda Mukhoty, Ali Ahmad, Mrs. Jayshree Ahmad, Tanveer Ahmad, S S Hussain for the appellants.
R.K. Garg and D.K. Garg for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is a tenant 's appeal by special leave.
After perusing the judgment impugned and grounds urged, we are of the opinion, that there is no substance in this appeal 843 On merit, though there are one or two technical breaches.
This is certainly not a decision which should be interfered with in the exercise of jurisdiction under Article 136 of the Constitution by this Court.
The appeal arises from the judgment and order dated 22nd September, 1978 of the High Court of Allahabad The respondent No. 2 herein, Smt.
Murtaza Begum filed an application under section 3 of the U.P Temporary) Control of Rent and Eviction Act, 1947 being U.P. Act No. 3 of 1947, hereinafter called the old Act, against the appellants Section 3 of the said Act provides that subject to any order passed under sub section (3) of that section, no suit shall, without the permission of the District Magistrate be filed in any court against any tenant for his eviction from any accommodation except on the grounds mentioned therein.
Sub section (2) of section 3 provided for revision to the Commissioner against the order of the District Magistrate Subsection (3) of section 3 empowered the Commissioner to hear the application and if he was not satisfied as to the correctness, legality or propriety of the order passed by the District Magistrate or as to regularity of proceedings held before him, alter or reverse his order or make such other order as might be just and proper.
By sub section (4) of section 3 the order of the Commissioner has been made final subject to any other order passed by the State Government under section 7 of the said Act.
Section 7 F of the said Act empowered the State Government to call for the record of any case granting or refusing to grant permission for the filing of a suit for eviction referred to and authorised him to make such order as appeared to it necessary for the ends of justice.
The application for eviction was granted by the Commissioner in this case on the 17th April, 1971.
The appellants went in revision to the State Government.
The revision was, however, rejected by the State Government on 7th February, 1972 The permission thereafter became final.
In pursuance of the aforesaid permission the respondent landlord filed a suit being suit No 464 of 1972 in the court of Judge, Small Causes, Meerut for eviction of the appellants Thereafter in 1973 the landlord filed an application for withdrawal of the suit on the ground that as U P Urban Buildings (Regulation of Letting Rent and Eviction) Act of 972 being U P Act no 3 of 972.
hereinafter called the New Act, had been amended, he would file an application for the enforcement of the permission obtained under section 3 of the old Act.
On that application the court found that as the cause of action on which the suit had been filed was rendered infructuous, the suit was liable to be dismissed.
After the suit was dismissed, the landlord being respondent no 2 herein filed an application under 844 section 43(2)(rr) of the New Act for eviction of the appellants from the premises in question.
It was resisted on the ground that the permission had been dismissed and the application under section 43(2)(rr) was not maintainable.
The Prescribed Authority upheld the said objection of the appellants and rejected the application filed by the landlord on the ground that since permission obtained by the landlord under section 3 of the U.P. Act has been exhausted, the application filed by the landlord was not maintainable.
It appears to us that the Prescribed Authority was clearly in error in so holding because the permission granted had not been exhausted because the suit as dismissed on a technical plea and not on the merit of the contentions Reference may be made to the observations in the decision of the Allahabad High Court in the case of Pahlad Das vs Ganga Saran and Another, AIR 1958 Allahabad 774, where the division bench of that court held that the obvious purpose of the permission under section 3 of the old Act was to enable the plaintiff, the landlord to evict the tenant from the premises and as long as that purpose was not fulfilled, the permission could not obviously exhaust itself Where it was not shown that the permission was granted to file a single suit or that it had been specified in it that a second suit could not be filed, the permission could not exhaust itself simply because the first suit filed on its basis was dismissed on some technical ground and the permission obtained could be availed of for filing the second suit.
In that view, the High Court affirmed the previous decision of that court.
It appears, however, that an appeal was filed against the order of the Prescribed Authority and the appeal was allowed by the order of the District Judge dated 28th April, 1978.
Aggrieved thereby the tenants filed a writ petition before the High Court.
The controversy in the High Court was whether the application filed by the landlord under section 43(2)(rr) of the New Act was not maintainable.
The basis of the claim of the tenant was that as the permission had been utilised by filing the suit, another proceeding on the basis of the said permission could not be initiated The High Court noted that section 43(2)(rr) was added by U.P. Act No. 37 of 1972.
By the addition of the new provision, the legislature conferred a right on a landlord who had obtained permission under the old Act and had filed an application under new provision to get the tenant evicted.
Section 43(2)(rr) of the New Act was again amended by the U.P. Act No. 28 of 1976.
By that amendment the words "whether or not a suit for the eviction of the tenant has been instituted" were inserted.
The amending Act laid down that the amendment in the provision shall be deemed to have always been substituted.
In other words, the amendment caused amendment to be retrospective in operation.
845 It is, therefore, apparent as the High Court in our opinion in the judgment under appeal rightly held that section 43(2)(rr) i.e. in 1973 permitted the landlord to file an application for the enforcement of the permission obtained by him.
After the aforesaid provision was amended, the landlord was not required to file a suit to avail of the permission.
The High Court in the judgment under appeal rejected the contention that once an application for permission had been filed, the second application would not lie.
The High Court held that where the first suit was not decided on merits subsequent action was not precluded.
The High Court noted that merits of the case were not examined by the Court.
The Court in this appeal on this occasion did not find that the permission obtained by the landlord was invalid or illegal.
The judgment of dismissal was thus on technical ground and not on merits.
The High Court held that the landlord had right to file the second application.
In our opinion, the High Court was right for the reasons mentioned hereinbefore.
It is next contended that since the suit was dismissed on the ground that the cause of action did not survive to the landlord, it should be held that the landlord had no right left to file an application under section 43(2)(rr).
This was, in our opinion, rightly rejected by the High Court.
The High Court negatived the contention of the tenant that dismissal of the first action taken by the landlord after obtaining permission under the old Act precluded the landlord from taking the second action under section 43(2)(rr) of the Act.
We are of the opinion that the High Court was right.
It will be appropriate at this stage to refer to the provisions of section 43(2)(rr) or the New Act which are as follows: "Where any permission referred to in Section 3 of the old Act has been obtained on any ground specified in subsection (1) or sub section (2) of Section 21, and has become final, either before the commencement of this Act, or in accordance with the provisions of this sub section, after the commencement of this Act, (whether or not a suit for the eviction of the tenant has been instituted), the landlord may apply to the prescribed authority for his eviction under Section 21, and thereupon the prescribed authority shall order the eviction of the tenant from the building under tenancy, and it shall not be necessary for the prescribed authority to satisfy itself afresh as to the existence of any ground as aforesaid, and such order shall be final and shall 846 not be open to appeal under Section 22: Provided that no application under this clause.
shall be maintainable on the basis of a permission granted under Section 3 of the old Act, where such permission became final more than three years before the commencement of the Act: Provided further that in computing the period of three years, the time during which the applicant has been prosecuting with due diligence any civil proceeding whether in a court of first instance or appeal or revision shall be excluded.
In view of the aforesaid, we are of the opinion that the Prescribed Authority was clearly in error in upholding the objection of the tenant that as the previous suit had been filed by the tenant on the basis of permission and the same had been dismissed, the application under section 43(2)(rr) of the Act 13 of 1972, was not maintainable.
It was clearly erroneous contention.
It would frustrate the very purpose of the express provision of section 43(2)(rr).
Finality of order in judicial proceeding is one of the essential principles which the scheme of the administration of justice, must strive for.
See in this connection the observations of D.K Soni vs P.K. Mukherjee & Ors., (Civil Appeal No. 6626/83 Judgment dated 27.
10. 1987).
It was contended before the High Court that no appeal lay from the decision of the Prescribed Authority to the District Judge.
The High Court accepted this contention.
The High Court finally held that though no appeal lay before the District Judge, the order of the Prescribed Authority was invalid and was rightly set aside by the District Judge.
On that ground the High Court declined to interfere with the order of the learned District Judge.
It is true that there has been some technical breach because if there is no appeal maintainable before the learned District Judge, in the appeal before the learned District Judge, the order of the Prescribed Authority could not be set aside.
But the High Court was exercising its jurisdiction under Article 226 of the Constitution.
The High Court had come to the conclusion that the order of the Prescribed Authority was invalid and improper.
The High Court itself could have set it aside.
Therefore in the facts and circumstances of the case justice has been done though, as mentioned hereinbefore, technically the appellant had a point that the order of the District Judge was illegal and improper.
If we reiterate the order of 847 the High Court as it is setting aside the order of the Prescribed Authority in exercise of the jurisdiction under Article 226 of the Constitution then no exception can be taken.
As mentioned hereinbefore, justice has been done and as the improper order of the Prescribed Authority has been set aside, on objection can be taken.
In the premises there is no scope for interference under Article 136 of the Constitution.
Our attention was drawn to certain observations of this Court about the power of the State Government under section 7 F of the old Act in Shri Bhagwan and Anr.
vs Ram Chand and Anr.
, [ ; In the view, we have taken of the facts of this case, it is not necessary to deal with this decision in any detail.
In the aforesaid view of the matter, this appeal must fail and is accordingly dismissed.
In the facts and circumstances of the case, we however, make no order as to costs.
P.S.S. Appeal dismissed.
|
ivil Appeal No. 2 107 of 1979.
From the Judgment and order dated 22.9.
1978 of the Allahabad High Court in C.M.W. No. 3857 of 1978.
Gobinda Mukhoty, Ali Ahmad, Mrs. Jayshree Ahmad, Tanveer Ahmad, S S Hussain for the appellants.
R.K. Garg and D.K. Garg for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is a tenant 's appeal by special leave.
After perusing the judgment impugned and grounds urged, we are of the opinion, that there is no substance in this appeal 843 On merit, though there are one or two technical breaches.
This is certainly not a decision which should be interfered with in the exercise of jurisdiction under Article 136 of the Constitution by this Court.
The appeal arises from the judgment and order dated 22nd September, 1978 of the High Court of Allahabad The respondent No. 2 herein, Smt.
Murtaza Begum filed an application under section 3 of the U.P Temporary) Control of Rent and Eviction Act, 1947 being U.P. Act No. 3 of 1947, hereinafter called the old Act, against the appellants Section 3 of the said Act provides that subject to any order passed under sub section (3) of that section, no suit shall, without the permission of the District Magistrate be filed in any court against any tenant for his eviction from any accommodation except on the grounds mentioned therein.
Sub section (2) of section 3 provided for revision to the Commissioner against the order of the District Magistrate Subsection (3) of section 3 empowered the Commissioner to hear the application and if he was not satisfied as to the correctness, legality or propriety of the order passed by the District Magistrate or as to regularity of proceedings held before him, alter or reverse his order or make such other order as might be just and proper.
By sub section (4) of section 3 the order of the Commissioner has been made final subject to any other order passed by the State Government under section 7 of the said Act.
Section 7 F of the said Act empowered the State Government to call for the record of any case granting or refusing to grant permission for the filing of a suit for eviction referred to and authorised him to make such order as appeared to it necessary for the ends of justice.
The application for eviction was granted by the Commissioner in this case on the 17th April, 1971.
The appellants went in revision to the State Government.
The revision was, however, rejected by the State Government on 7th February, 1972 The permission thereafter became final.
In pursuance of the aforesaid permission the respondent landlord filed a suit being suit No 464 of 1972 in the court of Judge, Small Causes, Meerut for eviction of the appellants Thereafter in 1973 the landlord filed an application for withdrawal of the suit on the ground that as U P Urban Buildings (Regulation of Letting Rent and Eviction) Act of 972 being U P Act no 3 of 972.
hereinafter called the New Act, had been amended, he would file an application for the enforcement of the permission obtained under section 3 of the old Act.
On that application the court found that as the cause of action on which the suit had been filed was rendered infructuous, the suit was liable to be dismissed.
After the suit was dismissed, the landlord being respondent no 2 herein filed an application under 844 section 43(2)(rr) of the New Act for eviction of the appellants from the premises in question.
It was resisted on the ground that the permission had been dismissed and the application under section 43(2)(rr) was not maintainable.
The Prescribed Authority upheld the said objection of the appellants and rejected the application filed by the landlord on the ground that since permission obtained by the landlord under section 3 of the U.P. Act has been exhausted, the application filed by the landlord was not maintainable.
It appears to us that the Prescribed Authority was clearly in error in so holding because the permission granted had not been exhausted because the suit as dismissed on a technical plea and not on the merit of the contentions Reference may be made to the observations in the decision of the Allahabad High Court in the case of Pahlad Das vs Ganga Saran and Another, AIR 1958 Allahabad 774, where the division bench of that court held that the obvious purpose of the permission under section 3 of the old Act was to enable the plaintiff, the landlord to evict the tenant from the premises and as long as that purpose was not fulfilled, the permission could not obviously exhaust itself Where it was not shown that the permission was granted to file a single suit or that it had been specified in it that a second suit could not be filed, the permission could not exhaust itself simply because the first suit filed on its basis was dismissed on some technical ground and the permission obtained could be availed of for filing the second suit.
In that view, the High Court affirmed the previous decision of that court.
It appears, however, that an appeal was filed against the order of the Prescribed Authority and the appeal was allowed by the order of the District Judge dated 28th April, 1978.
Aggrieved thereby the tenants filed a writ petition before the High Court.
The controversy in the High Court was whether the application filed by the landlord under section 43(2)(rr) of the New Act was not maintainable.
The basis of the claim of the tenant was that as the permission had been utilised by filing the suit, another proceeding on the basis of the said permission could not be initiated The High Court noted that section 43(2)(rr) was added by U.P. Act No. 37 of 1972.
By the addition of the new provision, the legislature conferred a right on a landlord who had obtained permission under the old Act and had filed an application under new provision to get the tenant evicted.
Section 43(2)(rr) of the New Act was again amended by the U.P. Act No. 28 of 1976.
By that amendment the words "whether or not a suit for the eviction of the tenant has been instituted" were inserted.
The amending Act laid down that the amendment in the provision shall be deemed to have always been substituted.
In other words, the amendment caused amendment to be retrospective in operation.
845 It is, therefore, apparent as the High Court in our opinion in the judgment under appeal rightly held that section 43(2)(rr) i.e. in 1973 permitted the landlord to file an application for the enforcement of the permission obtained by him.
After the aforesaid provision was amended, the landlord was not required to file a suit to avail of the permission.
The High Court in the judgment under appeal rejected the contention that once an application for permission had been filed, the second application would not lie.
The High Court held that where the first suit was not decided on merits subsequent action was not precluded.
The High Court noted that merits of the case were not examined by the Court.
The Court in this appeal on this occasion did not find that the permission obtained by the landlord was invalid or illegal.
The judgment of dismissal was thus on technical ground and not on merits.
The High Court held that the landlord had right to file the second application.
In our opinion, the High Court was right for the reasons mentioned hereinbefore.
It is next contended that since the suit was dismissed on the ground that the cause of action did not survive to the landlord, it should be held that the landlord had no right left to file an application under section 43(2)(rr).
This was, in our opinion, rightly rejected by the High Court.
The High Court negatived the contention of the tenant that dismissal of the first action taken by the landlord after obtaining permission under the old Act precluded the landlord from taking the second action under section 43(2)(rr) of the Act.
We are of the opinion that the High Court was right.
It will be appropriate at this stage to refer to the provisions of section 43(2)(rr) or the New Act which are as follows: "Where any permission referred to in Section 3 of the old Act has been obtained on any ground specified in subsection (1) or sub section (2) of Section 21, and has become final, either before the commencement of this Act, or in accordance with the provisions of this sub section, after the commencement of this Act, (whether or not a suit for the eviction of the tenant has been instituted), the landlord may apply to the prescribed authority for his eviction under Section 21, and thereupon the prescribed authority shall order the eviction of the tenant from the building under tenancy, and it shall not be necessary for the prescribed authority to satisfy itself afresh as to the existence of any ground as aforesaid, and such order shall be final and shall 846 not be open to appeal under Section 22: Provided that no application under this clause.
shall be maintainable on the basis of a permission granted under Section 3 of the old Act, where such permission became final more than three years before the commencement of the Act: Provided further that in computing the period of three years, the time during which the applicant has been prosecuting with due diligence any civil proceeding whether in a court of first instance or appeal or revision shall be excluded.
In view of the aforesaid, we are of the opinion that the Prescribed Authority was clearly in error in upholding the objection of the tenant that as the previous suit had been filed by the tenant on the basis of permission and the same had been dismissed, the application under section 43(2)(rr) of the Act 13 of 1972, was not maintainable.
It was clearly erroneous contention.
It would frustrate the very purpose of the express provision of section 43(2)(rr).
Finality of order in judicial proceeding is one of the essential principles which the scheme of the administration of justice, must strive for.
See in this connection the observations of D.K Soni vs P.K. Mukherjee & Ors., (Civil Appeal No. 6626/83 Judgment dated 27.
10. 1987).
It was contended before the High Court that no appeal lay from the decision of the Prescribed Authority to the District Judge.
The High Court accepted this contention.
The High Court finally held that though no appeal lay before the District Judge, the order of the Prescribed Authority was invalid and was rightly set aside by the District Judge.
On that ground the High Court declined to interfere with the order of the learned District Judge.
It is true that there has been some technical breach because if there is no appeal maintainable before the learned District Judge, in the appeal before the learned District Judge, the order of the Prescribed Authority could not be set aside.
But the High Court was exercising its jurisdiction under Article 226 of the Constitution.
The High Court had come to the conclusion that the order of the Prescribed Authority was invalid and improper.
The High Court itself could have set it aside.
Therefore in the facts and circumstances of the case justice has been done though, as mentioned hereinbefore, technically the appellant had a point that the order of the District Judge was illegal and improper.
If we reiterate the order of 847 the High Court as it is setting aside the order of the Prescribed Authority in exercise of the jurisdiction under Article 226 of the Constitution then no exception can be taken.
As mentioned hereinbefore, justice has been done and as the improper order of the Prescribed Authority has been set aside, on objection can be taken.
In the premises there is no scope for interference under Article 136 of the Constitution.
Our attention was drawn to certain observations of this Court about the power of the State Government under section 7 F of the old Act in Shri Bhagwan and Anr.
vs Ram Chand and Anr.
, [ ; In the view, we have taken of the facts of this case, it is not necessary to deal with this decision in any detail.
In the aforesaid view of the matter, this appeal must fail and is accordingly dismissed.
In the facts and circumstances of the case, we however, make no order as to costs.
P.S.S. Appeal dismissed.
|
% Sub section (1) of section 3 of the U.P. (Temporary) Control of Rent and Eviction Act, 1947 barred suits without the permission of the District Magistrate against tenants for eviction except on the grounds mentioned therein.
Sub section (2) provided for revision to the Commissioner, and sub section (4) made the order of the Commissioner final.
Section 7 F empowered the State Government to interfere with such orders.
That Act was repealed by the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972.
Section 43(2)(rr) of the new Act, inserted therein by U.P. Act 37 of 1972, provided that where any permission obtained under section 3 of the old Act had become final either before the commencement of the Act or in accordance with the provisions of the sub section after the commencement of the Act, the landlord may apply to the Prescribed Authority for tenant 's eviction.
This section was against amended in 1976 by insertion of the words "whether or not a suit for the eviction of the tenant has been instituted", and giving it retrospective operation.
The order of the Prescribed Authority in such cases was made final.
The landlord 's application under section 3 of the 1947 Act for eviction 'of the tenants appellants was granted by the Commissioner in April, 197I.
The revision preferred by them was rejected by the State Government in February, 1972 and the permission became final.
In pursuance 841 Of the said permission the landlord filed a suit for eviction of the appellants.
Thereafter in 1973 he filed an application for withdrawal of the said suit on the ground that as the 1972 Act had been amended, he would file an application for enforcement of the permission.
The Court of Small Causes found that as the cause of action on which the suit had been filed was rendered infructuous, the suit was liable to be dismissed.
The application filed by the landlord under section 43(2)(rr) of the new Act for eviction of the appellants, was rejected by the Prescribed Authority on the ground that since permission obtained under section 3 of the old Act had been exhausted, the application was not maintainable.
An appeal against that order was allowed by the District Judge.
In the writ petition filed by the appellants tenants under article 226 of the Constitution it was contended that the permission obtained by the landlord having been utilised by filing the suit, another proceeding on the basis of the said permission could not be initiated, and that no appeal lay from the decision of the Prescribed Authority to the District Judge.
The High Court held that the landlord had right to file the second application.
It took the view that dismissal of the first action taken by the landlord after obtaining permission under the old Act did not preclude him from taking the second action under section 43(2)(rr) of the Act.
It further held that since the first suit was not decided on merits subsequent action was not precluded.
Dismissing the appeal by special leave, ^ HELD: 1.
Section 43(2)(rr) of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 as it stood in 1973, permitted a landlord to file an application for the enforcement of the permission obtained by him under section 3 of the 1947 Act.
After the aforesaid provision was amended in 1976, the landlord was not required to file a suit to avail of the permission.
The amendment was retrospective in operation.
[844G H] 2.
The Prescribed Authority was in error in taking the view that as the previous suit had been filed by the landlord on the basis of permission and the same had been dismissed, the application under section 43(2)(rr) of the 1972 Act was not maintainable.
Such a view would frustrate the very purpose of the express provision of the section which conferred a right on a landlord who had obtained permission under the old Act and has filed an application under the new provision, to get the 842 tenant evicted.
More so, when the permission granted had not been exhausted because the suit was dismissed on a technical plea and not on the merit of the contentions.
[846C D; 845C] Pahlad Das vs Ganga Saran and Another, AIR 1958 Allahabad 774, approved.
3.1 Finality of order in judicial proceeding is one of the essential principles which the scheme of the administration of justice must strive for.
[846D] D.K. Soni vs P.K. Mukherjee & Ors.
C.A. No. 6626 of 1983 decided on October 27, 1987.
referred to. 3.2 In the instant case, through no appeal lay before the District Judge, the High Court came to the conclusion that the order of the Prescribed Authority was invalid and improper.
On that ground it declined to interfere with the order of the District Judge in exercise of its jurisdiction under article 226 of the Constitution.
Since justice has been done by setting aside the improper order of the Prescribed Authority, no exception can be taken to the order of the High Court.
There is, therefore, no scope for interference under article 136 of the Constitution.
[847A B] 1 Shri Bhagwan and Anr.
vs Ram Chand and Anr., ; , inapplicable.
|
% Sub section (1) of section 3 of the U.P. (Temporary) Control of Rent and Eviction Act, 1947 barred suits without the permission of the District Magistrate against tenants for eviction except on the grounds mentioned therein. Sub section (2) provided for revision to the Commissioner, and sub section (4) made the order of the Commissioner final. Section 7 F empowered the State Government to interfere with such orders. That Act was repealed by the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. This section was against amended in 1976 by insertion of the words "whether or not a suit for the eviction of the tenant has been instituted", and giving it retrospective operation. The order of the Prescribed Authority in such cases was made final. In pursuance 841 Of the said permission the landlord filed a suit for eviction of the appellants. Thereafter in 1973 he filed an application for withdrawal of the said suit on the ground that as the 1972 Act had been amended, he would file an application for enforcement of the permission. The Court of Small Causes found that as the cause of action on which the suit had been filed was rendered infructuous, the suit was liable to be dismissed. The application filed by the landlord under section 43(2)(rr) of the new Act for eviction of the appellants, was rejected by the Prescribed Authority on the ground that since permission obtained under section 3 of the old Act had been exhausted, the application was not maintainable. An appeal against that order was allowed by the District Judge. The High Court held that the landlord had right to file the second application. It took the view that dismissal of the first action taken by the landlord after obtaining permission under the old Act did not preclude him from taking the second action under section 43(2)(rr) of the Act. It further held that since the first suit was not decided on merits subsequent action was not precluded. Dismissing the appeal by special leave, ^ HELD: 1. After the aforesaid provision was amended in 1976, the landlord was not required to file a suit to avail of the permission. The amendment was retrospective in operation. More so, when the permission granted had not been exhausted because the suit was dismissed on a technical plea and not on the merit of the contentions. [846C D; 845C] Pahlad Das vs Ganga Saran and Another, AIR 1958 Allahabad 774, approved. 3.1 Finality of order in judicial proceeding is one of the essential principles which the scheme of the administration of justice must strive for. [846D] D.K. Soni vs P.K. Mukherjee & Ors. 6626 of 1983 decided on October 27, 1987. 3.2 In the instant case, through no appeal lay before the District Judge, the High Court came to the conclusion that the order of the Prescribed Authority was invalid and improper. On that ground it declined to interfere with the order of the District Judge in exercise of its jurisdiction under article 226 of the Constitution. Since justice has been done by setting aside the improper order of the Prescribed Authority, no exception can be taken to the order of the High Court. There is, therefore, no scope for interference under article 136 of the Constitution.
| 1
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ivil Appeal Nos. 850 of 1973 etc.
From the Judgment and Order dated 3.9.
1970 of the Allahabad High Court in Civil Miscellaneous (ITR) No. 461 of 1961.
With CIVIL APPEAL No. 941 of 1975.
From the Judgment and Order dated 5.5.
1972 of the Allahabad High Court in I.T. Reference No. 236 of 1969.
Raja Ram Agarwal and Mrs. Rani Chhabra for the Appellants.
B.B. Ahuja and Ms. A Subhashini for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
CA.
No. 850 of 1973 This appeal is by certificate and is directed against the judgment of the High Court of Allahabad.
Assessee and five of his brothers constituted a Hindu Joint Family.
The relevant assessment year is 1953 54 corresponding to the accounting period ending on 30th June, 1952.
The Joint Family which owned inter alia a sugar factory at Bijnore.
In 1930 there was partition in the family and the members of the erstwhile Joint Family constituted themselves into a partnership firm which took over the sugar factory and operated the same.
In the year ,1944, Sheo Prasad, one of the brothers who was a partner of the firm instituted a suit in the Lahore High Court for dissolution of the firm.
Partition of the country followed and after the parties shifted over to India a fresh suit was instituted at Bijnore for purposes of partition.
The properties were put in charge of a receiver appointed by the Court.
So far as the sugar factory is concerned, the arrangement was that at five yearly rest an auction was to be held confined to the partners and the highest bidder would be given lease to operate the factory for that period under the receiver.
On 16th July, 1948, Sheo Prasad trans ferred his 1/6th share to Banarsi Dass at a stated valuation of Rs.4,50,000.
On 3rd May, 1950, another brother, Devi Chand, leased out his 1/6th share to Banarsi Dass on an annual payment of Rs.50,000.
On 13th July, 1950, yet another brother, Kanshi Ram, similarly leased out his 1/6th share to Banarsi Dass for a similar sum.
In 1951, Kanshi Ram sued for cancellation of the lease.
On 6th April, 1954, the dispute was compromised and the lease was 104 terminated.
Kanshi Ram undertook to pay to Banarsi Dass at the rate of Rs. 16,000 for the first three years and at the rate of Rs. 10,000 for the subsequent two years.
Devi Chand 's 1/6th share was also returned on mutual arrangement and he agreed to pay a sum of Rs.39,000 and odd annually to Banarsi Dass for the lease period.
During the assessment proceedings, the nature of these receipts came to be debat ed the assessee maintained that these were in the nature of capital receipt lieu of the lease hold interest and the Income tax Officer maintained that those were revenue re ceipts.
In due course, the Tribunal ultimately upheld the view of the Revenue.
One more question that arose was the admissibility of a claim of expenditure being payment of interest on a loan taken for purchase of shares in the sugar factory.
The Income tax Officer had allowed the claim of Rs.75,211.
The Appellate Assistant Commissioner gave notice to the assessee and disallowed the same.
The Appellate Tribunal reversed the finding of the Appellate Assistant Commissioner in regard to the admissibility of the claim.
Thus the assessee as also the Revenue applied to the Tribunal to refer the case to the High Court.
As far as relevant, the following questions were referred for the opinion of the High Court under section 66(1) of the Act at the instance of the assessee.
Whether on the facts and in the circum stances of the case, the sums of Rs. 16,000 and Rs.39,262 received from Kanshi Ram and Devi Chand respectively were assessable as income of the assessee? 2.
Whether on the facts and in the circum stances of the case, depreciation is allowable on the 1/6th share in S.B. Sugar Mills, Bij nore which the assessee had acquired from Seth Sheo Prasad? So far as the first question is concerned, the High Court referred to the arrangement entered into by the parties as also the terms of compromise and referred to certain deci sions and came to the conclusion that the sum of Rs. 16,000 received as a part of the total sum of Rs.68,000 constituted an assessable receipt.
On the same reasoning, the High Court held that the amount of Rs.39,262 received from Devi Chand was also liable to tax.
So far as the other question is concerned, the High Court held: "The question, however, remains whether the assessee is 105 entitled to claim depreciation on the ground that it has acquired 1/6th share in the S.B. Sugar Mills.
It is to be noted that the asses see does not claim to be full owner of the property.
All that the assessee claims is 1/6th share in S.B. Sugar Mills." "The assessee claims allowance under clause (vi) of subsection (2) of section 10 of the Indian Income tax Act of 1922.
Clause (vi) is: 'In respect of depreciation of such buildings, machinery, plant or furniture being the property of the assessee . . " "In order to qualify for an allowance under clause (vi), the assessee has to make out that the building, machinery, plant or furniture is the property of the assessee.
Mr. Shanti Bhushan appearing for the assessee urged that clause (vi) is attracted even where an asses see owns a fractional share in the machinery.
On the other hand, Mr. Brij Lal Gupta appear ing for the Department urged that ownership of a fractional share in machinery does not attract clause (vi).
The point is not free from difficulty.
" The High Court ultimately came to hold: "In order to qualify for an allowance under clause (vi), the claimant must make out that the machinery is the property of the assessee.
That test is not satisfied by the present assessee.
The assessee does not claim to be the full owner of the machinery in question.
All that is claimed for the assessee is 1/6th share in the machinery.
Such a fractional share will not suffice for granting an allow ance for depreciation under section 10(2)(vi) of the Act.
" We have heard learned counsel for the assessee appellant at length.
He has referred to several authorities in support of the assessee 's stand of admissibility of the claim ' on both scores.
According to him, the proper test to be adopted should have been to find out whether the arrangement consti tuted an apparatus to earn profit.
whether the arrangement was one in course of business activity, and whether what was received constituted a part of the circulating capital or was a part of the fixed asset.
We have considered the sub missions of 106 the learned counsel for the appellant but are not in a position to accept the same.
There is hardly scope to doubt that the benefit of section 10(2)(vi) of the Act would be admissible only where the assessee is the owner of the property.
It too is not admissible in respect of a fraction al claim.
Similarly, we are of the view, in agreement with the High Court.
that the amounts which the assessee received under the compromise or by amicable arrangement was in the nature of profits to be received by the assessee for the interest held in the business and, therefore, constituted taxable income.
No other point was canvassed before us.
This appeal has to fail and is hereby dismissed.
Parties are directed to bear their own costs throughout.
A. No. 233 of 1976 This appeal between the parties is also by certificate granted by the Allahabad High Court and relates to the assessment year 1955 56 for the accounting period ending on 30th June, 1954.
Leave has been confined to two questions as would appear from the order granting the certificate, namely, as to whether one of the instalments received by the assessee out of the said amount of Rs.68,000, as referred to above, in respect of an earlier assessment year constituted a taxable receipt.
The second question relates to acquisition of the 1,6th share under a deed of exchange from Devi Chand under the exchange deed dated 16th July, 1948, which indicated that the valuation of that interest was shown to be Rs.4,50,000 and depreciation was claimed in regard to it.
Both the questions raised here are covered by our aforesaid judgment.
The appeal of the assessee has therefore to fail.
The appeal is accordingly dismissed.
Parties are directed to bear their own costs.
C.A. No. 1101 of 1975.
The relevant assessment year in this case is 1954 55 corresponding to the accounting period ending June 30, 1953.
Three questions survive for consideration: One relating to the receipt of Rs. 16,000 and Rs.42,957 in the same manner as already indicated, and the other depreciation in regard to the 1/6th share, said to have been valued at Rs.4,50,000.
Both the questions have to be answered against the assessee for the reasons already indicated.
In this case, there is a third question which is relevant, namely, whether in the facts and circumstances of the case.
the unabsorbed carried forward loss of Rs.78,084 was liable to be set off against the share of the rent received by the assessee from the Receiver.
Dealing with this question, the High Court ob served:.
107 "During the previous year relevant to the assessment year 1953 54, the assessee had suffered a loss in sugar business.
After setting off the loss against other heads of income there remained an unabsorbed loss of Rs.78,084.
In the assessment year in dispute the assessee claimed that the unabsorbed loss of the preceding year should be brought for ward and set off against its share in lease money received from the Receiver in respect of S.B. Sugar Mills.
This claim of the assessee has been disallowed and the question arises as to whether the assessee was entitled to carry forward and set off the loss as claimed by it.
" The High Court referred to section 24 of the Income tax Act of 1922 and indicated that two conditions had to be ful filled before the claim of set off of carried forward loss could be admitted, firstly, the income against which the loss has to be set off should be income from business and secondly, the business should be same in which the loss was suffered.
The High Court referred to certain decisions including the one of this Court in and ultimately negatived the claim of the assessee by saying that the question would not arise because the letting out of the sugar mill was not the business of the assessee.
In fact the receiver was appointed for dissolution of the firm and the main reason.
as found by the High Court.
for allowing the sugar factory to work was to dispose it of as a running mill so that proper price would be fetched.
Having heard learned counsel for the parties, we are satisfied that there is no merit in the assessee 's stand and the same has got to be dismissed.
The appeal is accordingly dismissed.
Parties are directed to bear their own costs throughout.
C.A. No. 941 of 1975 This appeal is by certificate from the judgment of the Allahabad High Court.
The assessee is the sugar mill which during the relevant assessment year 1960 61 corresponding to the accounting period ending 30th June, 1959, was in the hands of a Court Receiver.
The sugar mill was being assessed as an Association of Persons.
Banarsi Dass.
a partner, had 1/6th share therein.
He had acquired under a deed of ex change dated 16th July, 1948 1/6th share of Sheo Prasad in exchange of shares held by Banarsi Dass in Lord Krishna Sugar Mills valued at Rs.4,50.000.
In this assessment year, the receiver claimed that for the purposes of computing the depreciation allowance, the written down value of the busi ness assets be enhanced so as to reflect the sum of Rs.4,50,000 in place of 1/6th share representing the share of 108 Sheo Prasad.
Similar claim had been raised by Banarsi Dass in his own assessment.
The Income tax Officer rejected the claim and such rejection has been upheld throughout.
We have already turned down the claim of Banarsi Dass.
This claim has, therefore, to be rejected.
We may additionally point out that under the scheme of the Act, it is the assessee who alone is entitled to maintain such claim of depreciation and it would indeed be difficult, within the framework of the scheme contained in the statute, to maintain a separate value of the part of the asset to work out depreciation.
The book value as shown must be applicable to the entire assets of the firm including the 1/6th share which Sheo Prasad had given to Banarsi Dass.
The claim has rightly been rejected in the forums below including the High Court.
The appeal has no merit and is dismissed.
Parties will bear their own costs.
P.S.S. Appeals dis missed.
|
'A ', a partner in a firm running a sugar factory, insti tuted a suit for its dissolution in 1948 and a Receiver was appointed by the Court.
The arrangement arrived at for the factory was that it would be leased out for a term of five years to the highest bidder from amongst the six partners.
In July, 1948, 'A ' transferred his 1/6th share to the appel lant for Rs.4,50,000.
The appellant had taken a loan against shares of that value held by him in another sugar mill for purchase of the share.
In May, 1950, another partner 'B ' leased out his 1/6th share to the appellant on an annual payment of Rs.50,000.
In July, 1950 yet another partner 'C ' leased out his 1/6th share to the appellant for a similar sum.
In 1951 'C ' sued for cancellation of the lease.
In April, 1954 the dispute was compromised and the lease termi nated. 'C ' undertook to pay the appellant at the rate of Rs. 16,000 for the first three years and at the rate of Rs. I0,000 for the subsequent two years. 'B 's 1/6th share was also returned on mutual arrangement and he agreed to pay the appellant a sum of Rs.39,000 and odd annually.
During the assessment proceedings for the year 1953 54 the nature of these receipts came to be considered.
The assessee appellant maintained that these were in the nature of capital receipts in lieu of the lease hold interest.
The assessee also claimed depreciation on the 1/6th share in the sugar mill that he had acquired from 'A '.
Similar questions also arose for the assessment years 1954 55 and 1955 56.
The assessee had suffered a loss in the sugar business in the assessment year 1953 54, a part of which remained unab sorbed, and claimed set off of that unabsorbed loss against the share of the rent received by him from the Receiver in the assessment year 1954 55.
Since the sugar mill was being assessed as an association of persons, for the assessment year 1960 61 102 the Receiver claimed that for the purpose of computing depreciation allowance, the written down value of the busi ness assets be enhanced so as to reflect the sum of Rs.4,50,000 in place of 16th share representing the share of 'A '.
The Revenue negatived the assessee 's contentions, which view was upheld by the High Court.
Dismissing the appeals by certificate, the Court, HELD: 1.
The amounts the assessee received under the compromise or by amicable arrangement from other partners were in the nature of profits to be received by the assessee for the interest held in the business and, therefore, con stituted taxable income.
[106B] 2.
The benefit of section 10(2)(vi) of the Income tax Act, 1922 would be admissible only where the assessee is the owner of the property.
It too is not admissible in respect of a fractional claim.
[106A] In the instant case, all that is claimed for the asses see is 1/6th share in the machinery.
Such a fractional share does not suffice for granting an allowance for depreciation under section 10(2)(vi) of the Act.
[105F] 3.
Two conditions had to be fulfilled under section 24 of the Incometax Act, 1922 before the claim for set off of carried forward loss could be admitted, firstly, the income against which the loss has to be set off should be income from business and secondly, the business should be same in which the loss was suffered.
[107C] In the instant case, the letting out of the sugar mill was not the business of the assessee.
The Receiver was appointed for dissolution of the firm and the main reason for allowing the sugar factory to work was to dispose it of as a running mill so that proper price could be fetched.
[107DE] 4.
Under the scheme of 1922 Act, it is the assessee who alone is entitled to maintain claim of depreciation.
Within the framework of that scheme it is difficult to maintain separate value of a part of the asset to work out deprecia tion.
The book value, as shown must in the instant case, therefore, be applicable to the entire assets of the firm including the 1/6th share which 'A ' had given to the appel lant.
The claim of the Receiver for depreciation cannot, therefore, be sustained.
[108B] 103
|
ivil Appeal Nos. 850 of 1973 etc.
From the Judgment and Order dated 3.9.
1970 of the Allahabad High Court in Civil Miscellaneous (ITR) No. 461 of 1961.
With CIVIL APPEAL No. 941 of 1975.
From the Judgment and Order dated 5.5.
1972 of the Allahabad High Court in I.T. Reference No. 236 of 1969.
Raja Ram Agarwal and Mrs. Rani Chhabra for the Appellants.
B.B. Ahuja and Ms. A Subhashini for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
CA.
No. 850 of 1973 This appeal is by certificate and is directed against the judgment of the High Court of Allahabad.
Assessee and five of his brothers constituted a Hindu Joint Family.
The relevant assessment year is 1953 54 corresponding to the accounting period ending on 30th June, 1952.
The Joint Family which owned inter alia a sugar factory at Bijnore.
In 1930 there was partition in the family and the members of the erstwhile Joint Family constituted themselves into a partnership firm which took over the sugar factory and operated the same.
In the year ,1944, Sheo Prasad, one of the brothers who was a partner of the firm instituted a suit in the Lahore High Court for dissolution of the firm.
Partition of the country followed and after the parties shifted over to India a fresh suit was instituted at Bijnore for purposes of partition.
The properties were put in charge of a receiver appointed by the Court.
So far as the sugar factory is concerned, the arrangement was that at five yearly rest an auction was to be held confined to the partners and the highest bidder would be given lease to operate the factory for that period under the receiver.
On 16th July, 1948, Sheo Prasad trans ferred his 1/6th share to Banarsi Dass at a stated valuation of Rs.4,50,000.
On 3rd May, 1950, another brother, Devi Chand, leased out his 1/6th share to Banarsi Dass on an annual payment of Rs.50,000.
On 13th July, 1950, yet another brother, Kanshi Ram, similarly leased out his 1/6th share to Banarsi Dass for a similar sum.
In 1951, Kanshi Ram sued for cancellation of the lease.
On 6th April, 1954, the dispute was compromised and the lease was 104 terminated.
Kanshi Ram undertook to pay to Banarsi Dass at the rate of Rs. 16,000 for the first three years and at the rate of Rs. 10,000 for the subsequent two years.
Devi Chand 's 1/6th share was also returned on mutual arrangement and he agreed to pay a sum of Rs.39,000 and odd annually to Banarsi Dass for the lease period.
During the assessment proceedings, the nature of these receipts came to be debat ed the assessee maintained that these were in the nature of capital receipt lieu of the lease hold interest and the Income tax Officer maintained that those were revenue re ceipts.
In due course, the Tribunal ultimately upheld the view of the Revenue.
One more question that arose was the admissibility of a claim of expenditure being payment of interest on a loan taken for purchase of shares in the sugar factory.
The Income tax Officer had allowed the claim of Rs.75,211.
The Appellate Assistant Commissioner gave notice to the assessee and disallowed the same.
The Appellate Tribunal reversed the finding of the Appellate Assistant Commissioner in regard to the admissibility of the claim.
Thus the assessee as also the Revenue applied to the Tribunal to refer the case to the High Court.
As far as relevant, the following questions were referred for the opinion of the High Court under section 66(1) of the Act at the instance of the assessee.
Whether on the facts and in the circum stances of the case, the sums of Rs. 16,000 and Rs.39,262 received from Kanshi Ram and Devi Chand respectively were assessable as income of the assessee? 2.
Whether on the facts and in the circum stances of the case, depreciation is allowable on the 1/6th share in S.B. Sugar Mills, Bij nore which the assessee had acquired from Seth Sheo Prasad? So far as the first question is concerned, the High Court referred to the arrangement entered into by the parties as also the terms of compromise and referred to certain deci sions and came to the conclusion that the sum of Rs. 16,000 received as a part of the total sum of Rs.68,000 constituted an assessable receipt.
On the same reasoning, the High Court held that the amount of Rs.39,262 received from Devi Chand was also liable to tax.
So far as the other question is concerned, the High Court held: "The question, however, remains whether the assessee is 105 entitled to claim depreciation on the ground that it has acquired 1/6th share in the S.B. Sugar Mills.
It is to be noted that the asses see does not claim to be full owner of the property.
All that the assessee claims is 1/6th share in S.B. Sugar Mills." "The assessee claims allowance under clause (vi) of subsection (2) of section 10 of the Indian Income tax Act of 1922.
Clause (vi) is: 'In respect of depreciation of such buildings, machinery, plant or furniture being the property of the assessee . . " "In order to qualify for an allowance under clause (vi), the assessee has to make out that the building, machinery, plant or furniture is the property of the assessee.
Mr. Shanti Bhushan appearing for the assessee urged that clause (vi) is attracted even where an asses see owns a fractional share in the machinery.
On the other hand, Mr. Brij Lal Gupta appear ing for the Department urged that ownership of a fractional share in machinery does not attract clause (vi).
The point is not free from difficulty.
" The High Court ultimately came to hold: "In order to qualify for an allowance under clause (vi), the claimant must make out that the machinery is the property of the assessee.
That test is not satisfied by the present assessee.
The assessee does not claim to be the full owner of the machinery in question.
All that is claimed for the assessee is 1/6th share in the machinery.
Such a fractional share will not suffice for granting an allow ance for depreciation under section 10(2)(vi) of the Act.
" We have heard learned counsel for the assessee appellant at length.
He has referred to several authorities in support of the assessee 's stand of admissibility of the claim ' on both scores.
According to him, the proper test to be adopted should have been to find out whether the arrangement consti tuted an apparatus to earn profit.
whether the arrangement was one in course of business activity, and whether what was received constituted a part of the circulating capital or was a part of the fixed asset.
We have considered the sub missions of 106 the learned counsel for the appellant but are not in a position to accept the same.
There is hardly scope to doubt that the benefit of section 10(2)(vi) of the Act would be admissible only where the assessee is the owner of the property.
It too is not admissible in respect of a fraction al claim.
Similarly, we are of the view, in agreement with the High Court.
that the amounts which the assessee received under the compromise or by amicable arrangement was in the nature of profits to be received by the assessee for the interest held in the business and, therefore, constituted taxable income.
No other point was canvassed before us.
This appeal has to fail and is hereby dismissed.
Parties are directed to bear their own costs throughout.
A. No. 233 of 1976 This appeal between the parties is also by certificate granted by the Allahabad High Court and relates to the assessment year 1955 56 for the accounting period ending on 30th June, 1954.
Leave has been confined to two questions as would appear from the order granting the certificate, namely, as to whether one of the instalments received by the assessee out of the said amount of Rs.68,000, as referred to above, in respect of an earlier assessment year constituted a taxable receipt.
The second question relates to acquisition of the 1,6th share under a deed of exchange from Devi Chand under the exchange deed dated 16th July, 1948, which indicated that the valuation of that interest was shown to be Rs.4,50,000 and depreciation was claimed in regard to it.
Both the questions raised here are covered by our aforesaid judgment.
The appeal of the assessee has therefore to fail.
The appeal is accordingly dismissed.
Parties are directed to bear their own costs.
C.A. No. 1101 of 1975.
The relevant assessment year in this case is 1954 55 corresponding to the accounting period ending June 30, 1953.
Three questions survive for consideration: One relating to the receipt of Rs. 16,000 and Rs.42,957 in the same manner as already indicated, and the other depreciation in regard to the 1/6th share, said to have been valued at Rs.4,50,000.
Both the questions have to be answered against the assessee for the reasons already indicated.
In this case, there is a third question which is relevant, namely, whether in the facts and circumstances of the case.
the unabsorbed carried forward loss of Rs.78,084 was liable to be set off against the share of the rent received by the assessee from the Receiver.
Dealing with this question, the High Court ob served:.
107 "During the previous year relevant to the assessment year 1953 54, the assessee had suffered a loss in sugar business.
After setting off the loss against other heads of income there remained an unabsorbed loss of Rs.78,084.
In the assessment year in dispute the assessee claimed that the unabsorbed loss of the preceding year should be brought for ward and set off against its share in lease money received from the Receiver in respect of S.B. Sugar Mills.
This claim of the assessee has been disallowed and the question arises as to whether the assessee was entitled to carry forward and set off the loss as claimed by it.
" The High Court referred to section 24 of the Income tax Act of 1922 and indicated that two conditions had to be ful filled before the claim of set off of carried forward loss could be admitted, firstly, the income against which the loss has to be set off should be income from business and secondly, the business should be same in which the loss was suffered.
The High Court referred to certain decisions including the one of this Court in and ultimately negatived the claim of the assessee by saying that the question would not arise because the letting out of the sugar mill was not the business of the assessee.
In fact the receiver was appointed for dissolution of the firm and the main reason.
as found by the High Court.
for allowing the sugar factory to work was to dispose it of as a running mill so that proper price would be fetched.
Having heard learned counsel for the parties, we are satisfied that there is no merit in the assessee 's stand and the same has got to be dismissed.
The appeal is accordingly dismissed.
Parties are directed to bear their own costs throughout.
C.A. No. 941 of 1975 This appeal is by certificate from the judgment of the Allahabad High Court.
The assessee is the sugar mill which during the relevant assessment year 1960 61 corresponding to the accounting period ending 30th June, 1959, was in the hands of a Court Receiver.
The sugar mill was being assessed as an Association of Persons.
Banarsi Dass.
a partner, had 1/6th share therein.
He had acquired under a deed of ex change dated 16th July, 1948 1/6th share of Sheo Prasad in exchange of shares held by Banarsi Dass in Lord Krishna Sugar Mills valued at Rs.4,50.000.
In this assessment year, the receiver claimed that for the purposes of computing the depreciation allowance, the written down value of the busi ness assets be enhanced so as to reflect the sum of Rs.4,50,000 in place of 1/6th share representing the share of 108 Sheo Prasad.
Similar claim had been raised by Banarsi Dass in his own assessment.
The Income tax Officer rejected the claim and such rejection has been upheld throughout.
We have already turned down the claim of Banarsi Dass.
This claim has, therefore, to be rejected.
We may additionally point out that under the scheme of the Act, it is the assessee who alone is entitled to maintain such claim of depreciation and it would indeed be difficult, within the framework of the scheme contained in the statute, to maintain a separate value of the part of the asset to work out depreciation.
The book value as shown must be applicable to the entire assets of the firm including the 1/6th share which Sheo Prasad had given to Banarsi Dass.
The claim has rightly been rejected in the forums below including the High Court.
The appeal has no merit and is dismissed.
Parties will bear their own costs.
P.S.S. Appeals dis missed.
|
ivil Appeal Nos. 850 of 1973 etc.
From the Judgment and Order dated 3.9.
1970 of the Allahabad High Court in Civil Miscellaneous (ITR) No. 461 of 1961.
With CIVIL APPEAL No. 941 of 1975.
From the Judgment and Order dated 5.5.
1972 of the Allahabad High Court in I.T. Reference No. 236 of 1969.
Raja Ram Agarwal and Mrs. Rani Chhabra for the Appellants.
B.B. Ahuja and Ms. A Subhashini for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
CA.
No. 850 of 1973 This appeal is by certificate and is directed against the judgment of the High Court of Allahabad.
Assessee and five of his brothers constituted a Hindu Joint Family.
The relevant assessment year is 1953 54 corresponding to the accounting period ending on 30th June, 1952.
The Joint Family which owned inter alia a sugar factory at Bijnore.
In 1930 there was partition in the family and the members of the erstwhile Joint Family constituted themselves into a partnership firm which took over the sugar factory and operated the same.
In the year ,1944, Sheo Prasad, one of the brothers who was a partner of the firm instituted a suit in the Lahore High Court for dissolution of the firm.
Partition of the country followed and after the parties shifted over to India a fresh suit was instituted at Bijnore for purposes of partition.
The properties were put in charge of a receiver appointed by the Court.
So far as the sugar factory is concerned, the arrangement was that at five yearly rest an auction was to be held confined to the partners and the highest bidder would be given lease to operate the factory for that period under the receiver.
On 16th July, 1948, Sheo Prasad trans ferred his 1/6th share to Banarsi Dass at a stated valuation of Rs.4,50,000.
On 3rd May, 1950, another brother, Devi Chand, leased out his 1/6th share to Banarsi Dass on an annual payment of Rs.50,000.
On 13th July, 1950, yet another brother, Kanshi Ram, similarly leased out his 1/6th share to Banarsi Dass for a similar sum.
In 1951, Kanshi Ram sued for cancellation of the lease.
On 6th April, 1954, the dispute was compromised and the lease was 104 terminated.
Kanshi Ram undertook to pay to Banarsi Dass at the rate of Rs. 16,000 for the first three years and at the rate of Rs. 10,000 for the subsequent two years.
Devi Chand 's 1/6th share was also returned on mutual arrangement and he agreed to pay a sum of Rs.39,000 and odd annually to Banarsi Dass for the lease period.
During the assessment proceedings, the nature of these receipts came to be debat ed the assessee maintained that these were in the nature of capital receipt lieu of the lease hold interest and the Income tax Officer maintained that those were revenue re ceipts.
In due course, the Tribunal ultimately upheld the view of the Revenue.
One more question that arose was the admissibility of a claim of expenditure being payment of interest on a loan taken for purchase of shares in the sugar factory.
The Income tax Officer had allowed the claim of Rs.75,211.
The Appellate Assistant Commissioner gave notice to the assessee and disallowed the same.
The Appellate Tribunal reversed the finding of the Appellate Assistant Commissioner in regard to the admissibility of the claim.
Thus the assessee as also the Revenue applied to the Tribunal to refer the case to the High Court.
As far as relevant, the following questions were referred for the opinion of the High Court under section 66(1) of the Act at the instance of the assessee.
Whether on the facts and in the circum stances of the case, the sums of Rs. 16,000 and Rs.39,262 received from Kanshi Ram and Devi Chand respectively were assessable as income of the assessee? 2.
Whether on the facts and in the circum stances of the case, depreciation is allowable on the 1/6th share in S.B. Sugar Mills, Bij nore which the assessee had acquired from Seth Sheo Prasad? So far as the first question is concerned, the High Court referred to the arrangement entered into by the parties as also the terms of compromise and referred to certain deci sions and came to the conclusion that the sum of Rs. 16,000 received as a part of the total sum of Rs.68,000 constituted an assessable receipt.
On the same reasoning, the High Court held that the amount of Rs.39,262 received from Devi Chand was also liable to tax.
So far as the other question is concerned, the High Court held: "The question, however, remains whether the assessee is 105 entitled to claim depreciation on the ground that it has acquired 1/6th share in the S.B. Sugar Mills.
It is to be noted that the asses see does not claim to be full owner of the property.
All that the assessee claims is 1/6th share in S.B. Sugar Mills." "The assessee claims allowance under clause (vi) of subsection (2) of section 10 of the Indian Income tax Act of 1922.
Clause (vi) is: 'In respect of depreciation of such buildings, machinery, plant or furniture being the property of the assessee . . " "In order to qualify for an allowance under clause (vi), the assessee has to make out that the building, machinery, plant or furniture is the property of the assessee.
Mr. Shanti Bhushan appearing for the assessee urged that clause (vi) is attracted even where an asses see owns a fractional share in the machinery.
On the other hand, Mr. Brij Lal Gupta appear ing for the Department urged that ownership of a fractional share in machinery does not attract clause (vi).
The point is not free from difficulty.
" The High Court ultimately came to hold: "In order to qualify for an allowance under clause (vi), the claimant must make out that the machinery is the property of the assessee.
That test is not satisfied by the present assessee.
The assessee does not claim to be the full owner of the machinery in question.
All that is claimed for the assessee is 1/6th share in the machinery.
Such a fractional share will not suffice for granting an allow ance for depreciation under section 10(2)(vi) of the Act.
" We have heard learned counsel for the assessee appellant at length.
He has referred to several authorities in support of the assessee 's stand of admissibility of the claim ' on both scores.
According to him, the proper test to be adopted should have been to find out whether the arrangement consti tuted an apparatus to earn profit.
whether the arrangement was one in course of business activity, and whether what was received constituted a part of the circulating capital or was a part of the fixed asset.
We have considered the sub missions of 106 the learned counsel for the appellant but are not in a position to accept the same.
There is hardly scope to doubt that the benefit of section 10(2)(vi) of the Act would be admissible only where the assessee is the owner of the property.
It too is not admissible in respect of a fraction al claim.
Similarly, we are of the view, in agreement with the High Court.
that the amounts which the assessee received under the compromise or by amicable arrangement was in the nature of profits to be received by the assessee for the interest held in the business and, therefore, constituted taxable income.
No other point was canvassed before us.
This appeal has to fail and is hereby dismissed.
Parties are directed to bear their own costs throughout.
A. No. 233 of 1976 This appeal between the parties is also by certificate granted by the Allahabad High Court and relates to the assessment year 1955 56 for the accounting period ending on 30th June, 1954.
Leave has been confined to two questions as would appear from the order granting the certificate, namely, as to whether one of the instalments received by the assessee out of the said amount of Rs.68,000, as referred to above, in respect of an earlier assessment year constituted a taxable receipt.
The second question relates to acquisition of the 1,6th share under a deed of exchange from Devi Chand under the exchange deed dated 16th July, 1948, which indicated that the valuation of that interest was shown to be Rs.4,50,000 and depreciation was claimed in regard to it.
Both the questions raised here are covered by our aforesaid judgment.
The appeal of the assessee has therefore to fail.
The appeal is accordingly dismissed.
Parties are directed to bear their own costs.
C.A. No. 1101 of 1975.
The relevant assessment year in this case is 1954 55 corresponding to the accounting period ending June 30, 1953.
Three questions survive for consideration: One relating to the receipt of Rs. 16,000 and Rs.42,957 in the same manner as already indicated, and the other depreciation in regard to the 1/6th share, said to have been valued at Rs.4,50,000.
Both the questions have to be answered against the assessee for the reasons already indicated.
In this case, there is a third question which is relevant, namely, whether in the facts and circumstances of the case.
the unabsorbed carried forward loss of Rs.78,084 was liable to be set off against the share of the rent received by the assessee from the Receiver.
Dealing with this question, the High Court ob served:.
107 "During the previous year relevant to the assessment year 1953 54, the assessee had suffered a loss in sugar business.
After setting off the loss against other heads of income there remained an unabsorbed loss of Rs.78,084.
In the assessment year in dispute the assessee claimed that the unabsorbed loss of the preceding year should be brought for ward and set off against its share in lease money received from the Receiver in respect of S.B. Sugar Mills.
This claim of the assessee has been disallowed and the question arises as to whether the assessee was entitled to carry forward and set off the loss as claimed by it.
" The High Court referred to section 24 of the Income tax Act of 1922 and indicated that two conditions had to be ful filled before the claim of set off of carried forward loss could be admitted, firstly, the income against which the loss has to be set off should be income from business and secondly, the business should be same in which the loss was suffered.
The High Court referred to certain decisions including the one of this Court in and ultimately negatived the claim of the assessee by saying that the question would not arise because the letting out of the sugar mill was not the business of the assessee.
In fact the receiver was appointed for dissolution of the firm and the main reason.
as found by the High Court.
for allowing the sugar factory to work was to dispose it of as a running mill so that proper price would be fetched.
Having heard learned counsel for the parties, we are satisfied that there is no merit in the assessee 's stand and the same has got to be dismissed.
The appeal is accordingly dismissed.
Parties are directed to bear their own costs throughout.
C.A. No. 941 of 1975 This appeal is by certificate from the judgment of the Allahabad High Court.
The assessee is the sugar mill which during the relevant assessment year 1960 61 corresponding to the accounting period ending 30th June, 1959, was in the hands of a Court Receiver.
The sugar mill was being assessed as an Association of Persons.
Banarsi Dass.
a partner, had 1/6th share therein.
He had acquired under a deed of ex change dated 16th July, 1948 1/6th share of Sheo Prasad in exchange of shares held by Banarsi Dass in Lord Krishna Sugar Mills valued at Rs.4,50.000.
In this assessment year, the receiver claimed that for the purposes of computing the depreciation allowance, the written down value of the busi ness assets be enhanced so as to reflect the sum of Rs.4,50,000 in place of 1/6th share representing the share of 108 Sheo Prasad.
Similar claim had been raised by Banarsi Dass in his own assessment.
The Income tax Officer rejected the claim and such rejection has been upheld throughout.
We have already turned down the claim of Banarsi Dass.
This claim has, therefore, to be rejected.
We may additionally point out that under the scheme of the Act, it is the assessee who alone is entitled to maintain such claim of depreciation and it would indeed be difficult, within the framework of the scheme contained in the statute, to maintain a separate value of the part of the asset to work out depreciation.
The book value as shown must be applicable to the entire assets of the firm including the 1/6th share which Sheo Prasad had given to Banarsi Dass.
The claim has rightly been rejected in the forums below including the High Court.
The appeal has no merit and is dismissed.
Parties will bear their own costs.
P.S.S. Appeals dis missed.
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'A ', a partner in a firm running a sugar factory, insti tuted a suit for its dissolution in 1948 and a Receiver was appointed by the Court.
The arrangement arrived at for the factory was that it would be leased out for a term of five years to the highest bidder from amongst the six partners.
In July, 1948, 'A ' transferred his 1/6th share to the appel lant for Rs.4,50,000.
The appellant had taken a loan against shares of that value held by him in another sugar mill for purchase of the share.
In May, 1950, another partner 'B ' leased out his 1/6th share to the appellant on an annual payment of Rs.50,000.
In July, 1950 yet another partner 'C ' leased out his 1/6th share to the appellant for a similar sum.
In 1951 'C ' sued for cancellation of the lease.
In April, 1954 the dispute was compromised and the lease termi nated. 'C ' undertook to pay the appellant at the rate of Rs. 16,000 for the first three years and at the rate of Rs. I0,000 for the subsequent two years. 'B 's 1/6th share was also returned on mutual arrangement and he agreed to pay the appellant a sum of Rs.39,000 and odd annually.
During the assessment proceedings for the year 1953 54 the nature of these receipts came to be considered.
The assessee appellant maintained that these were in the nature of capital receipts in lieu of the lease hold interest.
The assessee also claimed depreciation on the 1/6th share in the sugar mill that he had acquired from 'A '.
Similar questions also arose for the assessment years 1954 55 and 1955 56.
The assessee had suffered a loss in the sugar business in the assessment year 1953 54, a part of which remained unab sorbed, and claimed set off of that unabsorbed loss against the share of the rent received by him from the Receiver in the assessment year 1954 55.
Since the sugar mill was being assessed as an association of persons, for the assessment year 1960 61 102 the Receiver claimed that for the purpose of computing depreciation allowance, the written down value of the busi ness assets be enhanced so as to reflect the sum of Rs.4,50,000 in place of 16th share representing the share of 'A '.
The Revenue negatived the assessee 's contentions, which view was upheld by the High Court.
Dismissing the appeals by certificate, the Court, HELD: 1.
The amounts the assessee received under the compromise or by amicable arrangement from other partners were in the nature of profits to be received by the assessee for the interest held in the business and, therefore, con stituted taxable income.
[106B] 2.
The benefit of section 10(2)(vi) of the Income tax Act, 1922 would be admissible only where the assessee is the owner of the property.
It too is not admissible in respect of a fractional claim.
[106A] In the instant case, all that is claimed for the asses see is 1/6th share in the machinery.
Such a fractional share does not suffice for granting an allowance for depreciation under section 10(2)(vi) of the Act.
[105F] 3.
Two conditions had to be fulfilled under section 24 of the Incometax Act, 1922 before the claim for set off of carried forward loss could be admitted, firstly, the income against which the loss has to be set off should be income from business and secondly, the business should be same in which the loss was suffered.
[107C] In the instant case, the letting out of the sugar mill was not the business of the assessee.
The Receiver was appointed for dissolution of the firm and the main reason for allowing the sugar factory to work was to dispose it of as a running mill so that proper price could be fetched.
[107DE] 4.
Under the scheme of 1922 Act, it is the assessee who alone is entitled to maintain claim of depreciation.
Within the framework of that scheme it is difficult to maintain separate value of a part of the asset to work out deprecia tion.
The book value, as shown must in the instant case, therefore, be applicable to the entire assets of the firm including the 1/6th share which 'A ' had given to the appel lant.
The claim of the Receiver for depreciation cannot, therefore, be sustained.
[108B] 103
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'A ', a partner in a firm running a sugar factory, insti tuted a suit for its dissolution in 1948 and a Receiver was appointed by the Court.
The arrangement arrived at for the factory was that it would be leased out for a term of five years to the highest bidder from amongst the six partners.
In July, 1948, 'A ' transferred his 1/6th share to the appel lant for Rs.4,50,000.
The appellant had taken a loan against shares of that value held by him in another sugar mill for purchase of the share.
In May, 1950, another partner 'B ' leased out his 1/6th share to the appellant on an annual payment of Rs.50,000.
In July, 1950 yet another partner 'C ' leased out his 1/6th share to the appellant for a similar sum.
In 1951 'C ' sued for cancellation of the lease.
In April, 1954 the dispute was compromised and the lease termi nated. 'C ' undertook to pay the appellant at the rate of Rs. 16,000 for the first three years and at the rate of Rs. I0,000 for the subsequent two years. 'B 's 1/6th share was also returned on mutual arrangement and he agreed to pay the appellant a sum of Rs.39,000 and odd annually.
During the assessment proceedings for the year 1953 54 the nature of these receipts came to be considered.
The assessee appellant maintained that these were in the nature of capital receipts in lieu of the lease hold interest.
The assessee also claimed depreciation on the 1/6th share in the sugar mill that he had acquired from 'A '.
Similar questions also arose for the assessment years 1954 55 and 1955 56.
The assessee had suffered a loss in the sugar business in the assessment year 1953 54, a part of which remained unab sorbed, and claimed set off of that unabsorbed loss against the share of the rent received by him from the Receiver in the assessment year 1954 55.
Since the sugar mill was being assessed as an association of persons, for the assessment year 1960 61 102 the Receiver claimed that for the purpose of computing depreciation allowance, the written down value of the busi ness assets be enhanced so as to reflect the sum of Rs.4,50,000 in place of 16th share representing the share of 'A '.
The Revenue negatived the assessee 's contentions, which view was upheld by the High Court.
Dismissing the appeals by certificate, the Court, HELD: 1.
The amounts the assessee received under the compromise or by amicable arrangement from other partners were in the nature of profits to be received by the assessee for the interest held in the business and, therefore, con stituted taxable income.
[106B] 2.
The benefit of section 10(2)(vi) of the Income tax Act, 1922 would be admissible only where the assessee is the owner of the property.
It too is not admissible in respect of a fractional claim.
[106A] In the instant case, all that is claimed for the asses see is 1/6th share in the machinery.
Such a fractional share does not suffice for granting an allowance for depreciation under section 10(2)(vi) of the Act.
[105F] 3.
Two conditions had to be fulfilled under section 24 of the Incometax Act, 1922 before the claim for set off of carried forward loss could be admitted, firstly, the income against which the loss has to be set off should be income from business and secondly, the business should be same in which the loss was suffered.
[107C] In the instant case, the letting out of the sugar mill was not the business of the assessee.
The Receiver was appointed for dissolution of the firm and the main reason for allowing the sugar factory to work was to dispose it of as a running mill so that proper price could be fetched.
[107DE] 4.
Under the scheme of 1922 Act, it is the assessee who alone is entitled to maintain claim of depreciation.
Within the framework of that scheme it is difficult to maintain separate value of a part of the asset to work out deprecia tion.
The book value, as shown must in the instant case, therefore, be applicable to the entire assets of the firm including the 1/6th share which 'A ' had given to the appel lant.
The claim of the Receiver for depreciation cannot, therefore, be sustained.
[108B] 103
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, right in holding that Respondent No. 1 was a 'workman ' and in granting relief on that basis.
[996E] & CIVIL APPELLATE JURISDICTION: Civil Appeal Nos.3521 3523 of 1987.
From the Judgment and order dated 17.10.
1986 of the Rajasthan High Court in D.B. Civil Special (Writ) Appeals Nos.
27,28 of 1983 and 224 of 1982.
Dr. Shankar Ghosh, N.C. Shah and Praveen Kumar for the Appellant.
Tapas Ray, S.K. Jain, Mrs. P.Jain and section Atreya for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
After hearing parties and after considering the relevant documents, additional as well as original, we grant leave to appeal in these matters.
The appeals are disposed of by the judgment herein.
989 Since prior to Ist of January, 1978 the respondent No. 1 Shri Kishan Bhageria was working under the appellant company as an Internal Auditor on a monthly salary of Rs.1186.60 per month.
The appellant alleged that the respondent started absenting himself from 28.1.78 and as such was not entitled to any salary for any period beyond 28.1.78 The said respondent was thereafter placed under suspension on 30th of March, 1978.
The respondent on 4th of May, 1978 filed an application under section 33C(2) of the (hereinafter called 'the Act ') claiming the total sum of Rs.4,746.40 on account of salary from Ist of January, 1978 to 30th of April, 1978 at the rate of Rs.11,86.60 per month.
The appellant company objected.
The main ground of objections was that the respondent was not a workman.
On or about 9th of November, 1978 there was an order dismissing the respondent from service.
The respondent thereafter on 2nd of January, 1979 filed an application under section 28A of the Rajasthan Shops & Establishments Act, 1958 (hereinafter called 'the Rajasthan Act ').
The said application was dismissed on 31st of July 1979 on the ground of limitation.
The Labour Court on 2nd of August, 1979 held that the respondent was doing clerical duties and as such was a workman under the Act and he was entitled to Rs.2,060 as salary from 1.1.78 to 9.3.78.
The appellant filed Writ Petition No. 765 of 1979 in the Rajasthan High Court against the order of the Labour Court allowing the said salary.
The respondent also filed another writ petition being writ petition No. 1091 of 1979 for declaration that he was entitled to receive Rs.2,066.98 as salary from 9.3.78 to 30.4.78.
There was thereafter a reference under section 10 of the Act on 8.8.80 arising out of the dismissal of the respondent.
The appellant filed another writ petition being Writ Petition No. 1623 of 1980 challenging the order of reference.
All these aforesaid writ petitions were disposed of by the learned Single Judge of the Rajasthan High Court on 16.3.82 holding that the respondent was not a workman.
The other contentions urged before the leaned Single Judge were not considered by the Division Bench in the view it took later on.
On 17th of October, 1986 the Division Bench reversed the judgment of the learned Single Judge and held that the respondent was a workman.
Two writ petitions of the appellant were dismissed and the writ petition of the respondent was allowed.
Aggrieved by the aforesaid orders the appellant has come up in these appeals before this Court.
The main question which requires consideration in these appeals is whether the respondent was a workman or not.
For the determination of this question it is necessary to refer to section 2(s) of the Act which defines "workman" and states that it means any person emp 990 loyed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and includes any such person who has been dismissed discharged or retrenched in connection with or as a consequence of any dispute.
But sub clause (iii) does not include any person who is employed mainly in a managerial or administrative capacity and sub clause (iv) does not include any person who being employed in a supervisory capacity draws wages exceeding one thousand six hundred rupees per month or duties attached to the office or by reason of the powers vested in him, discharges functions mainly of a managerial nature.
In view of the said definition, we are concerned here with the question whether the respondent was a workman as not being employed in any supervisory capacity.
There is no controversy that the said respondent is not employed in any managerial or administrative capacity.
In this case before we deal with the facts and the relevant authorities of this Court it may be appropriate to refer to a decision of P.B. Mukharji, J. Of the Calcutta High Court as the learned Chief Justice then was in Mcleod and Co. vs Sixth Industrial Tribunal, West Bengal and others, A.I.R. 1958 Calcutta 273.
There the learned Judge observed that whether a person was a workman within the definition of the was the very foundation of the jurisdiction of the Industrial Tribunal.
The Court further observed that in order to determine the categories of service indicated by the use of different words like "supervisory", "managerial", "administrative", it was necessary not to import the notions of one into the interpretation of the other.
The words such as supervisory, managerial and administrative are advisedly loose expressions with no rigid frontiers and too much subtlety should not be used in trying to precisely define where supervision ends and management begins or administration starts.
For that would be theoretical and not practical.
It has to be broadly interpreted from a common sense point of view where tests will be simple both in theory and in their application.
The learned Judge further observed that a supervisor need not be a manager or an administrator and a supervisor can be a workman so long as he did not exceed the monetary limitation indicated in the section and a supervisor irrespective of his salary is not a workman who has to discharge functions mainly of managerial nature by reasons of the duties attached to his office or of the powers vested in him.
In that case the learned Judge further held that a person in charge of a Department could not ordinarily be a clerk even though he may not have power to take disciplinary action or even though he may have another superior 991 officer above him.
It was further observed that distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision.
It is reiterated that a manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator.
Bearing in mind the aforesaid indication, it would be necessary to discuss some decisions of this Court.
In All India Reserve Bank Employees Association vs Reserve Bank of India, ; , this Court dealing with certain types of employees observed "These employees distribute work, detect faults, report for penalty, make arrangements for filling vacancies, to mention only a few of the duties which are supervisory and not merely clerical." At page 46 of the report Hidayatullah, J. as the learned Chief Justice then was observed that the work in a Bank involved layer upon layer of checkers and checking is hardly supervision but where there is a power of assigning duties and distribution of work there is supervision, (emphasis supplied).
There the Court referred to a previous decision in Llyods Bank Ltd. vs Pannalal Gupta, , where the finding of the Labour Appellate Tribunal was reversed because the legal inference from proved facts was wrongly drawn and it was reiterated that before a clerk could claim a special allowance payable to a supervisor, he must prove that he supervises the work of some others who are in a sense below him.
It was pointed out by Hidayatullah, J. that mere checking of the work of others is not enough because this checking was a part of accounting and not of supervision and the work done in the audit department of a bank was not supervision.
(emphasis supplied).
In Burmah Shell Oil Storage & Distribution Co. Of India.
vs Burmah Shell Management Staff Association & Ors., ; , this Court observed that a workman must be held to be employed to do that work which is the main work he is required to do, even though he may be incidentally doing other types of work.
Therefore, in determining which of the employees in the various categories are covered by the definition of 'workman ' one has to see what is the main or substantial work which he is employed to do.
In The Punjab Co operative Bank Ltd. vs R.S. Bhatia (dead) through Lrs., it was held that the accountant was supposed to sign the salary bills of the staff even while performing the duties of a clerk.
That did not make the respondent employed in a managerial or administrative capacity.
The workman was, therefore, in that context rightly held as a clerk. 992 In P. Maheshwari vs Delhi Administration & Ors., ; the question whether a person was performing supervisory or managerial work was the question of fact to be decided bearing in mind the correct principle.
The principle therefore is, one must look into the main work and that must be found out from the main duties.
A supervisor was one who could bind the company to take some kind of decision on behalf of the company.
One who was reporting merely as to the affairs of the company and making assessment for the purpose of reporting was not a supervisor.
See in this connection Black 's Law Dictionary, Special Deluxe, Fifth Edition.
At page 1290, "Supervisor" has been described, inter alia, as follows: "In a broad sense, one having authority over others, to superintend and direct.
The term 'supervisor ' means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibility to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.
" Reference may be made to the observations of this Court in Ved Prakash Gupta vs M/s. Delton Cable India (P) Ltd., ; There on facts a Security Inspector was held to be a workman.
At page 575 of the report this Court referred to the decision in Llyods Bank Ltd. vs Panna Lal Gupta, (supra) and also the observations of this Court in Hind Construction and Engineering Company Ltd. vs Their Workmen, In that case the nature of the duties performed by the appellant showed that the substantial part of the work of the appellant consisted of looking after the security of the factory and its property by deputing the watchmen working under him to work at the factory gate or sending them to watch towers or around the factory or to accompany visitors to the factory and making entries in the visitors ' register as regards the visitors and in the concerned registers as regards materials entering into or going out of the premises of the factory.
There it was found that he had no power to appoint.
In the instant case the evidence have been summarised by the Division Bench.
Reference may be made to pages 65, 73, 80, 84 to 94, 993 95, 96 and 97 of the Paper Book which indicate the nature of duties performed by the respondent No. 1 herein.
His duties were mainly, reporting and checking up on behalf of the management.
A reporter or a checking clerk is not a supervisor.
The respondent herein does not appear to us doing any kind of supervisory work.
He was undoubtedly checking up on behalf of the employer but he had no independent right or authority to take decision and his decision did not bind the company.
In that view of the matter keeping the correct principle of law in mind the Division Bench has come to the conclusion taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor.
That conclusion arrived at in the manner indicated above cannot, in our opinion, be interfered with under Article 136 of the Constitution.
It is not necessary for our present purpose to set out in extenso the evidence on record as discussed by the Division Bench.
Our attention was, however, drawn by the counsel for the respondent to certain correspondence, for instance the letter at page 65 of the paper book bearing the date 14th of May, 1976 where the respondent reported that certain materials were lying in stores deptt.
in absence of any decision.
It was further reiterated that on inspection of the pieces that those pieces were found cracked.
Similarly, our attention was drawn to several other letters and we have perused these letters.
We are of the opinion that the Division Bench was right that these letters only indicated that the report was being made of the checking done by the respondent.
A checker on behalf of the management or employer is not a supervisor.
In the aforesaid view of the matter the conclusion of the Division Bench that respondent No. 1 is a workman has to be sustained.
We do so accordingly.
The next question that arises in this case is whether Act would apply or the Rajasthan Act would apply.
In this connection section 28A of the Rajasthan Act is material.
It enjoins that no employer shall dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than 6 months except for a reasonable cause and after giving such employee at least one month 's prior notice or on paying him one month 's wages in lieu of such notice.
Sub section (2) of section 28A gives every employee, so dismissed or discharged, right to make a complaint in writing in the prescribed manner to a prescribed authority within 30 days of the receipt of the order of dismissal or discharge.
Sub section (3) of section 28A provides that the prescribed authority shall cause a notice to be served on the employer relating to the said complaint, record 994 briefly the evidence produced by the parties, hear them and make such enquiry as it might consider necessary and thereafter pass orders in writing giving reasons therefor.
Section 37 of the Rajasthan Act reads as follows: "37.
Saving of certain rights and privileges.
Nothing in this Act shall affect any rights or privileges which an employee in any establishment is entitled to on the date this Act comes into force under any other law, contract, custom or usage applicable to such establishment or any award, settlement or agreement binding on the employer and the employee in such establishment, if such rights or privileges are more favourable to him than those to which he would be entitled under this Act.
" It has to be borne in mind that section 2A of the Act was amended to permit individual workman to ask for a reference in the case of individual dispute.
This amendment was assented to by the President on 1st of December, 1965.
The Rajasthan Act received the assent of the President on 14th of July, 1958.
On 8th March, 1972 Chapter 6A including section 28A was inserted in the Rajasthan Act.
Therefore the material provision of the Rajasthan Act is the subsequent law.
Under Article 254(2) of the Constitution if there was any law by the State which had been reserved for the assent of the President and has received the assent of the President, the State law would prevail in that State even if there is an earlier law by the Parliament on a subject in the Concurrent List.
It appears that both of these Acts tread the same field and if there was any conflict with each other, then section 28A of Rajasthan Act would apply being a later law.
We find, however, that there is no conflict.
The learned Single Judge of the Rajasthan High Court in Poonam Talkies, Dausa vs The Presiding Officer, Labour Court, Jaipur, (S.B. Civil Writ Petition No. 1206/85 decided on 9.6.1986) so.
That decision has been upheld by the Division Bench of the Rajasthan High Court in Writ Appeal No. 231/86.
The Division Bench of the High Court in the instant appeal relying on the said decision held that there was no scope for any repugnancy.
It appears to us that it cannot be said that these two Acts do not tread the same field.
Both these Acts deal with the rights of the workman or employee to get redressal and damages in case of dismissal or discharge, but there is no repugnancy because there is no conflict between these two Acts, in pith and substance.
There is no inconsistency between these two acts.
These two Acts, in our opinion, are supplemental to each other.
995 In Deep Chand vs The State of Uttar Pradesh and others, [1959] Suppl.
2 S.C.R. 8, Subba Rao, J., as the learned Chief Justice then was observed that the result of the authorities indicated was as follows: "Nicholas in his Australian Constitution, 2nd Edition, p. 303, refers to three tests of inconsistency or repugnancy: 1.
There may be inconsistency in the actual terms of the competing statutes; 2.
Though there may be no direct conflict, a State law may be inoperative because the Commonwealth Code is intended to be a complete exhaustive code; and 3.
Even in the absence of intention, a conflict may arise when both State and Commonwealth seek to exercise their powers over the same subject matter.
" Quoting the aforesaid observations, this Court in M/s. Hoechst Pharmaceuticals Ltd. and others vs State of Bihar and others; , at page 87 where A.P. Sen, J. exhaustively dealt with the principles of repugnancy and observed that one of the occasions where inconsistency or repugnancy arose was when on the same subject matter, one law would be repugnant to the other.
Therefore, in order to raise a question of repugnancy two conditions must be fulfilled.
The State law and the Union law must operate on the same field and one must be repugnant or inconsistent with the other.
These are two conditions which are required to be fulfilled.
These are cumulative conditions.
Therefore, these laws must tread on the same field and these must be repugnant or inconsistent with each other.
In our opinion, in this case there is a good deal of justification to hold that these laws, the and the Rajasthan Act tread on the same field and both laws deal with the rights of dismissed workman or employee.
But these two laws are not inconsistent or repugnant to each other.
The basic test of repugnancy is that if one prevails the other cannot prevail.
That is not the position in this case.
Learned counsel on behalf of the appellant, however, contended that in this case, there had been an application as indicated above under section 28A of the Rajasthan Act and which was dismissed on ground of limitation.
Sree Shankar Ghosh tried to submit that there would be inconsistency or repugnancy between the two decisions, one given on limitation and the other if any 996 relief is given under the Act.
We are unable to accept this position, because the application under Section 28A of the Rajasthan Act was dismissed not on merit but on limitation.
There is a period of limitation provided under the Rajasthan Act of six months and it may be extended for reasonable cause.
But there is no period of limitation provided under the .
Therefore, that will be curtailment of the rights of the workmen or employees under the .
In the situation section 37 declares that law should not be construed to curtail any of the rights of the workmen.
As Poet Tennyson observed "freedom broadens from precedent to precedent" so also it is correct to state that social welfare and labour welfare broadens from legislation to legislation in India.
It will be a well settled principle of interpretation to proceed on that assumption and section 37 of the Rajasthan Act must be so construed.
Therefore in no way the Rajasthan Act could be construed to curtail the rights of the workman to seek any relief or to go in for an adjudication in case of the termination of the employment.
If that is the position in view of the provisions 6 months ' time in section 28A of the Rajasthan Act has to be ignored and that cannot have any binding effect inasmuch as it curtails the rights of the workman under the and that Act must prevail.
In the premises, there is no conflict between the two Acts and there is no question of repugnancy.
The High Court was, therefore, right in holding that the respondent was workman and in granting relief on that basis.
Before we conclude we note that our attention was drawn to certain observations of this Court that interference by the High Court in these matters at the initial stage protracts adjudication and defeats justice.
Reference was made to certain observations in P. Maheshwari vs Delhi Admn.
& Ors., (supra).
But as mentioned hereinbefore in this case, the interference was made by the High Court not at the initial stage.
In the premises, we are of the opinion that the High Court was right in the view it took.
These appeals, therefore, fail and are accordingly dismissed.
There will, however, be no order as to costs.
The reference before the Tribunal should proceed as expeditiously as possible.
N.V.K. Appeals dismissed.
|
% The Ist respondent was working in the appellant company as an Internal Auditor on a monthly salary of Rs.1186 60P per month.
The appellant alleged that the respondent started absenting himself from 28th January, 1978 and as such was not entitled to any salary for any period beyond the said date.
The respondent was thereafter placed under suspension on 30th March, 1978.
On 4th May, 1978 the respondent filed an application under section 33C(2) of the claiming a total sum of Rs.4746 40p on account of salary from Ist January, 1978 to 30th April, 1978.
The appellant objected on the ground that the respondent was not a 'workman '.
On 9th November, 1978 there was an order dismissing the respondent from service.
On 2nd January, 1979 the respondent filed an application under section 28A of the Rajasthan Shops and Commercial Establishments Act, 1958 which was dismissed on 31st July, 1979 on the ground of limitation.
On the 2nd August, 1979 the Labour Court held that the respondent was doing clerical duties and as such was a 'workman ' under the and he was entitled to Rs.2060 98p as salary 986 from 9th March, 1978 to 30th April, 1978.
There was also a reference under section 10 of the on 8th August, 1960 arising out of the dismissal of the respondent.
The appellant filed a writ petition challenging this order.
All the aforesaid writ petitions were disposed of by a Single Judge of the High Court on 16th March, 1982 holding that the respondent was not a 'workman '.
Division Bench of the High Court, however reversed the aforesaid judgment and held that the respondent was a 'workman '.
The two writ petitions of the appellant were dismissed, while the writ petition of the respondent was allowed.
Aggrieved by the aforesaid orders the appellant appealed to this Court.
On the questions: (1) whether the respondent was a 'workman ' or not within the definition of section 2(s) of the and (2) whether the or the Rajasthan Shops and Commercial Establishments Act, 1958 would apply.
Dismissing the appeals, ^ HELD: 1.(a) Whether a person was performing supervisory or managerial work is a question of fact.
One must, therefore, look into the main work and that must be found out from the main duties.
A supervisor has to take some kind of decision on behalf of the company.
One who was reporting merely as to the affairs of the company and making assessment for the purpose of reporting is not supervisor.
[992A B] (b) There is no controversy in the instant case, that the respondent is not employed in any managerial or administrative capacity.
Distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision.
A manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator.
Where there is a power of assigning duties and distribution of work there is supervision.
[990C,991A B,991D] Mcleod and Co. vs Sixth Industrial Tribunal West Bengal and others, A.I.R. 1958 Calcutta 273; All India Reserve Bank Employees Association vs Reserve Bank of India, ; ; Llyods Bank 987 Ltd. vs Pannalal Gupta, ; Burmah Shell Oil Storage & Distribution Co.
Of India.
vs Burmah Shell Management Staff Association & Ors. ; ; The Punjab Co operative Bank Ltd. vs R.S. Bhatia (dead) through Lrs, ; Maheshwari vs Delhi Administration Delton Cable India (P) Ltd.; , and Hind Construction and Engineering Company Ltd. vs Their Workmen, referred to.
(c) A checker on behalf of the management or employer is not a supervisor.
[993E] In the instant case, the nature of duties performed by Respondent No. 1 were mainly reporting and checking up on behalf of the management.
A reporter or a checking clerk is not a supervisor.
The respondent does not appear to be doing any kind of supervisory work.
He was undoubtedly checking up on behalf of the employer but he had no independent right or authority to take decision and his decision did not bind the company.
The Division Bench came to the conclusion that the respondent was a 'workman ' within the meaning of section 2(s) of the taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor.
That conclusion on the appreciation of evidence cannot be interfered with under Article 136 of the Constitution.
[993A C] 2.(a) In order to raise the question of repugnancy two conditions must be fulfilled.
The State law and the Union law must operate in the same field and one must be repugnant or inconsistent with the other.
These are two cumulative conditions which are required to be fulfilled.
[995E] Deep Chand vs The State of Uttar Pradesh and others, [1959] Suppl.
2 S.C.R. 8 and M/s. Hoechst Pharmaceuticals Ltd. and others vs State of Bihar and others; , at page 87 referred to.
(b) In this case there is a good deal of justification to hold that these laws, the and the Rajasthan Shops and Commercial Establishments Act, 1985 tread on the same field and both laws deal with the rights of a dismissed workman or employee.
But these two laws are not inconsistent or repugnant to each other.
The basic test of repugnancy is that if one prevails the other cannot prevail.
That is not the position in this case.
[995F G] 988 (c) The application under section 28A of the Rajasthan Act was dismissed not on merits but on limitation.
There is a period of limitation provided under the Rajasthan Act and it may be extended for reasonable cause.
But there is no period of limitation as such provided under the .
Therefore, that will be curtailment of the rights of the workmen or employees under the .
In that situation section 37 declares that law should not be construed to curtail any of the rights of the workmen.
[996A B] (d) Social Welfare and labour welfare broadens from legislation to legislation in India.
It will be a well settled principle of interpretation to proceed on that assumption and section 37 of the Rajasthan Act must be so construed.
In no way the Rajasthan Act could be construed to curtail the rights of the workman to seek any relief or to go in for adjudication in case of the termination of the employment.
[996C] (e) There is, therefore, no conflict between the and Rajasthan Shops and Commercial Establishments Act, 1985 and there is no question of repugnancy.
These two Acts are supplemental to each other.
[994G H; 996D]
|
, right in holding that Respondent No. 1 was a 'workman ' and in granting relief on that basis.
[996E] & CIVIL APPELLATE JURISDICTION: Civil Appeal Nos.3521 3523 of 1987.
From the Judgment and order dated 17.10.
1986 of the Rajasthan High Court in D.B. Civil Special (Writ) Appeals Nos.
27,28 of 1983 and 224 of 1982.
Dr. Shankar Ghosh, N.C. Shah and Praveen Kumar for the Appellant.
Tapas Ray, S.K. Jain, Mrs. P.Jain and section Atreya for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
After hearing parties and after considering the relevant documents, additional as well as original, we grant leave to appeal in these matters.
The appeals are disposed of by the judgment herein.
989 Since prior to Ist of January, 1978 the respondent No. 1 Shri Kishan Bhageria was working under the appellant company as an Internal Auditor on a monthly salary of Rs.1186.60 per month.
The appellant alleged that the respondent started absenting himself from 28.1.78 and as such was not entitled to any salary for any period beyond 28.1.78 The said respondent was thereafter placed under suspension on 30th of March, 1978.
The respondent on 4th of May, 1978 filed an application under section 33C(2) of the (hereinafter called 'the Act ') claiming the total sum of Rs.4,746.40 on account of salary from Ist of January, 1978 to 30th of April, 1978 at the rate of Rs.11,86.60 per month.
The appellant company objected.
The main ground of objections was that the respondent was not a workman.
On or about 9th of November, 1978 there was an order dismissing the respondent from service.
The respondent thereafter on 2nd of January, 1979 filed an application under section 28A of the Rajasthan Shops & Establishments Act, 1958 (hereinafter called 'the Rajasthan Act ').
The said application was dismissed on 31st of July 1979 on the ground of limitation.
The Labour Court on 2nd of August, 1979 held that the respondent was doing clerical duties and as such was a workman under the Act and he was entitled to Rs.2,060 as salary from 1.1.78 to 9.3.78.
The appellant filed Writ Petition No. 765 of 1979 in the Rajasthan High Court against the order of the Labour Court allowing the said salary.
The respondent also filed another writ petition being writ petition No. 1091 of 1979 for declaration that he was entitled to receive Rs.2,066.98 as salary from 9.3.78 to 30.4.78.
There was thereafter a reference under section 10 of the Act on 8.8.80 arising out of the dismissal of the respondent.
The appellant filed another writ petition being Writ Petition No. 1623 of 1980 challenging the order of reference.
All these aforesaid writ petitions were disposed of by the learned Single Judge of the Rajasthan High Court on 16.3.82 holding that the respondent was not a workman.
The other contentions urged before the leaned Single Judge were not considered by the Division Bench in the view it took later on.
On 17th of October, 1986 the Division Bench reversed the judgment of the learned Single Judge and held that the respondent was a workman.
Two writ petitions of the appellant were dismissed and the writ petition of the respondent was allowed.
Aggrieved by the aforesaid orders the appellant has come up in these appeals before this Court.
The main question which requires consideration in these appeals is whether the respondent was a workman or not.
For the determination of this question it is necessary to refer to section 2(s) of the Act which defines "workman" and states that it means any person emp 990 loyed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and includes any such person who has been dismissed discharged or retrenched in connection with or as a consequence of any dispute.
But sub clause (iii) does not include any person who is employed mainly in a managerial or administrative capacity and sub clause (iv) does not include any person who being employed in a supervisory capacity draws wages exceeding one thousand six hundred rupees per month or duties attached to the office or by reason of the powers vested in him, discharges functions mainly of a managerial nature.
In view of the said definition, we are concerned here with the question whether the respondent was a workman as not being employed in any supervisory capacity.
There is no controversy that the said respondent is not employed in any managerial or administrative capacity.
In this case before we deal with the facts and the relevant authorities of this Court it may be appropriate to refer to a decision of P.B. Mukharji, J. Of the Calcutta High Court as the learned Chief Justice then was in Mcleod and Co. vs Sixth Industrial Tribunal, West Bengal and others, A.I.R. 1958 Calcutta 273.
There the learned Judge observed that whether a person was a workman within the definition of the was the very foundation of the jurisdiction of the Industrial Tribunal.
The Court further observed that in order to determine the categories of service indicated by the use of different words like "supervisory", "managerial", "administrative", it was necessary not to import the notions of one into the interpretation of the other.
The words such as supervisory, managerial and administrative are advisedly loose expressions with no rigid frontiers and too much subtlety should not be used in trying to precisely define where supervision ends and management begins or administration starts.
For that would be theoretical and not practical.
It has to be broadly interpreted from a common sense point of view where tests will be simple both in theory and in their application.
The learned Judge further observed that a supervisor need not be a manager or an administrator and a supervisor can be a workman so long as he did not exceed the monetary limitation indicated in the section and a supervisor irrespective of his salary is not a workman who has to discharge functions mainly of managerial nature by reasons of the duties attached to his office or of the powers vested in him.
In that case the learned Judge further held that a person in charge of a Department could not ordinarily be a clerk even though he may not have power to take disciplinary action or even though he may have another superior 991 officer above him.
It was further observed that distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision.
It is reiterated that a manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator.
Bearing in mind the aforesaid indication, it would be necessary to discuss some decisions of this Court.
In All India Reserve Bank Employees Association vs Reserve Bank of India, ; , this Court dealing with certain types of employees observed "These employees distribute work, detect faults, report for penalty, make arrangements for filling vacancies, to mention only a few of the duties which are supervisory and not merely clerical." At page 46 of the report Hidayatullah, J. as the learned Chief Justice then was observed that the work in a Bank involved layer upon layer of checkers and checking is hardly supervision but where there is a power of assigning duties and distribution of work there is supervision, (emphasis supplied).
There the Court referred to a previous decision in Llyods Bank Ltd. vs Pannalal Gupta, , where the finding of the Labour Appellate Tribunal was reversed because the legal inference from proved facts was wrongly drawn and it was reiterated that before a clerk could claim a special allowance payable to a supervisor, he must prove that he supervises the work of some others who are in a sense below him.
It was pointed out by Hidayatullah, J. that mere checking of the work of others is not enough because this checking was a part of accounting and not of supervision and the work done in the audit department of a bank was not supervision.
(emphasis supplied).
In Burmah Shell Oil Storage & Distribution Co. Of India.
vs Burmah Shell Management Staff Association & Ors., ; , this Court observed that a workman must be held to be employed to do that work which is the main work he is required to do, even though he may be incidentally doing other types of work.
Therefore, in determining which of the employees in the various categories are covered by the definition of 'workman ' one has to see what is the main or substantial work which he is employed to do.
In The Punjab Co operative Bank Ltd. vs R.S. Bhatia (dead) through Lrs., it was held that the accountant was supposed to sign the salary bills of the staff even while performing the duties of a clerk.
That did not make the respondent employed in a managerial or administrative capacity.
The workman was, therefore, in that context rightly held as a clerk. 992 In P. Maheshwari vs Delhi Administration & Ors., ; the question whether a person was performing supervisory or managerial work was the question of fact to be decided bearing in mind the correct principle.
The principle therefore is, one must look into the main work and that must be found out from the main duties.
A supervisor was one who could bind the company to take some kind of decision on behalf of the company.
One who was reporting merely as to the affairs of the company and making assessment for the purpose of reporting was not a supervisor.
See in this connection Black 's Law Dictionary, Special Deluxe, Fifth Edition.
At page 1290, "Supervisor" has been described, inter alia, as follows: "In a broad sense, one having authority over others, to superintend and direct.
The term 'supervisor ' means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibility to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.
" Reference may be made to the observations of this Court in Ved Prakash Gupta vs M/s. Delton Cable India (P) Ltd., ; There on facts a Security Inspector was held to be a workman.
At page 575 of the report this Court referred to the decision in Llyods Bank Ltd. vs Panna Lal Gupta, (supra) and also the observations of this Court in Hind Construction and Engineering Company Ltd. vs Their Workmen, In that case the nature of the duties performed by the appellant showed that the substantial part of the work of the appellant consisted of looking after the security of the factory and its property by deputing the watchmen working under him to work at the factory gate or sending them to watch towers or around the factory or to accompany visitors to the factory and making entries in the visitors ' register as regards the visitors and in the concerned registers as regards materials entering into or going out of the premises of the factory.
There it was found that he had no power to appoint.
In the instant case the evidence have been summarised by the Division Bench.
Reference may be made to pages 65, 73, 80, 84 to 94, 993 95, 96 and 97 of the Paper Book which indicate the nature of duties performed by the respondent No. 1 herein.
His duties were mainly, reporting and checking up on behalf of the management.
A reporter or a checking clerk is not a supervisor.
The respondent herein does not appear to us doing any kind of supervisory work.
He was undoubtedly checking up on behalf of the employer but he had no independent right or authority to take decision and his decision did not bind the company.
In that view of the matter keeping the correct principle of law in mind the Division Bench has come to the conclusion taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor.
That conclusion arrived at in the manner indicated above cannot, in our opinion, be interfered with under Article 136 of the Constitution.
It is not necessary for our present purpose to set out in extenso the evidence on record as discussed by the Division Bench.
Our attention was, however, drawn by the counsel for the respondent to certain correspondence, for instance the letter at page 65 of the paper book bearing the date 14th of May, 1976 where the respondent reported that certain materials were lying in stores deptt.
in absence of any decision.
It was further reiterated that on inspection of the pieces that those pieces were found cracked.
Similarly, our attention was drawn to several other letters and we have perused these letters.
We are of the opinion that the Division Bench was right that these letters only indicated that the report was being made of the checking done by the respondent.
A checker on behalf of the management or employer is not a supervisor.
In the aforesaid view of the matter the conclusion of the Division Bench that respondent No. 1 is a workman has to be sustained.
We do so accordingly.
The next question that arises in this case is whether Act would apply or the Rajasthan Act would apply.
In this connection section 28A of the Rajasthan Act is material.
It enjoins that no employer shall dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than 6 months except for a reasonable cause and after giving such employee at least one month 's prior notice or on paying him one month 's wages in lieu of such notice.
Sub section (2) of section 28A gives every employee, so dismissed or discharged, right to make a complaint in writing in the prescribed manner to a prescribed authority within 30 days of the receipt of the order of dismissal or discharge.
Sub section (3) of section 28A provides that the prescribed authority shall cause a notice to be served on the employer relating to the said complaint, record 994 briefly the evidence produced by the parties, hear them and make such enquiry as it might consider necessary and thereafter pass orders in writing giving reasons therefor.
Section 37 of the Rajasthan Act reads as follows: "37.
Saving of certain rights and privileges.
Nothing in this Act shall affect any rights or privileges which an employee in any establishment is entitled to on the date this Act comes into force under any other law, contract, custom or usage applicable to such establishment or any award, settlement or agreement binding on the employer and the employee in such establishment, if such rights or privileges are more favourable to him than those to which he would be entitled under this Act.
" It has to be borne in mind that section 2A of the Act was amended to permit individual workman to ask for a reference in the case of individual dispute.
This amendment was assented to by the President on 1st of December, 1965.
The Rajasthan Act received the assent of the President on 14th of July, 1958.
On 8th March, 1972 Chapter 6A including section 28A was inserted in the Rajasthan Act.
Therefore the material provision of the Rajasthan Act is the subsequent law.
Under Article 254(2) of the Constitution if there was any law by the State which had been reserved for the assent of the President and has received the assent of the President, the State law would prevail in that State even if there is an earlier law by the Parliament on a subject in the Concurrent List.
It appears that both of these Acts tread the same field and if there was any conflict with each other, then section 28A of Rajasthan Act would apply being a later law.
We find, however, that there is no conflict.
The learned Single Judge of the Rajasthan High Court in Poonam Talkies, Dausa vs The Presiding Officer, Labour Court, Jaipur, (S.B. Civil Writ Petition No. 1206/85 decided on 9.6.1986) so.
That decision has been upheld by the Division Bench of the Rajasthan High Court in Writ Appeal No. 231/86.
The Division Bench of the High Court in the instant appeal relying on the said decision held that there was no scope for any repugnancy.
It appears to us that it cannot be said that these two Acts do not tread the same field.
Both these Acts deal with the rights of the workman or employee to get redressal and damages in case of dismissal or discharge, but there is no repugnancy because there is no conflict between these two Acts, in pith and substance.
There is no inconsistency between these two acts.
These two Acts, in our opinion, are supplemental to each other.
995 In Deep Chand vs The State of Uttar Pradesh and others, [1959] Suppl.
2 S.C.R. 8, Subba Rao, J., as the learned Chief Justice then was observed that the result of the authorities indicated was as follows: "Nicholas in his Australian Constitution, 2nd Edition, p. 303, refers to three tests of inconsistency or repugnancy: 1.
There may be inconsistency in the actual terms of the competing statutes; 2.
Though there may be no direct conflict, a State law may be inoperative because the Commonwealth Code is intended to be a complete exhaustive code; and 3.
Even in the absence of intention, a conflict may arise when both State and Commonwealth seek to exercise their powers over the same subject matter.
" Quoting the aforesaid observations, this Court in M/s. Hoechst Pharmaceuticals Ltd. and others vs State of Bihar and others; , at page 87 where A.P. Sen, J. exhaustively dealt with the principles of repugnancy and observed that one of the occasions where inconsistency or repugnancy arose was when on the same subject matter, one law would be repugnant to the other.
Therefore, in order to raise a question of repugnancy two conditions must be fulfilled.
The State law and the Union law must operate on the same field and one must be repugnant or inconsistent with the other.
These are two conditions which are required to be fulfilled.
These are cumulative conditions.
Therefore, these laws must tread on the same field and these must be repugnant or inconsistent with each other.
In our opinion, in this case there is a good deal of justification to hold that these laws, the and the Rajasthan Act tread on the same field and both laws deal with the rights of dismissed workman or employee.
But these two laws are not inconsistent or repugnant to each other.
The basic test of repugnancy is that if one prevails the other cannot prevail.
That is not the position in this case.
Learned counsel on behalf of the appellant, however, contended that in this case, there had been an application as indicated above under section 28A of the Rajasthan Act and which was dismissed on ground of limitation.
Sree Shankar Ghosh tried to submit that there would be inconsistency or repugnancy between the two decisions, one given on limitation and the other if any 996 relief is given under the Act.
We are unable to accept this position, because the application under Section 28A of the Rajasthan Act was dismissed not on merit but on limitation.
There is a period of limitation provided under the Rajasthan Act of six months and it may be extended for reasonable cause.
But there is no period of limitation provided under the .
Therefore, that will be curtailment of the rights of the workmen or employees under the .
In the situation section 37 declares that law should not be construed to curtail any of the rights of the workmen.
As Poet Tennyson observed "freedom broadens from precedent to precedent" so also it is correct to state that social welfare and labour welfare broadens from legislation to legislation in India.
It will be a well settled principle of interpretation to proceed on that assumption and section 37 of the Rajasthan Act must be so construed.
Therefore in no way the Rajasthan Act could be construed to curtail the rights of the workman to seek any relief or to go in for an adjudication in case of the termination of the employment.
If that is the position in view of the provisions 6 months ' time in section 28A of the Rajasthan Act has to be ignored and that cannot have any binding effect inasmuch as it curtails the rights of the workman under the and that Act must prevail.
In the premises, there is no conflict between the two Acts and there is no question of repugnancy.
The High Court was, therefore, right in holding that the respondent was workman and in granting relief on that basis.
Before we conclude we note that our attention was drawn to certain observations of this Court that interference by the High Court in these matters at the initial stage protracts adjudication and defeats justice.
Reference was made to certain observations in P. Maheshwari vs Delhi Admn.
& Ors., (supra).
But as mentioned hereinbefore in this case, the interference was made by the High Court not at the initial stage.
In the premises, we are of the opinion that the High Court was right in the view it took.
These appeals, therefore, fail and are accordingly dismissed.
There will, however, be no order as to costs.
The reference before the Tribunal should proceed as expeditiously as possible.
N.V.K. Appeals dismissed.
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1 was a 'workman ' and in granting relief on that basis. [996E] & CIVIL APPELLATE JURISDICTION: Civil Appeal Nos.3521 3523 of 1987. 1986 of the Rajasthan High Court in D.B. Civil Special (Writ) Appeals Nos. Dr. Shankar Ghosh, N.C. Shah and Praveen Kumar for the Appellant. Tapas Ray, S.K. Jain, Mrs. P.Jain and section Atreya for the Respondents. The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
After hearing parties and after considering the relevant documents, additional as well as original, we grant leave to appeal in these matters. The appeals are disposed of by the judgment herein. 989 Since prior to Ist of January, 1978 the respondent No. The appellant alleged that the respondent started absenting himself from 28.1.78 and as such was not entitled to any salary for any period beyond 28.1.78 The said respondent was thereafter placed under suspension on 30th of March, 1978. The main ground of objections was that the respondent was not a workman. On or about 9th of November, 1978 there was an order dismissing the respondent from service. The respondent thereafter on 2nd of January, 1979 filed an application under section 28A of the Rajasthan Shops & Establishments Act, 1958 (hereinafter called 'the Rajasthan Act '). The said application was dismissed on 31st of July 1979 on the ground of limitation. The Labour Court on 2nd of August, 1979 held that the respondent was doing clerical duties and as such was a workman under the Act and he was entitled to Rs.2,060 as salary from 1.1.78 to 9.3.78. 765 of 1979 in the Rajasthan High Court against the order of the Labour Court allowing the said salary. The respondent also filed another writ petition being writ petition No. There was thereafter a reference under section 10 of the Act on 8.8.80 arising out of the dismissal of the respondent. The appellant filed another writ petition being Writ Petition No. 1623 of 1980 challenging the order of reference. All these aforesaid writ petitions were disposed of by the learned Single Judge of the Rajasthan High Court on 16.3.82 holding that the respondent was not a workman. The other contentions urged before the leaned Single Judge were not considered by the Division Bench in the view it took later on. On 17th of October, 1986 the Division Bench reversed the judgment of the learned Single Judge and held that the respondent was a workman. Two writ petitions of the appellant were dismissed and the writ petition of the respondent was allowed. Aggrieved by the aforesaid orders the appellant has come up in these appeals before this Court. The main question which requires consideration in these appeals is whether the respondent was a workman or not. For the determination of this question it is necessary to refer to section 2(s) of the Act which defines "workman" and states that it means any person emp 990 loyed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and includes any such person who has been dismissed discharged or retrenched in connection with or as a consequence of any dispute. But sub clause (iii) does not include any person who is employed mainly in a managerial or administrative capacity and sub clause (iv) does not include any person who being employed in a supervisory capacity draws wages exceeding one thousand six hundred rupees per month or duties attached to the office or by reason of the powers vested in him, discharges functions mainly of a managerial nature. There is no controversy that the said respondent is not employed in any managerial or administrative capacity. In this case before we deal with the facts and the relevant authorities of this Court it may be appropriate to refer to a decision of P.B. Mukharji, J. Of the Calcutta High Court as the learned Chief Justice then was in Mcleod and Co. vs Sixth Industrial Tribunal, West Bengal and others, A.I.R. 1958 Calcutta 273. There the learned Judge observed that whether a person was a workman within the definition of the was the very foundation of the jurisdiction of the Industrial Tribunal. The Court further observed that in order to determine the categories of service indicated by the use of different words like "supervisory", "managerial", "administrative", it was necessary not to import the notions of one into the interpretation of the other. The words such as supervisory, managerial and administrative are advisedly loose expressions with no rigid frontiers and too much subtlety should not be used in trying to precisely define where supervision ends and management begins or administration starts. For that would be theoretical and not practical. It has to be broadly interpreted from a common sense point of view where tests will be simple both in theory and in their application. In that case the learned Judge further held that a person in charge of a Department could not ordinarily be a clerk even though he may not have power to take disciplinary action or even though he may have another superior 991 officer above him. It was further observed that distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision. It is reiterated that a manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator. Bearing in mind the aforesaid indication, it would be necessary to discuss some decisions of this Court. At page 46 of the report Hidayatullah, J. as the learned Chief Justice then was observed that the work in a Bank involved layer upon layer of checkers and checking is hardly supervision but where there is a power of assigning duties and distribution of work there is supervision, (emphasis supplied). In Burmah Shell Oil Storage & Distribution Co. Of India. vs Burmah Shell Management Staff Association & Ors., ; , this Court observed that a workman must be held to be employed to do that work which is the main work he is required to do, even though he may be incidentally doing other types of work. Therefore, in determining which of the employees in the various categories are covered by the definition of 'workman ' one has to see what is the main or substantial work which he is employed to do. In The Punjab Co operative Bank Ltd. vs R.S. Bhatia (dead) through Lrs., it was held that the accountant was supposed to sign the salary bills of the staff even while performing the duties of a clerk. That did not make the respondent employed in a managerial or administrative capacity. The workman was, therefore, in that context rightly held as a clerk. 992 In P. Maheshwari vs Delhi Administration & Ors., ; the question whether a person was performing supervisory or managerial work was the question of fact to be decided bearing in mind the correct principle. The principle therefore is, one must look into the main work and that must be found out from the main duties. A supervisor was one who could bind the company to take some kind of decision on behalf of the company. One who was reporting merely as to the affairs of the company and making assessment for the purpose of reporting was not a supervisor. See in this connection Black 's Law Dictionary, Special Deluxe, Fifth Edition. At page 1290, "Supervisor" has been described, inter alia, as follows: "In a broad sense, one having authority over others, to superintend and direct. The term 'supervisor ' means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibility to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment. There it was found that he had no power to appoint. In the instant case the evidence have been summarised by the Division Bench. Reference may be made to pages 65, 73, 80, 84 to 94, 993 95, 96 and 97 of the Paper Book which indicate the nature of duties performed by the respondent No. His duties were mainly, reporting and checking up on behalf of the management. A reporter or a checking clerk is not a supervisor. The respondent herein does not appear to us doing any kind of supervisory work. He was undoubtedly checking up on behalf of the employer but he had no independent right or authority to take decision and his decision did not bind the company. In that view of the matter keeping the correct principle of law in mind the Division Bench has come to the conclusion taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor. That conclusion arrived at in the manner indicated above cannot, in our opinion, be interfered with under Article 136 of the Constitution. It is not necessary for our present purpose to set out in extenso the evidence on record as discussed by the Division Bench. It was further reiterated that on inspection of the pieces that those pieces were found cracked. Similarly, our attention was drawn to several other letters and we have perused these letters. We are of the opinion that the Division Bench was right that these letters only indicated that the report was being made of the checking done by the respondent. A checker on behalf of the management or employer is not a supervisor. In the aforesaid view of the matter the conclusion of the Division Bench that respondent No. The next question that arises in this case is whether Act would apply or the Rajasthan Act would apply. In this connection section 28A of the Rajasthan Act is material. It enjoins that no employer shall dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than 6 months except for a reasonable cause and after giving such employee at least one month 's prior notice or on paying him one month 's wages in lieu of such notice. Sub section (3) of section 28A provides that the prescribed authority shall cause a notice to be served on the employer relating to the said complaint, record 994 briefly the evidence produced by the parties, hear them and make such enquiry as it might consider necessary and thereafter pass orders in writing giving reasons therefor. Section 37 of the Rajasthan Act reads as follows: "37. Nothing in this Act shall affect any rights or privileges which an employee in any establishment is entitled to on the date this Act comes into force under any other law, contract, custom or usage applicable to such establishment or any award, settlement or agreement binding on the employer and the employee in such establishment, if such rights or privileges are more favourable to him than those to which he would be entitled under this Act. " It has to be borne in mind that section 2A of the Act was amended to permit individual workman to ask for a reference in the case of individual dispute. This amendment was assented to by the President on 1st of December, 1965. The Rajasthan Act received the assent of the President on 14th of July, 1958. On 8th March, 1972 Chapter 6A including section 28A was inserted in the Rajasthan Act. Therefore the material provision of the Rajasthan Act is the subsequent law. It appears that both of these Acts tread the same field and if there was any conflict with each other, then section 28A of Rajasthan Act would apply being a later law. We find, however, that there is no conflict. That decision has been upheld by the Division Bench of the Rajasthan High Court in Writ Appeal No. The Division Bench of the High Court in the instant appeal relying on the said decision held that there was no scope for any repugnancy. It appears to us that it cannot be said that these two Acts do not tread the same field. Both these Acts deal with the rights of the workman or employee to get redressal and damages in case of dismissal or discharge, but there is no repugnancy because there is no conflict between these two Acts, in pith and substance. There is no inconsistency between these two acts. These two Acts, in our opinion, are supplemental to each other. 995 In Deep Chand vs The State of Uttar Pradesh and others, [1959] Suppl. 2 S.C.R. 8, Subba Rao, J., as the learned Chief Justice then was observed that the result of the authorities indicated was as follows: "Nicholas in his Australian Constitution, 2nd Edition, p. 303, refers to three tests of inconsistency or repugnancy: 1. There may be inconsistency in the actual terms of the competing statutes; 2. Though there may be no direct conflict, a State law may be inoperative because the Commonwealth Code is intended to be a complete exhaustive code; and 3. Even in the absence of intention, a conflict may arise when both State and Commonwealth seek to exercise their powers over the same subject matter. Therefore, in order to raise a question of repugnancy two conditions must be fulfilled. The State law and the Union law must operate on the same field and one must be repugnant or inconsistent with the other. These are two conditions which are required to be fulfilled. Therefore, these laws must tread on the same field and these must be repugnant or inconsistent with each other. But these two laws are not inconsistent or repugnant to each other. The basic test of repugnancy is that if one prevails the other cannot prevail. Sree Shankar Ghosh tried to submit that there would be inconsistency or repugnancy between the two decisions, one given on limitation and the other if any 996 relief is given under the Act. We are unable to accept this position, because the application under Section 28A of the Rajasthan Act was dismissed not on merit but on limitation. There is a period of limitation provided under the Rajasthan Act of six months and it may be extended for reasonable cause. But there is no period of limitation provided under the . Therefore, that will be curtailment of the rights of the workmen or employees under the . In the situation section 37 declares that law should not be construed to curtail any of the rights of the workmen. As Poet Tennyson observed "freedom broadens from precedent to precedent" so also it is correct to state that social welfare and labour welfare broadens from legislation to legislation in India. It will be a well settled principle of interpretation to proceed on that assumption and section 37 of the Rajasthan Act must be so construed. In the premises, there is no conflict between the two Acts and there is no question of repugnancy. The High Court was, therefore, right in holding that the respondent was workman and in granting relief on that basis. Reference was made to certain observations in P. Maheshwari vs Delhi Admn. But as mentioned hereinbefore in this case, the interference was made by the High Court not at the initial stage. In the premises, we are of the opinion that the High Court was right in the view it took. These appeals, therefore, fail and are accordingly dismissed. There will, however, be no order as to costs. The reference before the Tribunal should proceed as expeditiously as possible.
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% The Ist respondent was working in the appellant company as an Internal Auditor on a monthly salary of Rs.1186 60P per month.
The appellant alleged that the respondent started absenting himself from 28th January, 1978 and as such was not entitled to any salary for any period beyond the said date.
The respondent was thereafter placed under suspension on 30th March, 1978.
On 4th May, 1978 the respondent filed an application under section 33C(2) of the claiming a total sum of Rs.4746 40p on account of salary from Ist January, 1978 to 30th April, 1978.
The appellant objected on the ground that the respondent was not a 'workman '.
On 9th November, 1978 there was an order dismissing the respondent from service.
On 2nd January, 1979 the respondent filed an application under section 28A of the Rajasthan Shops and Commercial Establishments Act, 1958 which was dismissed on 31st July, 1979 on the ground of limitation.
On the 2nd August, 1979 the Labour Court held that the respondent was doing clerical duties and as such was a 'workman ' under the and he was entitled to Rs.2060 98p as salary 986 from 9th March, 1978 to 30th April, 1978.
There was also a reference under section 10 of the on 8th August, 1960 arising out of the dismissal of the respondent.
The appellant filed a writ petition challenging this order.
All the aforesaid writ petitions were disposed of by a Single Judge of the High Court on 16th March, 1982 holding that the respondent was not a 'workman '.
Division Bench of the High Court, however reversed the aforesaid judgment and held that the respondent was a 'workman '.
The two writ petitions of the appellant were dismissed, while the writ petition of the respondent was allowed.
Aggrieved by the aforesaid orders the appellant appealed to this Court.
On the questions: (1) whether the respondent was a 'workman ' or not within the definition of section 2(s) of the and (2) whether the or the Rajasthan Shops and Commercial Establishments Act, 1958 would apply.
Dismissing the appeals, ^ HELD: 1.(a) Whether a person was performing supervisory or managerial work is a question of fact.
One must, therefore, look into the main work and that must be found out from the main duties.
A supervisor has to take some kind of decision on behalf of the company.
One who was reporting merely as to the affairs of the company and making assessment for the purpose of reporting is not supervisor.
[992A B] (b) There is no controversy in the instant case, that the respondent is not employed in any managerial or administrative capacity.
Distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision.
A manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator.
Where there is a power of assigning duties and distribution of work there is supervision.
[990C,991A B,991D] Mcleod and Co. vs Sixth Industrial Tribunal West Bengal and others, A.I.R. 1958 Calcutta 273; All India Reserve Bank Employees Association vs Reserve Bank of India, ; ; Llyods Bank 987 Ltd. vs Pannalal Gupta, ; Burmah Shell Oil Storage & Distribution Co.
Of India.
vs Burmah Shell Management Staff Association & Ors. ; ; The Punjab Co operative Bank Ltd. vs R.S. Bhatia (dead) through Lrs, ; Maheshwari vs Delhi Administration Delton Cable India (P) Ltd.; , and Hind Construction and Engineering Company Ltd. vs Their Workmen, referred to.
(c) A checker on behalf of the management or employer is not a supervisor.
[993E] In the instant case, the nature of duties performed by Respondent No. 1 were mainly reporting and checking up on behalf of the management.
A reporter or a checking clerk is not a supervisor.
The respondent does not appear to be doing any kind of supervisory work.
He was undoubtedly checking up on behalf of the employer but he had no independent right or authority to take decision and his decision did not bind the company.
The Division Bench came to the conclusion that the respondent was a 'workman ' within the meaning of section 2(s) of the taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor.
That conclusion on the appreciation of evidence cannot be interfered with under Article 136 of the Constitution.
[993A C] 2.(a) In order to raise the question of repugnancy two conditions must be fulfilled.
The State law and the Union law must operate in the same field and one must be repugnant or inconsistent with the other.
These are two cumulative conditions which are required to be fulfilled.
[995E] Deep Chand vs The State of Uttar Pradesh and others, [1959] Suppl.
2 S.C.R. 8 and M/s. Hoechst Pharmaceuticals Ltd. and others vs State of Bihar and others; , at page 87 referred to.
(b) In this case there is a good deal of justification to hold that these laws, the and the Rajasthan Shops and Commercial Establishments Act, 1985 tread on the same field and both laws deal with the rights of a dismissed workman or employee.
But these two laws are not inconsistent or repugnant to each other.
The basic test of repugnancy is that if one prevails the other cannot prevail.
That is not the position in this case.
[995F G] 988 (c) The application under section 28A of the Rajasthan Act was dismissed not on merits but on limitation.
There is a period of limitation provided under the Rajasthan Act and it may be extended for reasonable cause.
But there is no period of limitation as such provided under the .
Therefore, that will be curtailment of the rights of the workmen or employees under the .
In that situation section 37 declares that law should not be construed to curtail any of the rights of the workmen.
[996A B] (d) Social Welfare and labour welfare broadens from legislation to legislation in India.
It will be a well settled principle of interpretation to proceed on that assumption and section 37 of the Rajasthan Act must be so construed.
In no way the Rajasthan Act could be construed to curtail the rights of the workman to seek any relief or to go in for adjudication in case of the termination of the employment.
[996C] (e) There is, therefore, no conflict between the and Rajasthan Shops and Commercial Establishments Act, 1985 and there is no question of repugnancy.
These two Acts are supplemental to each other.
[994G H; 996D]
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% The Ist respondent was working in the appellant company as an Internal Auditor on a monthly salary of Rs.1186 60P per month. The appellant alleged that the respondent started absenting himself from 28th January, 1978 and as such was not entitled to any salary for any period beyond the said date. On 9th November, 1978 there was an order dismissing the respondent from service. On 2nd January, 1979 the respondent filed an application under section 28A of the Rajasthan Shops and Commercial Establishments Act, 1958 which was dismissed on 31st July, 1979 on the ground of limitation. The appellant filed a writ petition challenging this order. Division Bench of the High Court, however reversed the aforesaid judgment and held that the respondent was a 'workman '. Aggrieved by the aforesaid orders the appellant appealed to this Court. One must, therefore, look into the main work and that must be found out from the main duties. A supervisor has to take some kind of decision on behalf of the company. [992A B] (b) There is no controversy in the instant case, that the respondent is not employed in any managerial or administrative capacity. Distribution of work may easily be the work of a manager or an administrator but "checking" the work so distributed or "keeping an eye" over it is certainly supervision. A manager or administrator 's work may easily include supervision but that does not mean that supervision is the only function of a manager or an administrator. Where there is a power of assigning duties and distribution of work there is supervision. vs Burmah Shell Management Staff Association & Ors. ; ; (c) A checker on behalf of the management or employer is not a supervisor. 1 were mainly reporting and checking up on behalf of the management. A reporter or a checking clerk is not a supervisor. The respondent does not appear to be doing any kind of supervisory work. The Division Bench came to the conclusion that the respondent was a 'workman ' within the meaning of section 2(s) of the taking into consideration the evidence recorded before the Labour Court that the respondent is a workman and not a supervisor. That conclusion on the appreciation of evidence cannot be interfered with under Article 136 of the Constitution. The State law and the Union law must operate in the same field and one must be repugnant or inconsistent with the other. These are two cumulative conditions which are required to be fulfilled. [995E] Deep Chand vs The State of Uttar Pradesh and others, [1959] Suppl. 2 S.C.R. 8 and M/s. Hoechst Pharmaceuticals Ltd. and others vs State of Bihar and others; , at page 87 referred to. But these two laws are not inconsistent or repugnant to each other. The basic test of repugnancy is that if one prevails the other cannot prevail. There is a period of limitation provided under the Rajasthan Act and it may be extended for reasonable cause. But there is no period of limitation as such provided under the . Therefore, that will be curtailment of the rights of the workmen or employees under the . [996A B] (d) Social Welfare and labour welfare broadens from legislation to legislation in India. In no way the Rajasthan Act could be construed to curtail the rights of the workman to seek any relief or to go in for adjudication in case of the termination of the employment. These two Acts are supplemental to each other.
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Appeal No. 214 of 1962.
Appeal from the judgment dated July 8, 1960 of the Kerala High Court, Emakulam, in Income tax Referred Case No. 10 of 1957.
section T. Desai and Sardar Bahadur, for the appellant.
K. N. Rajagopal Sastry, R. N. Sahthey and P. D. Menon, for the respondent.
October 25.
The judgment of the Court was delivered by HIDAYATULLAH, J.
The assessee, A.V. Thomas & Co., Ltd., Alleppey, claimed a deduction of Rs. 4,05,072 8 6 in the assessment year 1952 53 as a bad debt which was written off in its books of account on December 31, 1951.
This claim was disallowed.
After sundry procedure, the following question was considered by the High Court of Kerala and answered against the assessee company : "Whether on the facts and the circumstances of the case, the Tribunal was correct in holding 778 that the amount of Rs. 4,05,071 8 6 claimed by the assessee Co. as a deduction was not admis sible either under section 10(2) (xi) or 10(2) (xv) ?" The High Court certified the case as fit for appeal to this Court and this appeal has been filed by the assessee company.
The Commissioner of Income tax (Bangalore) Kerala, is the respondent.
The assessee company was incorporated in 1935 and, as is usual with companies, its Memorandum of Association, authorised it to do multifarious businesses.
According to clauses 1, 5, 18 and 23, it was authorised "to be interested in, to promote, and to undertake the formation and establishment of other companies", to make investments and to assist any company financially or otherwise.
At the material time the assessee company had three directors, whose names are given below 1.
A. V. Thomas 2. section Sankaranarayana lyer and 3.
J. Thomas.
There was another private limited company known as the Southern Agencies Limited, Pondicherry, and its directors were : 1.
A. V. Thomas 2.
section section Natarajan, and 3.
C, section Ramakrishna Karayalar.
There was a mill in Pondicherry known as Rodier Textile Mill belonging to the Anglo French Textiles Limited, Pondicherry.
The assessee company averred that the Southern Agencies Ltd., took up in 1948 the promotion of a limited company to be known as Rodier Textile Mills Ltd., Pondicherry, with 779 a view to buying and developing the Rodier Textile Mill.
The assessee company, so it was stated, financed the Southern Agencies Ltd., Pondicherry, by making over funds aggregating to the sum of Rs. 6,05,071 8 6.
This amount was not given directly by the assessee company but at its instance by India Coffee and Tea Distributors Ltd., Madras.
The assessee company further stated that though an entry in its own books dated December 31, 1948, showed this amount as an advance for purchase of 6,000 shares of Rs. 100 each in the Rodier Textile Mills Ltd., the main intention of the assessee company was to assist and finance the Southern Agencies Ltd. within the terms of the assessee company 's Memorandum.
The subscription list for the Rodier Textile Mills Ltd. remained open from January 5 to January 20, 1949.
No application for shares was made on behalf of the assessee company and the shares were not acquired.
The public took no interest in the new company which was being promoted and the whole project tailed.
On September 1, 1950, the assessee company approved of the action of Mr. A. V. Thomas in making the said advance and on September 18, 1950, a resolution was passed by the Board of Directors of The assessee company that the amount of Rs. 6,00,000 should be shown as an advance for purchase of shares in the Rodier Textile Mills Ltd. (in formation) and the balance of Rs. 5,072 8 5 be shown under sundry advances due from the promoters of the new company.
The Southern Agencies Ltd. however, did not return the ' entire amount.
On December 7, 1951, it paid back Rs. 2,00,000 which appears to have been received in full satisfaction.
Though as late as June 12, 1951, the advance was considered to be good and recoverable, the balance was written off on December 31, 1951, which was the close of the year of account of the assessee company.
It was this amount which was claimed in the assessment year 1952 53 as a bad 780 debt actually written off, or alternatively as an expenditure, not of a capital nature, laid out or expended wholly and exclusively for the purpose of the assessee company 's business.
The Income tax Officer, Alleppey, held that the debt was written off at a time when it was neither bad nor doubtful and the claim to write it off was premature.
He, therefore, disallowed it.
An appeal was taken to the Appellate Assistant Commissioner and he upheld the order of the Income tax Officer though on a different ground.
He held that the advance was made for the purpose of purchasing shares of the new company then in formation and it was thus made for the acquisition of a capital asset, which was either the control of the new company or ""to gain its good will likely to result in the grant of agency rights" to the assessee company.
According to the Commissioner, the loss, if any, was of a capital nature and the question whether the claim of bad debt was premature or otherwise did not arise for consideration.
The Appellate Assistant Commissioner also held that the deduction could not be claimed as an allowance under section 10(2)(xv) of the Income tax Act.
The assessee company appealed to the Tribunal.
The Tribunal upheld the order of the Appellate Assistant Commissioner but on a third ground.
The Tribunal accepted that one of the objects of the assessee company was the promotion and financing of other companies for gain but this advance of Rs. 6,00,000 was not made by the assessee company in the normal course of its business.
It was rather a transaction "actuated only by personal motives".
In reaching this conclusion the Tribunal observed that the advance was made to Southern Agencies Ltd. which was not a company promoted by the assessee company, that between these two companies there was no previous business connection and at the assessee company had no expectancy of a financial benefit.
The Tribunal held that the 781 Rodier Textile Mills Ltd.,, Pondicherry, was not being financed or promoted by the assessee company and that the statement by the assessee company that it would have received some agency right was not supported by evidence.
The Tribunal was of the opinion that this advance was probably due to the " substantially common ownership of the assessee company and the Southern Agencies Ltd., of two individuals, namely, A. V. Thomas and section section Natarajan." The Tribunal thus held that this deduction could not be claimed as it was given out of " 'personal motives" and not as a part of the business of the assessee company.
The assessee company demanded a case but it was refused by the Tribunal.
The assessee company in its application for the case had propounded three questions as under : "(i) Whether on the facts and in the circums tances of the case, the sum of Rs. 4,05,072 8 5 can be claimed by the assessee as a bad debt written off under the provisions of Section 10(2) (xi) of the Act, (ii) Whether on the facts and in the circums tances of the case, the assessee can claim the sum of Rs. 4 '.05,072 8 5 as permissible deduction under Section 10(2) (xv) of the Act, and (iii) Whether co the facts and in the circums tances of the case, the assessee is permitted to claim the deduction of the said sum of Rs. 4,05,072 8 5 as a proper debit and charge it to the Profit and Loss account of the assessee company.
" These questions show that the deduction was claimed (i) as a loss in the doing of the business under 782 section 10(1); (ii) as a bad debt actually written off under section 10(2)(xi); and (iii) as an expenditure laid out wholly and exclusively for the purpose of the business under section 10(2)(xv) of the Income tax Act.
The assessee company applied to the High Court and the High Court directed a reference on the single question which has been quoted.
That question shows that the High Court did not direct the case under section 10(1) of the Act.
The Tribunal had considered the case from the point of view of the business and had held that this was not an advance in the normal course of business but one out of ""personal motives".
The High Court apparently had not accepted that the matter could be considered under section 10(1) and framed the question under cls.
(xi) and (xv) of section 10(2).
The question as propounded and considered by the High Court related to the two clauses only.
An attempt was made before us to raise the issue under section 10(1) and to claim the deduction as an ordinary business loss.
We disallowed the argument because in our opinion the question as considered in the High Court does not embrace it.
The assessee company should have requested the High Court at some stage to frame a question that there was no material for the Tribunal to reach the conclusion that this was not a business transaction but a case of an advance out of personal motives.
It was contended before us that the High Court in calling for a reference on the single question had stated that that question would cover three matters.
The first two 'here mentioned in the question and the third which was said to be implicit was whether the Tribunal was competent to decide a case which had not been made out by the Department at an earlier stage.
But this was not the same thing as saying that the Tribunal had no material before it on which it could reach the conclusion that this was not an advance in the ordinary course of business by the assessee company.
No doubt, the High Court in its order calling for a statement of the case has observed that there was no dispute at any 783 earlier stage that this was not in the ordinary course of business, but that conclusion of the High Court in the order it made under section 66(2) can have no relevance or binding force.
Indeed, the High Court was in error in giving a finding of its own and it is not surprising that the Tribunal protested against this finding.
It was open to the High Court to frame a question whether there was any material to support the finding of the Tribunal and to ask the Tribunal to state a case thereon.
Not having done so, the question as framed drives the assessee company to prove its case either under section 10(2)(xi) or under section 10(2)(xv) and it is from these two angles that the case will be considered by us.
Clauses (xi) and (xv) of section 10(2) read as follows : "(2) Such profits or gains shall be computed after making the following allowances, namely x x x a (xi) when the assessee 's accounts in respect of any part of his business, profession or vocation are not kept on the cash basis, such sum, in respect of bad and doubtful debts, due to the assessee in respect of that part of his business, profession or vocation, and in the case of an assessee carrying on a banking or money lending business, such sum in respect of loans made in the ordinary course of such business as the Income tax Officer may estimate to be irrecoverable but not exceeding the amount actually written off as irrecoverable in the books of the assessee : (Proviso omitted) (xv) any expenditure (not being an allowance of the nature described in any of the clauses (i) to (xiv) inclusive, and not being in the nature of capital expenditure or 784 personal expenses) laid out or expended wholly and exclusively for the purpose of such business, profession or vocations".
In support of its case, the assessee company stated that as there was no dispute about the facts that this was an advance in the ordinary course of business it should be treated as a trading loss or alternatively as a bad debt or an expenditure claimable under section 10(2)(xv).
The assesses company relied strongly upon certain Ledger entries of the Rodier Textile Mills Ltd. in the books of the assessee company.
These have been marked as Annexures A. 1 to A. 3.
The High Court also referred to these accounts and they have been construed as showing, that there was an attempt by the assessee company to acquire a capital asset.
These accounts began in 1948 and ended on December 31, 1951.
The accounts are headed "Personal Ledger.
" In December, 1948, sundry amounts totalling Rs. 6,05,071 8 5 are shown as amounts "paid to you by Indian Coffee and Tea Distributors Ltd., Madras, towards purchase of shares.
" On January 1, 1949, the account opened with a debit balance of Rs. 6,05,071 8 5.
Nothing appears from the accounts who this " 'you" was.
A number of reversing entries were made in respect of certain amounts and then on December 31, 1949, the amount was shown as follows : By advance for sundry expenses due from the promoters of new company debited to this trans ferred 5,071 8 5 By balance 6,00,000 0 0 1950 opened with entry on January I To Balance 6,00,000 0 0 and closed with an entry By Amount paid to Southern Agencies Ltd, 6,00,000 0 0 785 This was shown as an opening balance on January 1, 1951.
On December 7, a payment of Rs. 2,00,000 was shown and Rs. 4,00,000 were transferred for writing off.
On December 31., 1951, Rs. 4,00,000 were written off and so also the amount of Rs. 5,072 8 5.
The last amount included a sum of Rupee 1, hire for carriage which was also written off after the entry had been reversed.
From these accounts it is quite clear that to begin with the amount was shown as an advance for purchase of shares of the Rodier Textile Mills Ltd. If this was the purpose, it was not an expenditure on the revenue side.
The High Court correctly pointed out that it was not the business of the assessee company to buy agencies and sell them.
The shares were being acquired by the assessee company so that it might have the lucrative business of selling agency and similar other agencies from the Rodier Textile Mills Limited.
As late as December 15, 1952, the Chairman of the assessee company stated in his speech as follows : "You are aware that an advance was made to the Southern Agencies (Pondicherry) Ltd. to acquire for us shares in Rodier Textile Mills Ltd. It was felt that when the promotion and working of Rodier Textile Mills Ltd., became a fait ac compli, our company stood considerably to gain by securing their agency for handling their goods.
" This clearly shows that the assessee company intended to acquire a capital asset for itself This purpose takes the case of the assessee company out of section 10(2)(xv) of the Income tax Act, because no expenditure can be claimed under that clause which 'is of a capital nature.
By the declaration of the Chairman of the assessee company the case under section 10(2)(xv) becomes completely untenable.
In any event, the 786 amount was not expended in the year of account ending with December 31, 1951 : it was expended in 1948.
It remains to consider the case under section 10(2)(xi).
In this connection, we were referred to the Memorandum of Association to show that it was one of the objects of the assessee company to promote other companies and this amount was paid to Southern Agencies Ltd. to promote the Rodier Textile Mills Ltd. There is no doubt that the objects mentioned in the Memorandum of Association of the assessee company include the promotion and financing of other companies.
A Memorandum, however, is not conclusive as to the real nature of a transaction.
That nature has to be deduced not from the Memorandum but from the circumstances in which the transaction took place.
Here, the different versions given in the books of account of the assessee company belie the assertion that this was an amount paid to promote the Rodier Textile Mills Ltd.
Even though this money was available on December 31, 194 8, and the subscription list for the shares remained open from January 5 to 20, 1949, no application for a single share was made on behalf of the assessee company.
The entry till the end of 1949 was that the amount was laid out for purchase of shares.
It was only subsequently that it was shown to be an advance to the Southern Agencies Ltd. In fact, the entry comes only at the end of 1950 when it is set down "By Amount paid to Southern Agencies Ltd." The assessee company raised three contentions in support of the case that this became a bad and doubtful debt which was actually written off : (a.) that the High Court was wrong in saying that before the assessee could claim the deduction under section 10(2)(xi) it must prove that it had in the past purchased and sold agencies, (b) that the object of the assessee company was to apply for shares but as it did not 787 apply for shares the transaction between it and the Southern Agencies remained an advance in the ordinary course of business, and (c) Southern Agencies having failed to give back the money the assessee company was within its rights to write off this bad and doubtful debt.
Now, a question under section 10(2)(xi) can only arise if there is a bad or doubtful debt.
Before a debt can become bad or doubtful it must first be a debt.
What is meant by debt in this connection was laid down by Rowlatt, J., in Curtis v.1.
& G. Oldfield Ltd.,(1) at p. 330 as follows : "When the Rule speaks of a bad debt it means a debt which is a debt that would have come into the balance sheet as a trading debt 'in the trade that is in question and that it is bad.
It does not really mean any debt which, when it was a good debt, would not have come in to swell the profits.
" A debt in such cases is an outstanding which if recovered would have swelled the profits.
It is not money handed over to someone for purchasing a thing which that person has failed to return even though no purchase was made.
In the section a debt means something more than a mere advance.
It means something which is related to business or results from it.
To be claimable as a bad or doubtful debt it must first be shown as a proper debt.
The observations of Rowlatt, J., were applied by the Privy Council in Arunachalam Chettiar vs Commissioner of income tax(2), at p. 245, where their Lordships observed as follows: "Their Lordships moreover can give no countenance to a suggestion that upon a dissolution of partnership a partner 's share of the losses for several preceding years can be accumulated and thrown into the scale against (1) , 330.
(2) (1936) L. R. 63 I. A. 233, 245 788 the income of another partner for a particular year.
No principle of writing off a bad debt could justify such a course, whether in the year following the dissolution or., as logic would permit, in some subsequent year in which the partner 's insolvency has crystallised.
The ; 'bad debt" would not, if good, have come in to swell the taxable profits of the other partner.
" This Court also approved the dictum of Rowlatt, J., in COMMissioner of Income tax vs Abdullabhai Abdulkadar (1) at p. 550 and referred to the observations of Venkatarama Ayyar, J., in Badridas Daga, vs Commissioner of Income, tax, (2) where the learned judge speaking for this Court said that a business debt "springs directly from the carrying on of the business and is incidental to it and not any loss sustained by the assessee, even if it has some connection with his business." Section 10(2)(xi) is in two parts.
One part deals with an assessee who carries on the business of a banker or money lender.
Another part deals with business other than the aforesaid.
Since this was not a loan by a banker or money lender, the debt to be a debt proper had to be one which if good would have swelled the taxable profits.
Applying these tests, it is quite obvious that an advance paid by the assessee company to another to purchase the shares cannot be said to be incidental to the trading activities of the assessee company.
It was more in the nature of a price paid in advance for the shares which the Southern Agencies had a right to allot in the Rodier Textile Mills Ltd. This cannot, therefore, be described as a debt and indeed the changes in the books of account of the assessee company clearly show that the assessee company itself was altering the entries to convert the advance into a debt so as to be able to write it off and claim (1) ; , 954.
(2) ; 789 the benefit of section 10 (2) (xi).
In our opinion, section 10(2)(xi) was inapplicable to the facts of this case.
In the result the appeal must fail and it is dismissed.
The assessee company shall pay the costs of the respondent.
Appeal dismissed.
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The assessee company was incorporated in 1935 and its Memorandum of association authorised it, inter alia, to promote and to undertake the formation and establishment of other companies and to assist any company financially or otherwise.
There was another company known as the Southern Agencies Ltd. and Mr. A. V. Thomas was director of both these companies.
In 1948 the Southern Agencies Ltd. began the promotion of a company to be known as the Rodier Textile Mills Ltd., with a view to buying up a Mill known as the Rodier Textile Mills.
The assessee company made an advance of Rs. 6 lakhs odd to the promoter for the purchase of 6000 shares of the new company.
The public took no interest in the new company and the whole project failed.
No application for shares was made on behalf of the assesee company and no share was acquired.
The Southern Agencies Ltd., however, did not return the entire amount.
On December 7, 1951, it paid back only Rs. 2 lakhs which was received in full satisfaction.
The balance of Rs. 4,05,071 8 6 was written off on December 31, 195 1, which was the close of the year of account of the assessee company.
For the assessment year 1952 33 the assessee company claimed a deduction of that amount as a bad debt actually written off, or alternatively as an Expenditure, not of a capital nature laid out or expended wholly and exclusively for the purpose of its business.
777 Held, (1) that the amount advanced for the purchase of shares was of a capital nature and, therefore, the balance was not allowable as an expenditure under s 10 (2) (xv) of the Indian Income tax Act, 1922, as it was not the business of the assessee company to buy agencies and sell them; and in any event the amount was expended in 1948 and not in the year of account ending December 31, 1951.
(2) that it was not a bad debt under section 10 (2) (xi).
A debt in such cases is an outstanding which is recovered would have swelled the profits.
It is not money handed over to some one for purchasing a thing which that person has failed to return even though no purchase was made.
Curtis vs J. & G. Old field Ltd., , Arunachalam Chettiar vs Commissioner 'of Income tax, (1936) L. R. 63 I. A. 233, Badridas Daga vs Commissioner of Income tax; , and Commissioner of Income tax vs Abdullabhi Abdulakadar; , , relied on.
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Appeal No. 214 of 1962.
Appeal from the judgment dated July 8, 1960 of the Kerala High Court, Emakulam, in Income tax Referred Case No. 10 of 1957.
section T. Desai and Sardar Bahadur, for the appellant.
K. N. Rajagopal Sastry, R. N. Sahthey and P. D. Menon, for the respondent.
October 25.
The judgment of the Court was delivered by HIDAYATULLAH, J.
The assessee, A.V. Thomas & Co., Ltd., Alleppey, claimed a deduction of Rs. 4,05,072 8 6 in the assessment year 1952 53 as a bad debt which was written off in its books of account on December 31, 1951.
This claim was disallowed.
After sundry procedure, the following question was considered by the High Court of Kerala and answered against the assessee company : "Whether on the facts and the circumstances of the case, the Tribunal was correct in holding 778 that the amount of Rs. 4,05,071 8 6 claimed by the assessee Co. as a deduction was not admis sible either under section 10(2) (xi) or 10(2) (xv) ?" The High Court certified the case as fit for appeal to this Court and this appeal has been filed by the assessee company.
The Commissioner of Income tax (Bangalore) Kerala, is the respondent.
The assessee company was incorporated in 1935 and, as is usual with companies, its Memorandum of Association, authorised it to do multifarious businesses.
According to clauses 1, 5, 18 and 23, it was authorised "to be interested in, to promote, and to undertake the formation and establishment of other companies", to make investments and to assist any company financially or otherwise.
At the material time the assessee company had three directors, whose names are given below 1.
A. V. Thomas 2. section Sankaranarayana lyer and 3.
J. Thomas.
There was another private limited company known as the Southern Agencies Limited, Pondicherry, and its directors were : 1.
A. V. Thomas 2.
section section Natarajan, and 3.
C, section Ramakrishna Karayalar.
There was a mill in Pondicherry known as Rodier Textile Mill belonging to the Anglo French Textiles Limited, Pondicherry.
The assessee company averred that the Southern Agencies Ltd., took up in 1948 the promotion of a limited company to be known as Rodier Textile Mills Ltd., Pondicherry, with 779 a view to buying and developing the Rodier Textile Mill.
The assessee company, so it was stated, financed the Southern Agencies Ltd., Pondicherry, by making over funds aggregating to the sum of Rs. 6,05,071 8 6.
This amount was not given directly by the assessee company but at its instance by India Coffee and Tea Distributors Ltd., Madras.
The assessee company further stated that though an entry in its own books dated December 31, 1948, showed this amount as an advance for purchase of 6,000 shares of Rs. 100 each in the Rodier Textile Mills Ltd., the main intention of the assessee company was to assist and finance the Southern Agencies Ltd. within the terms of the assessee company 's Memorandum.
The subscription list for the Rodier Textile Mills Ltd. remained open from January 5 to January 20, 1949.
No application for shares was made on behalf of the assessee company and the shares were not acquired.
The public took no interest in the new company which was being promoted and the whole project tailed.
On September 1, 1950, the assessee company approved of the action of Mr. A. V. Thomas in making the said advance and on September 18, 1950, a resolution was passed by the Board of Directors of The assessee company that the amount of Rs. 6,00,000 should be shown as an advance for purchase of shares in the Rodier Textile Mills Ltd. (in formation) and the balance of Rs. 5,072 8 5 be shown under sundry advances due from the promoters of the new company.
The Southern Agencies Ltd. however, did not return the ' entire amount.
On December 7, 1951, it paid back Rs. 2,00,000 which appears to have been received in full satisfaction.
Though as late as June 12, 1951, the advance was considered to be good and recoverable, the balance was written off on December 31, 1951, which was the close of the year of account of the assessee company.
It was this amount which was claimed in the assessment year 1952 53 as a bad 780 debt actually written off, or alternatively as an expenditure, not of a capital nature, laid out or expended wholly and exclusively for the purpose of the assessee company 's business.
The Income tax Officer, Alleppey, held that the debt was written off at a time when it was neither bad nor doubtful and the claim to write it off was premature.
He, therefore, disallowed it.
An appeal was taken to the Appellate Assistant Commissioner and he upheld the order of the Income tax Officer though on a different ground.
He held that the advance was made for the purpose of purchasing shares of the new company then in formation and it was thus made for the acquisition of a capital asset, which was either the control of the new company or ""to gain its good will likely to result in the grant of agency rights" to the assessee company.
According to the Commissioner, the loss, if any, was of a capital nature and the question whether the claim of bad debt was premature or otherwise did not arise for consideration.
The Appellate Assistant Commissioner also held that the deduction could not be claimed as an allowance under section 10(2)(xv) of the Income tax Act.
The assessee company appealed to the Tribunal.
The Tribunal upheld the order of the Appellate Assistant Commissioner but on a third ground.
The Tribunal accepted that one of the objects of the assessee company was the promotion and financing of other companies for gain but this advance of Rs. 6,00,000 was not made by the assessee company in the normal course of its business.
It was rather a transaction "actuated only by personal motives".
In reaching this conclusion the Tribunal observed that the advance was made to Southern Agencies Ltd. which was not a company promoted by the assessee company, that between these two companies there was no previous business connection and at the assessee company had no expectancy of a financial benefit.
The Tribunal held that the 781 Rodier Textile Mills Ltd.,, Pondicherry, was not being financed or promoted by the assessee company and that the statement by the assessee company that it would have received some agency right was not supported by evidence.
The Tribunal was of the opinion that this advance was probably due to the " substantially common ownership of the assessee company and the Southern Agencies Ltd., of two individuals, namely, A. V. Thomas and section section Natarajan." The Tribunal thus held that this deduction could not be claimed as it was given out of " 'personal motives" and not as a part of the business of the assessee company.
The assessee company demanded a case but it was refused by the Tribunal.
The assessee company in its application for the case had propounded three questions as under : "(i) Whether on the facts and in the circums tances of the case, the sum of Rs. 4,05,072 8 5 can be claimed by the assessee as a bad debt written off under the provisions of Section 10(2) (xi) of the Act, (ii) Whether on the facts and in the circums tances of the case, the assessee can claim the sum of Rs. 4 '.05,072 8 5 as permissible deduction under Section 10(2) (xv) of the Act, and (iii) Whether co the facts and in the circums tances of the case, the assessee is permitted to claim the deduction of the said sum of Rs. 4,05,072 8 5 as a proper debit and charge it to the Profit and Loss account of the assessee company.
" These questions show that the deduction was claimed (i) as a loss in the doing of the business under 782 section 10(1); (ii) as a bad debt actually written off under section 10(2)(xi); and (iii) as an expenditure laid out wholly and exclusively for the purpose of the business under section 10(2)(xv) of the Income tax Act.
The assessee company applied to the High Court and the High Court directed a reference on the single question which has been quoted.
That question shows that the High Court did not direct the case under section 10(1) of the Act.
The Tribunal had considered the case from the point of view of the business and had held that this was not an advance in the normal course of business but one out of ""personal motives".
The High Court apparently had not accepted that the matter could be considered under section 10(1) and framed the question under cls.
(xi) and (xv) of section 10(2).
The question as propounded and considered by the High Court related to the two clauses only.
An attempt was made before us to raise the issue under section 10(1) and to claim the deduction as an ordinary business loss.
We disallowed the argument because in our opinion the question as considered in the High Court does not embrace it.
The assessee company should have requested the High Court at some stage to frame a question that there was no material for the Tribunal to reach the conclusion that this was not a business transaction but a case of an advance out of personal motives.
It was contended before us that the High Court in calling for a reference on the single question had stated that that question would cover three matters.
The first two 'here mentioned in the question and the third which was said to be implicit was whether the Tribunal was competent to decide a case which had not been made out by the Department at an earlier stage.
But this was not the same thing as saying that the Tribunal had no material before it on which it could reach the conclusion that this was not an advance in the ordinary course of business by the assessee company.
No doubt, the High Court in its order calling for a statement of the case has observed that there was no dispute at any 783 earlier stage that this was not in the ordinary course of business, but that conclusion of the High Court in the order it made under section 66(2) can have no relevance or binding force.
Indeed, the High Court was in error in giving a finding of its own and it is not surprising that the Tribunal protested against this finding.
It was open to the High Court to frame a question whether there was any material to support the finding of the Tribunal and to ask the Tribunal to state a case thereon.
Not having done so, the question as framed drives the assessee company to prove its case either under section 10(2)(xi) or under section 10(2)(xv) and it is from these two angles that the case will be considered by us.
Clauses (xi) and (xv) of section 10(2) read as follows : "(2) Such profits or gains shall be computed after making the following allowances, namely x x x a (xi) when the assessee 's accounts in respect of any part of his business, profession or vocation are not kept on the cash basis, such sum, in respect of bad and doubtful debts, due to the assessee in respect of that part of his business, profession or vocation, and in the case of an assessee carrying on a banking or money lending business, such sum in respect of loans made in the ordinary course of such business as the Income tax Officer may estimate to be irrecoverable but not exceeding the amount actually written off as irrecoverable in the books of the assessee : (Proviso omitted) (xv) any expenditure (not being an allowance of the nature described in any of the clauses (i) to (xiv) inclusive, and not being in the nature of capital expenditure or 784 personal expenses) laid out or expended wholly and exclusively for the purpose of such business, profession or vocations".
In support of its case, the assessee company stated that as there was no dispute about the facts that this was an advance in the ordinary course of business it should be treated as a trading loss or alternatively as a bad debt or an expenditure claimable under section 10(2)(xv).
The assesses company relied strongly upon certain Ledger entries of the Rodier Textile Mills Ltd. in the books of the assessee company.
These have been marked as Annexures A. 1 to A. 3.
The High Court also referred to these accounts and they have been construed as showing, that there was an attempt by the assessee company to acquire a capital asset.
These accounts began in 1948 and ended on December 31, 1951.
The accounts are headed "Personal Ledger.
" In December, 1948, sundry amounts totalling Rs. 6,05,071 8 5 are shown as amounts "paid to you by Indian Coffee and Tea Distributors Ltd., Madras, towards purchase of shares.
" On January 1, 1949, the account opened with a debit balance of Rs. 6,05,071 8 5.
Nothing appears from the accounts who this " 'you" was.
A number of reversing entries were made in respect of certain amounts and then on December 31, 1949, the amount was shown as follows : By advance for sundry expenses due from the promoters of new company debited to this trans ferred 5,071 8 5 By balance 6,00,000 0 0 1950 opened with entry on January I To Balance 6,00,000 0 0 and closed with an entry By Amount paid to Southern Agencies Ltd, 6,00,000 0 0 785 This was shown as an opening balance on January 1, 1951.
On December 7, a payment of Rs. 2,00,000 was shown and Rs. 4,00,000 were transferred for writing off.
On December 31., 1951, Rs. 4,00,000 were written off and so also the amount of Rs. 5,072 8 5.
The last amount included a sum of Rupee 1, hire for carriage which was also written off after the entry had been reversed.
From these accounts it is quite clear that to begin with the amount was shown as an advance for purchase of shares of the Rodier Textile Mills Ltd. If this was the purpose, it was not an expenditure on the revenue side.
The High Court correctly pointed out that it was not the business of the assessee company to buy agencies and sell them.
The shares were being acquired by the assessee company so that it might have the lucrative business of selling agency and similar other agencies from the Rodier Textile Mills Limited.
As late as December 15, 1952, the Chairman of the assessee company stated in his speech as follows : "You are aware that an advance was made to the Southern Agencies (Pondicherry) Ltd. to acquire for us shares in Rodier Textile Mills Ltd. It was felt that when the promotion and working of Rodier Textile Mills Ltd., became a fait ac compli, our company stood considerably to gain by securing their agency for handling their goods.
" This clearly shows that the assessee company intended to acquire a capital asset for itself This purpose takes the case of the assessee company out of section 10(2)(xv) of the Income tax Act, because no expenditure can be claimed under that clause which 'is of a capital nature.
By the declaration of the Chairman of the assessee company the case under section 10(2)(xv) becomes completely untenable.
In any event, the 786 amount was not expended in the year of account ending with December 31, 1951 : it was expended in 1948.
It remains to consider the case under section 10(2)(xi).
In this connection, we were referred to the Memorandum of Association to show that it was one of the objects of the assessee company to promote other companies and this amount was paid to Southern Agencies Ltd. to promote the Rodier Textile Mills Ltd. There is no doubt that the objects mentioned in the Memorandum of Association of the assessee company include the promotion and financing of other companies.
A Memorandum, however, is not conclusive as to the real nature of a transaction.
That nature has to be deduced not from the Memorandum but from the circumstances in which the transaction took place.
Here, the different versions given in the books of account of the assessee company belie the assertion that this was an amount paid to promote the Rodier Textile Mills Ltd.
Even though this money was available on December 31, 194 8, and the subscription list for the shares remained open from January 5 to 20, 1949, no application for a single share was made on behalf of the assessee company.
The entry till the end of 1949 was that the amount was laid out for purchase of shares.
It was only subsequently that it was shown to be an advance to the Southern Agencies Ltd. In fact, the entry comes only at the end of 1950 when it is set down "By Amount paid to Southern Agencies Ltd." The assessee company raised three contentions in support of the case that this became a bad and doubtful debt which was actually written off : (a.) that the High Court was wrong in saying that before the assessee could claim the deduction under section 10(2)(xi) it must prove that it had in the past purchased and sold agencies, (b) that the object of the assessee company was to apply for shares but as it did not 787 apply for shares the transaction between it and the Southern Agencies remained an advance in the ordinary course of business, and (c) Southern Agencies having failed to give back the money the assessee company was within its rights to write off this bad and doubtful debt.
Now, a question under section 10(2)(xi) can only arise if there is a bad or doubtful debt.
Before a debt can become bad or doubtful it must first be a debt.
What is meant by debt in this connection was laid down by Rowlatt, J., in Curtis v.1.
& G. Oldfield Ltd.,(1) at p. 330 as follows : "When the Rule speaks of a bad debt it means a debt which is a debt that would have come into the balance sheet as a trading debt 'in the trade that is in question and that it is bad.
It does not really mean any debt which, when it was a good debt, would not have come in to swell the profits.
" A debt in such cases is an outstanding which if recovered would have swelled the profits.
It is not money handed over to someone for purchasing a thing which that person has failed to return even though no purchase was made.
In the section a debt means something more than a mere advance.
It means something which is related to business or results from it.
To be claimable as a bad or doubtful debt it must first be shown as a proper debt.
The observations of Rowlatt, J., were applied by the Privy Council in Arunachalam Chettiar vs Commissioner of income tax(2), at p. 245, where their Lordships observed as follows: "Their Lordships moreover can give no countenance to a suggestion that upon a dissolution of partnership a partner 's share of the losses for several preceding years can be accumulated and thrown into the scale against (1) , 330.
(2) (1936) L. R. 63 I. A. 233, 245 788 the income of another partner for a particular year.
No principle of writing off a bad debt could justify such a course, whether in the year following the dissolution or., as logic would permit, in some subsequent year in which the partner 's insolvency has crystallised.
The ; 'bad debt" would not, if good, have come in to swell the taxable profits of the other partner.
" This Court also approved the dictum of Rowlatt, J., in COMMissioner of Income tax vs Abdullabhai Abdulkadar (1) at p. 550 and referred to the observations of Venkatarama Ayyar, J., in Badridas Daga, vs Commissioner of Income, tax, (2) where the learned judge speaking for this Court said that a business debt "springs directly from the carrying on of the business and is incidental to it and not any loss sustained by the assessee, even if it has some connection with his business." Section 10(2)(xi) is in two parts.
One part deals with an assessee who carries on the business of a banker or money lender.
Another part deals with business other than the aforesaid.
Since this was not a loan by a banker or money lender, the debt to be a debt proper had to be one which if good would have swelled the taxable profits.
Applying these tests, it is quite obvious that an advance paid by the assessee company to another to purchase the shares cannot be said to be incidental to the trading activities of the assessee company.
It was more in the nature of a price paid in advance for the shares which the Southern Agencies had a right to allot in the Rodier Textile Mills Ltd. This cannot, therefore, be described as a debt and indeed the changes in the books of account of the assessee company clearly show that the assessee company itself was altering the entries to convert the advance into a debt so as to be able to write it off and claim (1) ; , 954.
(2) ; 789 the benefit of section 10 (2) (xi).
In our opinion, section 10(2)(xi) was inapplicable to the facts of this case.
In the result the appeal must fail and it is dismissed.
The assessee company shall pay the costs of the respondent.
Appeal dismissed.
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Appeal from the judgment dated July 8, 1960 of the Kerala High Court, Emakulam, in Income tax Referred Case No. section T. Desai and Sardar Bahadur, for the appellant. K. N. Rajagopal Sastry, R. N. Sahthey and P. D. Menon, for the respondent. The judgment of the Court was delivered by HIDAYATULLAH, J.
The assessee, A.V. Thomas & Co., Ltd., Alleppey, claimed a deduction of Rs. 4,05,072 8 6 in the assessment year 1952 53 as a bad debt which was written off in its books of account on December 31, 1951. After sundry procedure, the following question was considered by the High Court of Kerala and answered against the assessee company : "Whether on the facts and the circumstances of the case, the Tribunal was correct in holding 778 that the amount of Rs. The High Court certified the case as fit for appeal to this Court and this appeal has been filed by the assessee company. The Commissioner of Income tax (Bangalore) Kerala, is the respondent. The assessee company was incorporated in 1935 and, as is usual with companies, its Memorandum of Association, authorised it to do multifarious businesses. According to clauses 1, 5, 18 and 23, it was authorised "to be interested in, to promote, and to undertake the formation and establishment of other companies", to make investments and to assist any company financially or otherwise. At the material time the assessee company had three directors, whose names are given below 1. There was another private limited company known as the Southern Agencies Limited, Pondicherry, and its directors were : 1. There was a mill in Pondicherry known as Rodier Textile Mill belonging to the Anglo French Textiles Limited, Pondicherry. The assessee company averred that the Southern Agencies Ltd., took up in 1948 the promotion of a limited company to be known as Rodier Textile Mills Ltd., Pondicherry, with 779 a view to buying and developing the Rodier Textile Mill. The assessee company, so it was stated, financed the Southern Agencies Ltd., Pondicherry, by making over funds aggregating to the sum of Rs. This amount was not given directly by the assessee company but at its instance by India Coffee and Tea Distributors Ltd., Madras. The assessee company further stated that though an entry in its own books dated December 31, 1948, showed this amount as an advance for purchase of 6,000 shares of Rs. 100 each in the Rodier Textile Mills Ltd., the main intention of the assessee company was to assist and finance the Southern Agencies Ltd. within the terms of the assessee company 's Memorandum. The subscription list for the Rodier Textile Mills Ltd. remained open from January 5 to January 20, 1949. No application for shares was made on behalf of the assessee company and the shares were not acquired. The public took no interest in the new company which was being promoted and the whole project tailed. On September 1, 1950, the assessee company approved of the action of Mr. A. V. Thomas in making the said advance and on September 18, 1950, a resolution was passed by the Board of Directors of The assessee company that the amount of Rs. 6,00,000 should be shown as an advance for purchase of shares in the Rodier Textile Mills Ltd. (in formation) and the balance of Rs. 5,072 8 5 be shown under sundry advances due from the promoters of the new company. The Southern Agencies Ltd. however, did not return the ' entire amount. 2,00,000 which appears to have been received in full satisfaction. Though as late as June 12, 1951, the advance was considered to be good and recoverable, the balance was written off on December 31, 1951, which was the close of the year of account of the assessee company. It was this amount which was claimed in the assessment year 1952 53 as a bad 780 debt actually written off, or alternatively as an expenditure, not of a capital nature, laid out or expended wholly and exclusively for the purpose of the assessee company 's business. An appeal was taken to the Appellate Assistant Commissioner and he upheld the order of the Income tax Officer though on a different ground. He held that the advance was made for the purpose of purchasing shares of the new company then in formation and it was thus made for the acquisition of a capital asset, which was either the control of the new company or ""to gain its good will likely to result in the grant of agency rights" to the assessee company. According to the Commissioner, the loss, if any, was of a capital nature and the question whether the claim of bad debt was premature or otherwise did not arise for consideration. The assessee company appealed to the Tribunal. The Tribunal upheld the order of the Appellate Assistant Commissioner but on a third ground. The Tribunal accepted that one of the objects of the assessee company was the promotion and financing of other companies for gain but this advance of Rs. 6,00,000 was not made by the assessee company in the normal course of its business. It was rather a transaction "actuated only by personal motives". In reaching this conclusion the Tribunal observed that the advance was made to Southern Agencies Ltd. which was not a company promoted by the assessee company, that between these two companies there was no previous business connection and at the assessee company had no expectancy of a financial benefit. The Tribunal thus held that this deduction could not be claimed as it was given out of " 'personal motives" and not as a part of the business of the assessee company. The assessee company demanded a case but it was refused by the Tribunal. 4,05,072 8 5 can be claimed by the assessee as a bad debt written off under the provisions of Section 10(2) (xi) of the Act, (ii) Whether on the facts and in the circums tances of the case, the assessee can claim the sum of Rs. 4,05,072 8 5 as a proper debit and charge it to the Profit and Loss account of the assessee company. The assessee company applied to the High Court and the High Court directed a reference on the single question which has been quoted. That question shows that the High Court did not direct the case under section 10(1) of the Act. The High Court apparently had not accepted that the matter could be considered under section 10(1) and framed the question under cls. The question as propounded and considered by the High Court related to the two clauses only. An attempt was made before us to raise the issue under section 10(1) and to claim the deduction as an ordinary business loss. We disallowed the argument because in our opinion the question as considered in the High Court does not embrace it. It was contended before us that the High Court in calling for a reference on the single question had stated that that question would cover three matters. But this was not the same thing as saying that the Tribunal had no material before it on which it could reach the conclusion that this was not an advance in the ordinary course of business by the assessee company. No doubt, the High Court in its order calling for a statement of the case has observed that there was no dispute at any 783 earlier stage that this was not in the ordinary course of business, but that conclusion of the High Court in the order it made under section 66(2) can have no relevance or binding force. Indeed, the High Court was in error in giving a finding of its own and it is not surprising that the Tribunal protested against this finding. It was open to the High Court to frame a question whether there was any material to support the finding of the Tribunal and to ask the Tribunal to state a case thereon. Not having done so, the question as framed drives the assessee company to prove its case either under section 10(2)(xi) or under section 10(2)(xv) and it is from these two angles that the case will be considered by us. In support of its case, the assessee company stated that as there was no dispute about the facts that this was an advance in the ordinary course of business it should be treated as a trading loss or alternatively as a bad debt or an expenditure claimable under section 10(2)(xv). These have been marked as Annexures A. 1 to A. 3. The High Court also referred to these accounts and they have been construed as showing, that there was an attempt by the assessee company to acquire a capital asset. These accounts began in 1948 and ended on December 31, 1951. The accounts are headed "Personal Ledger. " In December, 1948, sundry amounts totalling Rs. 6,05,071 8 5 are shown as amounts "paid to you by Indian Coffee and Tea Distributors Ltd., Madras, towards purchase of shares. " On January 1, 1949, the account opened with a debit balance of Rs. Nothing appears from the accounts who this " 'you" was. A number of reversing entries were made in respect of certain amounts and then on December 31, 1949, the amount was shown as follows : By advance for sundry expenses due from the promoters of new company debited to this trans ferred 5,071 8 5 By balance 6,00,000 0 0 1950 opened with entry on January I To Balance 6,00,000 0 0 and closed with an entry By Amount paid to Southern Agencies Ltd, 6,00,000 0 0 785 This was shown as an opening balance on January 1, 1951. 4,00,000 were transferred for writing off. 4,00,000 were written off and so also the amount of Rs. The last amount included a sum of Rupee 1, hire for carriage which was also written off after the entry had been reversed. The High Court correctly pointed out that it was not the business of the assessee company to buy agencies and sell them. The shares were being acquired by the assessee company so that it might have the lucrative business of selling agency and similar other agencies from the Rodier Textile Mills Limited. " This clearly shows that the assessee company intended to acquire a capital asset for itself This purpose takes the case of the assessee company out of section 10(2)(xv) of the Income tax Act, because no expenditure can be claimed under that clause which 'is of a capital nature. In any event, the 786 amount was not expended in the year of account ending with December 31, 1951 : it was expended in 1948. It remains to consider the case under section 10(2)(xi). In this connection, we were referred to the Memorandum of Association to show that it was one of the objects of the assessee company to promote other companies and this amount was paid to Southern Agencies Ltd. to promote the Rodier Textile Mills Ltd. There is no doubt that the objects mentioned in the Memorandum of Association of the assessee company include the promotion and financing of other companies. A Memorandum, however, is not conclusive as to the real nature of a transaction. That nature has to be deduced not from the Memorandum but from the circumstances in which the transaction took place. Here, the different versions given in the books of account of the assessee company belie the assertion that this was an amount paid to promote the Rodier Textile Mills Ltd.
Even though this money was available on December 31, 194 8, and the subscription list for the shares remained open from January 5 to 20, 1949, no application for a single share was made on behalf of the assessee company. The entry till the end of 1949 was that the amount was laid out for purchase of shares. Now, a question under section 10(2)(xi) can only arise if there is a bad or doubtful debt. Before a debt can become bad or doubtful it must first be a debt. What is meant by debt in this connection was laid down by Rowlatt, J., in Curtis v.1. & G. Oldfield Ltd.,(1) at p. 330 as follows : "When the Rule speaks of a bad debt it means a debt which is a debt that would have come into the balance sheet as a trading debt 'in the trade that is in question and that it is bad. It does not really mean any debt which, when it was a good debt, would not have come in to swell the profits. " A debt in such cases is an outstanding which if recovered would have swelled the profits. It is not money handed over to someone for purchasing a thing which that person has failed to return even though no purchase was made. In the section a debt means something more than a mere advance. It means something which is related to business or results from it. To be claimable as a bad or doubtful debt it must first be shown as a proper debt. (2) (1936) L. R. 63 I. A. 233, 245 788 the income of another partner for a particular year. No principle of writing off a bad debt could justify such a course, whether in the year following the dissolution or., as logic would permit, in some subsequent year in which the partner 's insolvency has crystallised. The ; 'bad debt" would not, if good, have come in to swell the taxable profits of the other partner. " This Court also approved the dictum of Rowlatt, J., in COMMissioner of Income tax vs Abdullabhai Abdulkadar (1) at p. 550 and referred to the observations of Venkatarama Ayyar, J., in Badridas Daga, vs Commissioner of Income, tax, (2) where the learned judge speaking for this Court said that a business debt "springs directly from the carrying on of the business and is incidental to it and not any loss sustained by the assessee, even if it has some connection with his business." One part deals with an assessee who carries on the business of a banker or money lender. Another part deals with business other than the aforesaid. Since this was not a loan by a banker or money lender, the debt to be a debt proper had to be one which if good would have swelled the taxable profits. (2) ; 789 the benefit of section 10 (2) (xi). In our opinion, section 10(2)(xi) was inapplicable to the facts of this case. In the result the appeal must fail and it is dismissed. The assessee company shall pay the costs of the respondent.
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The assessee company was incorporated in 1935 and its Memorandum of association authorised it, inter alia, to promote and to undertake the formation and establishment of other companies and to assist any company financially or otherwise.
There was another company known as the Southern Agencies Ltd. and Mr. A. V. Thomas was director of both these companies.
In 1948 the Southern Agencies Ltd. began the promotion of a company to be known as the Rodier Textile Mills Ltd., with a view to buying up a Mill known as the Rodier Textile Mills.
The assessee company made an advance of Rs. 6 lakhs odd to the promoter for the purchase of 6000 shares of the new company.
The public took no interest in the new company and the whole project failed.
No application for shares was made on behalf of the assesee company and no share was acquired.
The Southern Agencies Ltd., however, did not return the entire amount.
On December 7, 1951, it paid back only Rs. 2 lakhs which was received in full satisfaction.
The balance of Rs. 4,05,071 8 6 was written off on December 31, 195 1, which was the close of the year of account of the assessee company.
For the assessment year 1952 33 the assessee company claimed a deduction of that amount as a bad debt actually written off, or alternatively as an Expenditure, not of a capital nature laid out or expended wholly and exclusively for the purpose of its business.
777 Held, (1) that the amount advanced for the purchase of shares was of a capital nature and, therefore, the balance was not allowable as an expenditure under s 10 (2) (xv) of the Indian Income tax Act, 1922, as it was not the business of the assessee company to buy agencies and sell them; and in any event the amount was expended in 1948 and not in the year of account ending December 31, 1951.
(2) that it was not a bad debt under section 10 (2) (xi).
A debt in such cases is an outstanding which is recovered would have swelled the profits.
It is not money handed over to some one for purchasing a thing which that person has failed to return even though no purchase was made.
Curtis vs J. & G. Old field Ltd., , Arunachalam Chettiar vs Commissioner 'of Income tax, (1936) L. R. 63 I. A. 233, Badridas Daga vs Commissioner of Income tax; , and Commissioner of Income tax vs Abdullabhi Abdulakadar; , , relied on.
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The assessee company was incorporated in 1935 and its Memorandum of association authorised it, inter alia, to promote and to undertake the formation and establishment of other companies and to assist any company financially or otherwise.
There was another company known as the Southern Agencies Ltd. and Mr. A. V. Thomas was director of both these companies.
In 1948 the Southern Agencies Ltd. began the promotion of a company to be known as the Rodier Textile Mills Ltd., with a view to buying up a Mill known as the Rodier Textile Mills.
The assessee company made an advance of Rs. 6 lakhs odd to the promoter for the purchase of 6000 shares of the new company.
The public took no interest in the new company and the whole project failed.
No application for shares was made on behalf of the assesee company and no share was acquired.
The Southern Agencies Ltd., however, did not return the entire amount.
On December 7, 1951, it paid back only Rs. 2 lakhs which was received in full satisfaction.
The balance of Rs. 4,05,071 8 6 was written off on December 31, 195 1, which was the close of the year of account of the assessee company.
For the assessment year 1952 33 the assessee company claimed a deduction of that amount as a bad debt actually written off, or alternatively as an Expenditure, not of a capital nature laid out or expended wholly and exclusively for the purpose of its business.
777 Held, (1) that the amount advanced for the purchase of shares was of a capital nature and, therefore, the balance was not allowable as an expenditure under s 10 (2) (xv) of the Indian Income tax Act, 1922, as it was not the business of the assessee company to buy agencies and sell them; and in any event the amount was expended in 1948 and not in the year of account ending December 31, 1951.
(2) that it was not a bad debt under section 10 (2) (xi).
A debt in such cases is an outstanding which is recovered would have swelled the profits.
It is not money handed over to some one for purchasing a thing which that person has failed to return even though no purchase was made.
Curtis vs J. & G. Old field Ltd., , Arunachalam Chettiar vs Commissioner 'of Income tax, (1936) L. R. 63 I. A. 233, Badridas Daga vs Commissioner of Income tax; , and Commissioner of Income tax vs Abdullabhi Abdulakadar; , , relied on.
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Civil Appeal No. 1425 of 1973.
From the Judgment and Order dated 21.9.1973 of the Delhi High 1025 Court in S.A.O. No. 294 of 1972.
Dr. Shankar Ghosh and Rathin Das for the Appellant.
A.B. Rohtagi, Soli J. Sorabjee, Mrs. R. Swami, A.K. Verma and Ms. section Sethna for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI J.
This is an appeal by special leave directed against the judgment and order of the High Court of Delhi dated the 21st September, 1973 in Second Appeal No. 294/72.
The High Court dismissed the Second Appeal of the appellant and confirmed the decision of the Rent Control Tribunal and ordered eviction.
Before the High Court three contentions were urged namely: 1.
The petition for eviction was not maintainable in the absence of a notice to quit while determining the tenancy, 2.
There was no sub letting or parting of possession by the appellant tenant in favour of R.C. Abrol & Company Pvt. Ltd., and 3.
If there was such sub letting, it had been made with the written consent of the landlord so was not actionable.
The Rent Control Tribunal confirmed the findings against the appellant in all the three contentions and the High Court also affirmed the findings of the Rent Control Tribunal.
We must note that no contention was raised before us as far as point No. 1, namely notice was not served.
The only contention before us was that there was no sub letting or parting of the possession by the appellant tenant in favour of R.C. Abrol & Company Pvt. Ltd. and secondly it was urged that if there was sub letting that had been made with the written consent of the landlord.
The Clause 14 of the lease deed in the instant case which provides, inter alia, the terms and conditions is as follows: "Clause 14 That the lessee undertakes not to sub let the premises to any other party without the written permission of the lessor, and that the lessee 's contractors M/s R.C. Abrol & Co. will share the premises with the permission of the lessor.
" 1026 This is in consonance also with provisions of Section 14(1)(b) of the Delhi Rent Control Act, 1958 (hereinafter called the Act) and Sub Sections (2) and (3) of Section 16 of the said Act.
The first question, therefore, is whether there was any sub letting and secondly if so was the same with the consent in writing of the landlord.
All these questions are essentially questions of facts and were held against the appellant by the Rent Control Tribunal which was the final Court of facts, applying the correct propositions of law.
This conclusion has been affirmed by the High Court.
Before us it was pointed out by Sree Shankar Ghosh, learned counsel for the appellant, that it was not necessary that the consent to sub letting should be in writing and what he contended was that it was necessary to have the consent and the manner of proving consent was provided in writing.
In other words, he contended that the provision which required that the consent should be in writing meant it was mandatory so far as it enjoined consent but it was directory so far as it said that such consent should be in writing.
Apart from the statute in this case, we find it difficult to accept this argument in view of the specific clause in the statute hereinbefore.
In South Asia Industries Private Ltd. vs section Sarup Singh and others; , Justice A.K. Sarkar as the learned Chief Justice then was, observed that the object of interpreting a statute was to ascertain the intention of the legislature in enacting it.
An interpretation defeating the object of a statute is, therefore, not permissible.
In paragraph 11 of the judgment at page 350 the learned Judge observed as follows: "I notice that the lease gave no express right to the lessee to assign with or without the consent of the lessor.
The lessee no doubt had that right under the Transfer of Property Act.
It may be that under the clause the lessee 's assignee would be included in the expression "lessee" as used in the lease; that is the entire effect of the clause.
But this would be so whether the lessor had consented to the assignment or not.
therefore this clause does not lead to the conclusion that the lessor had consented to the assignment.
It is of no assistance in the present case.
I am also inclined to the view that the consent contemplated by Section 14(1) proviso (b) is a direct consent to a contemplated assignment to a particular assignee.
See Regional Properties Ltd. vs Frankenschwerth, Clearly the clause in the case relied upon could not be a consent of this kind." 1027 It is true that Justice R.S. Bachawat had expressed the view that the consent could be general or special but in the case before the Court there was no conduct which showed that there was consent by the general words of the clause in the deed.
We are of the opinion on reading of the different provisions that the consent enjoined by bargain between the parties in this case must be in writing and must be to the specific sub letting.
That was the view of the Delhi High Court in Raja Ram Goyal vs Ashok Kumar and others, In Kartar Singh vs Shri Vijay Kumar and Another, [1978] All India Rent Conrol Journal 264 the High Court of Punjab & Haryana has also expressed similar view.
In the case of M/s Delhi Vanaspati Syndicate, Delhi vs M/s Bhagwan Dass Faqir Chand, Khanna, C.J. as he then was of the Delhi High Court observed at page 19 of the report: "Section 16 of the Act of 1958 holds the key to the interpretation of provisions of Clause (b) of sub section (1) of Section 14 of this Act as well as of Clause (b) of subsection (1) of section 13 of the Act of 1952.
It deals with restrictions on sub letting.
Sub section (1) of section 16 makes sub letting lawful though it was without the consent of the landlord provided that the sub letting has taken place before 9th day of June, 1952 and the sub tenant is in occupation of the premises at the time when the Act of 1958 came into force.
Sub section (2) of section 16 reiterates the provisions of Clause (b) of sub section (1) of Section 13 of the Act of 1952 and lays down that the sub letting after 9th day of June, 1952 without obtaining the consent in writing of the landlord shall not be deemed to the lawful.
It does not say that the requisite consent should be obtained before sub letting the premises and the consent obtained after sub letting will not enure for the benefit of the tenant.
However, sub section (3) of Section 16 prohibits subletting of the premises after commencement of Act of 1958 without the 'previous ' consent in writing of the landlord.
The use of word 'Previous ' in this sub section shows that where it was the intention of the legislature that the consent in writing should be obtained before sub letting, it said so specifically.
The absence of the word 'Previous ' in subsection (2) shows that it was not the intention of the legisla 1028 ture that the consent in writing could be obtained before sub letting.
Before the Act of 1952 a tenant could successfully show acquiescence of the landlord in sub letting to escape forfeiture of tenancy.
Since the absence of consent in writing by a landlord for sub letting gave rise to unnecessary litigation between a landlord and a tenant, the Act of 1952 required the consent of the landlord in writing after its commencement.
The purpose seemed to be that the consent of the landlord evidence by a writing would cut out litigation on this ground.
After all a landlord could always agree to sub letting either before or after sub letting of the premises.
For that reason no condition was laid down that such consent should be obtained before sub letting the premises.
" We are in agreement with this approach to the interpretation and it is in consonance with the view expressed by this Court earlier as mentioned hereinbefore.
In the aforesaid view of the matter we are of the opinion that it was necessary for the tenant to obtain the consent in writing to sub letting the premises.
The mere permission or acquiescence will not do.
The consent must be to the specific sub letting and must be in writing.
Indeed there was no implied permission also here.
Our attention was drawn to the fact that the landlord had written letter to the tenant and the landlord objected to the sub letting, the moment he realised the situation.
In that view of the matter we are clearly of the opinion that in this case there was no consent in writing on the part of landlord to such sub letting.
Dr. Shankar Ghosh tried to state that in view of the fact that the key of the premises was stated to be in the custody of the tenant, there was no sub letting.
It was the mere user, it was urged.
It is difficult to accept this contention.
The case of sub letting was accepted as has been found by all the Courts in this case.
Our attention was drawn to the certain observations on the question of directory/mandatory nature of the requirement that consent should be in writing.
Reliance was placed on the observations of Craies on Statute Law 7th Edition 261 wherein in the election case requirement that ballot paper had to be kept in a particular manner was considered to be 1029 directory and similarly it was submitted in this case the requirement of the consent to be in writing should be construed to be directory.
It was urged that the conduct of the parties indicated that there was no breach of the covenant.
We are unable to agree.
Here the situation is clearly different.
Here the requirement of consent to be in writing was to serve a public purpose, i.e., to avoid dispute as to whether there was consent or not.
Reliance was also placed on the observations of Maxwell in the Interpretation of Statutes 12th Edition at page 328 on the question of waiver: Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity.
We are, however, in this case unable to agree.
Firstly, in this case there was no case of waiver.
Waiver is a question of fact which has to be tested by facts and evidence.
There was no conscious relinquishment of the advantage of any statute.
No Court has gone into this fact.
It does not seem to have been urged before the High Court also.
Apart from this, in this requirement of the statute which is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord.
In Chaplin vs Smith, [1926] 1 King 's Bench Division 198, it was held that physical possession was not sufficient, there must be legal possession.
The question was whether there was any consent in writing in this case.
We have noticed Clause 14 of the lease deed states that the lessee will not sublet the premises or any part to any party without the written permission of the lessor except that the lessee 's Contractors M/s R.C. Abrol & Co. Pvt. Ltd. will share the premises with the permission of the lessor.
So the permission of the lessor was there but the purpose was of the sharing with M/s R.C. Abrol & Co. Pvt. Ltd. was not of leasing the premises to any other entity.
For the purpose of this, it is suffice for us to state that Clause 14 as enjoined did give permission of leasing the premises to M/s. R.C. & Co. Pvt. Ltd. which was a different entity.
Dealing with this contention the High Court observed in its judgment that the company had been incorporated some time in 1957 after the commencement of the tenancy.
Company was a distinct legal entity.
It appears in this case that the company was composed of the different persons.
The High Court noted that there was never any 1030 consent in writing of the landlord to sub letting the premises to the incorporated company.
The permission must have been in writing and specific in the words of Justice Sarkar in South Asia Industries Private Ltd. vs Sarup Singh and others, (Supra).
In the case of Mehta Jagjivan Vanechand vs Doshi Vanechand, (A.I.R. 1972 Gujarat 6), Justice Thakkar as he then was of the Gujarat High Court observed at page 8 of the report: "A similar question was raised before the Madras High Court in Gundalpalli Rangamannar Chetty vs Desu Rangiah, AIR 1954 Madras 182.
A reference was made to Jackson vs Simons, , and the distinction drawn between physical possession and legal possession in that decision was taken into account in rejecting the contention of the landlord that there was a subletting or assignment.
It has been observed by the Madras High Court in paragraph (5) of the said decision as under: "In `Jackson vs Simons ' the question was whether the tenant broke a similar covenant.
The defendant who was the tenant, without the plaintiffs ' consent or knowledge agreed for the sum of Ls 7 per week to allow the proprietor of a night club carried on in a basement beneath the shop to the front part of the shop between the hours of 10.30 P.M. and 2 a.m. for the sale of tickets of admission to the club Romer J. held that the arrangement conferred to estate or interest in the demised premises but was a mere privilege or licence to use portion thereof, the defendant retaining the legal possession of the whole and did not therefore constitute a breach of the covenants not to assign, underlet or part with the demised premises or any part thereof." The Madras High Court also relied on an observation made by Scrutton L.J. in Chaplin vs Smith, , at p. 211, wherein it was observed: "He did not assign; nor did he underlet.
He was constantly on the premises himself and kept the key of them.
He did business of his own as well as business of the company.
In my view he allowed the company to use the premises while he himself remained in possession of them." 1031 Reliance was also placed on the Treatise of Foa on Landlord and Tenant, 6th Edn.
at page 323, where the law on the subject has been summarized in the following words: "The mere act of letting other persons into possession by the tenant, and permitting them to use the premises for their own purposes, is not so long as he retains the legal possesion himself, a breach of the covenant." After considering all these decisions, the High Court of Madras extracted the following principles and came to the conclusion that a mere taking in of partners did not amount to transferring of possession and did not constitute assignment or subletting.
Says the Madras High Court: "It is clear from the aforesaid decisions that there cannot be a sub letting unless the lessee parted with legal possession.
The mere fact that another is allowed to use the premises while the lessee retains the legal possession is not enough to create a sub lease.
Section 105 of the Transfer of Property Act defines a lease of immovable property as to transfer of right to enjoy such property.
Therefore to create a lease or sub lease a right to exclusive possession and enjoyment of the property should be conferred on another.
In the present case the exclusive possession of the premises was not given to the second respondent.
the first respondent continued to be the lessee, though in regard to the business carried on in the premises he had taken in other partners.
The partners are not given any exclusive possession of the premises or a part thereof.
The first respondent continues to be in possession subject to the liability to pay rent to his landlord.
The partnership deed also, as I have already stated, does not confer any such right in the premises on the other partners.
I, therefore, hold in the circumstances of the case the first respondent did not sublet the premises to the second respondent, and therefore he is not liable to be evicted under the provisions of Act No. 25 of 1949.
" The view taken by me is reinforced by the opinion expressed by the Madras High Court in the aforesaid decision.
A similar view has also been taken by Saurashtra High Court in Karsandas Ramji vs Karsanji Kalyanji, AIR 1953 Sau. 113 at pp.
114 & 115.
In my opinion, it is therefore clear 1032 that there has been no assignment or subletting in favour of the partners of the firm by the tenant so as to attract the Bar of section 13(1)(e) of the Rent Act.
The view taken by the lower Courts is correct and no exception can be taken thereto.
There is no dispute in the legal proposition that there must be parting of the legal possession.
Parting of the legal possession means possession with the right to include and also right to exclude others.
That is, in our opinion, is the matter of fact.
In this case, it has been found that there was a right of possession in favour of the sub lessee R.C. Abrol & Co. Pvt. Ltd. and right to exclude indeed as it appears from the narration of the fact that the company has gone into liquidation and the official liquidator has taken possession of the premises on behalf of the liquidator and that must be on the basis that it was the asset belonging to the company.
In that aforesaid view of the matter we are unable to accept this proposition that there was no sub letting.
Dr. Shankar Ghosh drew our attention to the observations of the High Court of Delhi in the following three cases: Vishwa Nath and Anr.
vs Chaman Lal Khanna & Others, Shri Gurdial Singh vs Shri Brij Kishore & Others, [1970] Delhi Law Times 592.
M/s Reliable Finance Corporation (P) Ltd. vs M/s Clearing House and Agencies Private Ltd & Ors.
[1984] 2 Rent Control Reporter 449.
Madras Bangalore Transport Co. (West) vs Inder Singh and Others, He contended that in the light of the aforesaid authorities in this case, there was no parting of legal possession in favour of the sublessee.
We are unable to accept this position.
In the instant case, exclusive possession was given to the sub lessee and the tenant had transferred the right to possess in that portion.
It is clear that subletting was done without the consent in writing of the landlord.
If that is so, there was inevitably breach of the covenant.
In that view of the matter the High Court was right in upholding 1033 the order of the Rent Control Tribunal and directing eviction of the appellant.
The appeal, therefore, must fail and is accordingly dismissed.
In view of the fact that the appellant has been in possession of the premises for quite some time and to make its arrangements for shifting we direct the decree for eviction shall not be executed before 30.6.1988 provided the appellant files the usual undertaking in this Court within four weeks from today.
Mesne profits will be payable from 1st of December 1987 @ Rs.7,000 per month until the possession is delivered.
That the appellant will hand over vacant and peaceful possession of the premises to the respondents on or before 30.6.1988 from today.
That the appellant will pay to the respondent arrears of rent, if any, within one month from today.
That the appellant will pay to respondent further compensation for use and occupation of the premises month by month before 10th of every month.
That the appellant will not induct any other person in the premises.
The Court further directs that in default of compliance with any one or more of these conditions or if the undertaking is not filed as required within the stipulated time, the decree shall become executable forthwith.
N.V.K. Appeal dismissed.
|
% The respondent landlord sought eviction of the appellant tenant on the ground of having sub let without written consent the portion in his occupation in favour of M/s. R.C. Abrol & Co. The appellant resisted the petition for eviction, contending that it was not maintainable in the absence of a notice to quit while determining the tenancy, that there was no sub letting or parting of possession by the appellant in favour of M/s. R.C. Abrol & Co., in view of Clause 14 of the Lease agreement, which provided: "That the lessee undertakes not to sub let the premises to any other party without the written permission of the lessor and that the lessee 's contractors M/s.
R.C. Abrol and Co. will share the premises with the permission of the lessor".
The Rent Control Tribunal ordered eviction of the appellant on the ground of sub letting.
The High Court dismissed the Second Appeal of the appellant and confirmed the decision of the Rent Control Tribunal ordering eviction.
In the appeal to this Court by special leave it was contended for the appellant, that there was no sub letting or parting of possession by the appellant tenant in favour of M/s. R.C. Abrol & Co. (P) Ltd., and that if there was sub letting that had been made with the written consent of the landlord.
Dismissing the Appeal, ^ HELD: 1.
Sections 14(1) proviso (b), 16(2) and (3) of the Delhi Rent Control Act, 1958 require the tenant to obtain consent of the landlord in writing for sub letting of the premises.
The purpose of such written consent was that it would cut out litigation on this ground.
Mere permission or acquiescence would not do.
The consent must be to the specific sub letting and must be in writing.
There is no implied permission.
[1026A, 1028D] 1024 South Asia Industries Private Ltd. vs section Sarup Singh & others; , ,referred to.
Raja Ram Goyal vs Ashok Kumar and others, ; Kartar Singh vs Shri Vijay Kumar and Another, and M/s. Delhi Vanaspati Syndicate, Delhi vs Bhagwan Dass Faquir Chand, ,approved.
Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity.
Waiver is a question of fact which has to be decided by facts and evidence.
[1029C] Chaplin vs Smith, [1926) 1 King 's Bench Division 198, referred to.
In the instant case, there was no question of waiver.
There was no conscious relinquishment of the advantage of any statute.
No Court has gone into this fact.
It does not seem to have been urged before the High Court also.
As this requirement of the statute is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord.
[1029D] 3.
To constitute sub letting there must be parting of the legal possession.
Parting of the legal possession means possession with the rights to include and also the right to exclude others.
This is a question offact.
[1032B] Mehta Jagjivan Vanechand vs Doshi Vanechand, A.I.R. 1972 Gujarat 6, referred to.
In the instant case, exclusive possession was given to the sublessee, R.C. Abrol & Co. and the tenant has transferred the right to possess in that portion.
It is clear that the sub letting was done wihout the consent in writing of the landlord.
There was, therefore an inevitable breach of the covenant.
The High Court was therefore right in upholding the order of the Rent Control Tribunal and directing eviction of the appellant.
[1032G 1033A]
|
Civil Appeal No. 1425 of 1973.
From the Judgment and Order dated 21.9.1973 of the Delhi High 1025 Court in S.A.O. No. 294 of 1972.
Dr. Shankar Ghosh and Rathin Das for the Appellant.
A.B. Rohtagi, Soli J. Sorabjee, Mrs. R. Swami, A.K. Verma and Ms. section Sethna for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI J.
This is an appeal by special leave directed against the judgment and order of the High Court of Delhi dated the 21st September, 1973 in Second Appeal No. 294/72.
The High Court dismissed the Second Appeal of the appellant and confirmed the decision of the Rent Control Tribunal and ordered eviction.
Before the High Court three contentions were urged namely: 1.
The petition for eviction was not maintainable in the absence of a notice to quit while determining the tenancy, 2.
There was no sub letting or parting of possession by the appellant tenant in favour of R.C. Abrol & Company Pvt. Ltd., and 3.
If there was such sub letting, it had been made with the written consent of the landlord so was not actionable.
The Rent Control Tribunal confirmed the findings against the appellant in all the three contentions and the High Court also affirmed the findings of the Rent Control Tribunal.
We must note that no contention was raised before us as far as point No. 1, namely notice was not served.
The only contention before us was that there was no sub letting or parting of the possession by the appellant tenant in favour of R.C. Abrol & Company Pvt. Ltd. and secondly it was urged that if there was sub letting that had been made with the written consent of the landlord.
The Clause 14 of the lease deed in the instant case which provides, inter alia, the terms and conditions is as follows: "Clause 14 That the lessee undertakes not to sub let the premises to any other party without the written permission of the lessor, and that the lessee 's contractors M/s R.C. Abrol & Co. will share the premises with the permission of the lessor.
" 1026 This is in consonance also with provisions of Section 14(1)(b) of the Delhi Rent Control Act, 1958 (hereinafter called the Act) and Sub Sections (2) and (3) of Section 16 of the said Act.
The first question, therefore, is whether there was any sub letting and secondly if so was the same with the consent in writing of the landlord.
All these questions are essentially questions of facts and were held against the appellant by the Rent Control Tribunal which was the final Court of facts, applying the correct propositions of law.
This conclusion has been affirmed by the High Court.
Before us it was pointed out by Sree Shankar Ghosh, learned counsel for the appellant, that it was not necessary that the consent to sub letting should be in writing and what he contended was that it was necessary to have the consent and the manner of proving consent was provided in writing.
In other words, he contended that the provision which required that the consent should be in writing meant it was mandatory so far as it enjoined consent but it was directory so far as it said that such consent should be in writing.
Apart from the statute in this case, we find it difficult to accept this argument in view of the specific clause in the statute hereinbefore.
In South Asia Industries Private Ltd. vs section Sarup Singh and others; , Justice A.K. Sarkar as the learned Chief Justice then was, observed that the object of interpreting a statute was to ascertain the intention of the legislature in enacting it.
An interpretation defeating the object of a statute is, therefore, not permissible.
In paragraph 11 of the judgment at page 350 the learned Judge observed as follows: "I notice that the lease gave no express right to the lessee to assign with or without the consent of the lessor.
The lessee no doubt had that right under the Transfer of Property Act.
It may be that under the clause the lessee 's assignee would be included in the expression "lessee" as used in the lease; that is the entire effect of the clause.
But this would be so whether the lessor had consented to the assignment or not.
therefore this clause does not lead to the conclusion that the lessor had consented to the assignment.
It is of no assistance in the present case.
I am also inclined to the view that the consent contemplated by Section 14(1) proviso (b) is a direct consent to a contemplated assignment to a particular assignee.
See Regional Properties Ltd. vs Frankenschwerth, Clearly the clause in the case relied upon could not be a consent of this kind." 1027 It is true that Justice R.S. Bachawat had expressed the view that the consent could be general or special but in the case before the Court there was no conduct which showed that there was consent by the general words of the clause in the deed.
We are of the opinion on reading of the different provisions that the consent enjoined by bargain between the parties in this case must be in writing and must be to the specific sub letting.
That was the view of the Delhi High Court in Raja Ram Goyal vs Ashok Kumar and others, In Kartar Singh vs Shri Vijay Kumar and Another, [1978] All India Rent Conrol Journal 264 the High Court of Punjab & Haryana has also expressed similar view.
In the case of M/s Delhi Vanaspati Syndicate, Delhi vs M/s Bhagwan Dass Faqir Chand, Khanna, C.J. as he then was of the Delhi High Court observed at page 19 of the report: "Section 16 of the Act of 1958 holds the key to the interpretation of provisions of Clause (b) of sub section (1) of Section 14 of this Act as well as of Clause (b) of subsection (1) of section 13 of the Act of 1952.
It deals with restrictions on sub letting.
Sub section (1) of section 16 makes sub letting lawful though it was without the consent of the landlord provided that the sub letting has taken place before 9th day of June, 1952 and the sub tenant is in occupation of the premises at the time when the Act of 1958 came into force.
Sub section (2) of section 16 reiterates the provisions of Clause (b) of sub section (1) of Section 13 of the Act of 1952 and lays down that the sub letting after 9th day of June, 1952 without obtaining the consent in writing of the landlord shall not be deemed to the lawful.
It does not say that the requisite consent should be obtained before sub letting the premises and the consent obtained after sub letting will not enure for the benefit of the tenant.
However, sub section (3) of Section 16 prohibits subletting of the premises after commencement of Act of 1958 without the 'previous ' consent in writing of the landlord.
The use of word 'Previous ' in this sub section shows that where it was the intention of the legislature that the consent in writing should be obtained before sub letting, it said so specifically.
The absence of the word 'Previous ' in subsection (2) shows that it was not the intention of the legisla 1028 ture that the consent in writing could be obtained before sub letting.
Before the Act of 1952 a tenant could successfully show acquiescence of the landlord in sub letting to escape forfeiture of tenancy.
Since the absence of consent in writing by a landlord for sub letting gave rise to unnecessary litigation between a landlord and a tenant, the Act of 1952 required the consent of the landlord in writing after its commencement.
The purpose seemed to be that the consent of the landlord evidence by a writing would cut out litigation on this ground.
After all a landlord could always agree to sub letting either before or after sub letting of the premises.
For that reason no condition was laid down that such consent should be obtained before sub letting the premises.
" We are in agreement with this approach to the interpretation and it is in consonance with the view expressed by this Court earlier as mentioned hereinbefore.
In the aforesaid view of the matter we are of the opinion that it was necessary for the tenant to obtain the consent in writing to sub letting the premises.
The mere permission or acquiescence will not do.
The consent must be to the specific sub letting and must be in writing.
Indeed there was no implied permission also here.
Our attention was drawn to the fact that the landlord had written letter to the tenant and the landlord objected to the sub letting, the moment he realised the situation.
In that view of the matter we are clearly of the opinion that in this case there was no consent in writing on the part of landlord to such sub letting.
Dr. Shankar Ghosh tried to state that in view of the fact that the key of the premises was stated to be in the custody of the tenant, there was no sub letting.
It was the mere user, it was urged.
It is difficult to accept this contention.
The case of sub letting was accepted as has been found by all the Courts in this case.
Our attention was drawn to the certain observations on the question of directory/mandatory nature of the requirement that consent should be in writing.
Reliance was placed on the observations of Craies on Statute Law 7th Edition 261 wherein in the election case requirement that ballot paper had to be kept in a particular manner was considered to be 1029 directory and similarly it was submitted in this case the requirement of the consent to be in writing should be construed to be directory.
It was urged that the conduct of the parties indicated that there was no breach of the covenant.
We are unable to agree.
Here the situation is clearly different.
Here the requirement of consent to be in writing was to serve a public purpose, i.e., to avoid dispute as to whether there was consent or not.
Reliance was also placed on the observations of Maxwell in the Interpretation of Statutes 12th Edition at page 328 on the question of waiver: Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity.
We are, however, in this case unable to agree.
Firstly, in this case there was no case of waiver.
Waiver is a question of fact which has to be tested by facts and evidence.
There was no conscious relinquishment of the advantage of any statute.
No Court has gone into this fact.
It does not seem to have been urged before the High Court also.
Apart from this, in this requirement of the statute which is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord.
In Chaplin vs Smith, [1926] 1 King 's Bench Division 198, it was held that physical possession was not sufficient, there must be legal possession.
The question was whether there was any consent in writing in this case.
We have noticed Clause 14 of the lease deed states that the lessee will not sublet the premises or any part to any party without the written permission of the lessor except that the lessee 's Contractors M/s R.C. Abrol & Co. Pvt. Ltd. will share the premises with the permission of the lessor.
So the permission of the lessor was there but the purpose was of the sharing with M/s R.C. Abrol & Co. Pvt. Ltd. was not of leasing the premises to any other entity.
For the purpose of this, it is suffice for us to state that Clause 14 as enjoined did give permission of leasing the premises to M/s. R.C. & Co. Pvt. Ltd. which was a different entity.
Dealing with this contention the High Court observed in its judgment that the company had been incorporated some time in 1957 after the commencement of the tenancy.
Company was a distinct legal entity.
It appears in this case that the company was composed of the different persons.
The High Court noted that there was never any 1030 consent in writing of the landlord to sub letting the premises to the incorporated company.
The permission must have been in writing and specific in the words of Justice Sarkar in South Asia Industries Private Ltd. vs Sarup Singh and others, (Supra).
In the case of Mehta Jagjivan Vanechand vs Doshi Vanechand, (A.I.R. 1972 Gujarat 6), Justice Thakkar as he then was of the Gujarat High Court observed at page 8 of the report: "A similar question was raised before the Madras High Court in Gundalpalli Rangamannar Chetty vs Desu Rangiah, AIR 1954 Madras 182.
A reference was made to Jackson vs Simons, , and the distinction drawn between physical possession and legal possession in that decision was taken into account in rejecting the contention of the landlord that there was a subletting or assignment.
It has been observed by the Madras High Court in paragraph (5) of the said decision as under: "In `Jackson vs Simons ' the question was whether the tenant broke a similar covenant.
The defendant who was the tenant, without the plaintiffs ' consent or knowledge agreed for the sum of Ls 7 per week to allow the proprietor of a night club carried on in a basement beneath the shop to the front part of the shop between the hours of 10.30 P.M. and 2 a.m. for the sale of tickets of admission to the club Romer J. held that the arrangement conferred to estate or interest in the demised premises but was a mere privilege or licence to use portion thereof, the defendant retaining the legal possession of the whole and did not therefore constitute a breach of the covenants not to assign, underlet or part with the demised premises or any part thereof." The Madras High Court also relied on an observation made by Scrutton L.J. in Chaplin vs Smith, , at p. 211, wherein it was observed: "He did not assign; nor did he underlet.
He was constantly on the premises himself and kept the key of them.
He did business of his own as well as business of the company.
In my view he allowed the company to use the premises while he himself remained in possession of them." 1031 Reliance was also placed on the Treatise of Foa on Landlord and Tenant, 6th Edn.
at page 323, where the law on the subject has been summarized in the following words: "The mere act of letting other persons into possession by the tenant, and permitting them to use the premises for their own purposes, is not so long as he retains the legal possesion himself, a breach of the covenant." After considering all these decisions, the High Court of Madras extracted the following principles and came to the conclusion that a mere taking in of partners did not amount to transferring of possession and did not constitute assignment or subletting.
Says the Madras High Court: "It is clear from the aforesaid decisions that there cannot be a sub letting unless the lessee parted with legal possession.
The mere fact that another is allowed to use the premises while the lessee retains the legal possession is not enough to create a sub lease.
Section 105 of the Transfer of Property Act defines a lease of immovable property as to transfer of right to enjoy such property.
Therefore to create a lease or sub lease a right to exclusive possession and enjoyment of the property should be conferred on another.
In the present case the exclusive possession of the premises was not given to the second respondent.
the first respondent continued to be the lessee, though in regard to the business carried on in the premises he had taken in other partners.
The partners are not given any exclusive possession of the premises or a part thereof.
The first respondent continues to be in possession subject to the liability to pay rent to his landlord.
The partnership deed also, as I have already stated, does not confer any such right in the premises on the other partners.
I, therefore, hold in the circumstances of the case the first respondent did not sublet the premises to the second respondent, and therefore he is not liable to be evicted under the provisions of Act No. 25 of 1949.
" The view taken by me is reinforced by the opinion expressed by the Madras High Court in the aforesaid decision.
A similar view has also been taken by Saurashtra High Court in Karsandas Ramji vs Karsanji Kalyanji, AIR 1953 Sau. 113 at pp.
114 & 115.
In my opinion, it is therefore clear 1032 that there has been no assignment or subletting in favour of the partners of the firm by the tenant so as to attract the Bar of section 13(1)(e) of the Rent Act.
The view taken by the lower Courts is correct and no exception can be taken thereto.
There is no dispute in the legal proposition that there must be parting of the legal possession.
Parting of the legal possession means possession with the right to include and also right to exclude others.
That is, in our opinion, is the matter of fact.
In this case, it has been found that there was a right of possession in favour of the sub lessee R.C. Abrol & Co. Pvt. Ltd. and right to exclude indeed as it appears from the narration of the fact that the company has gone into liquidation and the official liquidator has taken possession of the premises on behalf of the liquidator and that must be on the basis that it was the asset belonging to the company.
In that aforesaid view of the matter we are unable to accept this proposition that there was no sub letting.
Dr. Shankar Ghosh drew our attention to the observations of the High Court of Delhi in the following three cases: Vishwa Nath and Anr.
vs Chaman Lal Khanna & Others, Shri Gurdial Singh vs Shri Brij Kishore & Others, [1970] Delhi Law Times 592.
M/s Reliable Finance Corporation (P) Ltd. vs M/s Clearing House and Agencies Private Ltd & Ors.
[1984] 2 Rent Control Reporter 449.
Madras Bangalore Transport Co. (West) vs Inder Singh and Others, He contended that in the light of the aforesaid authorities in this case, there was no parting of legal possession in favour of the sublessee.
We are unable to accept this position.
In the instant case, exclusive possession was given to the sub lessee and the tenant had transferred the right to possess in that portion.
It is clear that subletting was done without the consent in writing of the landlord.
If that is so, there was inevitably breach of the covenant.
In that view of the matter the High Court was right in upholding 1033 the order of the Rent Control Tribunal and directing eviction of the appellant.
The appeal, therefore, must fail and is accordingly dismissed.
In view of the fact that the appellant has been in possession of the premises for quite some time and to make its arrangements for shifting we direct the decree for eviction shall not be executed before 30.6.1988 provided the appellant files the usual undertaking in this Court within four weeks from today.
Mesne profits will be payable from 1st of December 1987 @ Rs.7,000 per month until the possession is delivered.
That the appellant will hand over vacant and peaceful possession of the premises to the respondents on or before 30.6.1988 from today.
That the appellant will pay to the respondent arrears of rent, if any, within one month from today.
That the appellant will pay to respondent further compensation for use and occupation of the premises month by month before 10th of every month.
That the appellant will not induct any other person in the premises.
The Court further directs that in default of compliance with any one or more of these conditions or if the undertaking is not filed as required within the stipulated time, the decree shall become executable forthwith.
N.V.K. Appeal dismissed.
|
From the Judgment and Order dated 21.9.1973 of the Delhi High 1025 Court in S.A.O. No. Dr. Shankar Ghosh and Rathin Das for the Appellant. A.B. Rohtagi, Soli J. Sorabjee, Mrs. R. Swami, A.K. Verma and Ms. section Sethna for the Respondents. The Judgment of the Court was delivered by SABYASACHI MUKHARJI J.
This is an appeal by special leave directed against the judgment and order of the High Court of Delhi dated the 21st September, 1973 in Second Appeal No. The High Court dismissed the Second Appeal of the appellant and confirmed the decision of the Rent Control Tribunal and ordered eviction. Before the High Court three contentions were urged namely: 1. The petition for eviction was not maintainable in the absence of a notice to quit while determining the tenancy, 2. There was no sub letting or parting of possession by the appellant tenant in favour of R.C. Abrol & Company Pvt. If there was such sub letting, it had been made with the written consent of the landlord so was not actionable. The Rent Control Tribunal confirmed the findings against the appellant in all the three contentions and the High Court also affirmed the findings of the Rent Control Tribunal. We must note that no contention was raised before us as far as point No. Ltd. and secondly it was urged that if there was sub letting that had been made with the written consent of the landlord. The Clause 14 of the lease deed in the instant case which provides, inter alia, the terms and conditions is as follows: "Clause 14 That the lessee undertakes not to sub let the premises to any other party without the written permission of the lessor, and that the lessee 's contractors M/s R.C. Abrol & Co. will share the premises with the permission of the lessor. " 1026 This is in consonance also with provisions of Section 14(1)(b) of the Delhi Rent Control Act, 1958 (hereinafter called the Act) and Sub Sections (2) and (3) of Section 16 of the said Act. The first question, therefore, is whether there was any sub letting and secondly if so was the same with the consent in writing of the landlord. All these questions are essentially questions of facts and were held against the appellant by the Rent Control Tribunal which was the final Court of facts, applying the correct propositions of law. This conclusion has been affirmed by the High Court. In other words, he contended that the provision which required that the consent should be in writing meant it was mandatory so far as it enjoined consent but it was directory so far as it said that such consent should be in writing. Apart from the statute in this case, we find it difficult to accept this argument in view of the specific clause in the statute hereinbefore. In South Asia Industries Private Ltd. vs section Sarup Singh and others; , Justice A.K. Sarkar as the learned Chief Justice then was, observed that the object of interpreting a statute was to ascertain the intention of the legislature in enacting it. An interpretation defeating the object of a statute is, therefore, not permissible. In paragraph 11 of the judgment at page 350 the learned Judge observed as follows: "I notice that the lease gave no express right to the lessee to assign with or without the consent of the lessor. The lessee no doubt had that right under the Transfer of Property Act. It may be that under the clause the lessee 's assignee would be included in the expression "lessee" as used in the lease; that is the entire effect of the clause. But this would be so whether the lessor had consented to the assignment or not. therefore this clause does not lead to the conclusion that the lessor had consented to the assignment. It is of no assistance in the present case. I am also inclined to the view that the consent contemplated by Section 14(1) proviso (b) is a direct consent to a contemplated assignment to a particular assignee. See Regional Properties Ltd. vs Frankenschwerth, Clearly the clause in the case relied upon could not be a consent of this kind." 1027 It is true that Justice R.S. Bachawat had expressed the view that the consent could be general or special but in the case before the Court there was no conduct which showed that there was consent by the general words of the clause in the deed. We are of the opinion on reading of the different provisions that the consent enjoined by bargain between the parties in this case must be in writing and must be to the specific sub letting. That was the view of the Delhi High Court in Raja Ram Goyal vs Ashok Kumar and others, In Kartar Singh vs Shri Vijay Kumar and Another, [1978] All India Rent Conrol Journal 264 the High Court of Punjab & Haryana has also expressed similar view. It deals with restrictions on sub letting. Sub section (2) of section 16 reiterates the provisions of Clause (b) of sub section (1) of Section 13 of the Act of 1952 and lays down that the sub letting after 9th day of June, 1952 without obtaining the consent in writing of the landlord shall not be deemed to the lawful. It does not say that the requisite consent should be obtained before sub letting the premises and the consent obtained after sub letting will not enure for the benefit of the tenant. However, sub section (3) of Section 16 prohibits subletting of the premises after commencement of Act of 1958 without the 'previous ' consent in writing of the landlord. The use of word 'Previous ' in this sub section shows that where it was the intention of the legislature that the consent in writing should be obtained before sub letting, it said so specifically. Before the Act of 1952 a tenant could successfully show acquiescence of the landlord in sub letting to escape forfeiture of tenancy. Since the absence of consent in writing by a landlord for sub letting gave rise to unnecessary litigation between a landlord and a tenant, the Act of 1952 required the consent of the landlord in writing after its commencement. The purpose seemed to be that the consent of the landlord evidence by a writing would cut out litigation on this ground. After all a landlord could always agree to sub letting either before or after sub letting of the premises. For that reason no condition was laid down that such consent should be obtained before sub letting the premises. " We are in agreement with this approach to the interpretation and it is in consonance with the view expressed by this Court earlier as mentioned hereinbefore. In the aforesaid view of the matter we are of the opinion that it was necessary for the tenant to obtain the consent in writing to sub letting the premises. The mere permission or acquiescence will not do. The consent must be to the specific sub letting and must be in writing. Indeed there was no implied permission also here. Our attention was drawn to the fact that the landlord had written letter to the tenant and the landlord objected to the sub letting, the moment he realised the situation. In that view of the matter we are clearly of the opinion that in this case there was no consent in writing on the part of landlord to such sub letting. It is difficult to accept this contention. The case of sub letting was accepted as has been found by all the Courts in this case. Our attention was drawn to the certain observations on the question of directory/mandatory nature of the requirement that consent should be in writing. Reliance was placed on the observations of Craies on Statute Law 7th Edition 261 wherein in the election case requirement that ballot paper had to be kept in a particular manner was considered to be 1029 directory and similarly it was submitted in this case the requirement of the consent to be in writing should be construed to be directory. It was urged that the conduct of the parties indicated that there was no breach of the covenant. Here the requirement of consent to be in writing was to serve a public purpose, i.e., to avoid dispute as to whether there was consent or not. Reliance was also placed on the observations of Maxwell in the Interpretation of Statutes 12th Edition at page 328 on the question of waiver: Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity. We are, however, in this case unable to agree. Firstly, in this case there was no case of waiver. Waiver is a question of fact which has to be tested by facts and evidence. There was no conscious relinquishment of the advantage of any statute. It does not seem to have been urged before the High Court also. Apart from this, in this requirement of the statute which is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord. In Chaplin vs Smith, [1926] 1 King 's Bench Division 198, it was held that physical possession was not sufficient, there must be legal possession. The question was whether there was any consent in writing in this case. Ltd. will share the premises with the permission of the lessor. So the permission of the lessor was there but the purpose was of the sharing with M/s R.C. Abrol & Co. Pvt. Ltd. was not of leasing the premises to any other entity. For the purpose of this, it is suffice for us to state that Clause 14 as enjoined did give permission of leasing the premises to M/s. R.C. & Co. Pvt. Dealing with this contention the High Court observed in its judgment that the company had been incorporated some time in 1957 after the commencement of the tenancy. It appears in this case that the company was composed of the different persons. The High Court noted that there was never any 1030 consent in writing of the landlord to sub letting the premises to the incorporated company. The permission must have been in writing and specific in the words of Justice Sarkar in South Asia Industries Private Ltd. vs Sarup Singh and others, (Supra). A reference was made to Jackson vs Simons, , and the distinction drawn between physical possession and legal possession in that decision was taken into account in rejecting the contention of the landlord that there was a subletting or assignment. It has been observed by the Madras High Court in paragraph (5) of the said decision as under: "In `Jackson vs Simons ' the question was whether the tenant broke a similar covenant. The Madras High Court also relied on an observation made by Scrutton L.J. in Chaplin vs Smith, , at p. 211, wherein it was observed: "He did not assign; nor did he underlet. He was constantly on the premises himself and kept the key of them. He did business of his own as well as business of the company. In my view he allowed the company to use the premises while he himself remained in possession of them." 1031 Reliance was also placed on the Treatise of Foa on Landlord and Tenant, 6th Edn. at page 323, where the law on the subject has been summarized in the following words: "The mere act of letting other persons into possession by the tenant, and permitting them to use the premises for their own purposes, is not so long as he retains the legal possesion himself, a breach of the covenant." After considering all these decisions, the High Court of Madras extracted the following principles and came to the conclusion that a mere taking in of partners did not amount to transferring of possession and did not constitute assignment or subletting. The mere fact that another is allowed to use the premises while the lessee retains the legal possession is not enough to create a sub lease. Section 105 of the Transfer of Property Act defines a lease of immovable property as to transfer of right to enjoy such property. Therefore to create a lease or sub lease a right to exclusive possession and enjoyment of the property should be conferred on another. In the present case the exclusive possession of the premises was not given to the second respondent. the first respondent continued to be the lessee, though in regard to the business carried on in the premises he had taken in other partners. The partners are not given any exclusive possession of the premises or a part thereof. The first respondent continues to be in possession subject to the liability to pay rent to his landlord. The partnership deed also, as I have already stated, does not confer any such right in the premises on the other partners. I, therefore, hold in the circumstances of the case the first respondent did not sublet the premises to the second respondent, and therefore he is not liable to be evicted under the provisions of Act No. " The view taken by me is reinforced by the opinion expressed by the Madras High Court in the aforesaid decision. A similar view has also been taken by Saurashtra High Court in Karsandas Ramji vs Karsanji Kalyanji, AIR 1953 Sau. In my opinion, it is therefore clear 1032 that there has been no assignment or subletting in favour of the partners of the firm by the tenant so as to attract the Bar of section 13(1)(e) of the Rent Act. The view taken by the lower Courts is correct and no exception can be taken thereto. There is no dispute in the legal proposition that there must be parting of the legal possession. Parting of the legal possession means possession with the right to include and also right to exclude others. That is, in our opinion, is the matter of fact. In this case, it has been found that there was a right of possession in favour of the sub lessee R.C. Abrol & Co. Pvt. Ltd. and right to exclude indeed as it appears from the narration of the fact that the company has gone into liquidation and the official liquidator has taken possession of the premises on behalf of the liquidator and that must be on the basis that it was the asset belonging to the company. In that aforesaid view of the matter we are unable to accept this proposition that there was no sub letting. Dr. Shankar Ghosh drew our attention to the observations of the High Court of Delhi in the following three cases: Vishwa Nath and Anr. vs Chaman Lal Khanna & Others, Shri Gurdial Singh vs Shri Brij Kishore & Others, [1970] Delhi Law Times 592. M/s Reliable Finance Corporation (P) Ltd. vs M/s Clearing House and Agencies Private Ltd & Ors. Madras Bangalore Transport Co. (West) vs Inder Singh and Others, He contended that in the light of the aforesaid authorities in this case, there was no parting of legal possession in favour of the sublessee. In the instant case, exclusive possession was given to the sub lessee and the tenant had transferred the right to possess in that portion. It is clear that subletting was done without the consent in writing of the landlord. If that is so, there was inevitably breach of the covenant. In that view of the matter the High Court was right in upholding 1033 the order of the Rent Control Tribunal and directing eviction of the appellant. The appeal, therefore, must fail and is accordingly dismissed. In view of the fact that the appellant has been in possession of the premises for quite some time and to make its arrangements for shifting we direct the decree for eviction shall not be executed before 30.6.1988 provided the appellant files the usual undertaking in this Court within four weeks from today. Mesne profits will be payable from 1st of December 1987 @ Rs.7,000 per month until the possession is delivered. That the appellant will hand over vacant and peaceful possession of the premises to the respondents on or before 30.6.1988 from today. That the appellant will pay to the respondent arrears of rent, if any, within one month from today. That the appellant will pay to respondent further compensation for use and occupation of the premises month by month before 10th of every month. That the appellant will not induct any other person in the premises. The Court further directs that in default of compliance with any one or more of these conditions or if the undertaking is not filed as required within the stipulated time, the decree shall become executable forthwith.
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% The respondent landlord sought eviction of the appellant tenant on the ground of having sub let without written consent the portion in his occupation in favour of M/s. R.C. Abrol & Co. The appellant resisted the petition for eviction, contending that it was not maintainable in the absence of a notice to quit while determining the tenancy, that there was no sub letting or parting of possession by the appellant in favour of M/s. R.C. Abrol & Co., in view of Clause 14 of the Lease agreement, which provided: "That the lessee undertakes not to sub let the premises to any other party without the written permission of the lessor and that the lessee 's contractors M/s.
R.C. Abrol and Co. will share the premises with the permission of the lessor".
The Rent Control Tribunal ordered eviction of the appellant on the ground of sub letting.
The High Court dismissed the Second Appeal of the appellant and confirmed the decision of the Rent Control Tribunal ordering eviction.
In the appeal to this Court by special leave it was contended for the appellant, that there was no sub letting or parting of possession by the appellant tenant in favour of M/s. R.C. Abrol & Co. (P) Ltd., and that if there was sub letting that had been made with the written consent of the landlord.
Dismissing the Appeal, ^ HELD: 1.
Sections 14(1) proviso (b), 16(2) and (3) of the Delhi Rent Control Act, 1958 require the tenant to obtain consent of the landlord in writing for sub letting of the premises.
The purpose of such written consent was that it would cut out litigation on this ground.
Mere permission or acquiescence would not do.
The consent must be to the specific sub letting and must be in writing.
There is no implied permission.
[1026A, 1028D] 1024 South Asia Industries Private Ltd. vs section Sarup Singh & others; , ,referred to.
Raja Ram Goyal vs Ashok Kumar and others, ; Kartar Singh vs Shri Vijay Kumar and Another, and M/s. Delhi Vanaspati Syndicate, Delhi vs Bhagwan Dass Faquir Chand, ,approved.
Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity.
Waiver is a question of fact which has to be decided by facts and evidence.
[1029C] Chaplin vs Smith, [1926) 1 King 's Bench Division 198, referred to.
In the instant case, there was no question of waiver.
There was no conscious relinquishment of the advantage of any statute.
No Court has gone into this fact.
It does not seem to have been urged before the High Court also.
As this requirement of the statute is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord.
[1029D] 3.
To constitute sub letting there must be parting of the legal possession.
Parting of the legal possession means possession with the rights to include and also the right to exclude others.
This is a question offact.
[1032B] Mehta Jagjivan Vanechand vs Doshi Vanechand, A.I.R. 1972 Gujarat 6, referred to.
In the instant case, exclusive possession was given to the sublessee, R.C. Abrol & Co. and the tenant has transferred the right to possess in that portion.
It is clear that the sub letting was done wihout the consent in writing of the landlord.
There was, therefore an inevitable breach of the covenant.
The High Court was therefore right in upholding the order of the Rent Control Tribunal and directing eviction of the appellant.
[1032G 1033A]
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% The respondent landlord sought eviction of the appellant tenant on the ground of having sub let without written consent the portion in his occupation in favour of M/s. R.C. Abrol & Co. The appellant resisted the petition for eviction, contending that it was not maintainable in the absence of a notice to quit while determining the tenancy, that there was no sub letting or parting of possession by the appellant in favour of M/s. R.C. Abrol & Co., in view of Clause 14 of the Lease agreement, which provided: "That the lessee undertakes not to sub let the premises to any other party without the written permission of the lessor and that the lessee 's contractors M/s.
R.C. Abrol and Co. will share the premises with the permission of the lessor".
The Rent Control Tribunal ordered eviction of the appellant on the ground of sub letting.
The High Court dismissed the Second Appeal of the appellant and confirmed the decision of the Rent Control Tribunal ordering eviction.
In the appeal to this Court by special leave it was contended for the appellant, that there was no sub letting or parting of possession by the appellant tenant in favour of M/s. R.C. Abrol & Co. (P) Ltd., and that if there was sub letting that had been made with the written consent of the landlord.
Dismissing the Appeal, ^ HELD: 1.
Sections 14(1) proviso (b), 16(2) and (3) of the Delhi Rent Control Act, 1958 require the tenant to obtain consent of the landlord in writing for sub letting of the premises.
The purpose of such written consent was that it would cut out litigation on this ground.
Mere permission or acquiescence would not do.
The consent must be to the specific sub letting and must be in writing.
There is no implied permission.
[1026A, 1028D] 1024 South Asia Industries Private Ltd. vs section Sarup Singh & others; , ,referred to.
Raja Ram Goyal vs Ashok Kumar and others, ; Kartar Singh vs Shri Vijay Kumar and Another, and M/s. Delhi Vanaspati Syndicate, Delhi vs Bhagwan Dass Faquir Chand, ,approved.
Everyone has a right to waive and to agree to waive the advantage of a law made solely for the benefit and protection of the individual in his individual capacity.
Waiver is a question of fact which has to be decided by facts and evidence.
[1029C] Chaplin vs Smith, [1926) 1 King 's Bench Division 198, referred to.
In the instant case, there was no question of waiver.
There was no conscious relinquishment of the advantage of any statute.
No Court has gone into this fact.
It does not seem to have been urged before the High Court also.
As this requirement of the statute is in the public interest there cannot be any question of waiver of a right, dealing with the rights of the tenants or the landlord.
[1029D] 3.
To constitute sub letting there must be parting of the legal possession.
Parting of the legal possession means possession with the rights to include and also the right to exclude others.
This is a question offact.
[1032B] Mehta Jagjivan Vanechand vs Doshi Vanechand, A.I.R. 1972 Gujarat 6, referred to.
In the instant case, exclusive possession was given to the sublessee, R.C. Abrol & Co. and the tenant has transferred the right to possess in that portion.
It is clear that the sub letting was done wihout the consent in writing of the landlord.
There was, therefore an inevitable breach of the covenant.
The High Court was therefore right in upholding the order of the Rent Control Tribunal and directing eviction of the appellant.
[1032G 1033A]
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Civil Appeal No. 3066 of 1987.
From the Judgment and Order dated 9.7.1986 of the Punjab and Haryana High Court in R.S.A. No. 163 of 1978.
Mala Ram Ghana and Dalveer Bhandari for the Appellant.
M.S. Gujral and Dr. Meera Aggarwal for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The High Court in its judgment and order dated 9th July, 1986, has observed that the question of limitation has been canvassed before the High Court.
The High Court expressed the view that there was a lot of conflict between the various High Courts on the interpretation of Article 54 of the Limitation Act which governed the point of limitation.
The High Court, however, did not decide this question and expressed the view that due to passage of time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale entered into.
In other words, it appears that without deciding the question whether the claim of the plaintiff was barred by limitation or not, the High Court exercised its discretion in refusing to grant the relief on the ground that there has been good deal of delay and the parties would suffer if specific performance of the agreement was granted.
It appears from the facts that in this case the major portion of the agreed price had been paid long time ago and the balance thereof was to be paid at the time of execution of the documents was a sum of Rs. 75 only.
It further appears that possession of the premises was with the appellant for all these years in part performance of the agreement.
In those circumstances, the principle upon which the High Court refused to exercise its discretion, in our opinion, was not applicable and such discretion was not proper.
The High Court exercised discretion on wrong principles.
See in this connection Madamsetty Satyanarayana vs G. Yellogi Rao & Two others; , ; Dr. Jiwan Lal & Ors.
vs Brij Mohan Mehra & Another, ; and see also the observation in Debendra Nath Mandal vs Sakhilal Kar & Ors., AIR 1950 Calcutta 526 In that view of the matter, we cannot sustain the exercise of discretion in the manner done by the High Court.
This, however, does 1101 not decide the matter because the High Court declined to go into the facts and decide the question of limitation on merits, the High Court took the view in exercise of its discretion.
Since we are not sustaining the High Court 's exercise of discretion hence the order and the Judgment of the High Court are set aside but the matter is remanded to the High Court for its decision on the merits.
The matter should be disposed of by the High Court as early as possible.
The appeal is accordingly allowed with no order as to costs.
P.S.S. Appeal allowed.
|
% Under an agreement of sale entered into by respondents the appellant had paid the major portion of the agreed price long time ago and the balance thereof that was to be paid at the time of execution of the documents was a sum of Rs. 75 only.
Possession of the premises was with the appellant for all these years in part performance of the agreement.
Upon failure of the respondents to execute documents of title, the appellant sought specific performance of the agreement.
The respondents canvassed the question of limitation before the High Court.
The High Court, however, without deciding that question took the view that due to passage of time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale.
Allowing the appeal by special leave, ^ HELD: The High Court exercised discretion on wrong principles.
Without deciding the question whether the claim of the plaintiff was barred by limitation or not it proceeded to refuse to grant the relief on the ground that there has been good deal of delay and the parties would suffer if specific performance of the agreement was granted.
This principle was not applicable to the facts of the case and the exercise of discretion was not proper.
The matter remanded to the High Court for decision in merits.
[1100G; E; 1101B] Madamsetty Satyanarayana vs G. Yellogi Rao & Ors.
, ; ; Dr. Jiwan Lal & Ors.
vs Brij Mohan Mehra & Anr., ; and Debendra Nath Mandal vs Sakhilal Kar & Ors., AIR 1950 Calcutta 526, referred to.
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Civil Appeal No. 3066 of 1987.
From the Judgment and Order dated 9.7.1986 of the Punjab and Haryana High Court in R.S.A. No. 163 of 1978.
Mala Ram Ghana and Dalveer Bhandari for the Appellant.
M.S. Gujral and Dr. Meera Aggarwal for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The High Court in its judgment and order dated 9th July, 1986, has observed that the question of limitation has been canvassed before the High Court.
The High Court expressed the view that there was a lot of conflict between the various High Courts on the interpretation of Article 54 of the Limitation Act which governed the point of limitation.
The High Court, however, did not decide this question and expressed the view that due to passage of time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale entered into.
In other words, it appears that without deciding the question whether the claim of the plaintiff was barred by limitation or not, the High Court exercised its discretion in refusing to grant the relief on the ground that there has been good deal of delay and the parties would suffer if specific performance of the agreement was granted.
It appears from the facts that in this case the major portion of the agreed price had been paid long time ago and the balance thereof was to be paid at the time of execution of the documents was a sum of Rs. 75 only.
It further appears that possession of the premises was with the appellant for all these years in part performance of the agreement.
In those circumstances, the principle upon which the High Court refused to exercise its discretion, in our opinion, was not applicable and such discretion was not proper.
The High Court exercised discretion on wrong principles.
See in this connection Madamsetty Satyanarayana vs G. Yellogi Rao & Two others; , ; Dr. Jiwan Lal & Ors.
vs Brij Mohan Mehra & Another, ; and see also the observation in Debendra Nath Mandal vs Sakhilal Kar & Ors., AIR 1950 Calcutta 526 In that view of the matter, we cannot sustain the exercise of discretion in the manner done by the High Court.
This, however, does 1101 not decide the matter because the High Court declined to go into the facts and decide the question of limitation on merits, the High Court took the view in exercise of its discretion.
Since we are not sustaining the High Court 's exercise of discretion hence the order and the Judgment of the High Court are set aside but the matter is remanded to the High Court for its decision on the merits.
The matter should be disposed of by the High Court as early as possible.
The appeal is accordingly allowed with no order as to costs.
P.S.S. Appeal allowed.
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Civil Appeal No. 3066 of 1987.
From the Judgment and Order dated 9.7.1986 of the Punjab and Haryana High Court in R.S.A. No. 163 of 1978.
Mala Ram Ghana and Dalveer Bhandari for the Appellant.
M.S. Gujral and Dr. Meera Aggarwal for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The High Court in its judgment and order dated 9th July, 1986, has observed that the question of limitation has been canvassed before the High Court.
The High Court expressed the view that there was a lot of conflict between the various High Courts on the interpretation of Article 54 of the Limitation Act which governed the point of limitation.
The High Court, however, did not decide this question and expressed the view that due to passage of time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale entered into.
In other words, it appears that without deciding the question whether the claim of the plaintiff was barred by limitation or not, the High Court exercised its discretion in refusing to grant the relief on the ground that there has been good deal of delay and the parties would suffer if specific performance of the agreement was granted.
It appears from the facts that in this case the major portion of the agreed price had been paid long time ago and the balance thereof was to be paid at the time of execution of the documents was a sum of Rs. 75 only.
It further appears that possession of the premises was with the appellant for all these years in part performance of the agreement.
In those circumstances, the principle upon which the High Court refused to exercise its discretion, in our opinion, was not applicable and such discretion was not proper.
The High Court exercised discretion on wrong principles.
See in this connection Madamsetty Satyanarayana vs G. Yellogi Rao & Two others; , ; Dr. Jiwan Lal & Ors.
vs Brij Mohan Mehra & Another, ; and see also the observation in Debendra Nath Mandal vs Sakhilal Kar & Ors., AIR 1950 Calcutta 526 In that view of the matter, we cannot sustain the exercise of discretion in the manner done by the High Court.
This, however, does 1101 not decide the matter because the High Court declined to go into the facts and decide the question of limitation on merits, the High Court took the view in exercise of its discretion.
Since we are not sustaining the High Court 's exercise of discretion hence the order and the Judgment of the High Court are set aside but the matter is remanded to the High Court for its decision on the merits.
The matter should be disposed of by the High Court as early as possible.
The appeal is accordingly allowed with no order as to costs.
P.S.S. Appeal allowed.
|
% Under an agreement of sale entered into by respondents the appellant had paid the major portion of the agreed price long time ago and the balance thereof that was to be paid at the time of execution of the documents was a sum of Rs. 75 only.
Possession of the premises was with the appellant for all these years in part performance of the agreement.
Upon failure of the respondents to execute documents of title, the appellant sought specific performance of the agreement.
The respondents canvassed the question of limitation before the High Court.
The High Court, however, without deciding that question took the view that due to passage of time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale.
Allowing the appeal by special leave, ^ HELD: The High Court exercised discretion on wrong principles.
Without deciding the question whether the claim of the plaintiff was barred by limitation or not it proceeded to refuse to grant the relief on the ground that there has been good deal of delay and the parties would suffer if specific performance of the agreement was granted.
This principle was not applicable to the facts of the case and the exercise of discretion was not proper.
The matter remanded to the High Court for decision in merits.
[1100G; E; 1101B] Madamsetty Satyanarayana vs G. Yellogi Rao & Ors.
, ; ; Dr. Jiwan Lal & Ors.
vs Brij Mohan Mehra & Anr., ; and Debendra Nath Mandal vs Sakhilal Kar & Ors., AIR 1950 Calcutta 526, referred to.
|
% Under an agreement of sale entered into by respondents the appellant had paid the major portion of the agreed price long time ago and the balance thereof that was to be paid at the time of execution of the documents was a sum of Rs. 75 only.
Possession of the premises was with the appellant for all these years in part performance of the agreement.
Upon failure of the respondents to execute documents of title, the appellant sought specific performance of the agreement.
The respondents canvassed the question of limitation before the High Court.
The High Court, however, without deciding that question took the view that due to passage of time prices of lands had gone up sky high and it would be unjust to enforce the agreement of sale.
Allowing the appeal by special leave, ^ HELD: The High Court exercised discretion on wrong principles.
Without deciding the question whether the claim of the plaintiff was barred by limitation or not it proceeded to refuse to grant the relief on the ground that there has been good deal of delay and the parties would suffer if specific performance of the agreement was granted.
This principle was not applicable to the facts of the case and the exercise of discretion was not proper.
The matter remanded to the High Court for decision in merits.
[1100G; E; 1101B] Madamsetty Satyanarayana vs G. Yellogi Rao & Ors.
, ; ; Dr. Jiwan Lal & Ors.
vs Brij Mohan Mehra & Anr., ; and Debendra Nath Mandal vs Sakhilal Kar & Ors., AIR 1950 Calcutta 526, referred to.
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Civil Appeal No. 1510 of 1987 etc.
From the Judgment and Order dated 4.6.1987 of the Gauhati High Court in F.A. No. 19 of 1984.
Dr. Shankar Ghosh, Gobind Das, Ashok Sen, S.N. Mukharji, N.R. Choudhary and G.S. Chatterjee for the appearing parties.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals by special leave 1072 relate to the affairs of M/s. Eastern Tea Estate (P) Ltd. It was of two branches namely, the Dutta 's and the Choudhury 'section Due to death and lack of cordiality between the erstwhile partners the two branches first drifted and then parted company as it unfortunately is the fate of so many Indian concerns and there were disputes and litigations in Court.
The Civil Appeal No. 1510 of 1987 arises from a judgment and decision of the Division Bench of the High Court of Gauhati dated 4th June, 1987.
It appears that that a petition was filed originally by the appellant under sections 397 and 398 read with section 403 of the (hereinafter called 'the Act ').
The company petition came to be disposed of on 4th February, 1977 in accordance with the compromise arrived at between the parties.
The said compromise comprised of inter alia, two relevant paragraphs, for the present purpose, which read as follows: "1.
Mrs. Arati Dutta will take over Chandana T.E. and Choudhury group will take over Martycherra T.E. On 25th January, 1976.
The Bank liability of the Company in respect to Martycherra T.E. amounting to Rs.2,20,000 (Approx.) shall be shared equally of which Rs.1,10,000 shall be paid by Mrs. Arati Dutta on 25th January, 1976 at Silchar in presence of Shri B.K. Das, Advocate and Shri S.K. Sen, Advocate.
The entire liability of the Company would be equally shared and for that purpose an independent Auditor shall be appointed by Shri S.K. Sen, Advocate who shall undertake to start the accounting from the 1st week of February, 1976.
The shares owned by Mrs. Arati Dutta and her sons and daughters will be sold to the Company on 25.1.76 and necessary permission shall be taken from Hon 'ble High Court in this regard.
The staff salary and gratuity of the employees of the Head Office of the Hon 'ble High Court is obtained shall be considered as the Liability of the Company and will be borne by the two parties equally.
1073 6.
Mrs. Arati Dutta shall have to pay another sum of Rs.12,500 to the Company in addition to her payment of 5% liability of the Company.
" Thereafter there were differences between the parties and it could not be adjusted as the parties could not agree as to audit.
On 9th November, 1982 the parties agreed that no auditor need be appointed in the matter of determination of liability and the matter of determination of liability as per the 1973 Balance sheet should be left entirely to the Court.
In accordance with the compromise the parties were asked to submit their Balance sheets regarding the payments made by them which related to liabilities in the Balance sheet as on 31st December, 1973.
The parties filed their Balance sheets and the learned Single Judge of the High Court computed the liabilities of the parties on that basis.
Aggrieved, however, by the said decision, the appellant preferred an appeal before the Division Bench of the said High Court.
The first question that was raised before the Division Bench was whether the appeal lay to the Division Bench under section 483 of the Act which dealt with appeals from orders.
The said section was as follows: "483: Appeals from orders Appeals from any order made or decision given in the matter of winding up of a company by the Court shall lie to the same Court to which, in the same manner in which, and subject to the same conditions under which, appeals lie from any other order or decision of the Court in cases within its ordinary jurisdiction.
" It was submitted by learned counsel that though the first application by the appellant was under sections 397 and 398 read with section 403 of the Act the same could be taken in the matter of winding up of a company to which the reference has been made in section 483.
On the other hand, it was submitted that no appeal lay.
It appears to us that though this present application was relating to sections 397 and 398 and as it arises in respect of the orders passed under sections 397 and 398 of the Act, the provisions of section 483 would be attracted and an appeal would lie to the Division Bench.
This conclusion seems to follow from an analysis of the sections as interpreted by the various decisions of this Court as well as one judgment of the Delhi High Court to which we will refer.
However, it is sufficient for the present purpose for us to refer to the observations of this Court in Shanta Genevienve Pommerat & Anr.
vs Papers Pvt. Ltd. & Ors.
A.I.R. 1983 S.C. 269 where this Court observed that an appeal under sections 397 and 398 read with 403 of the would lie to the same 1074 court to which, in the same manner in which, and subject to the same conditions under which the appeals lie from any order or decision of the court in cases within its ordinary jurisdiction.
This Court made the following observations at page 269 of the report: "Now an order under sections 397, 398 and 403 of the , on the face of it, cannot be said to be an order made or decision given, in the matter of the winding up of a company.
Relief, undoubtedly under section 397 and/or 398 is in fact an alternative to winding up.
No doubt order under sections 397 or 398 could be an order made or decision by the High Court.
Having jurisdiction under the the appeal will lie to the Division Bench of the same High Court.
This is not disputed.
Chapter XLII of the Bombay High Court Rules provides for appeals to appellate Court.
The Rules make provision for certain type of appeals to be placed in the first instance, for admission before a Bench of the High Court to be appointed by the Chief Justice.
It is not in dispute that the appeal preferred by the present appellants was not one such appeal which can be placed for admission under Rule 966 A and it follows from this Rule that the appeals other than those mentioned in that Rule are not to be placed for admission.
This point is no more res integra in view of the decision of this Court in M/s Golcha Investment (P) Ltd. vs Shanti Chandra Bafna., (A.I.R. wherein after considering the provision contained in Rule 966 A, it was held that appeals, other than those set out in the Rule are not to be placed for admission and they were entitled to be admitted as a matter of course.
This Court accordingly quashed the order dismissing the appeal in limine observing that the appellate court erred in summarily dismissing the appeal because it was bound to entertain the same and dispose it of on merits.
This observation will mutatis mutandis apply to the present appeal.
" References may also be made to the decisions of this Court in Shankarlal Aggarwal & Ors.
vs S.L. Poddar & Ors., A.I.R. 1965 S.C. 507; M/s. Golcha Investments (P) Ltd. vs Shanti Chandra Bafna (supra) and M/s. Tarapose & Co. vs Cochin Shipyard Ltd.; , The Delhi High Court in Gokulchand D. Morarka and another vs Company Law Board and others, 1075 correctly in our opinion explained the position.
There the High Court found that pending the petition for winding up of the company filed by two of its creditors for failure to pay a debt in spite of statutory notice, the Company Law Board had filed a petition under sections 397 and 398 of the and in an application applied for interim reliefs of removal of the sole Director and Constitution of a Board to manage the Company.
The Company Judge passed ex parte orders restraining the Company from disposing of its assets and restraining debenture trustees from enforcing their rights.
Thereupon, an application was filed under section 442 for stay of the petition and that petition under sections 397 and 398 was filed by 125 shareholders and a Bank has also filed another winding up petition claiming a large money.
Pending the winding up petitions the Company Judge heard two applications together and passed a common order for removal of the sole director and constitution of a Board of Directors with a retired Judge as the Chairman.
Appeals were taken to a Division Bench against another order of the Company Judge.
It was held over ruling the preliminary objections that the order passed by the Company Judge was appealable under section 483 of the because firstly, any order passed under section 397 or section 398 was one which was passed in lieu of winding up and hence, it was "in the matter of winding up" and, secondly, the order passed in C.A. No. 323 of 1971 expressly fell within the scope of section 442 as the order had been passed after at least two applications had been filed for the winding up of the Company.
The Court further held that there was nothing in section 483 of the , which took away or curtailed the right of appeal provided by section 5(1) of the , and clause 10 of the Letters Patent (Punjab) as applicable to the Delhi High Court; and that the jurisdiction conferred on the Bombay Judge of the High Court under section 10 of the was none other than its ordinary civil jurisdiction and appeal lay also under clause 10 of the Letters Patent to a Division Bench from the order of the Company Judge.
In this case in the High Court of Gauhati, however, unlike the Bombay High Court or the Calcutta High Court or the Delhi High Court, no Letters Patent was applicable to the Gauhati High Court.
It was therefore held that there was no provision for an appeal to the judgment of the learned Single Judge of the High Court.
In our opinion the decision in Shankar Lal Aggarwal & Ors.
vs Shankar Lal Poddar & Ors.
(supra) of this Court indicated the true position where 1076 this Court held that section 202 of the Companies Act, 1913 was in parimateria with the present section.
This Court preferred the view of the Chief Justice Chagla of the Bombay High Court reported in Bachharaj Factories Ltd. vs Hirjee Mills Ltd. A.I.R. 1955 Bombay 355 to the view expressed by the Calcutta High Court in Madan Gopal Daga vs Sachindra Nath Sen, A.I.R. 1928 Calcutta 295 wherein it was held that an order or the decision made or given in the matter of winding up of a company to be appealable had to satisfy the requirements of clause 15 of the Letters Patent.
This interpretation was not accepted by other High Courts and the Bombay High Court held differently.
The view of the Bombay High Court was preferred by this Court in the aforesaid decision and it was observed as follows: "We thus agree with Chagla C.J., that the second part of the section which refers to 'the manner ' and 'the conditions subject to which appeals may be had ' merely regulates the procedure to be followed in the presentation of the appeals and of hearing them, the period of limitation within which the appeal is to be presented and the forum to which appeal would lie and does not restrict or impair the substantive right of appeal which has been conferred by the opening words of that section.
" In our opinion this position is clear from the observation of this Court in Shankar Lal Aggarwal & Ors.
vs Shankar Lal Poddar & Ors., (supra) that the appeal lies to the same High Court irrespective of the powers under the Letters Patent.
Sections 397 and 398 read with section 483 indicate that the appeal would lie in the same manner to the same court and naturally and logically an appeal from the decision of the Single Judge would lie to the Division Bench.
This in our opinion follows logically from the ratio of decision of this Court in Shankarlal Aggarwal & Ors.
vs Shankarlal Poddar & Ors.
(supra) as well as other decisions referred hereinbefore.
It is true that there is perhaps no procedure to file an appeal from the decision of the learned Single Judge of the Gauhati High Court.
If that is so rules should be framed by the High Court in its jurisdiction of Rule making power for filing and disposal of such appeals.
But absence of the procedural rules do not take away a litigant 's right to file such appeals when the statute confers such a right specifically and the jurisdiction of the High Court to dispose of such an appeal if so filed.
We, therefore, propose to deal with the decision of the High Court.
Here, we are further helped by the fact that there is an appeal 1077 from the decision of the learned single judge being Appeal No. 1511/87.
In either view of the matter the view taken by the High Court is before us.
As noted, the learned single judge was asked by parties by agreement to compute the liabilities in view of the failure of the parties to agree to another auditor.
We have heard Sree Ghosh, learned counsel for the appellant and we have also heard Sree A.K. Sen, learned counsel for the respondent.
Sree Sen 's contention was that the current liabilities came to a sum of Rs.6,65,841.63.
He further submitted that the parties having agreed to divide the liabilities equally, the liability to the share of the appellant came to a sum of about Rs.3.32 lacs.
As the appellant had paid a sum of Rs.1.36 lacs the contention of the appellant was that the appellant has to pay a further sum of Rs.2 lacs.
In the alternative, it was urged by the appellant that what could be demanded from the appellant was the liabilities which were outstanding and not paid off by the time the settlement had been arrived at between the parties in January 1976.
But having regard to all the events and terms of settlement we are in agreement with the Division Bench of the High Court that so far as the Bank liability of Martycherra T.E. was concerned, the same had to be taken at the figure of Rs.2,20,000 as stated in clause (2) of the Agreement and not at Rs.6,28,000 and odd as given in the Balance sheet of 31st December, 1973.
The Division Bench computed the liability which came to a total of Rs.16,34,675.46 which has computed after deducting a sum of Rs.2,20,000 which was governed by clause (1) and it comprised of Bank Liability.
The Division Bench took into consideration that the appellant had paid a sum of Rs.1,36,038.06 after the compromise.
She had not paid anything more than this.
Therefore it follows that only a sum of Rs.6,81,299.67 was payable by the appellant to the respondent.
The Division Bench, in our opinion, correctly modified the determination on that figure and that is the sum which should be the liability of the appellant.
Sree Ghosh, learned counsel for the appellant tried to submit before us that a sum of Rs.1,36,038.06 should be given credit in computing the liability of the appellant and according to him the Division Bench fell into an error in not deducting this liability of his client.
We are unable to agree with this view.
In the aforesaid view of the matter we uphold the direction of the Division Bench in so far as they computed the liability and direct that the appellant would pay that sum to the respondent in settlement of the dues referred hereinbefore.
sum of Rs.1,36,038.06 was directed to be paid at the time of the admission of the appeal by the Division Bench of the High Court.
If that money has been paid or realised by the respondent the appel 1078 lant would pay the balance amount of Rs.6,81,299.67 and if the money is paid the respondent will by virtue of this order be entitled to withdraw the same and give credit to the appellant for the same.
The balance sum will be paid by 15th March, 1988.
In default of payment by that date the amount will carry 18% interest.
The appeal is disposed of accordingly by so holding.
In view of the aforesaid position, decision in C.A. No. 1511/87 which is from the decision of the learned Single Judge no longer survives and is disposed of accordingly.
SLP (C) No. 8152 of 1987 which is a cross petition filed against the decision of the Division Bench of the Gauhati High Court no longer survives and is disposed of accordingly.
Parties will pay and bear their own costs.
N.P.V. Appeal disposed of.
|
% The appellant filed a petition under Sections 397 and 398 read with Section 403 of the in respect of the affairs of the respondent firm which was disposed of in terms of the compromise arrived at between the parties.
The parties agreed that no Auditor need be appointed for the determination of the liability, and that the determination as per the 1973 balance sheet should be left entirely to the Court.
In accordance with the said compromise, the parties filed their balance sheets regarding the payments made by them which related to liabilities as on 31st December, 1973.
Single Judge of the High Court computed the liabilities of the parties on that basis.
The appellant preferred an appeal before the Division Bench against the aforesaid decision.
The Division Bench held that as no Letters Patent was applicable to the High Court there was no provision for an appeal against the judgment of the Single Judge and dismissed the appeal.
On the question: whether an appeal lies to the Division Bench under section 483 of the , against the orders of a Single Judge.
Disposing of the appeal, ^ HELD: Sections 397 and 398 read with section 483 of the 1071 indicate that an appeal would lie in the same manner to the same court.
Naturally and logically, therefore, an appeal from the decision of the Single Judge would lie to the Division Bench.
[1076E F] Shankarlal Aggarwal & Ors.
vs S.L. Poddar & Ors.
A.I.R. followed.
Shanta Genevienve Pommerat & Anr.
vs Papers Pvt. Ltd. & Ors., A.I.R. 1983 S.C. 269; M/s. Golcha Investment (P) Ltd. vs Shanti Chandra Bafna, A.I.R. 1970 S.C. 1350 and M/s. Tarapose & Co. vs Cochin Shipyard Ltd., A.I.R. 1984 S.C. 1072 referred to.
Absence of procedural rules does not take away a litigant 's right to file appeals against the decision of Single Judge when the statute confers such a right specifically, and the jurisdiction of the High Court to dispose of such an appeal, if so filed.
If there are no Rules, they should be framed by the High Court in its jurisdiction of Rule making power for filing and disposal of such appeals.
[1076G H] In the instant case, though the present application was relating to sections 397 and 398, and as it arises in respect of the orders passed under those sections, the provisions of section 483 would be attracted and an appeal would lie to the Division Bench.
[1073F G] [The High Court found that only a sum of Rs.6,81,299.67 was payable by the appellants to the respondent.
The Court is of the opinion that the High Court was right in its determination, and that is the sum which should be the liability of the appellant.
Appellant directed to pay the aforesaid amount to the respondent in full settlement of the dues.] [1077E G]
|
Civil Appeal No. 1510 of 1987 etc.
From the Judgment and Order dated 4.6.1987 of the Gauhati High Court in F.A. No. 19 of 1984.
Dr. Shankar Ghosh, Gobind Das, Ashok Sen, S.N. Mukharji, N.R. Choudhary and G.S. Chatterjee for the appearing parties.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals by special leave 1072 relate to the affairs of M/s. Eastern Tea Estate (P) Ltd. It was of two branches namely, the Dutta 's and the Choudhury 'section Due to death and lack of cordiality between the erstwhile partners the two branches first drifted and then parted company as it unfortunately is the fate of so many Indian concerns and there were disputes and litigations in Court.
The Civil Appeal No. 1510 of 1987 arises from a judgment and decision of the Division Bench of the High Court of Gauhati dated 4th June, 1987.
It appears that that a petition was filed originally by the appellant under sections 397 and 398 read with section 403 of the (hereinafter called 'the Act ').
The company petition came to be disposed of on 4th February, 1977 in accordance with the compromise arrived at between the parties.
The said compromise comprised of inter alia, two relevant paragraphs, for the present purpose, which read as follows: "1.
Mrs. Arati Dutta will take over Chandana T.E. and Choudhury group will take over Martycherra T.E. On 25th January, 1976.
The Bank liability of the Company in respect to Martycherra T.E. amounting to Rs.2,20,000 (Approx.) shall be shared equally of which Rs.1,10,000 shall be paid by Mrs. Arati Dutta on 25th January, 1976 at Silchar in presence of Shri B.K. Das, Advocate and Shri S.K. Sen, Advocate.
The entire liability of the Company would be equally shared and for that purpose an independent Auditor shall be appointed by Shri S.K. Sen, Advocate who shall undertake to start the accounting from the 1st week of February, 1976.
The shares owned by Mrs. Arati Dutta and her sons and daughters will be sold to the Company on 25.1.76 and necessary permission shall be taken from Hon 'ble High Court in this regard.
The staff salary and gratuity of the employees of the Head Office of the Hon 'ble High Court is obtained shall be considered as the Liability of the Company and will be borne by the two parties equally.
1073 6.
Mrs. Arati Dutta shall have to pay another sum of Rs.12,500 to the Company in addition to her payment of 5% liability of the Company.
" Thereafter there were differences between the parties and it could not be adjusted as the parties could not agree as to audit.
On 9th November, 1982 the parties agreed that no auditor need be appointed in the matter of determination of liability and the matter of determination of liability as per the 1973 Balance sheet should be left entirely to the Court.
In accordance with the compromise the parties were asked to submit their Balance sheets regarding the payments made by them which related to liabilities in the Balance sheet as on 31st December, 1973.
The parties filed their Balance sheets and the learned Single Judge of the High Court computed the liabilities of the parties on that basis.
Aggrieved, however, by the said decision, the appellant preferred an appeal before the Division Bench of the said High Court.
The first question that was raised before the Division Bench was whether the appeal lay to the Division Bench under section 483 of the Act which dealt with appeals from orders.
The said section was as follows: "483: Appeals from orders Appeals from any order made or decision given in the matter of winding up of a company by the Court shall lie to the same Court to which, in the same manner in which, and subject to the same conditions under which, appeals lie from any other order or decision of the Court in cases within its ordinary jurisdiction.
" It was submitted by learned counsel that though the first application by the appellant was under sections 397 and 398 read with section 403 of the Act the same could be taken in the matter of winding up of a company to which the reference has been made in section 483.
On the other hand, it was submitted that no appeal lay.
It appears to us that though this present application was relating to sections 397 and 398 and as it arises in respect of the orders passed under sections 397 and 398 of the Act, the provisions of section 483 would be attracted and an appeal would lie to the Division Bench.
This conclusion seems to follow from an analysis of the sections as interpreted by the various decisions of this Court as well as one judgment of the Delhi High Court to which we will refer.
However, it is sufficient for the present purpose for us to refer to the observations of this Court in Shanta Genevienve Pommerat & Anr.
vs Papers Pvt. Ltd. & Ors.
A.I.R. 1983 S.C. 269 where this Court observed that an appeal under sections 397 and 398 read with 403 of the would lie to the same 1074 court to which, in the same manner in which, and subject to the same conditions under which the appeals lie from any order or decision of the court in cases within its ordinary jurisdiction.
This Court made the following observations at page 269 of the report: "Now an order under sections 397, 398 and 403 of the , on the face of it, cannot be said to be an order made or decision given, in the matter of the winding up of a company.
Relief, undoubtedly under section 397 and/or 398 is in fact an alternative to winding up.
No doubt order under sections 397 or 398 could be an order made or decision by the High Court.
Having jurisdiction under the the appeal will lie to the Division Bench of the same High Court.
This is not disputed.
Chapter XLII of the Bombay High Court Rules provides for appeals to appellate Court.
The Rules make provision for certain type of appeals to be placed in the first instance, for admission before a Bench of the High Court to be appointed by the Chief Justice.
It is not in dispute that the appeal preferred by the present appellants was not one such appeal which can be placed for admission under Rule 966 A and it follows from this Rule that the appeals other than those mentioned in that Rule are not to be placed for admission.
This point is no more res integra in view of the decision of this Court in M/s Golcha Investment (P) Ltd. vs Shanti Chandra Bafna., (A.I.R. wherein after considering the provision contained in Rule 966 A, it was held that appeals, other than those set out in the Rule are not to be placed for admission and they were entitled to be admitted as a matter of course.
This Court accordingly quashed the order dismissing the appeal in limine observing that the appellate court erred in summarily dismissing the appeal because it was bound to entertain the same and dispose it of on merits.
This observation will mutatis mutandis apply to the present appeal.
" References may also be made to the decisions of this Court in Shankarlal Aggarwal & Ors.
vs S.L. Poddar & Ors., A.I.R. 1965 S.C. 507; M/s. Golcha Investments (P) Ltd. vs Shanti Chandra Bafna (supra) and M/s. Tarapose & Co. vs Cochin Shipyard Ltd.; , The Delhi High Court in Gokulchand D. Morarka and another vs Company Law Board and others, 1075 correctly in our opinion explained the position.
There the High Court found that pending the petition for winding up of the company filed by two of its creditors for failure to pay a debt in spite of statutory notice, the Company Law Board had filed a petition under sections 397 and 398 of the and in an application applied for interim reliefs of removal of the sole Director and Constitution of a Board to manage the Company.
The Company Judge passed ex parte orders restraining the Company from disposing of its assets and restraining debenture trustees from enforcing their rights.
Thereupon, an application was filed under section 442 for stay of the petition and that petition under sections 397 and 398 was filed by 125 shareholders and a Bank has also filed another winding up petition claiming a large money.
Pending the winding up petitions the Company Judge heard two applications together and passed a common order for removal of the sole director and constitution of a Board of Directors with a retired Judge as the Chairman.
Appeals were taken to a Division Bench against another order of the Company Judge.
It was held over ruling the preliminary objections that the order passed by the Company Judge was appealable under section 483 of the because firstly, any order passed under section 397 or section 398 was one which was passed in lieu of winding up and hence, it was "in the matter of winding up" and, secondly, the order passed in C.A. No. 323 of 1971 expressly fell within the scope of section 442 as the order had been passed after at least two applications had been filed for the winding up of the Company.
The Court further held that there was nothing in section 483 of the , which took away or curtailed the right of appeal provided by section 5(1) of the , and clause 10 of the Letters Patent (Punjab) as applicable to the Delhi High Court; and that the jurisdiction conferred on the Bombay Judge of the High Court under section 10 of the was none other than its ordinary civil jurisdiction and appeal lay also under clause 10 of the Letters Patent to a Division Bench from the order of the Company Judge.
In this case in the High Court of Gauhati, however, unlike the Bombay High Court or the Calcutta High Court or the Delhi High Court, no Letters Patent was applicable to the Gauhati High Court.
It was therefore held that there was no provision for an appeal to the judgment of the learned Single Judge of the High Court.
In our opinion the decision in Shankar Lal Aggarwal & Ors.
vs Shankar Lal Poddar & Ors.
(supra) of this Court indicated the true position where 1076 this Court held that section 202 of the Companies Act, 1913 was in parimateria with the present section.
This Court preferred the view of the Chief Justice Chagla of the Bombay High Court reported in Bachharaj Factories Ltd. vs Hirjee Mills Ltd. A.I.R. 1955 Bombay 355 to the view expressed by the Calcutta High Court in Madan Gopal Daga vs Sachindra Nath Sen, A.I.R. 1928 Calcutta 295 wherein it was held that an order or the decision made or given in the matter of winding up of a company to be appealable had to satisfy the requirements of clause 15 of the Letters Patent.
This interpretation was not accepted by other High Courts and the Bombay High Court held differently.
The view of the Bombay High Court was preferred by this Court in the aforesaid decision and it was observed as follows: "We thus agree with Chagla C.J., that the second part of the section which refers to 'the manner ' and 'the conditions subject to which appeals may be had ' merely regulates the procedure to be followed in the presentation of the appeals and of hearing them, the period of limitation within which the appeal is to be presented and the forum to which appeal would lie and does not restrict or impair the substantive right of appeal which has been conferred by the opening words of that section.
" In our opinion this position is clear from the observation of this Court in Shankar Lal Aggarwal & Ors.
vs Shankar Lal Poddar & Ors., (supra) that the appeal lies to the same High Court irrespective of the powers under the Letters Patent.
Sections 397 and 398 read with section 483 indicate that the appeal would lie in the same manner to the same court and naturally and logically an appeal from the decision of the Single Judge would lie to the Division Bench.
This in our opinion follows logically from the ratio of decision of this Court in Shankarlal Aggarwal & Ors.
vs Shankarlal Poddar & Ors.
(supra) as well as other decisions referred hereinbefore.
It is true that there is perhaps no procedure to file an appeal from the decision of the learned Single Judge of the Gauhati High Court.
If that is so rules should be framed by the High Court in its jurisdiction of Rule making power for filing and disposal of such appeals.
But absence of the procedural rules do not take away a litigant 's right to file such appeals when the statute confers such a right specifically and the jurisdiction of the High Court to dispose of such an appeal if so filed.
We, therefore, propose to deal with the decision of the High Court.
Here, we are further helped by the fact that there is an appeal 1077 from the decision of the learned single judge being Appeal No. 1511/87.
In either view of the matter the view taken by the High Court is before us.
As noted, the learned single judge was asked by parties by agreement to compute the liabilities in view of the failure of the parties to agree to another auditor.
We have heard Sree Ghosh, learned counsel for the appellant and we have also heard Sree A.K. Sen, learned counsel for the respondent.
Sree Sen 's contention was that the current liabilities came to a sum of Rs.6,65,841.63.
He further submitted that the parties having agreed to divide the liabilities equally, the liability to the share of the appellant came to a sum of about Rs.3.32 lacs.
As the appellant had paid a sum of Rs.1.36 lacs the contention of the appellant was that the appellant has to pay a further sum of Rs.2 lacs.
In the alternative, it was urged by the appellant that what could be demanded from the appellant was the liabilities which were outstanding and not paid off by the time the settlement had been arrived at between the parties in January 1976.
But having regard to all the events and terms of settlement we are in agreement with the Division Bench of the High Court that so far as the Bank liability of Martycherra T.E. was concerned, the same had to be taken at the figure of Rs.2,20,000 as stated in clause (2) of the Agreement and not at Rs.6,28,000 and odd as given in the Balance sheet of 31st December, 1973.
The Division Bench computed the liability which came to a total of Rs.16,34,675.46 which has computed after deducting a sum of Rs.2,20,000 which was governed by clause (1) and it comprised of Bank Liability.
The Division Bench took into consideration that the appellant had paid a sum of Rs.1,36,038.06 after the compromise.
She had not paid anything more than this.
Therefore it follows that only a sum of Rs.6,81,299.67 was payable by the appellant to the respondent.
The Division Bench, in our opinion, correctly modified the determination on that figure and that is the sum which should be the liability of the appellant.
Sree Ghosh, learned counsel for the appellant tried to submit before us that a sum of Rs.1,36,038.06 should be given credit in computing the liability of the appellant and according to him the Division Bench fell into an error in not deducting this liability of his client.
We are unable to agree with this view.
In the aforesaid view of the matter we uphold the direction of the Division Bench in so far as they computed the liability and direct that the appellant would pay that sum to the respondent in settlement of the dues referred hereinbefore.
sum of Rs.1,36,038.06 was directed to be paid at the time of the admission of the appeal by the Division Bench of the High Court.
If that money has been paid or realised by the respondent the appel 1078 lant would pay the balance amount of Rs.6,81,299.67 and if the money is paid the respondent will by virtue of this order be entitled to withdraw the same and give credit to the appellant for the same.
The balance sum will be paid by 15th March, 1988.
In default of payment by that date the amount will carry 18% interest.
The appeal is disposed of accordingly by so holding.
In view of the aforesaid position, decision in C.A. No. 1511/87 which is from the decision of the learned Single Judge no longer survives and is disposed of accordingly.
SLP (C) No. 8152 of 1987 which is a cross petition filed against the decision of the Division Bench of the Gauhati High Court no longer survives and is disposed of accordingly.
Parties will pay and bear their own costs.
N.P.V. Appeal disposed of.
|
Civil Appeal No. 1510 of 1987 etc.
From the Judgment and Order dated 4.6.1987 of the Gauhati High Court in F.A. No. 19 of 1984.
Dr. Shankar Ghosh, Gobind Das, Ashok Sen, S.N. Mukharji, N.R. Choudhary and G.S. Chatterjee for the appearing parties.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals by special leave 1072 relate to the affairs of M/s. Eastern Tea Estate (P) Ltd. It was of two branches namely, the Dutta 's and the Choudhury 'section Due to death and lack of cordiality between the erstwhile partners the two branches first drifted and then parted company as it unfortunately is the fate of so many Indian concerns and there were disputes and litigations in Court.
The Civil Appeal No. 1510 of 1987 arises from a judgment and decision of the Division Bench of the High Court of Gauhati dated 4th June, 1987.
It appears that that a petition was filed originally by the appellant under sections 397 and 398 read with section 403 of the (hereinafter called 'the Act ').
The company petition came to be disposed of on 4th February, 1977 in accordance with the compromise arrived at between the parties.
The said compromise comprised of inter alia, two relevant paragraphs, for the present purpose, which read as follows: "1.
Mrs. Arati Dutta will take over Chandana T.E. and Choudhury group will take over Martycherra T.E. On 25th January, 1976.
The Bank liability of the Company in respect to Martycherra T.E. amounting to Rs.2,20,000 (Approx.) shall be shared equally of which Rs.1,10,000 shall be paid by Mrs. Arati Dutta on 25th January, 1976 at Silchar in presence of Shri B.K. Das, Advocate and Shri S.K. Sen, Advocate.
The entire liability of the Company would be equally shared and for that purpose an independent Auditor shall be appointed by Shri S.K. Sen, Advocate who shall undertake to start the accounting from the 1st week of February, 1976.
The shares owned by Mrs. Arati Dutta and her sons and daughters will be sold to the Company on 25.1.76 and necessary permission shall be taken from Hon 'ble High Court in this regard.
The staff salary and gratuity of the employees of the Head Office of the Hon 'ble High Court is obtained shall be considered as the Liability of the Company and will be borne by the two parties equally.
1073 6.
Mrs. Arati Dutta shall have to pay another sum of Rs.12,500 to the Company in addition to her payment of 5% liability of the Company.
" Thereafter there were differences between the parties and it could not be adjusted as the parties could not agree as to audit.
On 9th November, 1982 the parties agreed that no auditor need be appointed in the matter of determination of liability and the matter of determination of liability as per the 1973 Balance sheet should be left entirely to the Court.
In accordance with the compromise the parties were asked to submit their Balance sheets regarding the payments made by them which related to liabilities in the Balance sheet as on 31st December, 1973.
The parties filed their Balance sheets and the learned Single Judge of the High Court computed the liabilities of the parties on that basis.
Aggrieved, however, by the said decision, the appellant preferred an appeal before the Division Bench of the said High Court.
The first question that was raised before the Division Bench was whether the appeal lay to the Division Bench under section 483 of the Act which dealt with appeals from orders.
The said section was as follows: "483: Appeals from orders Appeals from any order made or decision given in the matter of winding up of a company by the Court shall lie to the same Court to which, in the same manner in which, and subject to the same conditions under which, appeals lie from any other order or decision of the Court in cases within its ordinary jurisdiction.
" It was submitted by learned counsel that though the first application by the appellant was under sections 397 and 398 read with section 403 of the Act the same could be taken in the matter of winding up of a company to which the reference has been made in section 483.
On the other hand, it was submitted that no appeal lay.
It appears to us that though this present application was relating to sections 397 and 398 and as it arises in respect of the orders passed under sections 397 and 398 of the Act, the provisions of section 483 would be attracted and an appeal would lie to the Division Bench.
This conclusion seems to follow from an analysis of the sections as interpreted by the various decisions of this Court as well as one judgment of the Delhi High Court to which we will refer.
However, it is sufficient for the present purpose for us to refer to the observations of this Court in Shanta Genevienve Pommerat & Anr.
vs Papers Pvt. Ltd. & Ors.
A.I.R. 1983 S.C. 269 where this Court observed that an appeal under sections 397 and 398 read with 403 of the would lie to the same 1074 court to which, in the same manner in which, and subject to the same conditions under which the appeals lie from any order or decision of the court in cases within its ordinary jurisdiction.
This Court made the following observations at page 269 of the report: "Now an order under sections 397, 398 and 403 of the , on the face of it, cannot be said to be an order made or decision given, in the matter of the winding up of a company.
Relief, undoubtedly under section 397 and/or 398 is in fact an alternative to winding up.
No doubt order under sections 397 or 398 could be an order made or decision by the High Court.
Having jurisdiction under the the appeal will lie to the Division Bench of the same High Court.
This is not disputed.
Chapter XLII of the Bombay High Court Rules provides for appeals to appellate Court.
The Rules make provision for certain type of appeals to be placed in the first instance, for admission before a Bench of the High Court to be appointed by the Chief Justice.
It is not in dispute that the appeal preferred by the present appellants was not one such appeal which can be placed for admission under Rule 966 A and it follows from this Rule that the appeals other than those mentioned in that Rule are not to be placed for admission.
This point is no more res integra in view of the decision of this Court in M/s Golcha Investment (P) Ltd. vs Shanti Chandra Bafna., (A.I.R. wherein after considering the provision contained in Rule 966 A, it was held that appeals, other than those set out in the Rule are not to be placed for admission and they were entitled to be admitted as a matter of course.
This Court accordingly quashed the order dismissing the appeal in limine observing that the appellate court erred in summarily dismissing the appeal because it was bound to entertain the same and dispose it of on merits.
This observation will mutatis mutandis apply to the present appeal.
" References may also be made to the decisions of this Court in Shankarlal Aggarwal & Ors.
vs S.L. Poddar & Ors., A.I.R. 1965 S.C. 507; M/s. Golcha Investments (P) Ltd. vs Shanti Chandra Bafna (supra) and M/s. Tarapose & Co. vs Cochin Shipyard Ltd.; , The Delhi High Court in Gokulchand D. Morarka and another vs Company Law Board and others, 1075 correctly in our opinion explained the position.
There the High Court found that pending the petition for winding up of the company filed by two of its creditors for failure to pay a debt in spite of statutory notice, the Company Law Board had filed a petition under sections 397 and 398 of the and in an application applied for interim reliefs of removal of the sole Director and Constitution of a Board to manage the Company.
The Company Judge passed ex parte orders restraining the Company from disposing of its assets and restraining debenture trustees from enforcing their rights.
Thereupon, an application was filed under section 442 for stay of the petition and that petition under sections 397 and 398 was filed by 125 shareholders and a Bank has also filed another winding up petition claiming a large money.
Pending the winding up petitions the Company Judge heard two applications together and passed a common order for removal of the sole director and constitution of a Board of Directors with a retired Judge as the Chairman.
Appeals were taken to a Division Bench against another order of the Company Judge.
It was held over ruling the preliminary objections that the order passed by the Company Judge was appealable under section 483 of the because firstly, any order passed under section 397 or section 398 was one which was passed in lieu of winding up and hence, it was "in the matter of winding up" and, secondly, the order passed in C.A. No. 323 of 1971 expressly fell within the scope of section 442 as the order had been passed after at least two applications had been filed for the winding up of the Company.
The Court further held that there was nothing in section 483 of the , which took away or curtailed the right of appeal provided by section 5(1) of the , and clause 10 of the Letters Patent (Punjab) as applicable to the Delhi High Court; and that the jurisdiction conferred on the Bombay Judge of the High Court under section 10 of the was none other than its ordinary civil jurisdiction and appeal lay also under clause 10 of the Letters Patent to a Division Bench from the order of the Company Judge.
In this case in the High Court of Gauhati, however, unlike the Bombay High Court or the Calcutta High Court or the Delhi High Court, no Letters Patent was applicable to the Gauhati High Court.
It was therefore held that there was no provision for an appeal to the judgment of the learned Single Judge of the High Court.
In our opinion the decision in Shankar Lal Aggarwal & Ors.
vs Shankar Lal Poddar & Ors.
(supra) of this Court indicated the true position where 1076 this Court held that section 202 of the Companies Act, 1913 was in parimateria with the present section.
This Court preferred the view of the Chief Justice Chagla of the Bombay High Court reported in Bachharaj Factories Ltd. vs Hirjee Mills Ltd. A.I.R. 1955 Bombay 355 to the view expressed by the Calcutta High Court in Madan Gopal Daga vs Sachindra Nath Sen, A.I.R. 1928 Calcutta 295 wherein it was held that an order or the decision made or given in the matter of winding up of a company to be appealable had to satisfy the requirements of clause 15 of the Letters Patent.
This interpretation was not accepted by other High Courts and the Bombay High Court held differently.
The view of the Bombay High Court was preferred by this Court in the aforesaid decision and it was observed as follows: "We thus agree with Chagla C.J., that the second part of the section which refers to 'the manner ' and 'the conditions subject to which appeals may be had ' merely regulates the procedure to be followed in the presentation of the appeals and of hearing them, the period of limitation within which the appeal is to be presented and the forum to which appeal would lie and does not restrict or impair the substantive right of appeal which has been conferred by the opening words of that section.
" In our opinion this position is clear from the observation of this Court in Shankar Lal Aggarwal & Ors.
vs Shankar Lal Poddar & Ors., (supra) that the appeal lies to the same High Court irrespective of the powers under the Letters Patent.
Sections 397 and 398 read with section 483 indicate that the appeal would lie in the same manner to the same court and naturally and logically an appeal from the decision of the Single Judge would lie to the Division Bench.
This in our opinion follows logically from the ratio of decision of this Court in Shankarlal Aggarwal & Ors.
vs Shankarlal Poddar & Ors.
(supra) as well as other decisions referred hereinbefore.
It is true that there is perhaps no procedure to file an appeal from the decision of the learned Single Judge of the Gauhati High Court.
If that is so rules should be framed by the High Court in its jurisdiction of Rule making power for filing and disposal of such appeals.
But absence of the procedural rules do not take away a litigant 's right to file such appeals when the statute confers such a right specifically and the jurisdiction of the High Court to dispose of such an appeal if so filed.
We, therefore, propose to deal with the decision of the High Court.
Here, we are further helped by the fact that there is an appeal 1077 from the decision of the learned single judge being Appeal No. 1511/87.
In either view of the matter the view taken by the High Court is before us.
As noted, the learned single judge was asked by parties by agreement to compute the liabilities in view of the failure of the parties to agree to another auditor.
We have heard Sree Ghosh, learned counsel for the appellant and we have also heard Sree A.K. Sen, learned counsel for the respondent.
Sree Sen 's contention was that the current liabilities came to a sum of Rs.6,65,841.63.
He further submitted that the parties having agreed to divide the liabilities equally, the liability to the share of the appellant came to a sum of about Rs.3.32 lacs.
As the appellant had paid a sum of Rs.1.36 lacs the contention of the appellant was that the appellant has to pay a further sum of Rs.2 lacs.
In the alternative, it was urged by the appellant that what could be demanded from the appellant was the liabilities which were outstanding and not paid off by the time the settlement had been arrived at between the parties in January 1976.
But having regard to all the events and terms of settlement we are in agreement with the Division Bench of the High Court that so far as the Bank liability of Martycherra T.E. was concerned, the same had to be taken at the figure of Rs.2,20,000 as stated in clause (2) of the Agreement and not at Rs.6,28,000 and odd as given in the Balance sheet of 31st December, 1973.
The Division Bench computed the liability which came to a total of Rs.16,34,675.46 which has computed after deducting a sum of Rs.2,20,000 which was governed by clause (1) and it comprised of Bank Liability.
The Division Bench took into consideration that the appellant had paid a sum of Rs.1,36,038.06 after the compromise.
She had not paid anything more than this.
Therefore it follows that only a sum of Rs.6,81,299.67 was payable by the appellant to the respondent.
The Division Bench, in our opinion, correctly modified the determination on that figure and that is the sum which should be the liability of the appellant.
Sree Ghosh, learned counsel for the appellant tried to submit before us that a sum of Rs.1,36,038.06 should be given credit in computing the liability of the appellant and according to him the Division Bench fell into an error in not deducting this liability of his client.
We are unable to agree with this view.
In the aforesaid view of the matter we uphold the direction of the Division Bench in so far as they computed the liability and direct that the appellant would pay that sum to the respondent in settlement of the dues referred hereinbefore.
sum of Rs.1,36,038.06 was directed to be paid at the time of the admission of the appeal by the Division Bench of the High Court.
If that money has been paid or realised by the respondent the appel 1078 lant would pay the balance amount of Rs.6,81,299.67 and if the money is paid the respondent will by virtue of this order be entitled to withdraw the same and give credit to the appellant for the same.
The balance sum will be paid by 15th March, 1988.
In default of payment by that date the amount will carry 18% interest.
The appeal is disposed of accordingly by so holding.
In view of the aforesaid position, decision in C.A. No. 1511/87 which is from the decision of the learned Single Judge no longer survives and is disposed of accordingly.
SLP (C) No. 8152 of 1987 which is a cross petition filed against the decision of the Division Bench of the Gauhati High Court no longer survives and is disposed of accordingly.
Parties will pay and bear their own costs.
N.P.V. Appeal disposed of.
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% The appellant filed a petition under Sections 397 and 398 read with Section 403 of the in respect of the affairs of the respondent firm which was disposed of in terms of the compromise arrived at between the parties.
The parties agreed that no Auditor need be appointed for the determination of the liability, and that the determination as per the 1973 balance sheet should be left entirely to the Court.
In accordance with the said compromise, the parties filed their balance sheets regarding the payments made by them which related to liabilities as on 31st December, 1973.
Single Judge of the High Court computed the liabilities of the parties on that basis.
The appellant preferred an appeal before the Division Bench against the aforesaid decision.
The Division Bench held that as no Letters Patent was applicable to the High Court there was no provision for an appeal against the judgment of the Single Judge and dismissed the appeal.
On the question: whether an appeal lies to the Division Bench under section 483 of the , against the orders of a Single Judge.
Disposing of the appeal, ^ HELD: Sections 397 and 398 read with section 483 of the 1071 indicate that an appeal would lie in the same manner to the same court.
Naturally and logically, therefore, an appeal from the decision of the Single Judge would lie to the Division Bench.
[1076E F] Shankarlal Aggarwal & Ors.
vs S.L. Poddar & Ors.
A.I.R. followed.
Shanta Genevienve Pommerat & Anr.
vs Papers Pvt. Ltd. & Ors., A.I.R. 1983 S.C. 269; M/s. Golcha Investment (P) Ltd. vs Shanti Chandra Bafna, A.I.R. 1970 S.C. 1350 and M/s. Tarapose & Co. vs Cochin Shipyard Ltd., A.I.R. 1984 S.C. 1072 referred to.
Absence of procedural rules does not take away a litigant 's right to file appeals against the decision of Single Judge when the statute confers such a right specifically, and the jurisdiction of the High Court to dispose of such an appeal, if so filed.
If there are no Rules, they should be framed by the High Court in its jurisdiction of Rule making power for filing and disposal of such appeals.
[1076G H] In the instant case, though the present application was relating to sections 397 and 398, and as it arises in respect of the orders passed under those sections, the provisions of section 483 would be attracted and an appeal would lie to the Division Bench.
[1073F G] [The High Court found that only a sum of Rs.6,81,299.67 was payable by the appellants to the respondent.
The Court is of the opinion that the High Court was right in its determination, and that is the sum which should be the liability of the appellant.
Appellant directed to pay the aforesaid amount to the respondent in full settlement of the dues.] [1077E G]
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% The appellant filed a petition under Sections 397 and 398 read with Section 403 of the in respect of the affairs of the respondent firm which was disposed of in terms of the compromise arrived at between the parties.
The parties agreed that no Auditor need be appointed for the determination of the liability, and that the determination as per the 1973 balance sheet should be left entirely to the Court.
In accordance with the said compromise, the parties filed their balance sheets regarding the payments made by them which related to liabilities as on 31st December, 1973.
Single Judge of the High Court computed the liabilities of the parties on that basis.
The appellant preferred an appeal before the Division Bench against the aforesaid decision.
The Division Bench held that as no Letters Patent was applicable to the High Court there was no provision for an appeal against the judgment of the Single Judge and dismissed the appeal.
On the question: whether an appeal lies to the Division Bench under section 483 of the , against the orders of a Single Judge.
Disposing of the appeal, ^ HELD: Sections 397 and 398 read with section 483 of the 1071 indicate that an appeal would lie in the same manner to the same court.
Naturally and logically, therefore, an appeal from the decision of the Single Judge would lie to the Division Bench.
[1076E F] Shankarlal Aggarwal & Ors.
vs S.L. Poddar & Ors.
A.I.R. followed.
Shanta Genevienve Pommerat & Anr.
vs Papers Pvt. Ltd. & Ors., A.I.R. 1983 S.C. 269; M/s. Golcha Investment (P) Ltd. vs Shanti Chandra Bafna, A.I.R. 1970 S.C. 1350 and M/s. Tarapose & Co. vs Cochin Shipyard Ltd., A.I.R. 1984 S.C. 1072 referred to.
Absence of procedural rules does not take away a litigant 's right to file appeals against the decision of Single Judge when the statute confers such a right specifically, and the jurisdiction of the High Court to dispose of such an appeal, if so filed.
If there are no Rules, they should be framed by the High Court in its jurisdiction of Rule making power for filing and disposal of such appeals.
[1076G H] In the instant case, though the present application was relating to sections 397 and 398, and as it arises in respect of the orders passed under those sections, the provisions of section 483 would be attracted and an appeal would lie to the Division Bench.
[1073F G] [The High Court found that only a sum of Rs.6,81,299.67 was payable by the appellants to the respondent.
The Court is of the opinion that the High Court was right in its determination, and that is the sum which should be the liability of the appellant.
Appellant directed to pay the aforesaid amount to the respondent in full settlement of the dues.] [1077E G]
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ION: Civil Appeal No. 914 of 1987.
From the Judgment and Order dated 22.8.1984 of the Kerala High Court in O.P. No. 6806 of 1984.
Abdul Khader and E.M.S. Anam for the Appellant.
1081 G. Vishwanath Iyer, N. Sudhakaran for the Respondent.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
A tea estate of 100 acres with some buildings, machinery and equipments was given as security to the Kerala Financial Corporation ("The Corporation") against the loan taken by the appellant.
A part of the loan remained outstanding and the appellant could not clear it.
The Corporation thereupon filed O.A. No. 8/64 before the District Court of Kottayam for recovery of the arrears and obtained decree for an amount of Rs.1,20,000.
In execution of the decree, the said tea estate was brought for sale by court auction.
On November 5, 1969, the auction sale was held.
There was no bidder.
So the Corporation itself had to purchase the property for about Rs.1,65,000.
There was long standing dispute between the workmen of the estate and the previous management relating to payment of their wages.
The Corporation therefore could not take possession of the estate.
An extent of 85 acres out of 100 acres of the estate was in possession of the workmen as per settlement arrived at between the Labour Commissioner and the District Collector.
The workmen used to collect the income therefrom towards their wages.
This arrangement continued for about thirteen years.
On January 7, 1982, the Corporation got possession of the entire estate.
The Corporation wanted to recover its amount.
It was not interested in the property.
It therefore, invited tenders for the sale of the estate.
On March 19, 1982, a tender notification was published in dailies like Malayala Manorama, Mathrubhoomi and Deepika newspapers.
In response to the notification, the daughter in law of the appellant was the only tenderer.
She offered Rs.5,10,505.
The Corporation accepted the tender.
It was subsequently found that the daughter in law was no better than the appellant.
She also could not pay any amount.
On January 18, 1983, the Corporation again invited tenders for the sale of the property.
The notification was published in the said newspapers as it was done earlier.
This time, the Corporation received these tenders: (i) T.M. Hassan Rawther (Appellant before us) for Rs. six lakhs; (ii) P.M. Jacob for Rs.4,15,550 and (iii) K.K. Mathew for Rs.2,07,451.
Since the appellant submitted the highest offer, the Corporation naturally had to accept it.
On March 2, 1983, the acceptance was communicated to the appellant.
He must have thanked his stars for getting back his family property which was so dear to him or which was according to him so valuable.
But there was no such anxiety shown.
He did not pay anthing except the earnest money of Rs.40,000.
1082 The Corporation, however, extended the time for payment again and again.
The Corporation also gave him instalments for payment of the balance price.
All the efforts of the Corporation failed to induce the appellant.
The Corporation wanted to get back its money.
It was not interested in retaining the property.
So it negotiated with P.M. Jacob who had submitted his tender alongwith the appellant in response to the notification dated January 18, 1983.
He had then offered Rs.4,16,550.
His tender was the next best.
After negotiation, he enhanced the offer to Rs. four and a half lakhs.
The Corporation accepted it and decided to sell the property to P.M. Jacob.
The property however, was sold to M/s. Gumraj Plantations at the request of P.M. Jacob.
M/s. Gumraj Plantations is a partnership firm in which P.M. Jacob is one of the partners.
The appellant who could not purchase the said property by any means filed suit O.S. No. 229/84 before the Munsif Court Thidupuzha to restrain the Corporation from selling the property.
He could not get relief in the suit since by then the sale deed was executed in favour of M/s. Gumraj Plantations.
Subsequently, he moved the High Court of Kerala complaining that the Corporation while selling the property for Rs. four and a half lakhs to M/s. Gumraj Plantations, had deviated from the normal practice of inviting tenders from the public.
He contended that the Corporation being a public authority was bound to act reasonably and fairly and it ought not to have arbitrarily selected the purchaser.
The High Court found no substance in those submissions.
The High Court observed: "The submission made by the petitioner 's counsel is that the decision to sell the property by private negotiations is arbitrary and is therefore liable to be interfered with by this court.
This is clearly a case where in execution proceedings the decreeholder has purchased the property and thereafter the property was sold in public auction to the petitioner, who purchased it for Rs. six lakhs but failed to pay the sale amount in spite of the fact that this court and afterwards the corporation had shown great indulgence towards the petitioner.
This is not at all a fit case for interference under article 226 of the Constitution." Being aggrieved by the judgment of the High Court, the appellant has preferred the present appeal.
On May 18, 1985, this Court 1083 while entertaining the appeal issued notice limited to the question whether the sale of the property should be made by general auction.
This Court further directed that in any event, the appellant will not be allowed to participate in the auction.
Very interesting turn of events.
The appellant who miserably failed to secure the property for himself is now interested in securing the best price for the Corporation.
He says that this is a public interest litigation.
His case is that the Corporation in all fairness must dispose of the property by public auction.
It could not have bargained with P.M. Jacob and sold the property to M/s. Gumraj Plantations.
Before the High Court, the appellant attacked the sale also on the ground that it was actuated by extraneous considerations.
He alleged that the corporation had succumbed to the pressure of some influential persons for the sale of the property in favour of M/s. Gumraj Plantations.
The appellant made these allegations but did not substantiate it.
He did not give the names of influential persons who had brought pressure on the Corporation.
He did not even state as to how the Corporation officials had shown undue interest with P.M. Jacob or with the other partners of M/s. Gumraj Plantations for sale of the property.
It is not proper to make such light hearted and vague allegations against the statutory authorities.
These allegations, in our opinion, are uncharitable and unfounded.
The only question that arises for consideration is whether on the facts and in the circumstances, the Corporation was not justified in selling the property by private negotiations in favour of M/s. Gumraj Plantations at the instance of P.M. Jacob.
It is needless to state that the Government or public authorities should make all attempts to obtain the best available price while disposing of public properties.
They should not generally enter into private arrangements for the purpose.
These principles may be taken as well established by the following decisions of this Court: (i) K.N. Guruswamy vs The State of Mysore and others; , at 312; (ii) Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi and others, ; (iii) R.D. Shetty vs The International Airport Authority of India and Ors., ; ; (iv) Kasturi Lal Lakshmi Reddy vs State of Jammu and Kashmir and Anr., ; ; (v) Fertilizer Corporation Kamagar Union vs Union of India, ; ; (vi) Ram and Shyam Company vs State of Haryana and Ors.
[1985] Supp.
SCR 541 and (vii) Shri Sachidanand Pandey vs State of W.B. ; 1084 In R.D. Shetty vs The International Airport Authority of India and Ors.
; at 1041 Bhagwati, J. speaking for the Court observed: "Now, obviously where a corporation is an instrumentality or agency of Government, it would, in the exercise of its power or discretion, be subject to the same constitutional or public law limitations as Government.
The rule inhibiting arbitrary action by Government which we have discussed above must apply equally where such corporation is dealing with the public, whether by way of giving jobs or entering into contracts or otherwise, and it cannot act arbitrarily and enter into relationship with any person it likes at its sweetwill, but its action must be in conformity with some principle which meets the test of reason and relevance.
This rule also flows directly from the doctrine of equality embodied in Art 14.
It is now well settled as a result of the decisions of this Court in E.P. Rayappa vs State of Tamil Nadu and Maneka Gandhi vs Union of India that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment.
It requires that State action must not be arbitrary but must be based on some rational and relevant principle which is non discriminatory: it must not be guided by any extraneous or irrelevant considerations, because that would be denial of equality.
The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non arbitrariness is protected by article 14 and it must characterise every State action, whether it be under authority of law or in exercise of executive power without making of law.
The State cannot, therefore, act arbitrarily in entering into relationship, contractual or otherwise with a third party, but its action must conform to some standard or norm which is rational and non discriminatory.
" In Kasturi Lal Lakshmi Reddy vs State of J & K, ; at 1355 Bhagwati, J. again speaking for the Court reiterated what he said earlier to R.D. Shetty case.
The learned Judge went on to state: 1085 "Every action taken by the Government must be in public interest; the Government cannot act arbitrarily and without reason and if it does, its action would be liable to be invalidated.
If the Government awards a contract or leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touch stone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid.
" The learned Judge continued (at p. 1357): "But one basic principle which must guide the Court in arriving at its determination on this question is that there is always a presumption that the Governmental action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest.
This burden is a heavy one and it has to be discharged to the satisfaction of the Court by proper and adequate material.
The Court cannot lightly assume that the action taken by the Government is unreasonable or without public interest because as we said above, there are a large number of policy considerations which must necessarily weigh with the Government in taking action and therefore, the Court would not strike down governmental action as invalid on this ground, unless it is clearly satisfied that the action is unreasonable or not in public interest.
But where it is so satisfied it would be the plainest duty of the Court under the Constitution to invalidate the governmental action.
This is one of the most important functions of the Court and also one of the most essential for preservation of the rule of law.
" In Fertilizer Corporation case ; at 350 this Court speaking through Chandrachud, C.J., observed: "We want to make it clear that we do not doubt the bona fides of the authorities, but as far as possible, sales of public property, when the intention is to get the best price, ought to take place publicly.
The vendors are not necessarily bound to accept the highest or any other offer, but the public at least gets the satisfaction that the Government has 1086 put all its cards on the table.
In the instant case, the officers who were concerned with the sale have inevitably, though unjustifiably attracted the criticism that during the course of negotiations the original bid was reduced without a justifying cause.
We had willy nilly to spend quite some valuable time in satisfying ourselves that the reduction in the price was a necessary and fair consequence of the reduction in the quantity of the goods later offered for sale on March 31, 1980.
One cannot exclude the possibility that a better price might have been realised in a fresh public auction but such possibilities cannot vitiate the sale or justify the allegations of malafides.
" In Shri Sachidanand Pandey vs State of West Bengal, ; at 1133, O. Chinnappa Reddy, J. after considering almost all the decisions of this Court on the subject summarised the propositions in the following terms: "On a consideration of the relevant cases cited at the bar the following propositions may be taken as well established: State owned or public owned property is not to be dealt with at the absolute discretion of the executive.
Certain percepts and principes have to be observed.
Public interest is the paramount consideration.
One of the methods of securing the public interest when it is considered necessary to dispose of a property, is to sell the property by public auction or by inviting tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations where there are compelling reasons necessitating departure from the rule but then the reasons for the departure must be rational and should not be suggestive of discrimination.
Appearance of public justice is as important as doing justice.
Nothing should be done which gives an appearance of bias, jobbery or nepotism." After applying these tests, the learned Judge finally upheld the action of West Bengal Government in not inviting tenders, or in not holding a public auction but negotiating straightway at arms length with Taj Group of Hotels for giving about four acres of land for establishing a five star hotel.
The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting 1087 tenders.
This Court has been insisting upon that rule, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should undoubtedly act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection.
Nothing should be suggestive of discrimination.
Nothing should be done by them which gives an impression of bias, favouritism or nepotism.
Ordinarily these factors would be absent if the matter is brought to public auction or sale by tenders.
That is why the Court repeatedly stated and reiterated that the State owned properties are required to be disposed of publicly.
But that is not the only rule.
As O.Chinnappa Reddy, J. Observed "that though that is the ordinary rule, it is not an invariable rule.
" There may be situations necessitating departure from the rule, but then such instances must be justified by compulsions and not by compromise.
It must be justified by compelling reasons and not by just convenience.
What is the position in the present case.
Here is a case where the Corporation invited tenders for the sale of the property under notification dated January 18, 1983.
The appellant submitted the highest tender in response to the said notification.
He was given all concessions for payment of the tender amount.
But he did not.
He negotiated with the Managing Director of the Corporation for facilities for payment by instalments.
That was also granted to him.
There again he failed.
If the appellant could not act according to his tender, we fail to see why the property should not be offered to the person who was next in order.
The Corporation, in our opinion, did not do anything unfair with P.M.Jacob.
The Corporation got the tender amount raised from Rs.4,16,550 to Rs.4,50,000.
It shows the fairness with which the Corporation dealt with the property.
On a consideration of all the facts and circumstances of the case, we are satisfied that the action of the Corporation in offering the property to P.M.Jacob and selling the same at his request to M/s. Gumraj Plantations was perfectly justified and cannot be found fault with In the result the appeal fails and is dismissed.
In the circumstances, however, we make no order as to costs.
P.S.S. Appeal dismissed.
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% The respondent, a State Government Corporation obtained decree for certain amount against the appellant and in execution proceedings a tea estate was brought for sale by court auction in 1969, but in the absence of a bidder the respondent itself had to purchase it at a higher price.
The respondent, however, could take possession of the estate only in 1982.
It then invited tenders for the sale of the estate.
The appellant offered Rs.6,00,000.
The next best offer was for Rs.4,15,550 and the third for Rs.2,07,451.
The highest offer was accepted, but the appellant could not pay the amount except the earnest money, even after repeated extension of time and offer to receive the balance in instalments.
The respondent then negotiated with the next highest bidder, who enhanced the offer to Rs.4,50,000 which was accepted by the respondent.
The property, however, was sold to a partnership firm in which the said bidder was a partner.
The appellant thereupon moved the High Court complaining that the respondent in selling the property to the firm had deviated from the normal practice of inviting the tenders from the public and that the Corporation being a public authority was bound to act reasonably and fairly and it ought not be have arbitrarily selected the purchaser.
The High Court declined to interfere.
Dismissing the appeal, ^ HELD: The action of the respondent in offering the property to the person next in order by private negotiations and selling the same at 1080 his request to the partnership firm was perfectly justified.
[1087G] The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting tenders, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection and should not be suggestive of discrimination, bias, favouritism or nepotism.
Ordinarily these facts would be absent if the matter is brought to public auction or sale by tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations necessitating departure from the rule, but then such instances must be justified by compelling reasons and not by just convenience.
[1086H; 1087A C] In the instant case, the respondent dealt with the property in all fairness.
It invited tenders for the sale of the property under the notification.
The appellant submitted the highest tender in response to the said notification.
He was granted all concessions and facilities for payment by instalments but he failed.
If the appellant could not act according to his tender, there was no reason why the property should not be offered to the person who was next in order.
The respondent, therefore, did not do anything unfair with the second bidder after it had got the tender amount raised substantially.
[1087D F] K.N. Guruswamy vs The State of Mysore & Ors., ; at 312; Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi & Ors., ; R.D. Shetty vs The International Airport Authority of India State of Jammu and Kashmir & Anr., ; ; Fertilizer Corporation Kamagar Union vs Union of India, ; ; Ram and Shyam Company vs State of Haryana & Ors., and Shri Sachidanand Pandey vs State of W. B. ; , applied.
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ION: Civil Appeal No. 914 of 1987.
From the Judgment and Order dated 22.8.1984 of the Kerala High Court in O.P. No. 6806 of 1984.
Abdul Khader and E.M.S. Anam for the Appellant.
1081 G. Vishwanath Iyer, N. Sudhakaran for the Respondent.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
A tea estate of 100 acres with some buildings, machinery and equipments was given as security to the Kerala Financial Corporation ("The Corporation") against the loan taken by the appellant.
A part of the loan remained outstanding and the appellant could not clear it.
The Corporation thereupon filed O.A. No. 8/64 before the District Court of Kottayam for recovery of the arrears and obtained decree for an amount of Rs.1,20,000.
In execution of the decree, the said tea estate was brought for sale by court auction.
On November 5, 1969, the auction sale was held.
There was no bidder.
So the Corporation itself had to purchase the property for about Rs.1,65,000.
There was long standing dispute between the workmen of the estate and the previous management relating to payment of their wages.
The Corporation therefore could not take possession of the estate.
An extent of 85 acres out of 100 acres of the estate was in possession of the workmen as per settlement arrived at between the Labour Commissioner and the District Collector.
The workmen used to collect the income therefrom towards their wages.
This arrangement continued for about thirteen years.
On January 7, 1982, the Corporation got possession of the entire estate.
The Corporation wanted to recover its amount.
It was not interested in the property.
It therefore, invited tenders for the sale of the estate.
On March 19, 1982, a tender notification was published in dailies like Malayala Manorama, Mathrubhoomi and Deepika newspapers.
In response to the notification, the daughter in law of the appellant was the only tenderer.
She offered Rs.5,10,505.
The Corporation accepted the tender.
It was subsequently found that the daughter in law was no better than the appellant.
She also could not pay any amount.
On January 18, 1983, the Corporation again invited tenders for the sale of the property.
The notification was published in the said newspapers as it was done earlier.
This time, the Corporation received these tenders: (i) T.M. Hassan Rawther (Appellant before us) for Rs. six lakhs; (ii) P.M. Jacob for Rs.4,15,550 and (iii) K.K. Mathew for Rs.2,07,451.
Since the appellant submitted the highest offer, the Corporation naturally had to accept it.
On March 2, 1983, the acceptance was communicated to the appellant.
He must have thanked his stars for getting back his family property which was so dear to him or which was according to him so valuable.
But there was no such anxiety shown.
He did not pay anthing except the earnest money of Rs.40,000.
1082 The Corporation, however, extended the time for payment again and again.
The Corporation also gave him instalments for payment of the balance price.
All the efforts of the Corporation failed to induce the appellant.
The Corporation wanted to get back its money.
It was not interested in retaining the property.
So it negotiated with P.M. Jacob who had submitted his tender alongwith the appellant in response to the notification dated January 18, 1983.
He had then offered Rs.4,16,550.
His tender was the next best.
After negotiation, he enhanced the offer to Rs. four and a half lakhs.
The Corporation accepted it and decided to sell the property to P.M. Jacob.
The property however, was sold to M/s. Gumraj Plantations at the request of P.M. Jacob.
M/s. Gumraj Plantations is a partnership firm in which P.M. Jacob is one of the partners.
The appellant who could not purchase the said property by any means filed suit O.S. No. 229/84 before the Munsif Court Thidupuzha to restrain the Corporation from selling the property.
He could not get relief in the suit since by then the sale deed was executed in favour of M/s. Gumraj Plantations.
Subsequently, he moved the High Court of Kerala complaining that the Corporation while selling the property for Rs. four and a half lakhs to M/s. Gumraj Plantations, had deviated from the normal practice of inviting tenders from the public.
He contended that the Corporation being a public authority was bound to act reasonably and fairly and it ought not to have arbitrarily selected the purchaser.
The High Court found no substance in those submissions.
The High Court observed: "The submission made by the petitioner 's counsel is that the decision to sell the property by private negotiations is arbitrary and is therefore liable to be interfered with by this court.
This is clearly a case where in execution proceedings the decreeholder has purchased the property and thereafter the property was sold in public auction to the petitioner, who purchased it for Rs. six lakhs but failed to pay the sale amount in spite of the fact that this court and afterwards the corporation had shown great indulgence towards the petitioner.
This is not at all a fit case for interference under article 226 of the Constitution." Being aggrieved by the judgment of the High Court, the appellant has preferred the present appeal.
On May 18, 1985, this Court 1083 while entertaining the appeal issued notice limited to the question whether the sale of the property should be made by general auction.
This Court further directed that in any event, the appellant will not be allowed to participate in the auction.
Very interesting turn of events.
The appellant who miserably failed to secure the property for himself is now interested in securing the best price for the Corporation.
He says that this is a public interest litigation.
His case is that the Corporation in all fairness must dispose of the property by public auction.
It could not have bargained with P.M. Jacob and sold the property to M/s. Gumraj Plantations.
Before the High Court, the appellant attacked the sale also on the ground that it was actuated by extraneous considerations.
He alleged that the corporation had succumbed to the pressure of some influential persons for the sale of the property in favour of M/s. Gumraj Plantations.
The appellant made these allegations but did not substantiate it.
He did not give the names of influential persons who had brought pressure on the Corporation.
He did not even state as to how the Corporation officials had shown undue interest with P.M. Jacob or with the other partners of M/s. Gumraj Plantations for sale of the property.
It is not proper to make such light hearted and vague allegations against the statutory authorities.
These allegations, in our opinion, are uncharitable and unfounded.
The only question that arises for consideration is whether on the facts and in the circumstances, the Corporation was not justified in selling the property by private negotiations in favour of M/s. Gumraj Plantations at the instance of P.M. Jacob.
It is needless to state that the Government or public authorities should make all attempts to obtain the best available price while disposing of public properties.
They should not generally enter into private arrangements for the purpose.
These principles may be taken as well established by the following decisions of this Court: (i) K.N. Guruswamy vs The State of Mysore and others; , at 312; (ii) Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi and others, ; (iii) R.D. Shetty vs The International Airport Authority of India and Ors., ; ; (iv) Kasturi Lal Lakshmi Reddy vs State of Jammu and Kashmir and Anr., ; ; (v) Fertilizer Corporation Kamagar Union vs Union of India, ; ; (vi) Ram and Shyam Company vs State of Haryana and Ors.
[1985] Supp.
SCR 541 and (vii) Shri Sachidanand Pandey vs State of W.B. ; 1084 In R.D. Shetty vs The International Airport Authority of India and Ors.
; at 1041 Bhagwati, J. speaking for the Court observed: "Now, obviously where a corporation is an instrumentality or agency of Government, it would, in the exercise of its power or discretion, be subject to the same constitutional or public law limitations as Government.
The rule inhibiting arbitrary action by Government which we have discussed above must apply equally where such corporation is dealing with the public, whether by way of giving jobs or entering into contracts or otherwise, and it cannot act arbitrarily and enter into relationship with any person it likes at its sweetwill, but its action must be in conformity with some principle which meets the test of reason and relevance.
This rule also flows directly from the doctrine of equality embodied in Art 14.
It is now well settled as a result of the decisions of this Court in E.P. Rayappa vs State of Tamil Nadu and Maneka Gandhi vs Union of India that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment.
It requires that State action must not be arbitrary but must be based on some rational and relevant principle which is non discriminatory: it must not be guided by any extraneous or irrelevant considerations, because that would be denial of equality.
The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non arbitrariness is protected by article 14 and it must characterise every State action, whether it be under authority of law or in exercise of executive power without making of law.
The State cannot, therefore, act arbitrarily in entering into relationship, contractual or otherwise with a third party, but its action must conform to some standard or norm which is rational and non discriminatory.
" In Kasturi Lal Lakshmi Reddy vs State of J & K, ; at 1355 Bhagwati, J. again speaking for the Court reiterated what he said earlier to R.D. Shetty case.
The learned Judge went on to state: 1085 "Every action taken by the Government must be in public interest; the Government cannot act arbitrarily and without reason and if it does, its action would be liable to be invalidated.
If the Government awards a contract or leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touch stone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid.
" The learned Judge continued (at p. 1357): "But one basic principle which must guide the Court in arriving at its determination on this question is that there is always a presumption that the Governmental action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest.
This burden is a heavy one and it has to be discharged to the satisfaction of the Court by proper and adequate material.
The Court cannot lightly assume that the action taken by the Government is unreasonable or without public interest because as we said above, there are a large number of policy considerations which must necessarily weigh with the Government in taking action and therefore, the Court would not strike down governmental action as invalid on this ground, unless it is clearly satisfied that the action is unreasonable or not in public interest.
But where it is so satisfied it would be the plainest duty of the Court under the Constitution to invalidate the governmental action.
This is one of the most important functions of the Court and also one of the most essential for preservation of the rule of law.
" In Fertilizer Corporation case ; at 350 this Court speaking through Chandrachud, C.J., observed: "We want to make it clear that we do not doubt the bona fides of the authorities, but as far as possible, sales of public property, when the intention is to get the best price, ought to take place publicly.
The vendors are not necessarily bound to accept the highest or any other offer, but the public at least gets the satisfaction that the Government has 1086 put all its cards on the table.
In the instant case, the officers who were concerned with the sale have inevitably, though unjustifiably attracted the criticism that during the course of negotiations the original bid was reduced without a justifying cause.
We had willy nilly to spend quite some valuable time in satisfying ourselves that the reduction in the price was a necessary and fair consequence of the reduction in the quantity of the goods later offered for sale on March 31, 1980.
One cannot exclude the possibility that a better price might have been realised in a fresh public auction but such possibilities cannot vitiate the sale or justify the allegations of malafides.
" In Shri Sachidanand Pandey vs State of West Bengal, ; at 1133, O. Chinnappa Reddy, J. after considering almost all the decisions of this Court on the subject summarised the propositions in the following terms: "On a consideration of the relevant cases cited at the bar the following propositions may be taken as well established: State owned or public owned property is not to be dealt with at the absolute discretion of the executive.
Certain percepts and principes have to be observed.
Public interest is the paramount consideration.
One of the methods of securing the public interest when it is considered necessary to dispose of a property, is to sell the property by public auction or by inviting tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations where there are compelling reasons necessitating departure from the rule but then the reasons for the departure must be rational and should not be suggestive of discrimination.
Appearance of public justice is as important as doing justice.
Nothing should be done which gives an appearance of bias, jobbery or nepotism." After applying these tests, the learned Judge finally upheld the action of West Bengal Government in not inviting tenders, or in not holding a public auction but negotiating straightway at arms length with Taj Group of Hotels for giving about four acres of land for establishing a five star hotel.
The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting 1087 tenders.
This Court has been insisting upon that rule, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should undoubtedly act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection.
Nothing should be suggestive of discrimination.
Nothing should be done by them which gives an impression of bias, favouritism or nepotism.
Ordinarily these factors would be absent if the matter is brought to public auction or sale by tenders.
That is why the Court repeatedly stated and reiterated that the State owned properties are required to be disposed of publicly.
But that is not the only rule.
As O.Chinnappa Reddy, J. Observed "that though that is the ordinary rule, it is not an invariable rule.
" There may be situations necessitating departure from the rule, but then such instances must be justified by compulsions and not by compromise.
It must be justified by compelling reasons and not by just convenience.
What is the position in the present case.
Here is a case where the Corporation invited tenders for the sale of the property under notification dated January 18, 1983.
The appellant submitted the highest tender in response to the said notification.
He was given all concessions for payment of the tender amount.
But he did not.
He negotiated with the Managing Director of the Corporation for facilities for payment by instalments.
That was also granted to him.
There again he failed.
If the appellant could not act according to his tender, we fail to see why the property should not be offered to the person who was next in order.
The Corporation, in our opinion, did not do anything unfair with P.M.Jacob.
The Corporation got the tender amount raised from Rs.4,16,550 to Rs.4,50,000.
It shows the fairness with which the Corporation dealt with the property.
On a consideration of all the facts and circumstances of the case, we are satisfied that the action of the Corporation in offering the property to P.M.Jacob and selling the same at his request to M/s. Gumraj Plantations was perfectly justified and cannot be found fault with In the result the appeal fails and is dismissed.
In the circumstances, however, we make no order as to costs.
P.S.S. Appeal dismissed.
|
ION: Civil Appeal No. 914 of 1987.
From the Judgment and Order dated 22.8.1984 of the Kerala High Court in O.P. No. 6806 of 1984.
Abdul Khader and E.M.S. Anam for the Appellant.
1081 G. Vishwanath Iyer, N. Sudhakaran for the Respondent.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
A tea estate of 100 acres with some buildings, machinery and equipments was given as security to the Kerala Financial Corporation ("The Corporation") against the loan taken by the appellant.
A part of the loan remained outstanding and the appellant could not clear it.
The Corporation thereupon filed O.A. No. 8/64 before the District Court of Kottayam for recovery of the arrears and obtained decree for an amount of Rs.1,20,000.
In execution of the decree, the said tea estate was brought for sale by court auction.
On November 5, 1969, the auction sale was held.
There was no bidder.
So the Corporation itself had to purchase the property for about Rs.1,65,000.
There was long standing dispute between the workmen of the estate and the previous management relating to payment of their wages.
The Corporation therefore could not take possession of the estate.
An extent of 85 acres out of 100 acres of the estate was in possession of the workmen as per settlement arrived at between the Labour Commissioner and the District Collector.
The workmen used to collect the income therefrom towards their wages.
This arrangement continued for about thirteen years.
On January 7, 1982, the Corporation got possession of the entire estate.
The Corporation wanted to recover its amount.
It was not interested in the property.
It therefore, invited tenders for the sale of the estate.
On March 19, 1982, a tender notification was published in dailies like Malayala Manorama, Mathrubhoomi and Deepika newspapers.
In response to the notification, the daughter in law of the appellant was the only tenderer.
She offered Rs.5,10,505.
The Corporation accepted the tender.
It was subsequently found that the daughter in law was no better than the appellant.
She also could not pay any amount.
On January 18, 1983, the Corporation again invited tenders for the sale of the property.
The notification was published in the said newspapers as it was done earlier.
This time, the Corporation received these tenders: (i) T.M. Hassan Rawther (Appellant before us) for Rs. six lakhs; (ii) P.M. Jacob for Rs.4,15,550 and (iii) K.K. Mathew for Rs.2,07,451.
Since the appellant submitted the highest offer, the Corporation naturally had to accept it.
On March 2, 1983, the acceptance was communicated to the appellant.
He must have thanked his stars for getting back his family property which was so dear to him or which was according to him so valuable.
But there was no such anxiety shown.
He did not pay anthing except the earnest money of Rs.40,000.
1082 The Corporation, however, extended the time for payment again and again.
The Corporation also gave him instalments for payment of the balance price.
All the efforts of the Corporation failed to induce the appellant.
The Corporation wanted to get back its money.
It was not interested in retaining the property.
So it negotiated with P.M. Jacob who had submitted his tender alongwith the appellant in response to the notification dated January 18, 1983.
He had then offered Rs.4,16,550.
His tender was the next best.
After negotiation, he enhanced the offer to Rs. four and a half lakhs.
The Corporation accepted it and decided to sell the property to P.M. Jacob.
The property however, was sold to M/s. Gumraj Plantations at the request of P.M. Jacob.
M/s. Gumraj Plantations is a partnership firm in which P.M. Jacob is one of the partners.
The appellant who could not purchase the said property by any means filed suit O.S. No. 229/84 before the Munsif Court Thidupuzha to restrain the Corporation from selling the property.
He could not get relief in the suit since by then the sale deed was executed in favour of M/s. Gumraj Plantations.
Subsequently, he moved the High Court of Kerala complaining that the Corporation while selling the property for Rs. four and a half lakhs to M/s. Gumraj Plantations, had deviated from the normal practice of inviting tenders from the public.
He contended that the Corporation being a public authority was bound to act reasonably and fairly and it ought not to have arbitrarily selected the purchaser.
The High Court found no substance in those submissions.
The High Court observed: "The submission made by the petitioner 's counsel is that the decision to sell the property by private negotiations is arbitrary and is therefore liable to be interfered with by this court.
This is clearly a case where in execution proceedings the decreeholder has purchased the property and thereafter the property was sold in public auction to the petitioner, who purchased it for Rs. six lakhs but failed to pay the sale amount in spite of the fact that this court and afterwards the corporation had shown great indulgence towards the petitioner.
This is not at all a fit case for interference under article 226 of the Constitution." Being aggrieved by the judgment of the High Court, the appellant has preferred the present appeal.
On May 18, 1985, this Court 1083 while entertaining the appeal issued notice limited to the question whether the sale of the property should be made by general auction.
This Court further directed that in any event, the appellant will not be allowed to participate in the auction.
Very interesting turn of events.
The appellant who miserably failed to secure the property for himself is now interested in securing the best price for the Corporation.
He says that this is a public interest litigation.
His case is that the Corporation in all fairness must dispose of the property by public auction.
It could not have bargained with P.M. Jacob and sold the property to M/s. Gumraj Plantations.
Before the High Court, the appellant attacked the sale also on the ground that it was actuated by extraneous considerations.
He alleged that the corporation had succumbed to the pressure of some influential persons for the sale of the property in favour of M/s. Gumraj Plantations.
The appellant made these allegations but did not substantiate it.
He did not give the names of influential persons who had brought pressure on the Corporation.
He did not even state as to how the Corporation officials had shown undue interest with P.M. Jacob or with the other partners of M/s. Gumraj Plantations for sale of the property.
It is not proper to make such light hearted and vague allegations against the statutory authorities.
These allegations, in our opinion, are uncharitable and unfounded.
The only question that arises for consideration is whether on the facts and in the circumstances, the Corporation was not justified in selling the property by private negotiations in favour of M/s. Gumraj Plantations at the instance of P.M. Jacob.
It is needless to state that the Government or public authorities should make all attempts to obtain the best available price while disposing of public properties.
They should not generally enter into private arrangements for the purpose.
These principles may be taken as well established by the following decisions of this Court: (i) K.N. Guruswamy vs The State of Mysore and others; , at 312; (ii) Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi and others, ; (iii) R.D. Shetty vs The International Airport Authority of India and Ors., ; ; (iv) Kasturi Lal Lakshmi Reddy vs State of Jammu and Kashmir and Anr., ; ; (v) Fertilizer Corporation Kamagar Union vs Union of India, ; ; (vi) Ram and Shyam Company vs State of Haryana and Ors.
[1985] Supp.
SCR 541 and (vii) Shri Sachidanand Pandey vs State of W.B. ; 1084 In R.D. Shetty vs The International Airport Authority of India and Ors.
; at 1041 Bhagwati, J. speaking for the Court observed: "Now, obviously where a corporation is an instrumentality or agency of Government, it would, in the exercise of its power or discretion, be subject to the same constitutional or public law limitations as Government.
The rule inhibiting arbitrary action by Government which we have discussed above must apply equally where such corporation is dealing with the public, whether by way of giving jobs or entering into contracts or otherwise, and it cannot act arbitrarily and enter into relationship with any person it likes at its sweetwill, but its action must be in conformity with some principle which meets the test of reason and relevance.
This rule also flows directly from the doctrine of equality embodied in Art 14.
It is now well settled as a result of the decisions of this Court in E.P. Rayappa vs State of Tamil Nadu and Maneka Gandhi vs Union of India that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment.
It requires that State action must not be arbitrary but must be based on some rational and relevant principle which is non discriminatory: it must not be guided by any extraneous or irrelevant considerations, because that would be denial of equality.
The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non arbitrariness is protected by article 14 and it must characterise every State action, whether it be under authority of law or in exercise of executive power without making of law.
The State cannot, therefore, act arbitrarily in entering into relationship, contractual or otherwise with a third party, but its action must conform to some standard or norm which is rational and non discriminatory.
" In Kasturi Lal Lakshmi Reddy vs State of J & K, ; at 1355 Bhagwati, J. again speaking for the Court reiterated what he said earlier to R.D. Shetty case.
The learned Judge went on to state: 1085 "Every action taken by the Government must be in public interest; the Government cannot act arbitrarily and without reason and if it does, its action would be liable to be invalidated.
If the Government awards a contract or leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touch stone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid.
" The learned Judge continued (at p. 1357): "But one basic principle which must guide the Court in arriving at its determination on this question is that there is always a presumption that the Governmental action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest.
This burden is a heavy one and it has to be discharged to the satisfaction of the Court by proper and adequate material.
The Court cannot lightly assume that the action taken by the Government is unreasonable or without public interest because as we said above, there are a large number of policy considerations which must necessarily weigh with the Government in taking action and therefore, the Court would not strike down governmental action as invalid on this ground, unless it is clearly satisfied that the action is unreasonable or not in public interest.
But where it is so satisfied it would be the plainest duty of the Court under the Constitution to invalidate the governmental action.
This is one of the most important functions of the Court and also one of the most essential for preservation of the rule of law.
" In Fertilizer Corporation case ; at 350 this Court speaking through Chandrachud, C.J., observed: "We want to make it clear that we do not doubt the bona fides of the authorities, but as far as possible, sales of public property, when the intention is to get the best price, ought to take place publicly.
The vendors are not necessarily bound to accept the highest or any other offer, but the public at least gets the satisfaction that the Government has 1086 put all its cards on the table.
In the instant case, the officers who were concerned with the sale have inevitably, though unjustifiably attracted the criticism that during the course of negotiations the original bid was reduced without a justifying cause.
We had willy nilly to spend quite some valuable time in satisfying ourselves that the reduction in the price was a necessary and fair consequence of the reduction in the quantity of the goods later offered for sale on March 31, 1980.
One cannot exclude the possibility that a better price might have been realised in a fresh public auction but such possibilities cannot vitiate the sale or justify the allegations of malafides.
" In Shri Sachidanand Pandey vs State of West Bengal, ; at 1133, O. Chinnappa Reddy, J. after considering almost all the decisions of this Court on the subject summarised the propositions in the following terms: "On a consideration of the relevant cases cited at the bar the following propositions may be taken as well established: State owned or public owned property is not to be dealt with at the absolute discretion of the executive.
Certain percepts and principes have to be observed.
Public interest is the paramount consideration.
One of the methods of securing the public interest when it is considered necessary to dispose of a property, is to sell the property by public auction or by inviting tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations where there are compelling reasons necessitating departure from the rule but then the reasons for the departure must be rational and should not be suggestive of discrimination.
Appearance of public justice is as important as doing justice.
Nothing should be done which gives an appearance of bias, jobbery or nepotism." After applying these tests, the learned Judge finally upheld the action of West Bengal Government in not inviting tenders, or in not holding a public auction but negotiating straightway at arms length with Taj Group of Hotels for giving about four acres of land for establishing a five star hotel.
The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting 1087 tenders.
This Court has been insisting upon that rule, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should undoubtedly act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection.
Nothing should be suggestive of discrimination.
Nothing should be done by them which gives an impression of bias, favouritism or nepotism.
Ordinarily these factors would be absent if the matter is brought to public auction or sale by tenders.
That is why the Court repeatedly stated and reiterated that the State owned properties are required to be disposed of publicly.
But that is not the only rule.
As O.Chinnappa Reddy, J. Observed "that though that is the ordinary rule, it is not an invariable rule.
" There may be situations necessitating departure from the rule, but then such instances must be justified by compulsions and not by compromise.
It must be justified by compelling reasons and not by just convenience.
What is the position in the present case.
Here is a case where the Corporation invited tenders for the sale of the property under notification dated January 18, 1983.
The appellant submitted the highest tender in response to the said notification.
He was given all concessions for payment of the tender amount.
But he did not.
He negotiated with the Managing Director of the Corporation for facilities for payment by instalments.
That was also granted to him.
There again he failed.
If the appellant could not act according to his tender, we fail to see why the property should not be offered to the person who was next in order.
The Corporation, in our opinion, did not do anything unfair with P.M.Jacob.
The Corporation got the tender amount raised from Rs.4,16,550 to Rs.4,50,000.
It shows the fairness with which the Corporation dealt with the property.
On a consideration of all the facts and circumstances of the case, we are satisfied that the action of the Corporation in offering the property to P.M.Jacob and selling the same at his request to M/s. Gumraj Plantations was perfectly justified and cannot be found fault with In the result the appeal fails and is dismissed.
In the circumstances, however, we make no order as to costs.
P.S.S. Appeal dismissed.
|
% The respondent, a State Government Corporation obtained decree for certain amount against the appellant and in execution proceedings a tea estate was brought for sale by court auction in 1969, but in the absence of a bidder the respondent itself had to purchase it at a higher price.
The respondent, however, could take possession of the estate only in 1982.
It then invited tenders for the sale of the estate.
The appellant offered Rs.6,00,000.
The next best offer was for Rs.4,15,550 and the third for Rs.2,07,451.
The highest offer was accepted, but the appellant could not pay the amount except the earnest money, even after repeated extension of time and offer to receive the balance in instalments.
The respondent then negotiated with the next highest bidder, who enhanced the offer to Rs.4,50,000 which was accepted by the respondent.
The property, however, was sold to a partnership firm in which the said bidder was a partner.
The appellant thereupon moved the High Court complaining that the respondent in selling the property to the firm had deviated from the normal practice of inviting the tenders from the public and that the Corporation being a public authority was bound to act reasonably and fairly and it ought not be have arbitrarily selected the purchaser.
The High Court declined to interfere.
Dismissing the appeal, ^ HELD: The action of the respondent in offering the property to the person next in order by private negotiations and selling the same at 1080 his request to the partnership firm was perfectly justified.
[1087G] The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting tenders, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection and should not be suggestive of discrimination, bias, favouritism or nepotism.
Ordinarily these facts would be absent if the matter is brought to public auction or sale by tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations necessitating departure from the rule, but then such instances must be justified by compelling reasons and not by just convenience.
[1086H; 1087A C] In the instant case, the respondent dealt with the property in all fairness.
It invited tenders for the sale of the property under the notification.
The appellant submitted the highest tender in response to the said notification.
He was granted all concessions and facilities for payment by instalments but he failed.
If the appellant could not act according to his tender, there was no reason why the property should not be offered to the person who was next in order.
The respondent, therefore, did not do anything unfair with the second bidder after it had got the tender amount raised substantially.
[1087D F] K.N. Guruswamy vs The State of Mysore & Ors., ; at 312; Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi & Ors., ; R.D. Shetty vs The International Airport Authority of India State of Jammu and Kashmir & Anr., ; ; Fertilizer Corporation Kamagar Union vs Union of India, ; ; Ram and Shyam Company vs State of Haryana & Ors., and Shri Sachidanand Pandey vs State of W. B. ; , applied.
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% The respondent, a State Government Corporation obtained decree for certain amount against the appellant and in execution proceedings a tea estate was brought for sale by court auction in 1969, but in the absence of a bidder the respondent itself had to purchase it at a higher price.
The respondent, however, could take possession of the estate only in 1982.
It then invited tenders for the sale of the estate.
The appellant offered Rs.6,00,000.
The next best offer was for Rs.4,15,550 and the third for Rs.2,07,451.
The highest offer was accepted, but the appellant could not pay the amount except the earnest money, even after repeated extension of time and offer to receive the balance in instalments.
The respondent then negotiated with the next highest bidder, who enhanced the offer to Rs.4,50,000 which was accepted by the respondent.
The property, however, was sold to a partnership firm in which the said bidder was a partner.
The appellant thereupon moved the High Court complaining that the respondent in selling the property to the firm had deviated from the normal practice of inviting the tenders from the public and that the Corporation being a public authority was bound to act reasonably and fairly and it ought not be have arbitrarily selected the purchaser.
The High Court declined to interfere.
Dismissing the appeal, ^ HELD: The action of the respondent in offering the property to the person next in order by private negotiations and selling the same at 1080 his request to the partnership firm was perfectly justified.
[1087G] The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting tenders, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection and should not be suggestive of discrimination, bias, favouritism or nepotism.
Ordinarily these facts would be absent if the matter is brought to public auction or sale by tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations necessitating departure from the rule, but then such instances must be justified by compelling reasons and not by just convenience.
[1086H; 1087A C] In the instant case, the respondent dealt with the property in all fairness.
It invited tenders for the sale of the property under the notification.
The appellant submitted the highest tender in response to the said notification.
He was granted all concessions and facilities for payment by instalments but he failed.
If the appellant could not act according to his tender, there was no reason why the property should not be offered to the person who was next in order.
The respondent, therefore, did not do anything unfair with the second bidder after it had got the tender amount raised substantially.
[1087D F] K.N. Guruswamy vs The State of Mysore & Ors., ; at 312; Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi & Ors., ; R.D. Shetty vs The International Airport Authority of India State of Jammu and Kashmir & Anr., ; ; Fertilizer Corporation Kamagar Union vs Union of India, ; ; Ram and Shyam Company vs State of Haryana & Ors., and Shri Sachidanand Pandey vs State of W. B. ; , applied.
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Criminal Appeal No. 75 of 1979.
From the Judgment and Order dated 6.2.
1976 of the Bombay High Court in Criminal Appeal No. 636 of 1973.
Raghunath Singh (Amicus Curiae) for the Appellant.
A.S. Bhasme and A.M. Khanwilkar for the Respondents.
The Judgment of the Court was delivered by KULDIP SINGH, J.
The appellant, Shivaji Patil was ac quitted by the Additional Sessions Judge, Kolhapur of the charge under Section 302, Indian Penal Code for committing murder of one Tulashiram Sutar, but on appeal the High Court by its judgment dated February 6, 1976 set aside the order of acquittal and convicted him under section 302 of the Indian Penal Code and sentenced him to imprisonment for life.
The house of deceased Tulashiram in Village Rashivade adjoins the temple of Shri Ambabai and in front of the temple, there is open place.
The deceased along with his wife Parvatibai, two children and parents was living in the house.
Cousin brothers of the deceased and their mother were living in the adjoining house.
Vyanku Sutar belonging to the brother hood of deceased was also living in the same village.
The deceased had illic it relation with Vyanku 's wife Akkatai.
Parvatibai claimed to have caught them in the sex act in sugarcane fields.
The accused Shivaji and Vyanku were friends.
On January 30,1972 at about 7 or 7.30 P.M. Tulashiram returned to the house after performing his role described as "Sasankathi" in the festival of "Mahi Poornima".
In the house Parvatibai, her mother in law Tanubai, her husband 's sister Malutai, 402 and her husband 's cousin brother 's wife Shalubai, were present.
The male members, namely, deceased 's father Pandu rang Sutar, his brother Soundappa and servant named Shama had gone to another village called Kote.
Tulashiram asked his mother Tanubai to prepare tea and thereafter he went out and sat on the foot steps of the temple at a distance of about 15 to 20 feet from the house.
What followed can best be reproduced in words of Parvat ibai as P.W. 3 at the trial: "After the tea was ready, I started going out of the house to call for my husband, when I went to the front door of my house, I saw the accused Shivaji hitting my husband with a stick on his head and running away.
I saw him running in the direction of the by lane.
I saw my husband failing down from the steps and lying on the ground near the "Deepmal".
I saw him rubbing his feet on the ground in agony and blood was coming from the injury on his head.
I could see this in the light of the tube light.
I went near my husband and started calling him.
He could not speak.
Hence, I raise a hue and cry and my mother in law and sister in law Malubai and Shalibai and Vishnu Patil came there.
I did not see anybody else nearby then as I was busy attending to my husband.
My husband had become unconscious due to the head injuries and froth had come out of his mouth.
Myself, Vishnu Patil and sister in law bodily lifted my husband and took him to the house . .
Somebody went and brought a local doctor named Jayant Patil.
The doctor came there, examined and treated my husband and advised him to be removed to his dispen sary.
My husband was accordingly taken there, but I did not go, as my small children were crying and I was prevented from going there.
My children had frightened.
In the morning next day, I came to know that my husband was removed to C.P.R. Hospital at Kolhapur.
Hence in the morning, myself my mother in law and others went to Kolhapur by Yelavade Kolhapur Bus reaching there at about 8.30 A.M.
When we reached the C.P.R. Hospital my brother in law came there crying saying that my husband had overnight succumbed to his injuries.
Hence myself and my mother in law started crying and shouting.
Hence some villagers brought a taxi, we were 403 asked to sit in the taxi and we were taken to Rashivade even without showing the dead body to us.
We reached Rashivade at about 11 A.M.
After reaching home, we were crying in agony and our house became full with females and I did not notice who others had come there." Vishnu Patil deposed that he was returning from his sugarcane crushing site and while passing by the temple he found deceased Tulashiram lying injured in front of the steps of the temple and his wife was crying nearby.
At a distance of about 5 or 6 feet from there, he saw Nana Patil and asked him what was the matter.
Nana Patil replied that he did not know anything.
Vishnu Patil asked Nana Patil to call the doctor.
Jaywant Patil a private practitioner reached the house of the deceased and on his advice the deceased was removed to the dispensary.
When for two hours, Tulashiram did not regain consciousness, Dr.
Patil at about 11/12 P.M. took him to the hospital at Kolhapur in his own car.
Patil at the trial stated that Tanubai said to him and also gave in writing (exhibit 26) to the effect that she had no complaint against anybody.
The prosecution produced P.W. 3 Parvatibai, P.W. 9 Krishan Wadkar, P.W. 10 Shankar Patil, P.W. 11 Krishna Sadashiv Patil and P.W. 12 Nanu Patil, all eye witnesses.
Except P.W. 3 Parvatibai all other eye witnesses were de clared hostile.
The prosecution case, thus, hinges on the sole testimony of Parvatibai.
Parvatibai has deposed that she saw on the evening of January 30, 1972, Shivaji Patil hitting her husband with a stick.
Admittedly her mother in law, her two sisters in law and Shivaji Patil came present on the spot immediately thereafter.
Parvatibai did not disclose the name of the assailant to them or to anybody else.
Rather Dr. Patil who came to the house little later was told by Tanubai that the family did not suspect anybody.
Vishnu Patil stated at the trial that nobody informed him about the accused or any other person who gave injuries to the deceased.
The Police Patil in his report dated 31.1.1972 stated that at 10.30 A.M. on that day he went to the house of deceased.
The father of the deceased, an uncle and a distant relation were present in the house.
The Police Patil asked them about the incident.
They replied that they had no knowledge about the incident as they were not present in the house at the time of occurrence.
The Police Patil further says that while he was present in the house a taxi came from Kolhapur and the 404 mother and wife of Tulashiram deceased got down from the taxi.
The Police Patil questioned the ladies as to how Tulashiram was injured.
The ladies were not prepared to talk and no information regarding the alleged occurrence was given to him.
He made further enquiries from other people but nobody gave him any information regarding the assail ants.
On the basis of the Police Patil 's report a case was registered at police station Rachanagari wherein it was mentioned that the cause of death of Tulashiram was not known.
Head constable B.S. Patharvat sent a complaint on 1st of February, 1972 wherein he stated that he came to know about the incident on the morning of 31st of January, 1972 and he went to the house of Tulashiram at about 10/11 A.M. and asked the in mates about the occurrence but nobody gave him any information.
He again went to the house of Tulashiram deceased on 1st of February, 1972 and recorded the statement of Parvatibai.
She stated that when she came to the front door she saw Shivaji Patil running with a stick from near about her husband.
She said that the relations between her husband and Vyanku were not good and Shivaji Patil and Nana Patil were friends of Vyanku Sutar.
She further stated that Vyanku Sutar, Shivaji Patil and Nana Patil made company and assaulted her husband.
On the basis of the statement of Parvatibai the head constable sent the complaint for regis tering the case against Vyanku Sutar, Shivaji Patil and Nana Patil under sections 302/34, IPC, though ultimately charge was filed by police only against Shivaji Patil.
The question for consideration is as to why was Parvati bai mum from 30.1.1972 to 1.2.
1972? The High Court felt satisfied by saying that she was in a dazed mood.
We do not agree with the High Court.
Parvatibai 's conduct was highly unnatural.
A wife, who has seen an assailant giving fatal blows with a stick to her husband, would name the assailant to all present and to the police at an earliest opportunity.
There is nothing in the evidence to justify this highly unnatural and improbable conduct of Parvatibai.
Even on 1.2.
1972 the statement of Parvatibai recorded by police head constable is entirely different than what she stated at the trial.
The prosecution has, thus, not been able to prove its case against the appellant beyond reasonable doubt.
We, therefore, give benefit of doubt to the appellant and accept the appeal.
The judgment of the High Court is set aside and the appellant is acquitted of the charge under section 302, IPC.
The appellant is on bail and as such his bail bond is cancelled.
N.P.V. Appeal allowed.
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The appellant was charged under Section 302 I.P.C. for committing the murder of the deceased.
At the trial, prose cution produced P.W.3, wife of the deceased, and P.Ws.10, 11 and 12, all eye witnesses.
Except for P.W.3, all other eye witnesses were declared hostile.
Thus, the prosecution depended on the sole testimony of P.W.3. P.W.3 deposed that she saw the appellant hitting her husband with a stick.
But admittedly, she did not disclose the name of the appellant to anybody including the Police.
The doctor, who came to the house of the deceased little later, examined and treated the deceased and removed him to the hospital deposed that he was told by the mother of the deceased that the family did not suspect anybody.
Another witness who was passing by the scene of occurrence also testified that nobody informed him about the appellant or any other person, who injured the deceased.
The Additional Sessions Judge acquitted the appellant.
But, on appeal, the High Court, set aside the acquittal order, and convicted and sentenced the appellant to impris onment for life.
Hence, the appeal by the accused.
Allowing the appeal, this Court, HELD: The conduct of the deceased 's wife was highly unnatural.
A wife, who has seen an assailant giving fatal blows with a stick to her husband, would name the assailant to all present and to the police at an earliest opportunity.
There is nothing in the evidence to justify this highly unnatural and improbable conduct of the deceased 's wife.
Even her statement recorded by police head constable, is entirely different than what she stated at the trial.
The prosecution has, thus, not 401 been able to prove its case against the appellant beyond reasonable doubt.
[404F G] Therefore, the appellant is given benefit of doubt, the judgment of the High Court is set aside, and the appellant is acquitted of the charge under section 302, IPC.
[404H]
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Criminal Appeal No. 75 of 1979.
From the Judgment and Order dated 6.2.
1976 of the Bombay High Court in Criminal Appeal No. 636 of 1973.
Raghunath Singh (Amicus Curiae) for the Appellant.
A.S. Bhasme and A.M. Khanwilkar for the Respondents.
The Judgment of the Court was delivered by KULDIP SINGH, J.
The appellant, Shivaji Patil was ac quitted by the Additional Sessions Judge, Kolhapur of the charge under Section 302, Indian Penal Code for committing murder of one Tulashiram Sutar, but on appeal the High Court by its judgment dated February 6, 1976 set aside the order of acquittal and convicted him under section 302 of the Indian Penal Code and sentenced him to imprisonment for life.
The house of deceased Tulashiram in Village Rashivade adjoins the temple of Shri Ambabai and in front of the temple, there is open place.
The deceased along with his wife Parvatibai, two children and parents was living in the house.
Cousin brothers of the deceased and their mother were living in the adjoining house.
Vyanku Sutar belonging to the brother hood of deceased was also living in the same village.
The deceased had illic it relation with Vyanku 's wife Akkatai.
Parvatibai claimed to have caught them in the sex act in sugarcane fields.
The accused Shivaji and Vyanku were friends.
On January 30,1972 at about 7 or 7.30 P.M. Tulashiram returned to the house after performing his role described as "Sasankathi" in the festival of "Mahi Poornima".
In the house Parvatibai, her mother in law Tanubai, her husband 's sister Malutai, 402 and her husband 's cousin brother 's wife Shalubai, were present.
The male members, namely, deceased 's father Pandu rang Sutar, his brother Soundappa and servant named Shama had gone to another village called Kote.
Tulashiram asked his mother Tanubai to prepare tea and thereafter he went out and sat on the foot steps of the temple at a distance of about 15 to 20 feet from the house.
What followed can best be reproduced in words of Parvat ibai as P.W. 3 at the trial: "After the tea was ready, I started going out of the house to call for my husband, when I went to the front door of my house, I saw the accused Shivaji hitting my husband with a stick on his head and running away.
I saw him running in the direction of the by lane.
I saw my husband failing down from the steps and lying on the ground near the "Deepmal".
I saw him rubbing his feet on the ground in agony and blood was coming from the injury on his head.
I could see this in the light of the tube light.
I went near my husband and started calling him.
He could not speak.
Hence, I raise a hue and cry and my mother in law and sister in law Malubai and Shalibai and Vishnu Patil came there.
I did not see anybody else nearby then as I was busy attending to my husband.
My husband had become unconscious due to the head injuries and froth had come out of his mouth.
Myself, Vishnu Patil and sister in law bodily lifted my husband and took him to the house . .
Somebody went and brought a local doctor named Jayant Patil.
The doctor came there, examined and treated my husband and advised him to be removed to his dispen sary.
My husband was accordingly taken there, but I did not go, as my small children were crying and I was prevented from going there.
My children had frightened.
In the morning next day, I came to know that my husband was removed to C.P.R. Hospital at Kolhapur.
Hence in the morning, myself my mother in law and others went to Kolhapur by Yelavade Kolhapur Bus reaching there at about 8.30 A.M.
When we reached the C.P.R. Hospital my brother in law came there crying saying that my husband had overnight succumbed to his injuries.
Hence myself and my mother in law started crying and shouting.
Hence some villagers brought a taxi, we were 403 asked to sit in the taxi and we were taken to Rashivade even without showing the dead body to us.
We reached Rashivade at about 11 A.M.
After reaching home, we were crying in agony and our house became full with females and I did not notice who others had come there." Vishnu Patil deposed that he was returning from his sugarcane crushing site and while passing by the temple he found deceased Tulashiram lying injured in front of the steps of the temple and his wife was crying nearby.
At a distance of about 5 or 6 feet from there, he saw Nana Patil and asked him what was the matter.
Nana Patil replied that he did not know anything.
Vishnu Patil asked Nana Patil to call the doctor.
Jaywant Patil a private practitioner reached the house of the deceased and on his advice the deceased was removed to the dispensary.
When for two hours, Tulashiram did not regain consciousness, Dr.
Patil at about 11/12 P.M. took him to the hospital at Kolhapur in his own car.
Patil at the trial stated that Tanubai said to him and also gave in writing (exhibit 26) to the effect that she had no complaint against anybody.
The prosecution produced P.W. 3 Parvatibai, P.W. 9 Krishan Wadkar, P.W. 10 Shankar Patil, P.W. 11 Krishna Sadashiv Patil and P.W. 12 Nanu Patil, all eye witnesses.
Except P.W. 3 Parvatibai all other eye witnesses were de clared hostile.
The prosecution case, thus, hinges on the sole testimony of Parvatibai.
Parvatibai has deposed that she saw on the evening of January 30, 1972, Shivaji Patil hitting her husband with a stick.
Admittedly her mother in law, her two sisters in law and Shivaji Patil came present on the spot immediately thereafter.
Parvatibai did not disclose the name of the assailant to them or to anybody else.
Rather Dr. Patil who came to the house little later was told by Tanubai that the family did not suspect anybody.
Vishnu Patil stated at the trial that nobody informed him about the accused or any other person who gave injuries to the deceased.
The Police Patil in his report dated 31.1.1972 stated that at 10.30 A.M. on that day he went to the house of deceased.
The father of the deceased, an uncle and a distant relation were present in the house.
The Police Patil asked them about the incident.
They replied that they had no knowledge about the incident as they were not present in the house at the time of occurrence.
The Police Patil further says that while he was present in the house a taxi came from Kolhapur and the 404 mother and wife of Tulashiram deceased got down from the taxi.
The Police Patil questioned the ladies as to how Tulashiram was injured.
The ladies were not prepared to talk and no information regarding the alleged occurrence was given to him.
He made further enquiries from other people but nobody gave him any information regarding the assail ants.
On the basis of the Police Patil 's report a case was registered at police station Rachanagari wherein it was mentioned that the cause of death of Tulashiram was not known.
Head constable B.S. Patharvat sent a complaint on 1st of February, 1972 wherein he stated that he came to know about the incident on the morning of 31st of January, 1972 and he went to the house of Tulashiram at about 10/11 A.M. and asked the in mates about the occurrence but nobody gave him any information.
He again went to the house of Tulashiram deceased on 1st of February, 1972 and recorded the statement of Parvatibai.
She stated that when she came to the front door she saw Shivaji Patil running with a stick from near about her husband.
She said that the relations between her husband and Vyanku were not good and Shivaji Patil and Nana Patil were friends of Vyanku Sutar.
She further stated that Vyanku Sutar, Shivaji Patil and Nana Patil made company and assaulted her husband.
On the basis of the statement of Parvatibai the head constable sent the complaint for regis tering the case against Vyanku Sutar, Shivaji Patil and Nana Patil under sections 302/34, IPC, though ultimately charge was filed by police only against Shivaji Patil.
The question for consideration is as to why was Parvati bai mum from 30.1.1972 to 1.2.
1972? The High Court felt satisfied by saying that she was in a dazed mood.
We do not agree with the High Court.
Parvatibai 's conduct was highly unnatural.
A wife, who has seen an assailant giving fatal blows with a stick to her husband, would name the assailant to all present and to the police at an earliest opportunity.
There is nothing in the evidence to justify this highly unnatural and improbable conduct of Parvatibai.
Even on 1.2.
1972 the statement of Parvatibai recorded by police head constable is entirely different than what she stated at the trial.
The prosecution has, thus, not been able to prove its case against the appellant beyond reasonable doubt.
We, therefore, give benefit of doubt to the appellant and accept the appeal.
The judgment of the High Court is set aside and the appellant is acquitted of the charge under section 302, IPC.
The appellant is on bail and as such his bail bond is cancelled.
N.P.V. Appeal allowed.
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Criminal Appeal No. 75 of 1979.
From the Judgment and Order dated 6.2.
1976 of the Bombay High Court in Criminal Appeal No. 636 of 1973.
Raghunath Singh (Amicus Curiae) for the Appellant.
A.S. Bhasme and A.M. Khanwilkar for the Respondents.
The Judgment of the Court was delivered by KULDIP SINGH, J.
The appellant, Shivaji Patil was ac quitted by the Additional Sessions Judge, Kolhapur of the charge under Section 302, Indian Penal Code for committing murder of one Tulashiram Sutar, but on appeal the High Court by its judgment dated February 6, 1976 set aside the order of acquittal and convicted him under section 302 of the Indian Penal Code and sentenced him to imprisonment for life.
The house of deceased Tulashiram in Village Rashivade adjoins the temple of Shri Ambabai and in front of the temple, there is open place.
The deceased along with his wife Parvatibai, two children and parents was living in the house.
Cousin brothers of the deceased and their mother were living in the adjoining house.
Vyanku Sutar belonging to the brother hood of deceased was also living in the same village.
The deceased had illic it relation with Vyanku 's wife Akkatai.
Parvatibai claimed to have caught them in the sex act in sugarcane fields.
The accused Shivaji and Vyanku were friends.
On January 30,1972 at about 7 or 7.30 P.M. Tulashiram returned to the house after performing his role described as "Sasankathi" in the festival of "Mahi Poornima".
In the house Parvatibai, her mother in law Tanubai, her husband 's sister Malutai, 402 and her husband 's cousin brother 's wife Shalubai, were present.
The male members, namely, deceased 's father Pandu rang Sutar, his brother Soundappa and servant named Shama had gone to another village called Kote.
Tulashiram asked his mother Tanubai to prepare tea and thereafter he went out and sat on the foot steps of the temple at a distance of about 15 to 20 feet from the house.
What followed can best be reproduced in words of Parvat ibai as P.W. 3 at the trial: "After the tea was ready, I started going out of the house to call for my husband, when I went to the front door of my house, I saw the accused Shivaji hitting my husband with a stick on his head and running away.
I saw him running in the direction of the by lane.
I saw my husband failing down from the steps and lying on the ground near the "Deepmal".
I saw him rubbing his feet on the ground in agony and blood was coming from the injury on his head.
I could see this in the light of the tube light.
I went near my husband and started calling him.
He could not speak.
Hence, I raise a hue and cry and my mother in law and sister in law Malubai and Shalibai and Vishnu Patil came there.
I did not see anybody else nearby then as I was busy attending to my husband.
My husband had become unconscious due to the head injuries and froth had come out of his mouth.
Myself, Vishnu Patil and sister in law bodily lifted my husband and took him to the house . .
Somebody went and brought a local doctor named Jayant Patil.
The doctor came there, examined and treated my husband and advised him to be removed to his dispen sary.
My husband was accordingly taken there, but I did not go, as my small children were crying and I was prevented from going there.
My children had frightened.
In the morning next day, I came to know that my husband was removed to C.P.R. Hospital at Kolhapur.
Hence in the morning, myself my mother in law and others went to Kolhapur by Yelavade Kolhapur Bus reaching there at about 8.30 A.M.
When we reached the C.P.R. Hospital my brother in law came there crying saying that my husband had overnight succumbed to his injuries.
Hence myself and my mother in law started crying and shouting.
Hence some villagers brought a taxi, we were 403 asked to sit in the taxi and we were taken to Rashivade even without showing the dead body to us.
We reached Rashivade at about 11 A.M.
After reaching home, we were crying in agony and our house became full with females and I did not notice who others had come there." Vishnu Patil deposed that he was returning from his sugarcane crushing site and while passing by the temple he found deceased Tulashiram lying injured in front of the steps of the temple and his wife was crying nearby.
At a distance of about 5 or 6 feet from there, he saw Nana Patil and asked him what was the matter.
Nana Patil replied that he did not know anything.
Vishnu Patil asked Nana Patil to call the doctor.
Jaywant Patil a private practitioner reached the house of the deceased and on his advice the deceased was removed to the dispensary.
When for two hours, Tulashiram did not regain consciousness, Dr.
Patil at about 11/12 P.M. took him to the hospital at Kolhapur in his own car.
Patil at the trial stated that Tanubai said to him and also gave in writing (exhibit 26) to the effect that she had no complaint against anybody.
The prosecution produced P.W. 3 Parvatibai, P.W. 9 Krishan Wadkar, P.W. 10 Shankar Patil, P.W. 11 Krishna Sadashiv Patil and P.W. 12 Nanu Patil, all eye witnesses.
Except P.W. 3 Parvatibai all other eye witnesses were de clared hostile.
The prosecution case, thus, hinges on the sole testimony of Parvatibai.
Parvatibai has deposed that she saw on the evening of January 30, 1972, Shivaji Patil hitting her husband with a stick.
Admittedly her mother in law, her two sisters in law and Shivaji Patil came present on the spot immediately thereafter.
Parvatibai did not disclose the name of the assailant to them or to anybody else.
Rather Dr. Patil who came to the house little later was told by Tanubai that the family did not suspect anybody.
Vishnu Patil stated at the trial that nobody informed him about the accused or any other person who gave injuries to the deceased.
The Police Patil in his report dated 31.1.1972 stated that at 10.30 A.M. on that day he went to the house of deceased.
The father of the deceased, an uncle and a distant relation were present in the house.
The Police Patil asked them about the incident.
They replied that they had no knowledge about the incident as they were not present in the house at the time of occurrence.
The Police Patil further says that while he was present in the house a taxi came from Kolhapur and the 404 mother and wife of Tulashiram deceased got down from the taxi.
The Police Patil questioned the ladies as to how Tulashiram was injured.
The ladies were not prepared to talk and no information regarding the alleged occurrence was given to him.
He made further enquiries from other people but nobody gave him any information regarding the assail ants.
On the basis of the Police Patil 's report a case was registered at police station Rachanagari wherein it was mentioned that the cause of death of Tulashiram was not known.
Head constable B.S. Patharvat sent a complaint on 1st of February, 1972 wherein he stated that he came to know about the incident on the morning of 31st of January, 1972 and he went to the house of Tulashiram at about 10/11 A.M. and asked the in mates about the occurrence but nobody gave him any information.
He again went to the house of Tulashiram deceased on 1st of February, 1972 and recorded the statement of Parvatibai.
She stated that when she came to the front door she saw Shivaji Patil running with a stick from near about her husband.
She said that the relations between her husband and Vyanku were not good and Shivaji Patil and Nana Patil were friends of Vyanku Sutar.
She further stated that Vyanku Sutar, Shivaji Patil and Nana Patil made company and assaulted her husband.
On the basis of the statement of Parvatibai the head constable sent the complaint for regis tering the case against Vyanku Sutar, Shivaji Patil and Nana Patil under sections 302/34, IPC, though ultimately charge was filed by police only against Shivaji Patil.
The question for consideration is as to why was Parvati bai mum from 30.1.1972 to 1.2.
1972? The High Court felt satisfied by saying that she was in a dazed mood.
We do not agree with the High Court.
Parvatibai 's conduct was highly unnatural.
A wife, who has seen an assailant giving fatal blows with a stick to her husband, would name the assailant to all present and to the police at an earliest opportunity.
There is nothing in the evidence to justify this highly unnatural and improbable conduct of Parvatibai.
Even on 1.2.
1972 the statement of Parvatibai recorded by police head constable is entirely different than what she stated at the trial.
The prosecution has, thus, not been able to prove its case against the appellant beyond reasonable doubt.
We, therefore, give benefit of doubt to the appellant and accept the appeal.
The judgment of the High Court is set aside and the appellant is acquitted of the charge under section 302, IPC.
The appellant is on bail and as such his bail bond is cancelled.
N.P.V. Appeal allowed.
|
The appellant was charged under Section 302 I.P.C. for committing the murder of the deceased.
At the trial, prose cution produced P.W.3, wife of the deceased, and P.Ws.10, 11 and 12, all eye witnesses.
Except for P.W.3, all other eye witnesses were declared hostile.
Thus, the prosecution depended on the sole testimony of P.W.3. P.W.3 deposed that she saw the appellant hitting her husband with a stick.
But admittedly, she did not disclose the name of the appellant to anybody including the Police.
The doctor, who came to the house of the deceased little later, examined and treated the deceased and removed him to the hospital deposed that he was told by the mother of the deceased that the family did not suspect anybody.
Another witness who was passing by the scene of occurrence also testified that nobody informed him about the appellant or any other person, who injured the deceased.
The Additional Sessions Judge acquitted the appellant.
But, on appeal, the High Court, set aside the acquittal order, and convicted and sentenced the appellant to impris onment for life.
Hence, the appeal by the accused.
Allowing the appeal, this Court, HELD: The conduct of the deceased 's wife was highly unnatural.
A wife, who has seen an assailant giving fatal blows with a stick to her husband, would name the assailant to all present and to the police at an earliest opportunity.
There is nothing in the evidence to justify this highly unnatural and improbable conduct of the deceased 's wife.
Even her statement recorded by police head constable, is entirely different than what she stated at the trial.
The prosecution has, thus, not 401 been able to prove its case against the appellant beyond reasonable doubt.
[404F G] Therefore, the appellant is given benefit of doubt, the judgment of the High Court is set aside, and the appellant is acquitted of the charge under section 302, IPC.
[404H]
|
The appellant was charged under Section 302 I.P.C. for committing the murder of the deceased.
At the trial, prose cution produced P.W.3, wife of the deceased, and P.Ws.10, 11 and 12, all eye witnesses.
Except for P.W.3, all other eye witnesses were declared hostile.
Thus, the prosecution depended on the sole testimony of P.W.3. P.W.3 deposed that she saw the appellant hitting her husband with a stick.
But admittedly, she did not disclose the name of the appellant to anybody including the Police.
The doctor, who came to the house of the deceased little later, examined and treated the deceased and removed him to the hospital deposed that he was told by the mother of the deceased that the family did not suspect anybody.
Another witness who was passing by the scene of occurrence also testified that nobody informed him about the appellant or any other person, who injured the deceased.
The Additional Sessions Judge acquitted the appellant.
But, on appeal, the High Court, set aside the acquittal order, and convicted and sentenced the appellant to impris onment for life.
Hence, the appeal by the accused.
Allowing the appeal, this Court, HELD: The conduct of the deceased 's wife was highly unnatural.
A wife, who has seen an assailant giving fatal blows with a stick to her husband, would name the assailant to all present and to the police at an earliest opportunity.
There is nothing in the evidence to justify this highly unnatural and improbable conduct of the deceased 's wife.
Even her statement recorded by police head constable, is entirely different than what she stated at the trial.
The prosecution has, thus, not 401 been able to prove its case against the appellant beyond reasonable doubt.
[404F G] Therefore, the appellant is given benefit of doubt, the judgment of the High Court is set aside, and the appellant is acquitted of the charge under section 302, IPC.
[404H]
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tition (Criminal) Nos. 225 and 513 of 1987.
(Under Article 32 of the Constitution of India).
41 L.K. Pandey for the petitioner in W.P. No.225 of 1987.
M.S. Gupta for the petitioner in W.P. No. 513 of 1987.
Dalveer Bhandari, Ms. A. Subhashini and Mrs. C.K. Sucharita for the Respondents.
The Judgment of the Court was delivered by JAGANNATHASHETTY, J.
The petitioners have been convicted and sentenced by the General Court Martial under the .
They have been lodged in civil jails.
They seek a set off of their pre trial detention against the sentence of imprisonment.
The claim has been made under sec.
428 of the Code of Criminal Procedure ("The Code").
The jail and the army authorities have rejected their claim.
If sec.
428 of the Code of Criminal Procedure is applicable to the case of the petitioners, there is no doubt that they are entitled to get the benefit thereof.
The section provides that where an accused person has, on a conviction, been sentenced to imprisonment for a term (not being imprisonment in default of payment of fine), the period of detention, if any undergone by him during the investigation, inquiry or trial and before the date of such conviction, shall be set off against the term of imprisonment and the liability of such person to undergo imprisonment shall be restricted to the remainder, if any, of the term of imprisonment imposed on him.
The period of detention referred to in the section is of the accused person during the investigation, enquiry or trial of the offence against him.
Section 2(h) defines 'investigation ' and sec.
2(g) defines "enquiry".
Both refer to the proceedings under the Code.
In the first place, there is nothing on the record to indicate that the cases against the petitioners were investigated or enquired into under the Code.
Secondly, sec.
5 of the Code provides: "Nothing contained in the Code shall, in the absence of a specific provision to the contrary, affect any special or local law for the time being in force, or any special jurisdiction or power conferred, or any special form of procedure prescribed, by any other law for the time being in force.
" 42 The saving provisions in sec.
5 provides that the Code, as such, will not affect (I) any special law, (II) any local law, (III) any special jurisdiction or power and (lV) any special form of procedure, prescribed by any other law for the time being in force.
The is a special enactment applicable to persons covered under sec.
2 thereof.
It also provides special procedure for court martial.
The learned counsel for the petitioner however, submitted that since the petitioners are lodged in the civil prisons, they are entitled to the benefit of sec.
428 of the Code just like any other convict in the jail.
We are unable to agree with this contention.
The petitioners may be entitled to remissions as provided in the jail manuals, but not set off under sec.
428 of the Code.
They have been lodged in the civil prisons by an order made under sec.
169(1) of the .
169(I) provides: " Whenever any sentence of imprisonment is passed under this Act by a court martial or whenever any sentence of death or transportation is commuted to imprisonment, the confirming officer or in case of a summary court martial the officer holding the court or such other officer as may be prescribed, shall, save as otherwise provided in sub sections (3) and (4), direct either that the sentence shall be carried out by confinement in a military prison or that it shall be carried out by confinement in a civil prison.
xx xx xx xx xx xx xx xx xx xx xx xx" Section 167 of the also provides that the term of sentence imposed by a court martial shall be reckoned to commence on the day on which the original proceedings were signed by the presiding officer or by the officer holding the court martial as the case may be.
In view of these provisions in the which is a special enactment containing elaborate procedure for trial of the persons covered thereunder, we do not think that the petitioners could call into aid the provisions of sec.
428 of the Code.
In Bhagwan Singh vs The Asstt.
Superintendent, 119771 , the Pun jab & Haryana High Court said that the benefit of sec.
428 can only be claimed by a person whose case is investigated, inquired into or 43 tried under the Code of Criminal Procedure and it cannot be claimed A by a person convicted and sentenced under the by a courtmartial.
The Delhi High Court in F.R. Jesuratnam vs Chief of Air Staff, [19761 Crl.
L.J. 65 and the Madras High Court in P.P. Chandrasekaran vs Government of India, have also taken the similar view.
But the Kerala High Court in Subramonian vs O.C. Armoured Static Workshop, [1979] Crl.
L.J. 617 has taken a contrary view.
In our opinion, the Kerala High Court cannot be said to have laid down the law correctly.
In the result, these petitions fail and are dismissed.
C S.L. Petitions dismissed.
|
% The petitioners were convicted and sentenced by the General Court Martial under the and lodged in Civil Jails.
They sought a set off of their pre trial detention against the sentence of imprisonment.
The jail and army authorities rejected their claim.
They moved this Court for relief by writ petitions.
Dismissing the petitions, the Court, ^ HELD: The petitioners have been convicted and sentenced under the .
The is a special enactment containing elaborate procedure for the trial of the persons covered thereunder.
In view of the various provisions in the , the petitioners cannot call into aid section 428 of the Code of Criminal Procedure.
They may be entitled to remissions as provided in the jail manuals but not a set off under sec.
The benefit of section 428 cannot be claimed by a person convicted and sentenced by a Court Martial under the , as held by the Punjab and Haryana High Court in Bhagwan Singh vs The Asstt.
Superintendent, The High Courts of Delhi and Madras have also held likewise.
But in Subramonian vs O.C. Armoured Static Workshop, contrary view has been taken by the Kerala High Court which cannot be said to have laid down the law correctly.
[42G H; 43A C]
|
tition (Criminal) Nos. 225 and 513 of 1987.
(Under Article 32 of the Constitution of India).
41 L.K. Pandey for the petitioner in W.P. No.225 of 1987.
M.S. Gupta for the petitioner in W.P. No. 513 of 1987.
Dalveer Bhandari, Ms. A. Subhashini and Mrs. C.K. Sucharita for the Respondents.
The Judgment of the Court was delivered by JAGANNATHASHETTY, J.
The petitioners have been convicted and sentenced by the General Court Martial under the .
They have been lodged in civil jails.
They seek a set off of their pre trial detention against the sentence of imprisonment.
The claim has been made under sec.
428 of the Code of Criminal Procedure ("The Code").
The jail and the army authorities have rejected their claim.
If sec.
428 of the Code of Criminal Procedure is applicable to the case of the petitioners, there is no doubt that they are entitled to get the benefit thereof.
The section provides that where an accused person has, on a conviction, been sentenced to imprisonment for a term (not being imprisonment in default of payment of fine), the period of detention, if any undergone by him during the investigation, inquiry or trial and before the date of such conviction, shall be set off against the term of imprisonment and the liability of such person to undergo imprisonment shall be restricted to the remainder, if any, of the term of imprisonment imposed on him.
The period of detention referred to in the section is of the accused person during the investigation, enquiry or trial of the offence against him.
Section 2(h) defines 'investigation ' and sec.
2(g) defines "enquiry".
Both refer to the proceedings under the Code.
In the first place, there is nothing on the record to indicate that the cases against the petitioners were investigated or enquired into under the Code.
Secondly, sec.
5 of the Code provides: "Nothing contained in the Code shall, in the absence of a specific provision to the contrary, affect any special or local law for the time being in force, or any special jurisdiction or power conferred, or any special form of procedure prescribed, by any other law for the time being in force.
" 42 The saving provisions in sec.
5 provides that the Code, as such, will not affect (I) any special law, (II) any local law, (III) any special jurisdiction or power and (lV) any special form of procedure, prescribed by any other law for the time being in force.
The is a special enactment applicable to persons covered under sec.
2 thereof.
It also provides special procedure for court martial.
The learned counsel for the petitioner however, submitted that since the petitioners are lodged in the civil prisons, they are entitled to the benefit of sec.
428 of the Code just like any other convict in the jail.
We are unable to agree with this contention.
The petitioners may be entitled to remissions as provided in the jail manuals, but not set off under sec.
428 of the Code.
They have been lodged in the civil prisons by an order made under sec.
169(1) of the .
169(I) provides: " Whenever any sentence of imprisonment is passed under this Act by a court martial or whenever any sentence of death or transportation is commuted to imprisonment, the confirming officer or in case of a summary court martial the officer holding the court or such other officer as may be prescribed, shall, save as otherwise provided in sub sections (3) and (4), direct either that the sentence shall be carried out by confinement in a military prison or that it shall be carried out by confinement in a civil prison.
xx xx xx xx xx xx xx xx xx xx xx xx" Section 167 of the also provides that the term of sentence imposed by a court martial shall be reckoned to commence on the day on which the original proceedings were signed by the presiding officer or by the officer holding the court martial as the case may be.
In view of these provisions in the which is a special enactment containing elaborate procedure for trial of the persons covered thereunder, we do not think that the petitioners could call into aid the provisions of sec.
428 of the Code.
In Bhagwan Singh vs The Asstt.
Superintendent, 119771 , the Pun jab & Haryana High Court said that the benefit of sec.
428 can only be claimed by a person whose case is investigated, inquired into or 43 tried under the Code of Criminal Procedure and it cannot be claimed A by a person convicted and sentenced under the by a courtmartial.
The Delhi High Court in F.R. Jesuratnam vs Chief of Air Staff, [19761 Crl.
L.J. 65 and the Madras High Court in P.P. Chandrasekaran vs Government of India, have also taken the similar view.
But the Kerala High Court in Subramonian vs O.C. Armoured Static Workshop, [1979] Crl.
L.J. 617 has taken a contrary view.
In our opinion, the Kerala High Court cannot be said to have laid down the law correctly.
In the result, these petitions fail and are dismissed.
C S.L. Petitions dismissed.
|
tition (Criminal) Nos. 225 and 513 of 1987.
(Under Article 32 of the Constitution of India).
41 L.K. Pandey for the petitioner in W.P. No.225 of 1987.
M.S. Gupta for the petitioner in W.P. No. 513 of 1987.
Dalveer Bhandari, Ms. A. Subhashini and Mrs. C.K. Sucharita for the Respondents.
The Judgment of the Court was delivered by JAGANNATHASHETTY, J.
The petitioners have been convicted and sentenced by the General Court Martial under the .
They have been lodged in civil jails.
They seek a set off of their pre trial detention against the sentence of imprisonment.
The claim has been made under sec.
428 of the Code of Criminal Procedure ("The Code").
The jail and the army authorities have rejected their claim.
If sec.
428 of the Code of Criminal Procedure is applicable to the case of the petitioners, there is no doubt that they are entitled to get the benefit thereof.
The section provides that where an accused person has, on a conviction, been sentenced to imprisonment for a term (not being imprisonment in default of payment of fine), the period of detention, if any undergone by him during the investigation, inquiry or trial and before the date of such conviction, shall be set off against the term of imprisonment and the liability of such person to undergo imprisonment shall be restricted to the remainder, if any, of the term of imprisonment imposed on him.
The period of detention referred to in the section is of the accused person during the investigation, enquiry or trial of the offence against him.
Section 2(h) defines 'investigation ' and sec.
2(g) defines "enquiry".
Both refer to the proceedings under the Code.
In the first place, there is nothing on the record to indicate that the cases against the petitioners were investigated or enquired into under the Code.
Secondly, sec.
5 of the Code provides: "Nothing contained in the Code shall, in the absence of a specific provision to the contrary, affect any special or local law for the time being in force, or any special jurisdiction or power conferred, or any special form of procedure prescribed, by any other law for the time being in force.
" 42 The saving provisions in sec.
5 provides that the Code, as such, will not affect (I) any special law, (II) any local law, (III) any special jurisdiction or power and (lV) any special form of procedure, prescribed by any other law for the time being in force.
The is a special enactment applicable to persons covered under sec.
2 thereof.
It also provides special procedure for court martial.
The learned counsel for the petitioner however, submitted that since the petitioners are lodged in the civil prisons, they are entitled to the benefit of sec.
428 of the Code just like any other convict in the jail.
We are unable to agree with this contention.
The petitioners may be entitled to remissions as provided in the jail manuals, but not set off under sec.
428 of the Code.
They have been lodged in the civil prisons by an order made under sec.
169(1) of the .
169(I) provides: " Whenever any sentence of imprisonment is passed under this Act by a court martial or whenever any sentence of death or transportation is commuted to imprisonment, the confirming officer or in case of a summary court martial the officer holding the court or such other officer as may be prescribed, shall, save as otherwise provided in sub sections (3) and (4), direct either that the sentence shall be carried out by confinement in a military prison or that it shall be carried out by confinement in a civil prison.
xx xx xx xx xx xx xx xx xx xx xx xx" Section 167 of the also provides that the term of sentence imposed by a court martial shall be reckoned to commence on the day on which the original proceedings were signed by the presiding officer or by the officer holding the court martial as the case may be.
In view of these provisions in the which is a special enactment containing elaborate procedure for trial of the persons covered thereunder, we do not think that the petitioners could call into aid the provisions of sec.
428 of the Code.
In Bhagwan Singh vs The Asstt.
Superintendent, 119771 , the Pun jab & Haryana High Court said that the benefit of sec.
428 can only be claimed by a person whose case is investigated, inquired into or 43 tried under the Code of Criminal Procedure and it cannot be claimed A by a person convicted and sentenced under the by a courtmartial.
The Delhi High Court in F.R. Jesuratnam vs Chief of Air Staff, [19761 Crl.
L.J. 65 and the Madras High Court in P.P. Chandrasekaran vs Government of India, have also taken the similar view.
But the Kerala High Court in Subramonian vs O.C. Armoured Static Workshop, [1979] Crl.
L.J. 617 has taken a contrary view.
In our opinion, the Kerala High Court cannot be said to have laid down the law correctly.
In the result, these petitions fail and are dismissed.
C S.L. Petitions dismissed.
|
% The petitioners were convicted and sentenced by the General Court Martial under the and lodged in Civil Jails.
They sought a set off of their pre trial detention against the sentence of imprisonment.
The jail and army authorities rejected their claim.
They moved this Court for relief by writ petitions.
Dismissing the petitions, the Court, ^ HELD: The petitioners have been convicted and sentenced under the .
The is a special enactment containing elaborate procedure for the trial of the persons covered thereunder.
In view of the various provisions in the , the petitioners cannot call into aid section 428 of the Code of Criminal Procedure.
They may be entitled to remissions as provided in the jail manuals but not a set off under sec.
The benefit of section 428 cannot be claimed by a person convicted and sentenced by a Court Martial under the , as held by the Punjab and Haryana High Court in Bhagwan Singh vs The Asstt.
Superintendent, The High Courts of Delhi and Madras have also held likewise.
But in Subramonian vs O.C. Armoured Static Workshop, contrary view has been taken by the Kerala High Court which cannot be said to have laid down the law correctly.
[42G H; 43A C]
|
% The petitioners were convicted and sentenced by the General Court Martial under the and lodged in Civil Jails.
They sought a set off of their pre trial detention against the sentence of imprisonment.
The jail and army authorities rejected their claim.
They moved this Court for relief by writ petitions.
Dismissing the petitions, the Court, ^ HELD: The petitioners have been convicted and sentenced under the .
The is a special enactment containing elaborate procedure for the trial of the persons covered thereunder.
In view of the various provisions in the , the petitioners cannot call into aid section 428 of the Code of Criminal Procedure.
They may be entitled to remissions as provided in the jail manuals but not a set off under sec.
The benefit of section 428 cannot be claimed by a person convicted and sentenced by a Court Martial under the , as held by the Punjab and Haryana High Court in Bhagwan Singh vs The Asstt.
Superintendent, The High Courts of Delhi and Madras have also held likewise.
But in Subramonian vs O.C. Armoured Static Workshop, contrary view has been taken by the Kerala High Court which cannot be said to have laid down the law correctly.
[42G H; 43A C]
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Civil Appeal No. 2524 of 1985.
From the Judgment and order dated 26.11.1984 of the Rajasthan High Court in S.A. No. 12 of 1976.
Shankar Ghosh, B.P. Maheshwari and l3.S. Dorpura for the Appellant.
V.M. Tarkunde, S.K. Jain, Himansu Atrey and Mrs. Probha Jain for the Respondent.
The Judgment of the Court was delivered by RAY, J.
This is an appeal by special leave against the judgment and order dated 26th November, 1984 in S.B. Civil Execution Second Appeal No. 12 of 1976 whereby the appeal was allowed and respondent was granted one year time to vacate the premises.
The facts giving rise to this appeal are as follows: The respondent mortgaged the shop belonging to him to the defendant Nos. 1 to 11 on 9th May, 1950 by a registered mortgage deed.
The possession of the premises was given to the 101 mortgagees with right to collect rent from the tenant in payment A of interest on the mortgage amount.
the mortgagees let out the premises to the defendant petitioner during the subsistence of mortgage.
The respondent filed a suit for redemption of the mortgage and for vacant possession of the said shop against the mortgagees i.e. the defendant Nos.
l to 11.
The appellant who was the tenant of the shop was impleaded as party defendant No. 12 in the suit.
The suit was decreed and the mortgage was redeemed.
There was an order for giving vacant possession of the shop by the defendant NOS l to l l to the respondent i.e. the owner of the shop.
In Execution case No. 126 of 1975 the tenant appellant filed an application under Section 47 read with Section 151 of the Code of Civil Procedure, 1908 stating inter alia that the decree could not be executed and possession of the shop could not be given by the mortgagees to the decree holder respondent as the tenancy of the appellant subsisted and the same had not been terminated under the provisions of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
This plea was rejected by l) the executing court holding inter alia that letting out of the shop to the defendant No. 12 by the mortgagees was held to be not a bona fide act made as a person of ordinary prudence in the course of management of the property under Section 76A of Transfer of Property Act and that the relationship of the lessor and lessee could not subsist beyond the mortgagee 's interest unless a new relationship was created between the landlord and the tenant appellant.
It was aalso held that the termination of the mortagagee 's interest put an end to the relationship of landlord and tenant and the provisions of the Rent Control Act could not apply any further.
The decree was executable and the appellant had no interest and as such he could not resist the execution of the decree.
The application was dismissed.
Against this judgment and order the appellant filed an appeal being Civil Appeal No. 13 of 197().
The said appeal was, however.
allowed on a finding that the provisions of Section 13(1) of the Rajasthan Rent Control Act expressly ruled out the operation of the Transfer of Property Act and a person inducted as a tenant on the premises in a lawful manner could not he evicted except in accordance with the provisions of the Act.
The decision in M/s Sachalmal Parasram vs Mst.
Ratanbai & Ors., A I R 1972 (SC) 637 and The All India Film Corp. Ltd. and Ors.
Sri Raja Gyan Nath & Ors., were held to be not applicable to the instant case.
The interest of the appellant as a tenant subsists even after redemption of the mortgage until it is terminated in accordance with the provisions of the aforesaid 102 Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
The respondent preferred a second Appeal being S.B. Civil Execution Second Appeal No. 12 of 1976.
The said appeal was allowed by the High Court relying on the full bench decision of the High Court in 1984 R.L.R. page 709.
On the prayer of the appellant one year time was granted, on the expiry of which possession at the said premises shall have to be delivered.
A written undertaking to that effect had been filed by the appellant in compliance with the directions of the Court The appellant thereafter filed the instant appeal on special leave.
The following two questions come up tor consideration in this appeal: (i) whether a tenant of a mortgagee can continue as a tenant after redemption of the mortgage decree until he is evicted from the suit premises in accordance with the provisions of the Rajasthan V Premises (Control of Rent and Eviction) Act, 1950; and (ii) whether the tenancy created in favour of the appellant can be deemed to be an act of ordinary prudence on the part of the mortgagee in managing the property falling within Section 76A of the Transfer of Property Act.
Identical questions fell for consideration in Mahabir Gope and Ors.
vs Harbans Narain Singh and Ors.
, In this case the mortgagors mortgaged agricultural lands with possession by ijara to the mortgagee to the effect that the mortgagee would cultivate the land and take the crops.
The mortgagee during the subsistence of the mortgage leased out the land to a tenant.
The mortgage was redeemed on payment of the mortgage debt.
The mortgagor on being opposed by the tenant to have the possession of the mortgaged property, filed a suit for recovery of the possession of the land.
lt ultimately came up before this Court and it was held as follows: "The general rule is that a person cannot by transfer or otherwise confer a better title on another than he himself has.
A mortgagee cannot, therefore, create an interest in the mortgaged property which will enure beyond the termination of his interest as a mortgagee.
Further, the mortgagee, who takes possession of the mortgaged property, must manage it as a person of ordinary prudence would manage it if it were his own and he must not 103 commit any act which is destructive or permanently injurious to the property; see section 76, sub clauses (a) & (e) of the transfer of Property Act.
It follows that he may grant leases not extending beyond the period of the mortgage; any leases granted by him must come to an end at redemption.
A mortgagee cannot during the subsistence of the mortgage act in a manner detrimental to the mortgagor 's interests such as by giving a lease which may enable the tenant to acquire permanent or occupancy rights in the land thereby defeating the mortgagor 's right to khas possession; it would be an act which would fall within the provisions of Section 76, sub clause (e), of the Transfer of Property Act.
A permissible settlement by a mortgagee in possession with a tenant in the course of prudent management and the springing up of rights in the tenant conferred or created by statute based on the nature of the land and possession for the requisite period is a different matter altogether.
It is an exception to the general rule.
The tenant cannot be ejected by the mortgagor even after the redemption of the mortgage.
He may become an occupancy raiyat in some cases and a non occupancy raiyat in other cases.
But the settlement of the tenant by the mortgagee must have been a bona fide one.
This exception will not apply in a case where the terms of the mortgage prohibit the mortgagee from making any settlement of tenants on the land either expressly or by necessary implication.
" It was held that the settlement was not a bona fide one and a successor of the tenant did not acquire permanent right of tenancy in the demised lands under Bihar Tenancy Act.
In Harihar Prasad Singh & Anr.
vs Must.
Of Munshi Nath Prasad & Ors., [1956] S.C.R. l where the mortgage was in respect of agricultural lands, this Court held: "The law is that a person cannot confer on another any right higher than what he himself possess, and therefore, a lease created by a usufructuary mortgagee would normally terminated on the redemption of the mortgage.
Section 76(a) enacts an exception to this rule.
If the lease is one 104 which could have been made by the owner in the course of prudent management, it would be binding on the mortgagors, notwithstanding that the mortgage has been redeemed.
Even in such a case, the operation of the lease cannot extend beyond the period for which it was granted.
In the present case, assuming that the mortgagees had the power under Section 76(a.) of the Transfer of Property Act to continue the lessees under Exhibit 2(a) as tenants on the lands after the termination of the period fixed therein, that would confer on them at best the status of tenants from year to year and not give them the right to continue in possession after the termination of the agricultural year during which the redemption takes place." This Court while considering the ambit of provisions of Section 76(a) of the Transfer of Property Act observed in Asa Ram and Another vs Mst.
Ram Kali and Another, A.I.R. 1958 (SC) 183 as follows: "The law undoubtedly is that no person can transfer property so as to confer on the transferee a title better than what he possesses.
Therefore, any transfer of the property mortgaged, by the mortgagee must cease, when the mortgage is redeemed.
Now, section 76(a) provides that a mortgagee in possession must manage the property as a person of ordinary prudence would manage it if it were his own.
Though on the language of the statute, this is an obligation cast on the mortgagee, the authorities have held that an agricultural lease created by him would be binding on the mortgagor even though the mortgage has been redeemed, provided it is of such a character that a prudent owner of property would enter into it in the usual course of management.
This being in the nature of an exception, it is for the person who claims the benefit thereof, to strictly establish it.
" It has been further observed that if there is a prohibition on mortgagee in letting of lands, the lease will not be binding on the mortgagors.
But where there is no such prohibition the parties will be thrown back on their rights under the Transfer of Property Act, and lessees must establish that the lease is binding on the mortgagors under Section 76(a) of that Act.
The act of the mortgagors leasing out the lands to tenants on the terms set out in the kabuliat was held to be neither prudent nor bona fide and as such the lease was not binding on the mortgagors.
105 In All India Film Corp. Ltd. & Ors.
vs Sri Raja Gyan Nath & Ors., (supra), the owner of the property in dispute known as Odeon Cinema mortgaged the property with possession to mortgagees.
The mortgagor, however, migrated to Pakistan in 1947.
The mortgagees leased out the property to All India Film Corp. Ltd. with option of yearly renewal for 10 years.
The property being an evacuee property, the Competent officer after determining the mortgage charge sold the property.
The respondent purchased the property but could not get possession as sub tenants claimed benefit of East Punjab Rent Restriction Act (3 of 1949).
The purchaser fired a suit for possession of the property from the Head lessee and sub lessee.
It was held by this Court: "The termination of the mortgagee interest terminated the relationship of landlord and tenant and it could not, in the circumstances, be said to run with the land.
There being no landlord and no tenant, the provisions of the Rent Restriction Act could not apply any further.
Nor could it be said that when the mortgagor cancelled the rent note and authorised the mortgagee to find any other tenant, the intention was to allow expressly a tenancy beyond the term of the mortgage.
In this view of the matter the decision of the High Court and the Court the below cannot be said to be erroneous." Following the above observations, this Court in M/s Sachalmal Parasram vs Mst.
Ratanoai and Ors., (supra) has observed that tenancy created by the mortgagee in possession does not survive the termination of the mortgagee 's interest.
After termination of mortgagee 's interest the relationship of landlord and tenant does not survive and the claim of protection of Tenancy Act is not available to the tenant inducted by the mortgagee.
The lease was also held to be not an act of prudent management.
In the case of Om Parkash Garg vs Ganga Sahai & Ors., JT 1987(1) S.C. 245.
In which one of us was a party, this Court observed that the lease in question being held to be not an act of prudent management on the part of the mortgagee within the meaning of Section 76(a) of the transfer of Property Act, 1882, the alleged lease could not subsist after termination of the mortgage by passing of the final decree of redemption and the appellant could not take advantage of the act as there was no subsisting lease in his favour.
106 On a conspectus of all these decisions we hold that the lease given by mortgagee during the subsistence of the mortgage came to and end on the redemption of the mortgage.
It is pertinent to mention that the question whether after termination of mortgagee 's interest on redemption of mortgage the lessees can claim the benefit of Rent Act was considered by the Full Bench of Rajasthan High Court in 1984 (R.L.R., 709) and the High Court following the decisions of the Supreme Court has answered that "Tenant of the mortgagee in possession is not entitled to the protection of Rajasthan Premises (Control of Rent and Eviction) Act, 1950 against the mortgagor after redemption of the mortgage.
" We fully agree with this view.
There is specific finding by all the courts below in the suit for redemption that the letting out of the premises to the tenant appellant by the mortgagees is not a prudent act done in the ordinary course of the management.
This finding being not challenged became final.
The mortgagor landlord is entitled to get recovery of possession.
We, therefore, affirm the judgment and order of the High Court and dismiss the appeal.
In the facts and circumstances of the case, there will be no order as to costs.
S.L. Appeal dismissed.
|
% The respondent mortgaged his shop and delivered possession thereof to the mortgagees with the right to collect rent from the tenant in payment of the interest on the mortgage amount.
The mortgagees let out the premises to the appellant (tenant), during the subsistence of the mortgage.
The respondent filled a suit against the mortgagees for redemption of the mortgage and recovery of vacant possession of the mortgaged shop.
The appellant tenant was also impleaded as a party defendant in the suit.
The suit was decreed and the mortgage was redeemed, with an order to the mortgagees to give possession of the shop to the respondent.
The appellant tenant filed an application under Section 47, read with Section 151 of the C.P.C. stating that the decree of redemption could not be executed and possession given by the mortgagees to the respondent/decree holder, as the tenancy of the appellant subsisted and the same had not been terminated under the provisions of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
This plea of the appellant was rejected by the executing Court which held that the decree was executable and the appellant had no interest and he could not resist the execution of the decree.
Against this Judgment and order of the court, the appellant filed an appeal which was allowed.
Thereupon, the respondent preferred a second appeal which was allowed by the High Court.
The appellant appealed to this Court by special leave against the order of the High Court.
Dismissing the appeal, the Court on a conspectus of the various decisions of the Court on the subject, 100 ^ HELD: The lease given by the mortgagee during the subsistence of the mortgage came to an end on the redemption of the mortgage.
The tenant of the mortgagee in possession is not entitled to the protection of the Rent Act against the mortgagor after redemption of the mortgage, as held by the Rajasthan High Court in 1984 R.L.R. 709, following the decisions of this Court.
The letting out of the premises to the appellant tenant was not a prudent act done in the ordinary course of management, as held by all the Courts below.
The respondent/mortgagor landlord is entitled to get recovery of possession.
[106A D] M/s. Sachalmal Parasram vs Mst.
Ratanbai and Ors., AIR 1972 (SC) 637; The All India Film Corp. Ltd. & Ors.
vs Sri Raja Gyan Nath & Ors. ; Mahabir Cope & Ors.
vs Harbans Narain Singh & Ors., ; Hanhar Prasad Singh & Anr.
vs Must.
Of Munshi Nath Prasad & Ors., [1956] SCR t; Asa Ram & Anr.
vs Mst.
Ram Kali Anr.
AIR 1958 (SC) 183 and Om Prakash Garg vs Ganga Sahai & Ors.
JT , referred to.
|
Civil Appeal No. 2524 of 1985.
From the Judgment and order dated 26.11.1984 of the Rajasthan High Court in S.A. No. 12 of 1976.
Shankar Ghosh, B.P. Maheshwari and l3.S. Dorpura for the Appellant.
V.M. Tarkunde, S.K. Jain, Himansu Atrey and Mrs. Probha Jain for the Respondent.
The Judgment of the Court was delivered by RAY, J.
This is an appeal by special leave against the judgment and order dated 26th November, 1984 in S.B. Civil Execution Second Appeal No. 12 of 1976 whereby the appeal was allowed and respondent was granted one year time to vacate the premises.
The facts giving rise to this appeal are as follows: The respondent mortgaged the shop belonging to him to the defendant Nos. 1 to 11 on 9th May, 1950 by a registered mortgage deed.
The possession of the premises was given to the 101 mortgagees with right to collect rent from the tenant in payment A of interest on the mortgage amount.
the mortgagees let out the premises to the defendant petitioner during the subsistence of mortgage.
The respondent filed a suit for redemption of the mortgage and for vacant possession of the said shop against the mortgagees i.e. the defendant Nos.
l to 11.
The appellant who was the tenant of the shop was impleaded as party defendant No. 12 in the suit.
The suit was decreed and the mortgage was redeemed.
There was an order for giving vacant possession of the shop by the defendant NOS l to l l to the respondent i.e. the owner of the shop.
In Execution case No. 126 of 1975 the tenant appellant filed an application under Section 47 read with Section 151 of the Code of Civil Procedure, 1908 stating inter alia that the decree could not be executed and possession of the shop could not be given by the mortgagees to the decree holder respondent as the tenancy of the appellant subsisted and the same had not been terminated under the provisions of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
This plea was rejected by l) the executing court holding inter alia that letting out of the shop to the defendant No. 12 by the mortgagees was held to be not a bona fide act made as a person of ordinary prudence in the course of management of the property under Section 76A of Transfer of Property Act and that the relationship of the lessor and lessee could not subsist beyond the mortgagee 's interest unless a new relationship was created between the landlord and the tenant appellant.
It was aalso held that the termination of the mortagagee 's interest put an end to the relationship of landlord and tenant and the provisions of the Rent Control Act could not apply any further.
The decree was executable and the appellant had no interest and as such he could not resist the execution of the decree.
The application was dismissed.
Against this judgment and order the appellant filed an appeal being Civil Appeal No. 13 of 197().
The said appeal was, however.
allowed on a finding that the provisions of Section 13(1) of the Rajasthan Rent Control Act expressly ruled out the operation of the Transfer of Property Act and a person inducted as a tenant on the premises in a lawful manner could not he evicted except in accordance with the provisions of the Act.
The decision in M/s Sachalmal Parasram vs Mst.
Ratanbai & Ors., A I R 1972 (SC) 637 and The All India Film Corp. Ltd. and Ors.
Sri Raja Gyan Nath & Ors., were held to be not applicable to the instant case.
The interest of the appellant as a tenant subsists even after redemption of the mortgage until it is terminated in accordance with the provisions of the aforesaid 102 Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
The respondent preferred a second Appeal being S.B. Civil Execution Second Appeal No. 12 of 1976.
The said appeal was allowed by the High Court relying on the full bench decision of the High Court in 1984 R.L.R. page 709.
On the prayer of the appellant one year time was granted, on the expiry of which possession at the said premises shall have to be delivered.
A written undertaking to that effect had been filed by the appellant in compliance with the directions of the Court The appellant thereafter filed the instant appeal on special leave.
The following two questions come up tor consideration in this appeal: (i) whether a tenant of a mortgagee can continue as a tenant after redemption of the mortgage decree until he is evicted from the suit premises in accordance with the provisions of the Rajasthan V Premises (Control of Rent and Eviction) Act, 1950; and (ii) whether the tenancy created in favour of the appellant can be deemed to be an act of ordinary prudence on the part of the mortgagee in managing the property falling within Section 76A of the Transfer of Property Act.
Identical questions fell for consideration in Mahabir Gope and Ors.
vs Harbans Narain Singh and Ors.
, In this case the mortgagors mortgaged agricultural lands with possession by ijara to the mortgagee to the effect that the mortgagee would cultivate the land and take the crops.
The mortgagee during the subsistence of the mortgage leased out the land to a tenant.
The mortgage was redeemed on payment of the mortgage debt.
The mortgagor on being opposed by the tenant to have the possession of the mortgaged property, filed a suit for recovery of the possession of the land.
lt ultimately came up before this Court and it was held as follows: "The general rule is that a person cannot by transfer or otherwise confer a better title on another than he himself has.
A mortgagee cannot, therefore, create an interest in the mortgaged property which will enure beyond the termination of his interest as a mortgagee.
Further, the mortgagee, who takes possession of the mortgaged property, must manage it as a person of ordinary prudence would manage it if it were his own and he must not 103 commit any act which is destructive or permanently injurious to the property; see section 76, sub clauses (a) & (e) of the transfer of Property Act.
It follows that he may grant leases not extending beyond the period of the mortgage; any leases granted by him must come to an end at redemption.
A mortgagee cannot during the subsistence of the mortgage act in a manner detrimental to the mortgagor 's interests such as by giving a lease which may enable the tenant to acquire permanent or occupancy rights in the land thereby defeating the mortgagor 's right to khas possession; it would be an act which would fall within the provisions of Section 76, sub clause (e), of the Transfer of Property Act.
A permissible settlement by a mortgagee in possession with a tenant in the course of prudent management and the springing up of rights in the tenant conferred or created by statute based on the nature of the land and possession for the requisite period is a different matter altogether.
It is an exception to the general rule.
The tenant cannot be ejected by the mortgagor even after the redemption of the mortgage.
He may become an occupancy raiyat in some cases and a non occupancy raiyat in other cases.
But the settlement of the tenant by the mortgagee must have been a bona fide one.
This exception will not apply in a case where the terms of the mortgage prohibit the mortgagee from making any settlement of tenants on the land either expressly or by necessary implication.
" It was held that the settlement was not a bona fide one and a successor of the tenant did not acquire permanent right of tenancy in the demised lands under Bihar Tenancy Act.
In Harihar Prasad Singh & Anr.
vs Must.
Of Munshi Nath Prasad & Ors., [1956] S.C.R. l where the mortgage was in respect of agricultural lands, this Court held: "The law is that a person cannot confer on another any right higher than what he himself possess, and therefore, a lease created by a usufructuary mortgagee would normally terminated on the redemption of the mortgage.
Section 76(a) enacts an exception to this rule.
If the lease is one 104 which could have been made by the owner in the course of prudent management, it would be binding on the mortgagors, notwithstanding that the mortgage has been redeemed.
Even in such a case, the operation of the lease cannot extend beyond the period for which it was granted.
In the present case, assuming that the mortgagees had the power under Section 76(a.) of the Transfer of Property Act to continue the lessees under Exhibit 2(a) as tenants on the lands after the termination of the period fixed therein, that would confer on them at best the status of tenants from year to year and not give them the right to continue in possession after the termination of the agricultural year during which the redemption takes place." This Court while considering the ambit of provisions of Section 76(a) of the Transfer of Property Act observed in Asa Ram and Another vs Mst.
Ram Kali and Another, A.I.R. 1958 (SC) 183 as follows: "The law undoubtedly is that no person can transfer property so as to confer on the transferee a title better than what he possesses.
Therefore, any transfer of the property mortgaged, by the mortgagee must cease, when the mortgage is redeemed.
Now, section 76(a) provides that a mortgagee in possession must manage the property as a person of ordinary prudence would manage it if it were his own.
Though on the language of the statute, this is an obligation cast on the mortgagee, the authorities have held that an agricultural lease created by him would be binding on the mortgagor even though the mortgage has been redeemed, provided it is of such a character that a prudent owner of property would enter into it in the usual course of management.
This being in the nature of an exception, it is for the person who claims the benefit thereof, to strictly establish it.
" It has been further observed that if there is a prohibition on mortgagee in letting of lands, the lease will not be binding on the mortgagors.
But where there is no such prohibition the parties will be thrown back on their rights under the Transfer of Property Act, and lessees must establish that the lease is binding on the mortgagors under Section 76(a) of that Act.
The act of the mortgagors leasing out the lands to tenants on the terms set out in the kabuliat was held to be neither prudent nor bona fide and as such the lease was not binding on the mortgagors.
105 In All India Film Corp. Ltd. & Ors.
vs Sri Raja Gyan Nath & Ors., (supra), the owner of the property in dispute known as Odeon Cinema mortgaged the property with possession to mortgagees.
The mortgagor, however, migrated to Pakistan in 1947.
The mortgagees leased out the property to All India Film Corp. Ltd. with option of yearly renewal for 10 years.
The property being an evacuee property, the Competent officer after determining the mortgage charge sold the property.
The respondent purchased the property but could not get possession as sub tenants claimed benefit of East Punjab Rent Restriction Act (3 of 1949).
The purchaser fired a suit for possession of the property from the Head lessee and sub lessee.
It was held by this Court: "The termination of the mortgagee interest terminated the relationship of landlord and tenant and it could not, in the circumstances, be said to run with the land.
There being no landlord and no tenant, the provisions of the Rent Restriction Act could not apply any further.
Nor could it be said that when the mortgagor cancelled the rent note and authorised the mortgagee to find any other tenant, the intention was to allow expressly a tenancy beyond the term of the mortgage.
In this view of the matter the decision of the High Court and the Court the below cannot be said to be erroneous." Following the above observations, this Court in M/s Sachalmal Parasram vs Mst.
Ratanoai and Ors., (supra) has observed that tenancy created by the mortgagee in possession does not survive the termination of the mortgagee 's interest.
After termination of mortgagee 's interest the relationship of landlord and tenant does not survive and the claim of protection of Tenancy Act is not available to the tenant inducted by the mortgagee.
The lease was also held to be not an act of prudent management.
In the case of Om Parkash Garg vs Ganga Sahai & Ors., JT 1987(1) S.C. 245.
In which one of us was a party, this Court observed that the lease in question being held to be not an act of prudent management on the part of the mortgagee within the meaning of Section 76(a) of the transfer of Property Act, 1882, the alleged lease could not subsist after termination of the mortgage by passing of the final decree of redemption and the appellant could not take advantage of the act as there was no subsisting lease in his favour.
106 On a conspectus of all these decisions we hold that the lease given by mortgagee during the subsistence of the mortgage came to and end on the redemption of the mortgage.
It is pertinent to mention that the question whether after termination of mortgagee 's interest on redemption of mortgage the lessees can claim the benefit of Rent Act was considered by the Full Bench of Rajasthan High Court in 1984 (R.L.R., 709) and the High Court following the decisions of the Supreme Court has answered that "Tenant of the mortgagee in possession is not entitled to the protection of Rajasthan Premises (Control of Rent and Eviction) Act, 1950 against the mortgagor after redemption of the mortgage.
" We fully agree with this view.
There is specific finding by all the courts below in the suit for redemption that the letting out of the premises to the tenant appellant by the mortgagees is not a prudent act done in the ordinary course of the management.
This finding being not challenged became final.
The mortgagor landlord is entitled to get recovery of possession.
We, therefore, affirm the judgment and order of the High Court and dismiss the appeal.
In the facts and circumstances of the case, there will be no order as to costs.
S.L. Appeal dismissed.
|
Civil Appeal No. 2524 of 1985.
From the Judgment and order dated 26.11.1984 of the Rajasthan High Court in S.A. No. 12 of 1976.
Shankar Ghosh, B.P. Maheshwari and l3.S. Dorpura for the Appellant.
V.M. Tarkunde, S.K. Jain, Himansu Atrey and Mrs. Probha Jain for the Respondent.
The Judgment of the Court was delivered by RAY, J.
This is an appeal by special leave against the judgment and order dated 26th November, 1984 in S.B. Civil Execution Second Appeal No. 12 of 1976 whereby the appeal was allowed and respondent was granted one year time to vacate the premises.
The facts giving rise to this appeal are as follows: The respondent mortgaged the shop belonging to him to the defendant Nos. 1 to 11 on 9th May, 1950 by a registered mortgage deed.
The possession of the premises was given to the 101 mortgagees with right to collect rent from the tenant in payment A of interest on the mortgage amount.
the mortgagees let out the premises to the defendant petitioner during the subsistence of mortgage.
The respondent filed a suit for redemption of the mortgage and for vacant possession of the said shop against the mortgagees i.e. the defendant Nos.
l to 11.
The appellant who was the tenant of the shop was impleaded as party defendant No. 12 in the suit.
The suit was decreed and the mortgage was redeemed.
There was an order for giving vacant possession of the shop by the defendant NOS l to l l to the respondent i.e. the owner of the shop.
In Execution case No. 126 of 1975 the tenant appellant filed an application under Section 47 read with Section 151 of the Code of Civil Procedure, 1908 stating inter alia that the decree could not be executed and possession of the shop could not be given by the mortgagees to the decree holder respondent as the tenancy of the appellant subsisted and the same had not been terminated under the provisions of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
This plea was rejected by l) the executing court holding inter alia that letting out of the shop to the defendant No. 12 by the mortgagees was held to be not a bona fide act made as a person of ordinary prudence in the course of management of the property under Section 76A of Transfer of Property Act and that the relationship of the lessor and lessee could not subsist beyond the mortgagee 's interest unless a new relationship was created between the landlord and the tenant appellant.
It was aalso held that the termination of the mortagagee 's interest put an end to the relationship of landlord and tenant and the provisions of the Rent Control Act could not apply any further.
The decree was executable and the appellant had no interest and as such he could not resist the execution of the decree.
The application was dismissed.
Against this judgment and order the appellant filed an appeal being Civil Appeal No. 13 of 197().
The said appeal was, however.
allowed on a finding that the provisions of Section 13(1) of the Rajasthan Rent Control Act expressly ruled out the operation of the Transfer of Property Act and a person inducted as a tenant on the premises in a lawful manner could not he evicted except in accordance with the provisions of the Act.
The decision in M/s Sachalmal Parasram vs Mst.
Ratanbai & Ors., A I R 1972 (SC) 637 and The All India Film Corp. Ltd. and Ors.
Sri Raja Gyan Nath & Ors., were held to be not applicable to the instant case.
The interest of the appellant as a tenant subsists even after redemption of the mortgage until it is terminated in accordance with the provisions of the aforesaid 102 Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
The respondent preferred a second Appeal being S.B. Civil Execution Second Appeal No. 12 of 1976.
The said appeal was allowed by the High Court relying on the full bench decision of the High Court in 1984 R.L.R. page 709.
On the prayer of the appellant one year time was granted, on the expiry of which possession at the said premises shall have to be delivered.
A written undertaking to that effect had been filed by the appellant in compliance with the directions of the Court The appellant thereafter filed the instant appeal on special leave.
The following two questions come up tor consideration in this appeal: (i) whether a tenant of a mortgagee can continue as a tenant after redemption of the mortgage decree until he is evicted from the suit premises in accordance with the provisions of the Rajasthan V Premises (Control of Rent and Eviction) Act, 1950; and (ii) whether the tenancy created in favour of the appellant can be deemed to be an act of ordinary prudence on the part of the mortgagee in managing the property falling within Section 76A of the Transfer of Property Act.
Identical questions fell for consideration in Mahabir Gope and Ors.
vs Harbans Narain Singh and Ors.
, In this case the mortgagors mortgaged agricultural lands with possession by ijara to the mortgagee to the effect that the mortgagee would cultivate the land and take the crops.
The mortgagee during the subsistence of the mortgage leased out the land to a tenant.
The mortgage was redeemed on payment of the mortgage debt.
The mortgagor on being opposed by the tenant to have the possession of the mortgaged property, filed a suit for recovery of the possession of the land.
lt ultimately came up before this Court and it was held as follows: "The general rule is that a person cannot by transfer or otherwise confer a better title on another than he himself has.
A mortgagee cannot, therefore, create an interest in the mortgaged property which will enure beyond the termination of his interest as a mortgagee.
Further, the mortgagee, who takes possession of the mortgaged property, must manage it as a person of ordinary prudence would manage it if it were his own and he must not 103 commit any act which is destructive or permanently injurious to the property; see section 76, sub clauses (a) & (e) of the transfer of Property Act.
It follows that he may grant leases not extending beyond the period of the mortgage; any leases granted by him must come to an end at redemption.
A mortgagee cannot during the subsistence of the mortgage act in a manner detrimental to the mortgagor 's interests such as by giving a lease which may enable the tenant to acquire permanent or occupancy rights in the land thereby defeating the mortgagor 's right to khas possession; it would be an act which would fall within the provisions of Section 76, sub clause (e), of the Transfer of Property Act.
A permissible settlement by a mortgagee in possession with a tenant in the course of prudent management and the springing up of rights in the tenant conferred or created by statute based on the nature of the land and possession for the requisite period is a different matter altogether.
It is an exception to the general rule.
The tenant cannot be ejected by the mortgagor even after the redemption of the mortgage.
He may become an occupancy raiyat in some cases and a non occupancy raiyat in other cases.
But the settlement of the tenant by the mortgagee must have been a bona fide one.
This exception will not apply in a case where the terms of the mortgage prohibit the mortgagee from making any settlement of tenants on the land either expressly or by necessary implication.
" It was held that the settlement was not a bona fide one and a successor of the tenant did not acquire permanent right of tenancy in the demised lands under Bihar Tenancy Act.
In Harihar Prasad Singh & Anr.
vs Must.
Of Munshi Nath Prasad & Ors., [1956] S.C.R. l where the mortgage was in respect of agricultural lands, this Court held: "The law is that a person cannot confer on another any right higher than what he himself possess, and therefore, a lease created by a usufructuary mortgagee would normally terminated on the redemption of the mortgage.
Section 76(a) enacts an exception to this rule.
If the lease is one 104 which could have been made by the owner in the course of prudent management, it would be binding on the mortgagors, notwithstanding that the mortgage has been redeemed.
Even in such a case, the operation of the lease cannot extend beyond the period for which it was granted.
In the present case, assuming that the mortgagees had the power under Section 76(a.) of the Transfer of Property Act to continue the lessees under Exhibit 2(a) as tenants on the lands after the termination of the period fixed therein, that would confer on them at best the status of tenants from year to year and not give them the right to continue in possession after the termination of the agricultural year during which the redemption takes place." This Court while considering the ambit of provisions of Section 76(a) of the Transfer of Property Act observed in Asa Ram and Another vs Mst.
Ram Kali and Another, A.I.R. 1958 (SC) 183 as follows: "The law undoubtedly is that no person can transfer property so as to confer on the transferee a title better than what he possesses.
Therefore, any transfer of the property mortgaged, by the mortgagee must cease, when the mortgage is redeemed.
Now, section 76(a) provides that a mortgagee in possession must manage the property as a person of ordinary prudence would manage it if it were his own.
Though on the language of the statute, this is an obligation cast on the mortgagee, the authorities have held that an agricultural lease created by him would be binding on the mortgagor even though the mortgage has been redeemed, provided it is of such a character that a prudent owner of property would enter into it in the usual course of management.
This being in the nature of an exception, it is for the person who claims the benefit thereof, to strictly establish it.
" It has been further observed that if there is a prohibition on mortgagee in letting of lands, the lease will not be binding on the mortgagors.
But where there is no such prohibition the parties will be thrown back on their rights under the Transfer of Property Act, and lessees must establish that the lease is binding on the mortgagors under Section 76(a) of that Act.
The act of the mortgagors leasing out the lands to tenants on the terms set out in the kabuliat was held to be neither prudent nor bona fide and as such the lease was not binding on the mortgagors.
105 In All India Film Corp. Ltd. & Ors.
vs Sri Raja Gyan Nath & Ors., (supra), the owner of the property in dispute known as Odeon Cinema mortgaged the property with possession to mortgagees.
The mortgagor, however, migrated to Pakistan in 1947.
The mortgagees leased out the property to All India Film Corp. Ltd. with option of yearly renewal for 10 years.
The property being an evacuee property, the Competent officer after determining the mortgage charge sold the property.
The respondent purchased the property but could not get possession as sub tenants claimed benefit of East Punjab Rent Restriction Act (3 of 1949).
The purchaser fired a suit for possession of the property from the Head lessee and sub lessee.
It was held by this Court: "The termination of the mortgagee interest terminated the relationship of landlord and tenant and it could not, in the circumstances, be said to run with the land.
There being no landlord and no tenant, the provisions of the Rent Restriction Act could not apply any further.
Nor could it be said that when the mortgagor cancelled the rent note and authorised the mortgagee to find any other tenant, the intention was to allow expressly a tenancy beyond the term of the mortgage.
In this view of the matter the decision of the High Court and the Court the below cannot be said to be erroneous." Following the above observations, this Court in M/s Sachalmal Parasram vs Mst.
Ratanoai and Ors., (supra) has observed that tenancy created by the mortgagee in possession does not survive the termination of the mortgagee 's interest.
After termination of mortgagee 's interest the relationship of landlord and tenant does not survive and the claim of protection of Tenancy Act is not available to the tenant inducted by the mortgagee.
The lease was also held to be not an act of prudent management.
In the case of Om Parkash Garg vs Ganga Sahai & Ors., JT 1987(1) S.C. 245.
In which one of us was a party, this Court observed that the lease in question being held to be not an act of prudent management on the part of the mortgagee within the meaning of Section 76(a) of the transfer of Property Act, 1882, the alleged lease could not subsist after termination of the mortgage by passing of the final decree of redemption and the appellant could not take advantage of the act as there was no subsisting lease in his favour.
106 On a conspectus of all these decisions we hold that the lease given by mortgagee during the subsistence of the mortgage came to and end on the redemption of the mortgage.
It is pertinent to mention that the question whether after termination of mortgagee 's interest on redemption of mortgage the lessees can claim the benefit of Rent Act was considered by the Full Bench of Rajasthan High Court in 1984 (R.L.R., 709) and the High Court following the decisions of the Supreme Court has answered that "Tenant of the mortgagee in possession is not entitled to the protection of Rajasthan Premises (Control of Rent and Eviction) Act, 1950 against the mortgagor after redemption of the mortgage.
" We fully agree with this view.
There is specific finding by all the courts below in the suit for redemption that the letting out of the premises to the tenant appellant by the mortgagees is not a prudent act done in the ordinary course of the management.
This finding being not challenged became final.
The mortgagor landlord is entitled to get recovery of possession.
We, therefore, affirm the judgment and order of the High Court and dismiss the appeal.
In the facts and circumstances of the case, there will be no order as to costs.
S.L. Appeal dismissed.
|
% The respondent mortgaged his shop and delivered possession thereof to the mortgagees with the right to collect rent from the tenant in payment of the interest on the mortgage amount.
The mortgagees let out the premises to the appellant (tenant), during the subsistence of the mortgage.
The respondent filled a suit against the mortgagees for redemption of the mortgage and recovery of vacant possession of the mortgaged shop.
The appellant tenant was also impleaded as a party defendant in the suit.
The suit was decreed and the mortgage was redeemed, with an order to the mortgagees to give possession of the shop to the respondent.
The appellant tenant filed an application under Section 47, read with Section 151 of the C.P.C. stating that the decree of redemption could not be executed and possession given by the mortgagees to the respondent/decree holder, as the tenancy of the appellant subsisted and the same had not been terminated under the provisions of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
This plea of the appellant was rejected by the executing Court which held that the decree was executable and the appellant had no interest and he could not resist the execution of the decree.
Against this Judgment and order of the court, the appellant filed an appeal which was allowed.
Thereupon, the respondent preferred a second appeal which was allowed by the High Court.
The appellant appealed to this Court by special leave against the order of the High Court.
Dismissing the appeal, the Court on a conspectus of the various decisions of the Court on the subject, 100 ^ HELD: The lease given by the mortgagee during the subsistence of the mortgage came to an end on the redemption of the mortgage.
The tenant of the mortgagee in possession is not entitled to the protection of the Rent Act against the mortgagor after redemption of the mortgage, as held by the Rajasthan High Court in 1984 R.L.R. 709, following the decisions of this Court.
The letting out of the premises to the appellant tenant was not a prudent act done in the ordinary course of management, as held by all the Courts below.
The respondent/mortgagor landlord is entitled to get recovery of possession.
[106A D] M/s. Sachalmal Parasram vs Mst.
Ratanbai and Ors., AIR 1972 (SC) 637; The All India Film Corp. Ltd. & Ors.
vs Sri Raja Gyan Nath & Ors. ; Mahabir Cope & Ors.
vs Harbans Narain Singh & Ors., ; Hanhar Prasad Singh & Anr.
vs Must.
Of Munshi Nath Prasad & Ors., [1956] SCR t; Asa Ram & Anr.
vs Mst.
Ram Kali Anr.
AIR 1958 (SC) 183 and Om Prakash Garg vs Ganga Sahai & Ors.
JT , referred to.
|
% The respondent mortgaged his shop and delivered possession thereof to the mortgagees with the right to collect rent from the tenant in payment of the interest on the mortgage amount.
The mortgagees let out the premises to the appellant (tenant), during the subsistence of the mortgage.
The respondent filled a suit against the mortgagees for redemption of the mortgage and recovery of vacant possession of the mortgaged shop.
The appellant tenant was also impleaded as a party defendant in the suit.
The suit was decreed and the mortgage was redeemed, with an order to the mortgagees to give possession of the shop to the respondent.
The appellant tenant filed an application under Section 47, read with Section 151 of the C.P.C. stating that the decree of redemption could not be executed and possession given by the mortgagees to the respondent/decree holder, as the tenancy of the appellant subsisted and the same had not been terminated under the provisions of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
This plea of the appellant was rejected by the executing Court which held that the decree was executable and the appellant had no interest and he could not resist the execution of the decree.
Against this Judgment and order of the court, the appellant filed an appeal which was allowed.
Thereupon, the respondent preferred a second appeal which was allowed by the High Court.
The appellant appealed to this Court by special leave against the order of the High Court.
Dismissing the appeal, the Court on a conspectus of the various decisions of the Court on the subject, 100 ^ HELD: The lease given by the mortgagee during the subsistence of the mortgage came to an end on the redemption of the mortgage.
The tenant of the mortgagee in possession is not entitled to the protection of the Rent Act against the mortgagor after redemption of the mortgage, as held by the Rajasthan High Court in 1984 R.L.R. 709, following the decisions of this Court.
The letting out of the premises to the appellant tenant was not a prudent act done in the ordinary course of management, as held by all the Courts below.
The respondent/mortgagor landlord is entitled to get recovery of possession.
[106A D] M/s. Sachalmal Parasram vs Mst.
Ratanbai and Ors., AIR 1972 (SC) 637; The All India Film Corp. Ltd. & Ors.
vs Sri Raja Gyan Nath & Ors. ; Mahabir Cope & Ors.
vs Harbans Narain Singh & Ors., ; Hanhar Prasad Singh & Anr.
vs Must.
Of Munshi Nath Prasad & Ors., [1956] SCR t; Asa Ram & Anr.
vs Mst.
Ram Kali Anr.
AIR 1958 (SC) 183 and Om Prakash Garg vs Ganga Sahai & Ors.
JT , referred to.
| 1
| 1
| 1
| 1
|
ivil Appeal Nos.
97 & 98 of 1981.
From the Judgment and order dated 25.4.1980 of the Punjab and Haryana High Court in C.W. No. 2512 of 1979.
V.M. Tarkunde and N.S. Das Behl for the Appellants.
Kapil Sibal, P. Gaur and Jitendra Sharma for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
These appeals by special leave are directed against the judgment dated April 25, 1980 of the High Court of Punjab & Haryana in civil writ No. 3512 of 1979.
The revised policy of allotment of industrial sites for the establishment of printing presses in Chandigarh has been called into question in the aforesaid writ petition.
The printing presses are now scattered all over Chandigarh.
They are situated either in residential premises or in small shops in different localities.
The Chandigarh administration wanted them to be located in an industrial area.
For that purpose, they earmarked forty three sites in the industrial area phase II.
The sites are comparatively of bigger dimensions.
In 1975, the authorities invited applications for allotment of those sites.
Several persons submitted applications.
The appellants in Appeal No. 97 of 1981 were some of them.
They applied with deposit of earnest money of Rs.1000 each.
That would be ten per cent of the premium payable for the site.
All the applications were processed for final allotment.
In the meantime, it is said that the appellants were called upon to deposit 25 per cent of the premium calculated at the rate of Rs. 15 per square yard.
The appellants appear to have complied with that demand also.
Since there were more applicants than the sites available, the authorities decided to draw the lots.
In October 1977, the lots were drawn and the lady luck smiled at the appellants.
But the authorities did not issue letters of allotment.
The reason was obvious.
The authorities had a second look at the scheme of allotment of sites for printing industries.
The authorities wanted to 161 accommodate as many applicants as possible.
But they could not accommodate all those applicants for want of adequate number of sites in the industrial area phase II.
The authorities were also of the view that for setting up the printing industry, larger sites such as those earmarked earlier, would not be necessary and smaller sites would meet the requirements.
Consequently, the sites proposed in the industrial area phase II were given up and a lay out of smaller sites in the industrial area phase I was formed.
There about 131 of sites were reserved for allotment to printing press owners.
The appellants and other like applicant were intimated by letters that the said sites would be allotted at the rate of RS.35 per square yard.
They were also informed that the allotment would be made by draw of lots on October 3, 1979.
The appellants however, did not participate in the proceedings.
They moved the High Court with a petition under article 226 of the Constitution challenging the revised policy for allotment of smaller sites.
It was contended inter alia that they had a right to take possession of bigger plots in respect of which the lots were earlier drawn in their favour.
The High Court issued rule Nisi in the petition, but allowed the authorities to draw the lots as proposed.
The High Court also permitted the appellants to deposit the premium demanded without prejudice to their rights in the writ petition.
That is all at the preliminary hearing of the writ petition.
In the final hearing the High Court did not give substantial relief to the appellants.
The High Court was of the view that there was nothing illegal in the revised policy adopted by the Chandigarh administration since the appellants did not acquire right to get bigger sites in the industrial area phase II.
The High Court however, felt that the appellants would be liable to pay only at the rate of .
Rs. 15 per square yard and not Rs.35 per square yard.
Accordingly a direction was issued to the authorities.
It is against this judgment that the present appeals have been preferred.
Civil appeal No. 97/81 is by the printing press owners.
Civil Appeal No. 98/81 is by the Chandigarh administration.
The Chandigarh administration is aggrieved by the direction issued by the High Court as to the premium to be recovered from the allottees.
We may first dispose of the appeal preferred by the Chandigarh administration.
We do not find any substance in this appeal.
If the applicants had been allotted sites as per the original proposal and as 162 per the first draw in 1977, they would have been liable to pay only at the rate of Rs. 15 per square yard.
In fact, the other entrepreneurs who were allotted sites from industrial area phase II paid the premium only at the rate of Rs. 15 per square yard.
Why then there should be a higher rate payable by these persons.
They did not ask for sites in the Industrial area phase I. Their applications for sites in the industrial area phase II were not rejected.
The same applications appear to have been considered for sites in the industrial area phase I.
Secondly, the applicants were not responsible for the delay in the allotment of sites.
The delay was entirely due to the change of policy adopted by the Chandigarh administration.
Thirdly, there is no evidence that the Chandigarh administration had to incur more expenditure for forming new sites in phase I.
It is, therefore, not proper that these applicants should be asked to pay the premium at a higher rate.
The High Court, in our opinion, was justified in directing the authorities to recover only at rate of Rs. 15 per square yard.
Before considering the contentions urged in the appeal of printing press owners, we may briefly refer to the relevant provisions of the enactment bearing on the contentions.
The disposal of building sites in Chandigarh has been regulated by the Capital of Punjab (Development and Regulation) Act, 1952 which may be termed as "The Act".
The Chandigarh Lease Hold of Sites and Building Rules, 1973 are the relevant rules which may be referred to as "The Rules".
Section 3 of the Act provides power to the authorities to sell, lease or otherwise transfer any land or building belonging to the Government.
They could be disposed of by auction, allotment or otherwise.
Rule 4 provides that Chandigarh Administration may demise sites and building on lease for 99 years.
The procedure for allotment has been prescribed under rule 8.
Rule 8 so far as it is material provides: "Rule 8.
Lease by allotment Procedure for (1)In case of allotment of site or building the intending lessee shall make an application to the Estate officer in Form 'A '.
(2)No application under sub rule (l) shall be valid unless it is accompanied by 10 per cent of the premium as earnest money in the prescribed form of payment.
(3)When 10 per cent of the premium has been so tendered the Estate officer, shall, subject to such directions 163 as may be issued by the Chief Administrator in this behalf, allot a site of the size applied for or a building or which particulars are given in the application and shall intimate, by registered post the number, sector, approximate area, premium and the rent of the site or building allotted to the applicant.
(4)The applicant shall, unless he refuses to accept the allotment within 30 days of the date of the receipt of the allotment order, deposit within that period and in the prescribed mode of payment, further 15 per cent of the premium.
The remaining 75 per cent of the premium shall be paid as provided in Rule 12.
" The scheme provided under these Rules for allotment of sites is like this: Sub rule (1) of Rule 8 provides for making an application to the Estate officer for allotment of site.
The application shall be accompanied with 10 per cent of the premium as earnest money.
That amount must be tendered to the Estate officer.
The allotment of a site shall be intimated to the applicant by registered letter giving the particulars of number, sector, approximate area, premium and the rent of the site or building allotted to the applicant.
It would be open to the applicant to accept the allotment or not.
If he accepts the allotment he must deposit 15 per cent of the premium and the remaining 75 per cent of the premium shall be paid as provided under Rule.
Relying on these provisions, it was urged that the appellants had a right to obtain transfer of sites in respect of which the lots were first drawn in their favour.
We are unable to accept this contention.
Admittedly, at that stage, there was no intimation of allotment of sites to the appellants.
There was no official communication to them as required under sub rule (3) of Rule 8.
Such intimation alone confers right on the appellants to obtain possession of the sites.
The intimation must be sent by a registered letter giving particulars of the sites allotted and the premium payable in respect thereof.
In the absence of any such communication, the appellants cannot be held to have the right to get transfer of sites in their favour.
The next step in the argument was that the Estate officer ought to have allotted the sites upon the receipt of applications of the appellants.
The reliance was placed and emphasis was put on the word "shall" used in sub rule (3) of Rule 8.
Sub rule (3) of Rule 8 provides 164 that when 10 per cent of the premium has been tendered, the Estate officer shall, subject to such directions as may be issued by the Chief Administrator in that behalf, allot a site of the size applied for.
We do not think that there is much force in this contention also.
Generally the use of the word "shall" prima facie indicates that the particular provision is imperative.
But that is not always so.
The meaning to be given to a word depends upon the context in which it is used.
The word takes the colour depending upon the context.
We must ask what does the word mean in its context? We must examine why the Rule making authority has chosen that word.
After examining the purpose and scope of the rule, we must give such meaning as to render the rule workable in a fair manner.
We must give that meaning which would promote the purpose and object of the rule.
When there is a choice of meanings, there is a presumption that one which produces an unjust or inconvenient result was not intended.
Let us now take a brief look at Rule 8.
If sub rule (3) of Rule 8 is construed as mandatory, then every person who applies for a site with earnest money must be allotted a site.
That means the administration must receive only equal number of applications as there are sites available for allotment.
That would be impracticable.
The administration cannot restrict the number of applications to be received when the public are notified.
Secondly, the sites are required to be disposed by auction or allotment.
If it is by allotment, it should be after considering all applications.
The sites cannot be allotted by private arrangement.
All the applications received must be considered and if there are more applications than the available sites, some reasonable procedure should be adopted for consideration and elimination.
In our opinion, the right of every applicant under sub rule (3) of Rule 8 is only the right to have his application considered.
The acceptance of application does not create a right for allotment of a site.
The word "shall" used in sub rule (3) must, therefore, be considered as not mandatory.
The imperative meaning would defeat the purpose of the rule.
It was next urged that the Chandigarh administration was estopped from revising the policy of allotment after taking several steps for allotment of sites.
The steps taken like demanding 25 per cent of the premium payable and drawing the lots would lead to an assurance that they would be allotted bigger plots.
It was stated that the appellants upon the assurance of getting bigger plots had placed orders for heavy machinaries for their printing presses.
These averments were also made in the writ petition before the High Court.
The High Court rejected the plea of estoppel on the ground that there was no evidence 165 of heavy investment on machinaries.
Mr. V.M. Tarkunde, learned counsel for the appellants urged that there is no need to produce any such evidence to invoke the doctrine of equitable estoppel.
The counsel is right in this aspect.
The party invoking the doctrine of estoppel need not prove any detriment as such.
It may be sufficient if he has relied upon the assurance made to him.
This court in the Delhi Cloth & General Mills Ltd. vs Union of India, (Civil Appeal No. 223 of 1974 disposed of on October 8, 1987) to which one of us was a member, said: "It is true, that in the formative period, it was generally said that the doctrine of promissory estoppel cannot be invoked by the promisee unless he has suffered 'detriment ' or 'prejudice '.
It was often said simply, that the party asserting the estoppel must have been induced to act to his detriment.
But this has now been explained in so many decisions all over.
All that is now required is that the party asserting the estoppel must have acted upon the assurance given to him must have relied upon the representation made to him.
It means, the party has changed or altered the position by relying on the assurance or the representation.
The alteration of position by the party is the only indispensable requirement of the doctrine.
It is not necessary to prove further any damage, detriment or prejudice to the party asserting the estoppel.
The Court, however, would compel the opposite party to adhere to the representation acted upon or abstained from acting.
The entire doctrine proceeds on the promise that it is reliance based and nothing more." And said: "The concept of detriment as we now understand is whether it appears unjust, unreasonable or inequitable that the promisor should be allowed to resile from his assurance or representation having regard to what the promisee has done or refrained from doing in reliance on the assurance or representation.
" It was further said: "It is however, quite fundamental that the doctrine of promissory estoppel, cannot be used to compel the 166 public bodies or the Government to carry out the rep resentation or promise which is contrary to law or which is outside their authority of power." In the first place, we do not know under what provision the authorities asked the appellants to pay 25 per cent of the premium payable in respect of the sites even before allotment.
Apparently that procedure appears to be irregular with no statutory sanction.
Secondly, we do not find any specific assurance or representation made by the authorities promising to allot the sites applied for.
Thirdly, even if there was any such assurance, we do not think that it would give rise to the doctrine of promissory estoppel in the instance case.
The authorities cannot give assurance contrary to the statutory rules.
The sites are required to be disposed of by auction, allotment or sale as per the procedure prescribed.
The authorities who are bound by the rules of procedure cannot make any representation or promise to allot particular sites to the applicants.
Even if they make such promise or assurance, the doctrine of promissory estoppel cannot be invoked to compel them to carry out the promise or assurance which is contrary to law.
The next contention urged for the appellants related to the revised policy adopted by the Chandigarh administration for allotment of smaller sites.
It was said that the sites in phase II ought to have been allotted when there were enough to go round the appellants.
It was also said that the other entrepreneurs who had filed applications along with the appellants had been allotted sites in phase II and there was no good reason to exclude the appellants for being considered for smaller sites in phase I. The procedure followed by the authorities has been assailed as arbitrary and contrary to article 14 of the Constitution.
Of course, if there were enough plots to accommodate all the applicants in the industrial area phase II, it would not be proper for the authorities to revise the policy and allot smaller sites in phase I.
But no material has been placed before us to come to the conclusion that there were enough industrial plots to accommodate as far as possible all those applicants.
It appears from the record that the authorities for want of plots in phase II formed another lay out in phrase I. The action of the authorities appears to be bona fide and we have no reason to doubt it.
This takes us to the question whether the revised policy adopted by the Chandigarh administration to allot smaller sites to these appellants was discriminatory and violative of article 14 of the 167 Constitution.
The true meaning and scope of article 14 has been stated and restated in a string of decisions of this Court.
It is now well established that article 14 forbids class legislation, but does not forbid reasonable classification for the purpose of legislation.
In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group; and (ii) that the differentia must have a rational relation to the object sought to be achieved by the statute in question.
The classification may be founded on different basis, namely, geographical or according to objects or occupations or the like.
What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration.
S.R. Oas, C.J. speaking for this Court in Shri Ram Krishna Dalmia vs Shri Justice S.R. Tendolkar & others; , has formulated the various aspects of article 14 and out of them, we may refer to the following proposition: (a) article 14 condemns discrimination not only by substantive law but by a law of procedure, (b) article 14 forbids class legislation but does not forbid classification, (c) In permissible classification, mathematical nicety and perfect equality are not required, (d) The classification may be founded on different basis, namely, geographical or according to objects or occupations or the like, (e) If a law deals equally with members of a well defined class, it is not obnoxious and it is not open to the charge of denial of equal protection on the ground that it has no application to other persons, and (f) Even a single individual may form a class by himself on account of some special circumstances or reason applicable to him and not applicable to others.
This Court speaking through Chandrachud, CJ.
in Re The Special Courts Bill, 1978(19792 SCR 476) reformulated in detail the propositions on article 14.
The following are relevant for the 168 present case and may be extracted: (i) The constitutional command to the State to afford equal protection of its law sets a goal not attainable by the invention and application of a precise formula.
Therefore, classification need not be constituted by an exact or scientific exclusion or inclusion of persons or things.
The Courts should not insist on delusive exactness or apply doctrinaire tests for determining the validity of classification in any given case.
Classification is justified if it is not palpably arbitrary.
(ii) The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience.
It can recognise even a degree of evil, but the classification should never be arbitrary, artificial or evasive.
(iii) The classification must not be arbitrary but must be rational, that is to say, it must not only be based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out but those qualities or characteristics must have a reasonable relation to the object of the legislation.
There is yet another facet of article 14.
This Court speaking through Bhagwati, J. in E.P. Royappa vs State of Tamil Nadu, and in Maneka Gandhi case (AIR 1978 SC 597) held that the basic principle which informs both articles 14 and 16 is equality and inhibition against discrimination.
Equality and arbitrariness are sworn enemies, one belongs to the rule of law in a republic while the other to the whim and caprise of an absolute monarch.
Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore, violative of article 14.
Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment.
This, in our opinion, is more fundamental.
Article 14 unlike other articles in Part III of the Constitution, is an injunction against the State that it shall not discriminate person to person unless the action is supported by well known principles.
There is thus no doubt or dispute about the principles.
The question is only the application of the principles to a given case.
In the present case, however, we do not find that the revised policy of the Chandigarh administration suffers from any act of arbitrariness 169 either in classifying the appellants as a separate group or in considering them for allotment of smaller sites in phase I. The appellants formed a separate class.
All the persons who have applied for industrial sites for establishing printing presses were grouped together.
They were considered together.
They could not have been accommodated in phase II for want of enough sites.
So another lay out was formed in phase I. We are told that most of the applicants have now been allotted sites and they have since taken possession.
The appellants were also allotted sites in phase I.
We are, therefore.
Of the opinion that the grievance of the appellants about discrimination is not justified on the facts and circumstances of the case.
In the result, both the appeals fail and are dismissed, but we make no order as to costs.
S.L. Appeals dismissed.
|
% The Chandigarh administration wanted the printing presses, scattered all over Chandigarh in the residential premises or small shops, to be located in an industrial area.
For that purpose, the administration earmarked forty three sites in the industrial area Phase lI, and invited applications for allotment of the sites.
Several persons submitted the applications with deposits of earnest money of Rs.1,000 in each.
That was ten per cent of the premium payable for each site.
The appellants in the C.A. No. 97 of 1981, who were among the said applicants, were called upon to deposit 25 per cent of the premium calculated at the rate of Rs.15 per square yard.
The appellants complied with that demand.
The authorities decided to draw lots as the applicants were more than the number of the sites available.
In October 1977, lots were drawn and the appellants won.
But the authorities did not issue the letters of allotments.
The authorities had a second thought about the scheme of the allotment of the sites.
They wanted to accommodate as many applicants as possible, which, however, could not be done in the industrial area phase II.
The authorities also came to hold the view that for setting up the printing industry, larger sites as earmarked earlier would not be necessary and smaller sites would meet the requirements.
Consequently, the sites proposed in the industrial phase II were given up and a lay out of smaller sites in the industrial area phase I was prepared, wherein about 131 sites were reserved for allotment to the printing press owners.
The appellants as also the other applicants were intimated by letters that the said sites would be allotted at the rate of Rs.35 per square yard, and that the allotment would be made by draw of lots on October 3, 1979.
The appellants did not participate in the proceedings.
They moved the High Court by a writ petition, challenging the 158 revised policy of the allotment of the smaller sites on the ground inter alia that they had a right to take possession of bigger plots in respect which lots were earlier drawn in their favour.
The High Court did not give substantial relief to the appellants, holding that there was nothing illegal in the said revised policy since the appellants did not acquire right to get bigger sites in the phase II, it directed that the appellants would be liable to pay at the rate of Rs.15 and not Rs.35 per square yard.
The appellants appealed to this Court by special leave against the decision of the High Court (C.A 97 of 1981).
The respondents the Chandigarh Administration also moved this Court by special leave (C.A. No. 98 of 1981) against the direction of the High Court as to the reduced premium to be recovered from the appellants.
Dismissing both the appeals, the Court, ^ HELD: There was no substance in the appeal by the respondents.
If the applicants had been allotted sites as per the original plan and as per the first draw in 1977, they would have been liable to pay at the rate of Rs.15 per square yard.
In fact, the other enterpreneurs who were allotted sites in the industrial area phase II paid premium only at the rate of Rs.15 per square yard.
Why then should there be a higher rate payable by the appellants? They had not asked for the sites in the industrial area phase I. Secondly, the applicants were not responsible for the delay in the allotment of sites.
Thirdly, there was no evidence that the Chandigarh Administration had to incur more expenditure in forming the new sites in the phase I. The High Court was right in directing the authorities to recover only at the rate of Rs.15 per square yard.
[161H; 162A C] In the case of the appeal by the appellants/owners of the printing presses, admittedly, at the relevant stage, there was no intimation of the allotment of the sites to the appellants.
There was no official communication to them, as required under sub rule (3) of Rule 8 of the Chandigarh Lease Hold Sites and Building Rules, 1973.
Such an intimation alone could confer the right on the appellants to obtain possession of the sites.
In the absence of any such communication, the appellants could not be held to have the right to get the sites.
[163F G] Emphasis was laid on the word "shall" used in sub rule (3) of Rule 8, which provides that when 10 per cent of the premium has been tendered, the Estate officer shall, subject to such directions as may be issued by the Chief Administrator in that behalf, allot a site of the size 159 applied for.
There is not much force in this contention.
Generally, the use of the word "shall" prima facie indicates that the particular provision is imperative, but that is not so always.
The meaning to be given to a word depends upon the context in which it is used.
The right of every applicant under sub rule (3) of Rule 8 is only a right to have his application considered.
The acceptance of the application does not create a right for allotment of a site.
The word "shall" used in the sub rule must be considered as not mandatory.
imperative meaning would defeat the purpose of the rule.
[163H; 164A B, F] It is not known under what provision the authorities asked the appellants to pay 25 per cent of the premium payable in respect of the sites even before allotment.
There was no specific assurance or representation made by the authorities, promising to allot the sites applied for.
Even if there was any such assurance, the Court did not think that it would give rise to the doctrine of promissory estoppel in the case.
The authorities cannot give assurance contrary to the statutory rules.
They are bound by the rule of procedure and cannot make any representation or promise to allot particular sites to the applicants.
Even if they make such a promise or assurance, the doctrine of promissory estoppel cannot be invoked to compel them to carry out the promise or assurance which is contrary to law.
[166B D] If there were enough plots to accommodate all the applicants in the industrial area Phase II, it would not be proper for the authorities to revise the policy and allot smaller sites in phase I.
But no material was placed before the Court to come to the conclusion that there were enough industrial plots to accommodate, possibly, all the applicants.
The authorities formed another lay out in phase I for want of plots in phase II.
The action of the authorities was bona fide and there was no reason to doubt it.
[166F G] The revised policy of the Chandigarh Administration did not suffer from any act of arbitrariness either in classifying the appellants as a separate group or in considering them for allotment of smaller sites in phase I. All the persons, who had applied for industrial sites for establishing printing presses were grouped together.
They were considered together.
They could not be accommodated in phase II for want of enough sites.
So, another lay out was formed in phase I. The grievance of the appellants about the revised policy of the Chandigarh Administration to allot smaller sites to them, being discriminatory, was not justified.
[168H; t69A C] 160 Delhi Cloth & General Mills Ltd. vs Union of India, Civil Appeal No. 223 of 1974, disposed of by this Court on October 8, 1987 and Shri Ram Krishna Dalmia vs Shri Justice S.R. Tendolkar and Ors,. ; , referred to.
|
ivil Appeal Nos.
97 & 98 of 1981.
From the Judgment and order dated 25.4.1980 of the Punjab and Haryana High Court in C.W. No. 2512 of 1979.
V.M. Tarkunde and N.S. Das Behl for the Appellants.
Kapil Sibal, P. Gaur and Jitendra Sharma for the Respondents.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
These appeals by special leave are directed against the judgment dated April 25, 1980 of the High Court of Punjab & Haryana in civil writ No. 3512 of 1979.
The revised policy of allotment of industrial sites for the establishment of printing presses in Chandigarh has been called into question in the aforesaid writ petition.
The printing presses are now scattered all over Chandigarh.
They are situated either in residential premises or in small shops in different localities.
The Chandigarh administration wanted them to be located in an industrial area.
For that purpose, they earmarked forty three sites in the industrial area phase II.
The sites are comparatively of bigger dimensions.
In 1975, the authorities invited applications for allotment of those sites.
Several persons submitted applications.
The appellants in Appeal No. 97 of 1981 were some of them.
They applied with deposit of earnest money of Rs.1000 each.
That would be ten per cent of the premium payable for the site.
All the applications were processed for final allotment.
In the meantime, it is said that the appellants were called upon to deposit 25 per cent of the premium calculated at the rate of Rs. 15 per square yard.
The appellants appear to have complied with that demand also.
Since there were more applicants than the sites available, the authorities decided to draw the lots.
In October 1977, the lots were drawn and the lady luck smiled at the appellants.
But the authorities did not issue letters of allotment.
The reason was obvious.
The authorities had a second look at the scheme of allotment of sites for printing industries.
The authorities wanted to 161 accommodate as many applicants as possible.
But they could not accommodate all those applicants for want of adequate number of sites in the industrial area phase II.
The authorities were also of the view that for setting up the printing industry, larger sites such as those earmarked earlier, would not be necessary and smaller sites would meet the requirements.
Consequently, the sites proposed in the industrial area phase II were given up and a lay out of smaller sites in the industrial area phase I was formed.
There about 131 of sites were reserved for allotment to printing press owners.
The appellants and other like applicant were intimated by letters that the said sites would be allotted at the rate of RS.35 per square yard.
They were also informed that the allotment would be made by draw of lots on October 3, 1979.
The appellants however, did not participate in the proceedings.
They moved the High Court with a petition under article 226 of the Constitution challenging the revised policy for allotment of smaller sites.
It was contended inter alia that they had a right to take possession of bigger plots in respect of which the lots were earlier drawn in their favour.
The High Court issued rule Nisi in the petition, but allowed the authorities to draw the lots as proposed.
The High Court also permitted the appellants to deposit the premium demanded without prejudice to their rights in the writ petition.
That is all at the preliminary hearing of the writ petition.
In the final hearing the High Court did not give substantial relief to the appellants.
The High Court was of the view that there was nothing illegal in the revised policy adopted by the Chandigarh administration since the appellants did not acquire right to get bigger sites in the industrial area phase II.
The High Court however, felt that the appellants would be liable to pay only at the rate of .
Rs. 15 per square yard and not Rs.35 per square yard.
Accordingly a direction was issued to the authorities.
It is against this judgment that the present appeals have been preferred.
Civil appeal No. 97/81 is by the printing press owners.
Civil Appeal No. 98/81 is by the Chandigarh administration.
The Chandigarh administration is aggrieved by the direction issued by the High Court as to the premium to be recovered from the allottees.
We may first dispose of the appeal preferred by the Chandigarh administration.
We do not find any substance in this appeal.
If the applicants had been allotted sites as per the original proposal and as 162 per the first draw in 1977, they would have been liable to pay only at the rate of Rs. 15 per square yard.
In fact, the other entrepreneurs who were allotted sites from industrial area phase II paid the premium only at the rate of Rs. 15 per square yard.
Why then there should be a higher rate payable by these persons.
They did not ask for sites in the Industrial area phase I. Their applications for sites in the industrial area phase II were not rejected.
The same applications appear to have been considered for sites in the industrial area phase I.
Secondly, the applicants were not responsible for the delay in the allotment of sites.
The delay was entirely due to the change of policy adopted by the Chandigarh administration.
Thirdly, there is no evidence that the Chandigarh administration had to incur more expenditure for forming new sites in phase I.
It is, therefore, not proper that these applicants should be asked to pay the premium at a higher rate.
The High Court, in our opinion, was justified in directing the authorities to recover only at rate of Rs. 15 per square yard.
Before considering the contentions urged in the appeal of printing press owners, we may briefly refer to the relevant provisions of the enactment bearing on the contentions.
The disposal of building sites in Chandigarh has been regulated by the Capital of Punjab (Development and Regulation) Act, 1952 which may be termed as "The Act".
The Chandigarh Lease Hold of Sites and Building Rules, 1973 are the relevant rules which may be referred to as "The Rules".
Section 3 of the Act provides power to the authorities to sell, lease or otherwise transfer any land or building belonging to the Government.
They could be disposed of by auction, allotment or otherwise.
Rule 4 provides that Chandigarh Administration may demise sites and building on lease for 99 years.
The procedure for allotment has been prescribed under rule 8.
Rule 8 so far as it is material provides: "Rule 8.
Lease by allotment Procedure for (1)In case of allotment of site or building the intending lessee shall make an application to the Estate officer in Form 'A '.
(2)No application under sub rule (l) shall be valid unless it is accompanied by 10 per cent of the premium as earnest money in the prescribed form of payment.
(3)When 10 per cent of the premium has been so tendered the Estate officer, shall, subject to such directions 163 as may be issued by the Chief Administrator in this behalf, allot a site of the size applied for or a building or which particulars are given in the application and shall intimate, by registered post the number, sector, approximate area, premium and the rent of the site or building allotted to the applicant.
(4)The applicant shall, unless he refuses to accept the allotment within 30 days of the date of the receipt of the allotment order, deposit within that period and in the prescribed mode of payment, further 15 per cent of the premium.
The remaining 75 per cent of the premium shall be paid as provided in Rule 12.
" The scheme provided under these Rules for allotment of sites is like this: Sub rule (1) of Rule 8 provides for making an application to the Estate officer for allotment of site.
The application shall be accompanied with 10 per cent of the premium as earnest money.
That amount must be tendered to the Estate officer.
The allotment of a site shall be intimated to the applicant by registered letter giving the particulars of number, sector, approximate area, premium and the rent of the site or building allotted to the applicant.
It would be open to the applicant to accept the allotment or not.
If he accepts the allotment he must deposit 15 per cent of the premium and the remaining 75 per cent of the premium shall be paid as provided under Rule.
Relying on these provisions, it was urged that the appellants had a right to obtain transfer of sites in respect of which the lots were first drawn in their favour.
We are unable to accept this contention.
Admittedly, at that stage, there was no intimation of allotment of sites to the appellants.
There was no official communication to them as required under sub rule (3) of Rule 8.
Such intimation alone confers right on the appellants to obtain possession of the sites.
The intimation must be sent by a registered letter giving particulars of the sites allotted and the premium payable in respect thereof.
In the absence of any such communication, the appellants cannot be held to have the right to get transfer of sites in their favour.
The next step in the argument was that the Estate officer ought to have allotted the sites upon the receipt of applications of the appellants.
The reliance was placed and emphasis was put on the word "shall" used in sub rule (3) of Rule 8.
Sub rule (3) of Rule 8 provides 164 that when 10 per cent of the premium has been tendered, the Estate officer shall, subject to such directions as may be issued by the Chief Administrator in that behalf, allot a site of the size applied for.
We do not think that there is much force in this contention also.
Generally the use of the word "shall" prima facie indicates that the particular provision is imperative.
But that is not always so.
The meaning to be given to a word depends upon the context in which it is used.
The word takes the colour depending upon the context.
We must ask what does the word mean in its context? We must examine why the Rule making authority has chosen that word.
After examining the purpose and scope of the rule, we must give such meaning as to render the rule workable in a fair manner.
We must give that meaning which would promote the purpose and object of the rule.
When there is a choice of meanings, there is a presumption that one which produces an unjust or inconvenient result was not intended.
Let us now take a brief look at Rule 8.
If sub rule (3) of Rule 8 is construed as mandatory, then every person who applies for a site with earnest money must be allotted a site.
That means the administration must receive only equal number of applications as there are sites available for allotment.
That would be impracticable.
The administration cannot restrict the number of applications to be received when the public are notified.
Secondly, the sites are required to be disposed by auction or allotment.
If it is by allotment, it should be after considering all applications.
The sites cannot be allotted by private arrangement.
All the applications received must be considered and if there are more applications than the available sites, some reasonable procedure should be adopted for consideration and elimination.
In our opinion, the right of every applicant under sub rule (3) of Rule 8 is only the right to have his application considered.
The acceptance of application does not create a right for allotment of a site.
The word "shall" used in sub rule (3) must, therefore, be considered as not mandatory.
The imperative meaning would defeat the purpose of the rule.
It was next urged that the Chandigarh administration was estopped from revising the policy of allotment after taking several steps for allotment of sites.
The steps taken like demanding 25 per cent of the premium payable and drawing the lots would lead to an assurance that they would be allotted bigger plots.
It was stated that the appellants upon the assurance of getting bigger plots had placed orders for heavy machinaries for their printing presses.
These averments were also made in the writ petition before the High Court.
The High Court rejected the plea of estoppel on the ground that there was no evidence 165 of heavy investment on machinaries.
Mr. V.M. Tarkunde, learned counsel for the appellants urged that there is no need to produce any such evidence to invoke the doctrine of equitable estoppel.
The counsel is right in this aspect.
The party invoking the doctrine of estoppel need not prove any detriment as such.
It may be sufficient if he has relied upon the assurance made to him.
This court in the Delhi Cloth & General Mills Ltd. vs Union of India, (Civil Appeal No. 223 of 1974 disposed of on October 8, 1987) to which one of us was a member, said: "It is true, that in the formative period, it was generally said that the doctrine of promissory estoppel cannot be invoked by the promisee unless he has suffered 'detriment ' or 'prejudice '.
It was often said simply, that the party asserting the estoppel must have been induced to act to his detriment.
But this has now been explained in so many decisions all over.
All that is now required is that the party asserting the estoppel must have acted upon the assurance given to him must have relied upon the representation made to him.
It means, the party has changed or altered the position by relying on the assurance or the representation.
The alteration of position by the party is the only indispensable requirement of the doctrine.
It is not necessary to prove further any damage, detriment or prejudice to the party asserting the estoppel.
The Court, however, would compel the opposite party to adhere to the representation acted upon or abstained from acting.
The entire doctrine proceeds on the promise that it is reliance based and nothing more." And said: "The concept of detriment as we now understand is whether it appears unjust, unreasonable or inequitable that the promisor should be allowed to resile from his assurance or representation having regard to what the promisee has done or refrained from doing in reliance on the assurance or representation.
" It was further said: "It is however, quite fundamental that the doctrine of promissory estoppel, cannot be used to compel the 166 public bodies or the Government to carry out the rep resentation or promise which is contrary to law or which is outside their authority of power." In the first place, we do not know under what provision the authorities asked the appellants to pay 25 per cent of the premium payable in respect of the sites even before allotment.
Apparently that procedure appears to be irregular with no statutory sanction.
Secondly, we do not find any specific assurance or representation made by the authorities promising to allot the sites applied for.
Thirdly, even if there was any such assurance, we do not think that it would give rise to the doctrine of promissory estoppel in the instance case.
The authorities cannot give assurance contrary to the statutory rules.
The sites are required to be disposed of by auction, allotment or sale as per the procedure prescribed.
The authorities who are bound by the rules of procedure cannot make any representation or promise to allot particular sites to the applicants.
Even if they make such promise or assurance, the doctrine of promissory estoppel cannot be invoked to compel them to carry out the promise or assurance which is contrary to law.
The next contention urged for the appellants related to the revised policy adopted by the Chandigarh administration for allotment of smaller sites.
It was said that the sites in phase II ought to have been allotted when there were enough to go round the appellants.
It was also said that the other entrepreneurs who had filed applications along with the appellants had been allotted sites in phase II and there was no good reason to exclude the appellants for being considered for smaller sites in phase I. The procedure followed by the authorities has been assailed as arbitrary and contrary to article 14 of the Constitution.
Of course, if there were enough plots to accommodate all the applicants in the industrial area phase II, it would not be proper for the authorities to revise the policy and allot smaller sites in phase I.
But no material has been placed before us to come to the conclusion that there were enough industrial plots to accommodate as far as possible all those applicants.
It appears from the record that the authorities for want of plots in phase II formed another lay out in phrase I. The action of the authorities appears to be bona fide and we have no reason to doubt it.
This takes us to the question whether the revised policy adopted by the Chandigarh administration to allot smaller sites to these appellants was discriminatory and violative of article 14 of the 167 Constitution.
The true meaning and scope of article 14 has been stated and restated in a string of decisions of this Court.
It is now well established that article 14 forbids class legislation, but does not forbid reasonable classification for the purpose of legislation.
In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group; and (ii) that the differentia must have a rational relation to the object sought to be achieved by the statute in question.
The classification may be founded on different basis, namely, geographical or according to objects or occupations or the like.
What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration.
S.R. Oas, C.J. speaking for this Court in Shri Ram Krishna Dalmia vs Shri Justice S.R. Tendolkar & others; , has formulated the various aspects of article 14 and out of them, we may refer to the following proposition: (a) article 14 condemns discrimination not only by substantive law but by a law of procedure, (b) article 14 forbids class legislation but does not forbid classification, (c) In permissible classification, mathematical nicety and perfect equality are not required, (d) The classification may be founded on different basis, namely, geographical or according to objects or occupations or the like, (e) If a law deals equally with members of a well defined class, it is not obnoxious and it is not open to the charge of denial of equal protection on the ground that it has no application to other persons, and (f) Even a single individual may form a class by himself on account of some special circumstances or reason applicable to him and not applicable to others.
This Court speaking through Chandrachud, CJ.
in Re The Special Courts Bill, 1978(19792 SCR 476) reformulated in detail the propositions on article 14.
The following are relevant for the 168 present case and may be extracted: (i) The constitutional command to the State to afford equal protection of its law sets a goal not attainable by the invention and application of a precise formula.
Therefore, classification need not be constituted by an exact or scientific exclusion or inclusion of persons or things.
The Courts should not insist on delusive exactness or apply doctrinaire tests for determining the validity of classification in any given case.
Classification is justified if it is not palpably arbitrary.
(ii) The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience.
It can recognise even a degree of evil, but the classification should never be arbitrary, artificial or evasive.
(iii) The classification must not be arbitrary but must be rational, that is to say, it must not only be based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out but those qualities or characteristics must have a reasonable relation to the object of the legislation.
There is yet another facet of article 14.
This Court speaking through Bhagwati, J. in E.P. Royappa vs State of Tamil Nadu, and in Maneka Gandhi case (AIR 1978 SC 597) held that the basic principle which informs both articles 14 and 16 is equality and inhibition against discrimination.
Equality and arbitrariness are sworn enemies, one belongs to the rule of law in a republic while the other to the whim and caprise of an absolute monarch.
Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore, violative of article 14.
Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment.
This, in our opinion, is more fundamental.
Article 14 unlike other articles in Part III of the Constitution, is an injunction against the State that it shall not discriminate person to person unless the action is supported by well known principles.
There is thus no doubt or dispute about the principles.
The question is only the application of the principles to a given case.
In the present case, however, we do not find that the revised policy of the Chandigarh administration suffers from any act of arbitrariness 169 either in classifying the appellants as a separate group or in considering them for allotment of smaller sites in phase I. The appellants formed a separate class.
All the persons who have applied for industrial sites for establishing printing presses were grouped together.
They were considered together.
They could not have been accommodated in phase II for want of enough sites.
So another lay out was formed in phase I. We are told that most of the applicants have now been allotted sites and they have since taken possession.
The appellants were also allotted sites in phase I.
We are, therefore.
Of the opinion that the grievance of the appellants about discrimination is not justified on the facts and circumstances of the case.
In the result, both the appeals fail and are dismissed, but we make no order as to costs.
S.L. Appeals dismissed.
|
From the Judgment and order dated 25.4.1980 of the Punjab and Haryana High Court in C.W. No. V.M. Tarkunde and N.S. Das Behl for the Appellants. Kapil Sibal, P. Gaur and Jitendra Sharma for the Respondents. The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
These appeals by special leave are directed against the judgment dated April 25, 1980 of the High Court of Punjab & Haryana in civil writ No. The revised policy of allotment of industrial sites for the establishment of printing presses in Chandigarh has been called into question in the aforesaid writ petition. The printing presses are now scattered all over Chandigarh. They are situated either in residential premises or in small shops in different localities. The Chandigarh administration wanted them to be located in an industrial area. For that purpose, they earmarked forty three sites in the industrial area phase II. The sites are comparatively of bigger dimensions. In 1975, the authorities invited applications for allotment of those sites. They applied with deposit of earnest money of Rs.1000 each. That would be ten per cent of the premium payable for the site. All the applications were processed for final allotment. In the meantime, it is said that the appellants were called upon to deposit 25 per cent of the premium calculated at the rate of Rs. The appellants appear to have complied with that demand also. Since there were more applicants than the sites available, the authorities decided to draw the lots. In October 1977, the lots were drawn and the lady luck smiled at the appellants. But the authorities did not issue letters of allotment. The authorities had a second look at the scheme of allotment of sites for printing industries. The authorities wanted to 161 accommodate as many applicants as possible. But they could not accommodate all those applicants for want of adequate number of sites in the industrial area phase II. The authorities were also of the view that for setting up the printing industry, larger sites such as those earmarked earlier, would not be necessary and smaller sites would meet the requirements. Consequently, the sites proposed in the industrial area phase II were given up and a lay out of smaller sites in the industrial area phase I was formed. There about 131 of sites were reserved for allotment to printing press owners. The appellants and other like applicant were intimated by letters that the said sites would be allotted at the rate of RS.35 per square yard. They were also informed that the allotment would be made by draw of lots on October 3, 1979. The appellants however, did not participate in the proceedings. They moved the High Court with a petition under article 226 of the Constitution challenging the revised policy for allotment of smaller sites. It was contended inter alia that they had a right to take possession of bigger plots in respect of which the lots were earlier drawn in their favour. The High Court issued rule Nisi in the petition, but allowed the authorities to draw the lots as proposed. That is all at the preliminary hearing of the writ petition. In the final hearing the High Court did not give substantial relief to the appellants. The High Court was of the view that there was nothing illegal in the revised policy adopted by the Chandigarh administration since the appellants did not acquire right to get bigger sites in the industrial area phase II. The High Court however, felt that the appellants would be liable to pay only at the rate of . 15 per square yard and not Rs.35 per square yard. Accordingly a direction was issued to the authorities. It is against this judgment that the present appeals have been preferred. 98/81 is by the Chandigarh administration. We may first dispose of the appeal preferred by the Chandigarh administration. We do not find any substance in this appeal. In fact, the other entrepreneurs who were allotted sites from industrial area phase II paid the premium only at the rate of Rs. Why then there should be a higher rate payable by these persons. They did not ask for sites in the Industrial area phase I. Their applications for sites in the industrial area phase II were not rejected. The same applications appear to have been considered for sites in the industrial area phase I.
Secondly, the applicants were not responsible for the delay in the allotment of sites. The delay was entirely due to the change of policy adopted by the Chandigarh administration. Before considering the contentions urged in the appeal of printing press owners, we may briefly refer to the relevant provisions of the enactment bearing on the contentions. The disposal of building sites in Chandigarh has been regulated by the Capital of Punjab (Development and Regulation) Act, 1952 which may be termed as "The Act". Section 3 of the Act provides power to the authorities to sell, lease or otherwise transfer any land or building belonging to the Government. They could be disposed of by auction, allotment or otherwise. Rule 4 provides that Chandigarh Administration may demise sites and building on lease for 99 years. The procedure for allotment has been prescribed under rule 8. Rule 8 so far as it is material provides: "Rule 8. Lease by allotment Procedure for (1)In case of allotment of site or building the intending lessee shall make an application to the Estate officer in Form 'A '. (2)No application under sub rule (l) shall be valid unless it is accompanied by 10 per cent of the premium as earnest money in the prescribed form of payment. (3)When 10 per cent of the premium has been so tendered the Estate officer, shall, subject to such directions 163 as may be issued by the Chief Administrator in this behalf, allot a site of the size applied for or a building or which particulars are given in the application and shall intimate, by registered post the number, sector, approximate area, premium and the rent of the site or building allotted to the applicant. The remaining 75 per cent of the premium shall be paid as provided in Rule 12. The application shall be accompanied with 10 per cent of the premium as earnest money. That amount must be tendered to the Estate officer. It would be open to the applicant to accept the allotment or not. There was no official communication to them as required under sub rule (3) of Rule 8. The intimation must be sent by a registered letter giving particulars of the sites allotted and the premium payable in respect thereof. The next step in the argument was that the Estate officer ought to have allotted the sites upon the receipt of applications of the appellants. The reliance was placed and emphasis was put on the word "shall" used in sub rule (3) of Rule 8. Sub rule (3) of Rule 8 provides 164 that when 10 per cent of the premium has been tendered, the Estate officer shall, subject to such directions as may be issued by the Chief Administrator in that behalf, allot a site of the size applied for. We do not think that there is much force in this contention also. Generally the use of the word "shall" prima facie indicates that the particular provision is imperative. The meaning to be given to a word depends upon the context in which it is used. The word takes the colour depending upon the context. We must ask what does the word mean in its context? We must examine why the Rule making authority has chosen that word. After examining the purpose and scope of the rule, we must give such meaning as to render the rule workable in a fair manner. We must give that meaning which would promote the purpose and object of the rule. When there is a choice of meanings, there is a presumption that one which produces an unjust or inconvenient result was not intended. If sub rule (3) of Rule 8 is construed as mandatory, then every person who applies for a site with earnest money must be allotted a site. That means the administration must receive only equal number of applications as there are sites available for allotment. The administration cannot restrict the number of applications to be received when the public are notified. Secondly, the sites are required to be disposed by auction or allotment. If it is by allotment, it should be after considering all applications. The sites cannot be allotted by private arrangement. All the applications received must be considered and if there are more applications than the available sites, some reasonable procedure should be adopted for consideration and elimination. In our opinion, the right of every applicant under sub rule (3) of Rule 8 is only the right to have his application considered. The acceptance of application does not create a right for allotment of a site. The word "shall" used in sub rule (3) must, therefore, be considered as not mandatory. The imperative meaning would defeat the purpose of the rule. The steps taken like demanding 25 per cent of the premium payable and drawing the lots would lead to an assurance that they would be allotted bigger plots. It was stated that the appellants upon the assurance of getting bigger plots had placed orders for heavy machinaries for their printing presses. These averments were also made in the writ petition before the High Court. The High Court rejected the plea of estoppel on the ground that there was no evidence 165 of heavy investment on machinaries. The party invoking the doctrine of estoppel need not prove any detriment as such. It may be sufficient if he has relied upon the assurance made to him. This court in the Delhi Cloth & General Mills Ltd. vs Union of India, (Civil Appeal No. It was often said simply, that the party asserting the estoppel must have been induced to act to his detriment. But this has now been explained in so many decisions all over. All that is now required is that the party asserting the estoppel must have acted upon the assurance given to him must have relied upon the representation made to him. It means, the party has changed or altered the position by relying on the assurance or the representation. The alteration of position by the party is the only indispensable requirement of the doctrine. It is not necessary to prove further any damage, detriment or prejudice to the party asserting the estoppel. The Court, however, would compel the opposite party to adhere to the representation acted upon or abstained from acting. The entire doctrine proceeds on the promise that it is reliance based and nothing more." " It was further said: "It is however, quite fundamental that the doctrine of promissory estoppel, cannot be used to compel the 166 public bodies or the Government to carry out the rep resentation or promise which is contrary to law or which is outside their authority of power." In the first place, we do not know under what provision the authorities asked the appellants to pay 25 per cent of the premium payable in respect of the sites even before allotment. Apparently that procedure appears to be irregular with no statutory sanction. Secondly, we do not find any specific assurance or representation made by the authorities promising to allot the sites applied for. Thirdly, even if there was any such assurance, we do not think that it would give rise to the doctrine of promissory estoppel in the instance case. The authorities cannot give assurance contrary to the statutory rules. The sites are required to be disposed of by auction, allotment or sale as per the procedure prescribed. It was said that the sites in phase II ought to have been allotted when there were enough to go round the appellants. Of course, if there were enough plots to accommodate all the applicants in the industrial area phase II, it would not be proper for the authorities to revise the policy and allot smaller sites in phase I.
But no material has been placed before us to come to the conclusion that there were enough industrial plots to accommodate as far as possible all those applicants. It appears from the record that the authorities for want of plots in phase II formed another lay out in phrase I. The action of the authorities appears to be bona fide and we have no reason to doubt it. The true meaning and scope of article 14 has been stated and restated in a string of decisions of this Court. It is now well established that article 14 forbids class legislation, but does not forbid reasonable classification for the purpose of legislation. In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group; and (ii) that the differentia must have a rational relation to the object sought to be achieved by the statute in question. The classification may be founded on different basis, namely, geographical or according to objects or occupations or the like. What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration. This Court speaking through Chandrachud, CJ. in Re The Special Courts Bill, 1978(19792 SCR 476) reformulated in detail the propositions on article 14. The following are relevant for the 168 present case and may be extracted: (i) The constitutional command to the State to afford equal protection of its law sets a goal not attainable by the invention and application of a precise formula. Therefore, classification need not be constituted by an exact or scientific exclusion or inclusion of persons or things. The Courts should not insist on delusive exactness or apply doctrinaire tests for determining the validity of classification in any given case. Classification is justified if it is not palpably arbitrary. (ii) The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience. It can recognise even a degree of evil, but the classification should never be arbitrary, artificial or evasive. There is yet another facet of article 14. Equality and arbitrariness are sworn enemies, one belongs to the rule of law in a republic while the other to the whim and caprise of an absolute monarch. Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore, violative of article 14. Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment. This, in our opinion, is more fundamental. Article 14 unlike other articles in Part III of the Constitution, is an injunction against the State that it shall not discriminate person to person unless the action is supported by well known principles. There is thus no doubt or dispute about the principles. The question is only the application of the principles to a given case. In the present case, however, we do not find that the revised policy of the Chandigarh administration suffers from any act of arbitrariness 169 either in classifying the appellants as a separate group or in considering them for allotment of smaller sites in phase I. The appellants formed a separate class. All the persons who have applied for industrial sites for establishing printing presses were grouped together. They could not have been accommodated in phase II for want of enough sites. So another lay out was formed in phase I. We are told that most of the applicants have now been allotted sites and they have since taken possession. The appellants were also allotted sites in phase I.
We are, therefore. Of the opinion that the grievance of the appellants about discrimination is not justified on the facts and circumstances of the case. In the result, both the appeals fail and are dismissed, but we make no order as to costs.
|
% The Chandigarh administration wanted the printing presses, scattered all over Chandigarh in the residential premises or small shops, to be located in an industrial area.
For that purpose, the administration earmarked forty three sites in the industrial area Phase lI, and invited applications for allotment of the sites.
Several persons submitted the applications with deposits of earnest money of Rs.1,000 in each.
That was ten per cent of the premium payable for each site.
The appellants in the C.A. No. 97 of 1981, who were among the said applicants, were called upon to deposit 25 per cent of the premium calculated at the rate of Rs.15 per square yard.
The appellants complied with that demand.
The authorities decided to draw lots as the applicants were more than the number of the sites available.
In October 1977, lots were drawn and the appellants won.
But the authorities did not issue the letters of allotments.
The authorities had a second thought about the scheme of the allotment of the sites.
They wanted to accommodate as many applicants as possible, which, however, could not be done in the industrial area phase II.
The authorities also came to hold the view that for setting up the printing industry, larger sites as earmarked earlier would not be necessary and smaller sites would meet the requirements.
Consequently, the sites proposed in the industrial phase II were given up and a lay out of smaller sites in the industrial area phase I was prepared, wherein about 131 sites were reserved for allotment to the printing press owners.
The appellants as also the other applicants were intimated by letters that the said sites would be allotted at the rate of Rs.35 per square yard, and that the allotment would be made by draw of lots on October 3, 1979.
The appellants did not participate in the proceedings.
They moved the High Court by a writ petition, challenging the 158 revised policy of the allotment of the smaller sites on the ground inter alia that they had a right to take possession of bigger plots in respect which lots were earlier drawn in their favour.
The High Court did not give substantial relief to the appellants, holding that there was nothing illegal in the said revised policy since the appellants did not acquire right to get bigger sites in the phase II, it directed that the appellants would be liable to pay at the rate of Rs.15 and not Rs.35 per square yard.
The appellants appealed to this Court by special leave against the decision of the High Court (C.A 97 of 1981).
The respondents the Chandigarh Administration also moved this Court by special leave (C.A. No. 98 of 1981) against the direction of the High Court as to the reduced premium to be recovered from the appellants.
Dismissing both the appeals, the Court, ^ HELD: There was no substance in the appeal by the respondents.
If the applicants had been allotted sites as per the original plan and as per the first draw in 1977, they would have been liable to pay at the rate of Rs.15 per square yard.
In fact, the other enterpreneurs who were allotted sites in the industrial area phase II paid premium only at the rate of Rs.15 per square yard.
Why then should there be a higher rate payable by the appellants? They had not asked for the sites in the industrial area phase I. Secondly, the applicants were not responsible for the delay in the allotment of sites.
Thirdly, there was no evidence that the Chandigarh Administration had to incur more expenditure in forming the new sites in the phase I. The High Court was right in directing the authorities to recover only at the rate of Rs.15 per square yard.
[161H; 162A C] In the case of the appeal by the appellants/owners of the printing presses, admittedly, at the relevant stage, there was no intimation of the allotment of the sites to the appellants.
There was no official communication to them, as required under sub rule (3) of Rule 8 of the Chandigarh Lease Hold Sites and Building Rules, 1973.
Such an intimation alone could confer the right on the appellants to obtain possession of the sites.
In the absence of any such communication, the appellants could not be held to have the right to get the sites.
[163F G] Emphasis was laid on the word "shall" used in sub rule (3) of Rule 8, which provides that when 10 per cent of the premium has been tendered, the Estate officer shall, subject to such directions as may be issued by the Chief Administrator in that behalf, allot a site of the size 159 applied for.
There is not much force in this contention.
Generally, the use of the word "shall" prima facie indicates that the particular provision is imperative, but that is not so always.
The meaning to be given to a word depends upon the context in which it is used.
The right of every applicant under sub rule (3) of Rule 8 is only a right to have his application considered.
The acceptance of the application does not create a right for allotment of a site.
The word "shall" used in the sub rule must be considered as not mandatory.
imperative meaning would defeat the purpose of the rule.
[163H; 164A B, F] It is not known under what provision the authorities asked the appellants to pay 25 per cent of the premium payable in respect of the sites even before allotment.
There was no specific assurance or representation made by the authorities, promising to allot the sites applied for.
Even if there was any such assurance, the Court did not think that it would give rise to the doctrine of promissory estoppel in the case.
The authorities cannot give assurance contrary to the statutory rules.
They are bound by the rule of procedure and cannot make any representation or promise to allot particular sites to the applicants.
Even if they make such a promise or assurance, the doctrine of promissory estoppel cannot be invoked to compel them to carry out the promise or assurance which is contrary to law.
[166B D] If there were enough plots to accommodate all the applicants in the industrial area Phase II, it would not be proper for the authorities to revise the policy and allot smaller sites in phase I.
But no material was placed before the Court to come to the conclusion that there were enough industrial plots to accommodate, possibly, all the applicants.
The authorities formed another lay out in phase I for want of plots in phase II.
The action of the authorities was bona fide and there was no reason to doubt it.
[166F G] The revised policy of the Chandigarh Administration did not suffer from any act of arbitrariness either in classifying the appellants as a separate group or in considering them for allotment of smaller sites in phase I. All the persons, who had applied for industrial sites for establishing printing presses were grouped together.
They were considered together.
They could not be accommodated in phase II for want of enough sites.
So, another lay out was formed in phase I. The grievance of the appellants about the revised policy of the Chandigarh Administration to allot smaller sites to them, being discriminatory, was not justified.
[168H; t69A C] 160 Delhi Cloth & General Mills Ltd. vs Union of India, Civil Appeal No. 223 of 1974, disposed of by this Court on October 8, 1987 and Shri Ram Krishna Dalmia vs Shri Justice S.R. Tendolkar and Ors,. ; , referred to.
|
% The Chandigarh administration wanted the printing presses, scattered all over Chandigarh in the residential premises or small shops, to be located in an industrial area. That was ten per cent of the premium payable for each site. 97 of 1981, who were among the said applicants, were called upon to deposit 25 per cent of the premium calculated at the rate of Rs.15 per square yard. The appellants complied with that demand. The authorities decided to draw lots as the applicants were more than the number of the sites available. In October 1977, lots were drawn and the appellants won. But the authorities did not issue the letters of allotments. They wanted to accommodate as many applicants as possible, which, however, could not be done in the industrial area phase II. The appellants did not participate in the proceedings. The appellants appealed to this Court by special leave against the decision of the High Court (C.A 97 of 1981). Dismissing both the appeals, the Court, ^ HELD: There was no substance in the appeal by the respondents. Why then should there be a higher rate payable by the appellants? They had not asked for the sites in the industrial area phase I. Secondly, the applicants were not responsible for the delay in the allotment of sites. [161H; 162A C] In the case of the appeal by the appellants/owners of the printing presses, admittedly, at the relevant stage, there was no intimation of the allotment of the sites to the appellants. There is not much force in this contention. The meaning to be given to a word depends upon the context in which it is used. The right of every applicant under sub rule (3) of Rule 8 is only a right to have his application considered. The word "shall" used in the sub rule must be considered as not mandatory. imperative meaning would defeat the purpose of the rule. The authorities cannot give assurance contrary to the statutory rules. They are bound by the rule of procedure and cannot make any representation or promise to allot particular sites to the applicants. Even if they make such a promise or assurance, the doctrine of promissory estoppel cannot be invoked to compel them to carry out the promise or assurance which is contrary to law. [166B D] If there were enough plots to accommodate all the applicants in the industrial area Phase II, it would not be proper for the authorities to revise the policy and allot smaller sites in phase I.
But no material was placed before the Court to come to the conclusion that there were enough industrial plots to accommodate, possibly, all the applicants. The authorities formed another lay out in phase I for want of plots in phase II. The action of the authorities was bona fide and there was no reason to doubt it. They could not be accommodated in phase II for want of enough sites. So, another lay out was formed in phase I. The grievance of the appellants about the revised policy of the Chandigarh Administration to allot smaller sites to them, being discriminatory, was not justified. [168H; t69A C] 160 Delhi Cloth & General Mills Ltd. vs Union of India, Civil Appeal No. 223 of 1974, disposed of by this Court on October 8, 1987 and Shri Ram Krishna Dalmia vs Shri Justice S.R. Tendolkar and Ors,. ; ,
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ION: Civil Appeal No. 4096 of 1987.
From the Judgment and order dated 2.6.1987 of the Calcutta High Court in Appeal NQ.
344 of 1980.
332 A.K. Sen, S.k. Gambhir and Vivek Gambhir for the Appellant.
Dr. Shankar Ghosh and Rathin Das for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The respondent was appointed a transport and handling contractor by the appellant subject to the terms and conditions mentioned in three successive agreements in writing entered into by both the parties.
After disputes arose between the parties, as per the terrns of arbitration clause an arbitrator was appointed to adjudicate upon the disputes.
Both the respondent and the appellant filed their respective claims and counter claims before the arbitrator.
After considering the documents and evidence filed before the arbitrator, he made and published an award which was a speaking one.
The arbitrator did not allow the appellant 's claim for demurrage and wharfage charges paid to Railways amounting to Rs.15,63,863.02 by reason of the alleged wrongful conduct of respondent but the arbitrator awarded only 55% of the claim.
The arbitrator also did not allow the appellant 's claim for shortage in transit but reduced the claim by 40% and allowed only 60% of it amounting to Rs.52,971.99.
By the award the arbitrator awarded to the respondent Rs.12,64,175.97 and pendente lite interest at 6% per annum.
The appellant filed objections in the High Court of Calcutta under sections 30 and 33 of the (hereinafter called 'the Act ') for setting aside the award.
On 18th September, 19.80, the learned single judge of the High Court by his judgment and order set aside the award.
There was an appeal to the Division Bench of the High Court.
On 2nd June, 1987 the Division Bench of the High Court allowed the respondent 's appeal by its judgment and order and set aside the judgment of the learned single judge and upheld the award.
Being aggrieved thereby the appellant has come up before this Court by special leave under Article 136 of the Constitution.
While issuing notice on the application under Article 136 of the Constitution it was indicated that only three questions will be adjudicated upon in this appeal viz. Rs.13,94,982.46 which was the amount allowed on account of demurrage and wharfage charges mentioned in the award and secondly, the sum of Rs.2,35,769.46 and lastly on the question of interest.
So far as the second question of the matter is concerned Sree A.K. Sen, counsel appearing for the appellant has not made any sub 333 mission before us.
We also cannot find any substance in this aspect.
Therefore, it is not necessary for us to deal with this aspect of the matter.
So far as the amount of Rs. 13,94,982.46 on account of demurrage and wharfage is concerned, which was allowed, the award dealt with the question as set out in the paper book.
It appears that the total demurrage and wharfage charges paid by the Corporation to the Railways, in respect of the wagons cleared by the claimant firm, respondent herein, after obtaining such waiver as the Railways were persuaded to make was for Rs.15,63,863.21.
The charges were alleged to have been paid under Credit Notes which were produced before the arbitrator.
There was no dispute about the actual payment of the charges.
The appellant 's case was that it was entitled to recover the entire amount it had to pay on account of the demurrage and wharfage charges from the respondent under clause 9(a) of the agreement.
Clauses 9, 9(a) and 9(b) of the agreement are as follows: 9.
The Agent shall commence to load and/or unload all the wagons and trucks as well as all streamers, flats, barges and boats or any other conveyance on the day of these arrival and shall carry out the orders and directions of the Manager with all possible despatch and shall be responsible for and make good all demurrage or other waiting charges and expenses that may accrue and all other charges that may in the opinion of the Manager be payable because of or through any reasonable detention or delay." "9(a) The Agent shall be responsible for unloading/loading the wagons within the free period allowed by the Railways and also for loading/unloading for trucks/carts or any other transport vehicles expeditiously.
The Agent shall be liable to make good any compensation/demurrage/wharfage as per Railway rules in force during the period of contract other charges or expenses that may be incurred by the Corporation on account of delay in loading/unloading of truck/carts and unloading/loading of Wagons unless the delay is for reason beyond the Agents ' control.
The decision of the manager in this respect shall be final and binding on the Agent." "9(b) The Agent be present himself or send his duly 334 authorised representative to be present at all weighments A with which the Agent is concerned under this Agreement and in case he fails or chooses not to do so, no claim what soever shall lie against the Corporation in this regard.
" Under clause 9(a), according to the appellant, the Agent was liable to make good any compensation/demurrage/wharfage as per Railway rates in force during the period of contract, other charges or expenses that might be incurred by the Corporation on account of delay in loading/unloading of trucks/carts and unloading/loading or wagons unless the delay was for reasons beyond the Agent 's control.
It appears that the appellant and periodically served notices upon the respondent firm calling upon it to pay demurrage and wharfage charges with liberty to prefer objections.
Such objections as the respondent firm preferred were heard and disposed of by the District Manager.
This procedure continued till the end of November, 1975.
Then the respondent firm went to the Civil Court and obtained discontinuance of all proceedings for recovery of demurrage and wharfage charges.
The arbitrator noted that as a result of the hearings by the Corporation upto November, 1975 relief to the tune of Rs.1,21,884.55 was granted to the respondent firm and recovery of Rs.46,996.20 was made from the respondent firm 's bills.
The Corporation, therefore, claimed before the arbitrator recovery of remaining of the claim of Rs.13,94,982.46.
The respondent on the other hand claimed refund of the amount already deducted from the bills on the ground that it was not liable for any part of the demurrage and wharfage charges.
The claim of the respondent was that the demurrage and wharfage charges accrued invariably in circumstances beyond its control and accordingly under clause 9(a) of the agreement it could not be made liable for such charges.
The arbitrator noted that the respondent firm had impressive documentary evidence in support of its case.
It had produced numerous letters in which it fully explained to the authorities concerned the difficulties it was experiencing in timely clearance of goods from railway wagons and sheds.
It was claimed that it had produced month wise report of its work accounting for nearly all cases of demurrage and wharfage.
On 9th of October, 1975 the respondent had informed the Corporation by a letter Exhibit 128 which inadvertently was not marked exhibit that it was resuming work (there had been a break in his contract) on the condition that it would not be required to clear more than 10 c.c.
Or 4 box wagons, i.e. 200 m.t.
approximately daily.
This is a belated and rather grudging acceptance of this condition by the letter, Exhibit 44 dated 3rd of August, 1976.
335 The Arbitrator noted that from the letters and reports it appeared that timely clearance was hampered, and often made impossible by arrival of too many wagons at a time, congestion at the sidings and at the weighbridges with consequent detention of lorries, labour unrest and chronic want of space in the Corporation 's godowns and by others.
The arbitrator noted that there was insistent complaint about this want of space in the Corporation 's godown, which led to the goods being left in railways sheds for days together incurring unusually heavy wharfage charges.
The Corporation sometimes prepared over ambitious programmes of work for the contractors, as if unaware.
Of the existing situation.
The arbitrator noted that the appellant had examined several witnesses from the sidings.
But they did not according to the Arbitrator, prove anything beyond the procedure of work generally adopted at the sidings.
The arbitrator further noted about the foregoing explanations that the very often the objection of the railway shed staff to the claimant regarding not clearing of the wagons timely from the railway shed because of non space there owing to heavy stock kept therein remaining uncleared, and further that the claimant under the direction and order of the respondent being given limited programme because of non space in the receiving depots/ godowns were causes of delay.
The arbitrator noted that it would be fair to make the claimant firm liable for only 25% of the demurrage and wharfage charges sought to be recovered by the Corporation, leaving the remaining 75% to be borne by the Corporation itself.
Therefore, out of Rs.13,94,982.46 the Corporation, according to the arbitrator, could recover only Rs.3,48,745.61.
The appellant felt aggrieved thereby and challenges this grant of 25%.
So far as respondent 's claim for refund of Rs.46.996.20 already recovered, the arbitrator felt that there was no ground for interference.
The arbitrator noted that after hearing the claimant firm 's objections the deductions had been made.
The claimant firm had been granted relief in respect of Rs.1,21,884.55.
The arbitrator had not been able to ascertain precisely the total claim of the appellant till the end of November, 1975 but he noted that the sum of Rs.46,996.20 represented not much more than 25% of the total claim.
Therefore, the arbitrator noted that the claimant, namely, the respondent was not entitled to any refund and that the appellant could recover only Rs.3,48,745.61 on account of demurrage and wharfage charges.
As mentioned hereinbefore that is the main contention in this challenge before this Court.
The appellant claimed that it should have been entitled to the benefit of Rs.13,94,982.46 and not to 25% of the same.
Sree Sen, counsel for the appellant drew out attention to clauses 336 9(a) and (b) as set out hereinbefore and submitted that the respondent was only entitled to the amount as determined by the Manager which was described as final.
Sree Sen submitted that according to clause 9(a) aforesaid the adjudication made by the manager was final and there was no dispute thereafter and therefore, there could be no determination beyond 25%.
He drew our attention to that part of the 13 clause 9(a) to the following effect "the decision of the manager in this respect shall be final and binding on the Agent." So according to Sree Sen apart from what had been granted by the Manager for determination on account of demurrage and wharfage charges, no further deduction was possible nor was it arbitrable because it was final.
He drew our attention to certain observation in Wadsworth vs Smith, L.R. Vol.
Vl Q.B. 332.
There by a written agreement the plaintiff therein had agreed to build four houses on land of defendant and the defendant to grant plaintiff a lease when the houses were completed; the architects of the defendant for the time being were to certify as to the progress of the work, and if there should be any unnecessary delay or unsatisfactory conduct on the part of the plaintiff with regard to the erection of the buildings, on any matter or thing connected therewith "the fact of such delay or unsatisfactory conduct to be ascertained and decided in writing by the architects, against whose decision there shall be no appeal", then it should be lawful for defendant to employ other persons to execute the works, and to sell the buildings and lease the land to other persons.
On an application to make the agreement a rule of court under section 17 of the Common Law Procedure Act, 1854 of England, it was held by Cockburn, C.J., Blackburn and Mellor, JJ.
that assuming the agreement to be "an agreement or submission to arbitration" within the section, the clause that there was to be no appeal against the decision of the architects amounted to "words purporting that the parties intended that it should not be made a rule of court.
" The question was raised whether the agreement was not a submission to arbitration.
Cockburn, C.J. Observed that this clause was certainly more like a submission to arbitration ' it was on the confines of the two classes ' but on the whole it seems to His Lordship to savour more of a mere architect 's certificate than of a judicial proceeding.
Moreover, even if this were a submission within section 17, the Chief Justice thought that it could not be made a rule of court, because it was clear that the parties intended that the matter should be left to the decision of the architects without appeal; but to make it a rule of court would be to submit the decision to the jurisdiction of the Court.
Blackburn, J. agreed.
His Lordship observed that where by an agreement the right of one of the parties to have or to do a particular thing was made to depend on the determination of a third person, that 337 was not a submission to arbitration, nor was the determination an award; but where there was an agreement that any dispute about a particular thin shall be enquired into and determined by a person named, that might amount to a submission to arbitration, and the determination though in the form of a certificate, be an award.
Hannen, J. was of the view that this is not an agreement or submission to arbitration; the clause in question appeared to be no more than an extension of the ordinary clause in building contracts, that the certificate of the architect should be conclusive as to work done and the mode of doing it.
If we proceed on this basis then the logical conclusion of this would be that where there is a decision by the manager as in the instant case that would be final.
Where a dispute has been adjudicated by the manager in this aspect there was nothing for the arbitrator to decide.
It appears to us on the facts as recorded by the arbitrator in his award that there was adjudication really by the Manager of the claims upto November, 1975.
Thereafter there could be no adjudication as a result of injunction obtained from the court.
Therefore, it appears to us that there was really, in fact, no adjudication of all the disputes.
The remaining points were arbitrable because of the amplitude of the arbitration clause.
The relevant arbitration clause in this case contained, inter alia, as follows: .
"In the event of any question or dispute arising under this Agreement regarding the construction thereof or any clause herein or in respect of any act, matter or thing relating to this agreement the same shall be referred to the Sole Arbitration of any person appointed by the Managing Director of the Food Corporation of India . . .
The Award of such Arbitrator shall be final and binding on the parties to this Agreement . ." The point there having been decision before the Manager, that disallowance of the claim beyond 25% was beyond the jurisdiction of arbitration was not agitated before the High Court.
Prabir Kumar Majumdar, J. speaking for the Division Bench of the High Court of Calcutta observed at page 24 of the paper book as follows: "It has not been brought to our notice whether there has been any such decision by the Manager.
Further, taking all the relevant materials into consideration, the learned arbitrator has made a finding in respect of the appellant 's 338 claim and respondent 's counter claim in respect of demur rage and wharfage charges.
" It has not been brought to our notice that there has been any such decision by the Manager beyond the claim for the period of November, 1975 as mentioned hereinbefore.
Therefore, in our opinion, the arbitrator was not in error in proceeding in the manner as he did.
There was no other aspect of law on this aspect of the matter to which our attention was drawn.
The submission on this aspect is, therefore, negatived.
The challenge to the award on this aspect must, therefore, fail.
So far as the grant of interest pendente lite in the award is concerned, reliance was placed on various decisions of this Court.
Reliance was placed on State of Orissa and others vs Construction India, (J.T. where the award of interest from the commencement of the proceedings before the Arbitrator to the date of the award was disallowed in consonance with the views expressed by this Court in the case of Executive Engineer Irrigation Galimala & Ors.
vs Abaaduta Jena,) J.T.
Our attention was drawn by Dr. Ghosh counsel for the respondent firstly, to the decision in the case of Firm Madanlal Roshanlal Mahajan vs Hukumchand Mills Ltd., Indore, ; There the respondent had filed a suit against the appellant claiming two sums as losses in respect of two items and interest on the same.
The disputes were referred to an arbitrator, before whom the respondent did not press for interest prior to the institution of the suit, but pressed its claim for the two sums and interests from the date of the institution of the suit till recovery.
Bachawat, J. speaking for the three learned Judges of this Court held that though in terms, section 34 of the Code of Civil Procedure did not apply to arbitrations, it was an implied term of the reference in the suit that the arbitrator would decide the dispute according to law and would give such relief with regard to pendente lite interest as the Court could give if it decided the dispute.
This power of the arbitrator, it was held, was not fettered either by the arbitration agreement or by the .
Our attention was also drawn to the decision in the case of State of Madhya Pradesh vs M/s. Saith & Skelton (P) Ltd., ; There disputes had arisen between the appellant and the respondent with reference to the performance of a contract which provided for arbitration.
Steps were taken to appoint arbitrators and an umpire.
339 The appellant filed a petition in the District Judge 's Court, having jurisdiction over the matter for Setting aside the nominations.
When the matter came up to this Court in appeal, this Court appointed a sole arbitrator with consent of the parties.
Thereafter in the presence of counsel for both the parties, this Court gave directions in the appeal that the arbitration records be sent to the sole arbitrator and later extended the time for making the award and gave directions regarding the venue.
The arbitrator gave his award, directing the payment of a certain sum by the appellant to the respondent with simple interest at 9% from the date anterior to the reference and filed the award in the Court the next day.
One of the question that arose before this Court was whether the arbitrator had any jurisdiction to award the interest from a date anterior to the date of award or reference.
This Court held that the claim for the payment of interest had been referred to the arbitrator.
The contract did not provide that no interest was payable on the amount that might be found due.
Therefore, the respondent was entitled under section 61(2) of the , to claim interest from the date on which the price became due and payable.
The arbitrator had found that the price had become payable from a date anterior to the date of the award.
Therefore, the award of interest from the anterior date was justified.
The Court further held that the award of interest at 9% was also not exorbitant because the parties themselves claimed interest at 12%.
Our attention was also drawn to M/s. Ashok Construction Company vs Union of lndia, where a bench of three learned Judges at page 68 of the report held that the terms of the arbitration agreement did not exclude the jurisdiction of the arbitrator to entertain a claim for interest, on the amount due under the contract and on this ground this Court upheld the grant of interest.
Our attention was drawn by Dr. Ghosh to the observations in the case of M/s. Alopi Parshad & Sons, Ltd. vs The Union of India; , This Court reiterated the well settled principle that an award was liable to be set aside because of an error apparent on the face of the award.
An arbitration award may be set aside on the ground of an error on the face of it when the reasons given for the C, decision, either in the award or in any document incorporated with it, are based upon any legal proposition which is erroneous.
In a recent decision, Chinnappa Reddy, J. speaking for a bench of three learned Judges in Executive Engineer Irrigation Galimala 's case (supra) at paragraph 15 of the judgment considered the ques ll 340 tion of award of interest by an arbitrator.
The learned Judge noted the decisions in Firm Madanlal Roshanlal Mahajan vs Hukamchand Hills Ltd. (supra) Ashok Construction Company vs Union of India, (supra.
and the State of Madhya Pradesh vs M/s. Saith & Skelton Private Limited, (supra) and expressed the view that these were cases in which the references to arbitration were made by the court or in court proceedings of the disputes in the suit.
It was held that the arbitrator must be assumed in these cases to have the same power to award interest as the court.
Therefore, the grant of pendente lite interest on the analogy of section 34 of the Civil Procedure Code was permissible.
In regard to interest prior to the suit, it was held in most of these cases that since the Interest Act, 1839 was not applicable, interest could be awarded if there was an agreement to pay interest or a usage of trade having the force of law.
This Court held in the last mentioned case that they are not entitled to claim interest for the period prior to the commencement of the arbitration proceedings for the reason that the Interest Act did not apply to their case and there was no agreement to pay interest or any usage of trade.
It was further held that the claimants were not entitled to claim pendente lite interest as the arbitrator was not a court nor were the references to arbitration made in suits.
In deference to the latest pronouncement of this Court which is a pronouncement of three learned Judges, we must hold that the grant of pendente lite interest in this case was not justified.
Though the award in this case is a speaking award, it was not made clear on what basis the interest was awarded.
We are of the opinion that the arbitrator was in error in granting the interest in the manner he did.
It is true that in specific term there was no denial of this right to grant interest but there was denial as to get it in accordance with law.
In the aforesaid view of the matter so far as the interest of the award is concerned we are of the opinion that in awarding the interest the arbitrator committed an error of law.
With this modification the judgment and order of the High Court are confirmed.
The appeal is disposed of in these terms without any order as to costs.
S.L. Appeal disposed of.
|
% The respondent was appointed a transport and handling Contractor by the appellant subject to the terms and conditions mentioned in three successive written agreements entered into by both the parties.
After disputes arose between the parties, an arbitrator was appointed as per the arbitration clause to adjudicate upon the disputes.
The arbitrator made and published an award which was a speaking one.
He did not allow the appellant 's claim for demurrage and wharfage charges paid to the Railways amounting to Rs.15,63,863.02 by reason of the alleged wrongful conduct of the respondent but awarded only 25% of the claim.
The arbitrator also did not allow the appellant 's claim for shortage in transit but reduced the claim by 40% and allowed only 60% of it amounting to Rs.52,971.99.
The arbitrator awarded to the respondent Rs.12,64,175.97 and pendente lite interest at 6% per annum.
The appellant filed objections in the High Court under sections 30 and 33 of the ( 'The Act ') for setting aside the award.
The High Court (Single Judge) set aside the award.
The respondent filed an appeal to the Division Bench of the High Court which allowed the same, setting aside the judgment of the learned single judge and upholding the award.
Being aggrieved by the decision of the High Court, the appellant appealed to This Court for relief by special leave under Article 136 of the Constitution.
Disposing of the appeal, this Court, ^ HELD: While issuing notice on the application under Article 136 of the Constitution, it was indicated that only three questions would be adjudicated upon in this appeal, viz, Rs.13,94,982.46 being the amount allowed on account of demurrage and wharfage charges mentioned in the award, secondly, the sum of Rs.2,35,769.46 and lastly, the question of interest.
[332G] 330 So far as the second question was concerned, counsel for the appellant did not make any submission before the Court.
The Court also could not find any substance in this aspect.
Therefore, it was not necessary to deal with this aspect of the matter.
[332H; 333A] So far as the amount of Rs.13,94,982.46 on account of demurrage and wharfage was concerned, which was allowed, it appeared that the total demurrage and wharfage charges paid by the Corporation to the Railways in respect of the wagons cleared by the claimant firm, respondent herein, after obtaining such waiver as the Railways were persuaded to make were Rs.15,63,863.21.
There was no dispute about the actual payment of the charges.
The appellant 's case was that it was entitled to recover the entire amount it had to pay on account of the demurrage and wharfage charges from the respondent under clause 9(a) of the agreement.
[333B C] Under clause 9(a) according to the appellant, the Agent was liable to make good any compensation/demurrage/wharfage as per Railway rates in force during the period of contract and other charges or expenses that might be incurred by the Corporation on account of delay in loading/unloading of trucks/carts and unloading/loading of wagons unless the delay was for reasons beyond the Agent 's control.
It appeared that the appellant had periodically served notices upon the respondent of firm calling upon it to pay demurrage and wharfage charges with liberty prefer objections.
Such objections as the respondent firm preferred were disposed of by the District Manager.
This procedure continued till the end of November, 1975.
Then the respondent firm went to the Civil Court and obtained discontinuance of all proceedings for the recovery of demurrage and wharfage charges.
The arbitrator noted that as a result of the hearings by the Corporation upto November, 1975, relief to the tune of Rs.1,21,884.55 was granted to the respondent firm and the recovery of Rs.45,996.20 was made from the respondent firm 's bills.
The Corporation, therefore, claimed before the arbitrator recovery of the remaining or the claim of Rs.13,94,982.46.
Counsel for the appellant drew this Court 's attention to clauses 9(a) and (b) of the agreement and submitted that the adjudication made by the Manager was final and there was no dispute thereafter.
According to him, no further deduction was possible from what had been granted by the Manager for determination on account of demurrage and wharfage charges, nor was it arbitrable because it was final.
[334B E] It appears on the facts as recorded by the arbitrator in his award that there was adjudication really by the Manager of the claims upto 331 November, 1975.
Thereafter, there could be no adjudication as a result of injunction obtained from the Court.
Therefore, it appeared that there was in fact no adjudication of all the disputes.
The remaining points were arbitrable because of the amplitude of the arbitration clause.
It was not brought to the notice of the Court that there was an adjudication by the Manager of the claim for the period beyond November, 1975, as mentioned hereinbefore.
Therefore, the arbitrator was not in error in proceeding in the manner he did.
There was no other aspect of law on this aspect of the matter to which the attention of the Court was drawn.
The submission on this aspect was, therefore, negatived and the challenge to the award on this aspect must fail.
[337C D; 338B] So far as the grant of interest pendente lite in the award was concerned, reliance was placed on various decisions of this Court.
In deference to the latest pronouncement of this Court, which is a pronouncement of three learned Judges, in Executive Engineer Irrigation Galimala & Ors.
vs Abaadute Jena, (J.T. , the Court held that the grant of pendente lite interest in this case was was not justified.
Though the award in this case was a speaking award, it was not made clear on what basis the interest was awarded.
The arbitrator was in error in granting the interest in the manner he did .
It was true that in specific terms there was no denial on this right to grant interest, but there was denial as to get it in accordance with law.[338C D; 340E F] In awarding the interest the arbitrator committed an error of law.
With this modification, the judgment and order of the High Court were affirmed.
[340F G] Wadsworth vs Smith, L.R. Vol.
VI Q.B. 332; State of Orissa and others, vs Construction India, J.T. [1987] 4 S.C. 588; Executive Engineer Irrigation Galimala & Ors.
vs Abaaduta Jena, J.T. , Firm Madan lal Roshanlal Mahajan vs Hukumchand Mills Ltd., Indore, [1987] 1 S.C.R. 105; State of Madhya Pradesh vs M/s. Saith & Skelton (P) Ltd., ; ; M/s. Ashok Construction Company vs Union of India, and M/s. Alopi Parshad referred to.
|
ION: Civil Appeal No. 4096 of 1987.
From the Judgment and order dated 2.6.1987 of the Calcutta High Court in Appeal NQ.
344 of 1980.
332 A.K. Sen, S.k. Gambhir and Vivek Gambhir for the Appellant.
Dr. Shankar Ghosh and Rathin Das for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The respondent was appointed a transport and handling contractor by the appellant subject to the terms and conditions mentioned in three successive agreements in writing entered into by both the parties.
After disputes arose between the parties, as per the terrns of arbitration clause an arbitrator was appointed to adjudicate upon the disputes.
Both the respondent and the appellant filed their respective claims and counter claims before the arbitrator.
After considering the documents and evidence filed before the arbitrator, he made and published an award which was a speaking one.
The arbitrator did not allow the appellant 's claim for demurrage and wharfage charges paid to Railways amounting to Rs.15,63,863.02 by reason of the alleged wrongful conduct of respondent but the arbitrator awarded only 55% of the claim.
The arbitrator also did not allow the appellant 's claim for shortage in transit but reduced the claim by 40% and allowed only 60% of it amounting to Rs.52,971.99.
By the award the arbitrator awarded to the respondent Rs.12,64,175.97 and pendente lite interest at 6% per annum.
The appellant filed objections in the High Court of Calcutta under sections 30 and 33 of the (hereinafter called 'the Act ') for setting aside the award.
On 18th September, 19.80, the learned single judge of the High Court by his judgment and order set aside the award.
There was an appeal to the Division Bench of the High Court.
On 2nd June, 1987 the Division Bench of the High Court allowed the respondent 's appeal by its judgment and order and set aside the judgment of the learned single judge and upheld the award.
Being aggrieved thereby the appellant has come up before this Court by special leave under Article 136 of the Constitution.
While issuing notice on the application under Article 136 of the Constitution it was indicated that only three questions will be adjudicated upon in this appeal viz. Rs.13,94,982.46 which was the amount allowed on account of demurrage and wharfage charges mentioned in the award and secondly, the sum of Rs.2,35,769.46 and lastly on the question of interest.
So far as the second question of the matter is concerned Sree A.K. Sen, counsel appearing for the appellant has not made any sub 333 mission before us.
We also cannot find any substance in this aspect.
Therefore, it is not necessary for us to deal with this aspect of the matter.
So far as the amount of Rs. 13,94,982.46 on account of demurrage and wharfage is concerned, which was allowed, the award dealt with the question as set out in the paper book.
It appears that the total demurrage and wharfage charges paid by the Corporation to the Railways, in respect of the wagons cleared by the claimant firm, respondent herein, after obtaining such waiver as the Railways were persuaded to make was for Rs.15,63,863.21.
The charges were alleged to have been paid under Credit Notes which were produced before the arbitrator.
There was no dispute about the actual payment of the charges.
The appellant 's case was that it was entitled to recover the entire amount it had to pay on account of the demurrage and wharfage charges from the respondent under clause 9(a) of the agreement.
Clauses 9, 9(a) and 9(b) of the agreement are as follows: 9.
The Agent shall commence to load and/or unload all the wagons and trucks as well as all streamers, flats, barges and boats or any other conveyance on the day of these arrival and shall carry out the orders and directions of the Manager with all possible despatch and shall be responsible for and make good all demurrage or other waiting charges and expenses that may accrue and all other charges that may in the opinion of the Manager be payable because of or through any reasonable detention or delay." "9(a) The Agent shall be responsible for unloading/loading the wagons within the free period allowed by the Railways and also for loading/unloading for trucks/carts or any other transport vehicles expeditiously.
The Agent shall be liable to make good any compensation/demurrage/wharfage as per Railway rules in force during the period of contract other charges or expenses that may be incurred by the Corporation on account of delay in loading/unloading of truck/carts and unloading/loading of Wagons unless the delay is for reason beyond the Agents ' control.
The decision of the manager in this respect shall be final and binding on the Agent." "9(b) The Agent be present himself or send his duly 334 authorised representative to be present at all weighments A with which the Agent is concerned under this Agreement and in case he fails or chooses not to do so, no claim what soever shall lie against the Corporation in this regard.
" Under clause 9(a), according to the appellant, the Agent was liable to make good any compensation/demurrage/wharfage as per Railway rates in force during the period of contract, other charges or expenses that might be incurred by the Corporation on account of delay in loading/unloading of trucks/carts and unloading/loading or wagons unless the delay was for reasons beyond the Agent 's control.
It appears that the appellant and periodically served notices upon the respondent firm calling upon it to pay demurrage and wharfage charges with liberty to prefer objections.
Such objections as the respondent firm preferred were heard and disposed of by the District Manager.
This procedure continued till the end of November, 1975.
Then the respondent firm went to the Civil Court and obtained discontinuance of all proceedings for recovery of demurrage and wharfage charges.
The arbitrator noted that as a result of the hearings by the Corporation upto November, 1975 relief to the tune of Rs.1,21,884.55 was granted to the respondent firm and recovery of Rs.46,996.20 was made from the respondent firm 's bills.
The Corporation, therefore, claimed before the arbitrator recovery of remaining of the claim of Rs.13,94,982.46.
The respondent on the other hand claimed refund of the amount already deducted from the bills on the ground that it was not liable for any part of the demurrage and wharfage charges.
The claim of the respondent was that the demurrage and wharfage charges accrued invariably in circumstances beyond its control and accordingly under clause 9(a) of the agreement it could not be made liable for such charges.
The arbitrator noted that the respondent firm had impressive documentary evidence in support of its case.
It had produced numerous letters in which it fully explained to the authorities concerned the difficulties it was experiencing in timely clearance of goods from railway wagons and sheds.
It was claimed that it had produced month wise report of its work accounting for nearly all cases of demurrage and wharfage.
On 9th of October, 1975 the respondent had informed the Corporation by a letter Exhibit 128 which inadvertently was not marked exhibit that it was resuming work (there had been a break in his contract) on the condition that it would not be required to clear more than 10 c.c.
Or 4 box wagons, i.e. 200 m.t.
approximately daily.
This is a belated and rather grudging acceptance of this condition by the letter, Exhibit 44 dated 3rd of August, 1976.
335 The Arbitrator noted that from the letters and reports it appeared that timely clearance was hampered, and often made impossible by arrival of too many wagons at a time, congestion at the sidings and at the weighbridges with consequent detention of lorries, labour unrest and chronic want of space in the Corporation 's godowns and by others.
The arbitrator noted that there was insistent complaint about this want of space in the Corporation 's godown, which led to the goods being left in railways sheds for days together incurring unusually heavy wharfage charges.
The Corporation sometimes prepared over ambitious programmes of work for the contractors, as if unaware.
Of the existing situation.
The arbitrator noted that the appellant had examined several witnesses from the sidings.
But they did not according to the Arbitrator, prove anything beyond the procedure of work generally adopted at the sidings.
The arbitrator further noted about the foregoing explanations that the very often the objection of the railway shed staff to the claimant regarding not clearing of the wagons timely from the railway shed because of non space there owing to heavy stock kept therein remaining uncleared, and further that the claimant under the direction and order of the respondent being given limited programme because of non space in the receiving depots/ godowns were causes of delay.
The arbitrator noted that it would be fair to make the claimant firm liable for only 25% of the demurrage and wharfage charges sought to be recovered by the Corporation, leaving the remaining 75% to be borne by the Corporation itself.
Therefore, out of Rs.13,94,982.46 the Corporation, according to the arbitrator, could recover only Rs.3,48,745.61.
The appellant felt aggrieved thereby and challenges this grant of 25%.
So far as respondent 's claim for refund of Rs.46.996.20 already recovered, the arbitrator felt that there was no ground for interference.
The arbitrator noted that after hearing the claimant firm 's objections the deductions had been made.
The claimant firm had been granted relief in respect of Rs.1,21,884.55.
The arbitrator had not been able to ascertain precisely the total claim of the appellant till the end of November, 1975 but he noted that the sum of Rs.46,996.20 represented not much more than 25% of the total claim.
Therefore, the arbitrator noted that the claimant, namely, the respondent was not entitled to any refund and that the appellant could recover only Rs.3,48,745.61 on account of demurrage and wharfage charges.
As mentioned hereinbefore that is the main contention in this challenge before this Court.
The appellant claimed that it should have been entitled to the benefit of Rs.13,94,982.46 and not to 25% of the same.
Sree Sen, counsel for the appellant drew out attention to clauses 336 9(a) and (b) as set out hereinbefore and submitted that the respondent was only entitled to the amount as determined by the Manager which was described as final.
Sree Sen submitted that according to clause 9(a) aforesaid the adjudication made by the manager was final and there was no dispute thereafter and therefore, there could be no determination beyond 25%.
He drew our attention to that part of the 13 clause 9(a) to the following effect "the decision of the manager in this respect shall be final and binding on the Agent." So according to Sree Sen apart from what had been granted by the Manager for determination on account of demurrage and wharfage charges, no further deduction was possible nor was it arbitrable because it was final.
He drew our attention to certain observation in Wadsworth vs Smith, L.R. Vol.
Vl Q.B. 332.
There by a written agreement the plaintiff therein had agreed to build four houses on land of defendant and the defendant to grant plaintiff a lease when the houses were completed; the architects of the defendant for the time being were to certify as to the progress of the work, and if there should be any unnecessary delay or unsatisfactory conduct on the part of the plaintiff with regard to the erection of the buildings, on any matter or thing connected therewith "the fact of such delay or unsatisfactory conduct to be ascertained and decided in writing by the architects, against whose decision there shall be no appeal", then it should be lawful for defendant to employ other persons to execute the works, and to sell the buildings and lease the land to other persons.
On an application to make the agreement a rule of court under section 17 of the Common Law Procedure Act, 1854 of England, it was held by Cockburn, C.J., Blackburn and Mellor, JJ.
that assuming the agreement to be "an agreement or submission to arbitration" within the section, the clause that there was to be no appeal against the decision of the architects amounted to "words purporting that the parties intended that it should not be made a rule of court.
" The question was raised whether the agreement was not a submission to arbitration.
Cockburn, C.J. Observed that this clause was certainly more like a submission to arbitration ' it was on the confines of the two classes ' but on the whole it seems to His Lordship to savour more of a mere architect 's certificate than of a judicial proceeding.
Moreover, even if this were a submission within section 17, the Chief Justice thought that it could not be made a rule of court, because it was clear that the parties intended that the matter should be left to the decision of the architects without appeal; but to make it a rule of court would be to submit the decision to the jurisdiction of the Court.
Blackburn, J. agreed.
His Lordship observed that where by an agreement the right of one of the parties to have or to do a particular thing was made to depend on the determination of a third person, that 337 was not a submission to arbitration, nor was the determination an award; but where there was an agreement that any dispute about a particular thin shall be enquired into and determined by a person named, that might amount to a submission to arbitration, and the determination though in the form of a certificate, be an award.
Hannen, J. was of the view that this is not an agreement or submission to arbitration; the clause in question appeared to be no more than an extension of the ordinary clause in building contracts, that the certificate of the architect should be conclusive as to work done and the mode of doing it.
If we proceed on this basis then the logical conclusion of this would be that where there is a decision by the manager as in the instant case that would be final.
Where a dispute has been adjudicated by the manager in this aspect there was nothing for the arbitrator to decide.
It appears to us on the facts as recorded by the arbitrator in his award that there was adjudication really by the Manager of the claims upto November, 1975.
Thereafter there could be no adjudication as a result of injunction obtained from the court.
Therefore, it appears to us that there was really, in fact, no adjudication of all the disputes.
The remaining points were arbitrable because of the amplitude of the arbitration clause.
The relevant arbitration clause in this case contained, inter alia, as follows: .
"In the event of any question or dispute arising under this Agreement regarding the construction thereof or any clause herein or in respect of any act, matter or thing relating to this agreement the same shall be referred to the Sole Arbitration of any person appointed by the Managing Director of the Food Corporation of India . . .
The Award of such Arbitrator shall be final and binding on the parties to this Agreement . ." The point there having been decision before the Manager, that disallowance of the claim beyond 25% was beyond the jurisdiction of arbitration was not agitated before the High Court.
Prabir Kumar Majumdar, J. speaking for the Division Bench of the High Court of Calcutta observed at page 24 of the paper book as follows: "It has not been brought to our notice whether there has been any such decision by the Manager.
Further, taking all the relevant materials into consideration, the learned arbitrator has made a finding in respect of the appellant 's 338 claim and respondent 's counter claim in respect of demur rage and wharfage charges.
" It has not been brought to our notice that there has been any such decision by the Manager beyond the claim for the period of November, 1975 as mentioned hereinbefore.
Therefore, in our opinion, the arbitrator was not in error in proceeding in the manner as he did.
There was no other aspect of law on this aspect of the matter to which our attention was drawn.
The submission on this aspect is, therefore, negatived.
The challenge to the award on this aspect must, therefore, fail.
So far as the grant of interest pendente lite in the award is concerned, reliance was placed on various decisions of this Court.
Reliance was placed on State of Orissa and others vs Construction India, (J.T. where the award of interest from the commencement of the proceedings before the Arbitrator to the date of the award was disallowed in consonance with the views expressed by this Court in the case of Executive Engineer Irrigation Galimala & Ors.
vs Abaaduta Jena,) J.T.
Our attention was drawn by Dr. Ghosh counsel for the respondent firstly, to the decision in the case of Firm Madanlal Roshanlal Mahajan vs Hukumchand Mills Ltd., Indore, ; There the respondent had filed a suit against the appellant claiming two sums as losses in respect of two items and interest on the same.
The disputes were referred to an arbitrator, before whom the respondent did not press for interest prior to the institution of the suit, but pressed its claim for the two sums and interests from the date of the institution of the suit till recovery.
Bachawat, J. speaking for the three learned Judges of this Court held that though in terms, section 34 of the Code of Civil Procedure did not apply to arbitrations, it was an implied term of the reference in the suit that the arbitrator would decide the dispute according to law and would give such relief with regard to pendente lite interest as the Court could give if it decided the dispute.
This power of the arbitrator, it was held, was not fettered either by the arbitration agreement or by the .
Our attention was also drawn to the decision in the case of State of Madhya Pradesh vs M/s. Saith & Skelton (P) Ltd., ; There disputes had arisen between the appellant and the respondent with reference to the performance of a contract which provided for arbitration.
Steps were taken to appoint arbitrators and an umpire.
339 The appellant filed a petition in the District Judge 's Court, having jurisdiction over the matter for Setting aside the nominations.
When the matter came up to this Court in appeal, this Court appointed a sole arbitrator with consent of the parties.
Thereafter in the presence of counsel for both the parties, this Court gave directions in the appeal that the arbitration records be sent to the sole arbitrator and later extended the time for making the award and gave directions regarding the venue.
The arbitrator gave his award, directing the payment of a certain sum by the appellant to the respondent with simple interest at 9% from the date anterior to the reference and filed the award in the Court the next day.
One of the question that arose before this Court was whether the arbitrator had any jurisdiction to award the interest from a date anterior to the date of award or reference.
This Court held that the claim for the payment of interest had been referred to the arbitrator.
The contract did not provide that no interest was payable on the amount that might be found due.
Therefore, the respondent was entitled under section 61(2) of the , to claim interest from the date on which the price became due and payable.
The arbitrator had found that the price had become payable from a date anterior to the date of the award.
Therefore, the award of interest from the anterior date was justified.
The Court further held that the award of interest at 9% was also not exorbitant because the parties themselves claimed interest at 12%.
Our attention was also drawn to M/s. Ashok Construction Company vs Union of lndia, where a bench of three learned Judges at page 68 of the report held that the terms of the arbitration agreement did not exclude the jurisdiction of the arbitrator to entertain a claim for interest, on the amount due under the contract and on this ground this Court upheld the grant of interest.
Our attention was drawn by Dr. Ghosh to the observations in the case of M/s. Alopi Parshad & Sons, Ltd. vs The Union of India; , This Court reiterated the well settled principle that an award was liable to be set aside because of an error apparent on the face of the award.
An arbitration award may be set aside on the ground of an error on the face of it when the reasons given for the C, decision, either in the award or in any document incorporated with it, are based upon any legal proposition which is erroneous.
In a recent decision, Chinnappa Reddy, J. speaking for a bench of three learned Judges in Executive Engineer Irrigation Galimala 's case (supra) at paragraph 15 of the judgment considered the ques ll 340 tion of award of interest by an arbitrator.
The learned Judge noted the decisions in Firm Madanlal Roshanlal Mahajan vs Hukamchand Hills Ltd. (supra) Ashok Construction Company vs Union of India, (supra.
and the State of Madhya Pradesh vs M/s. Saith & Skelton Private Limited, (supra) and expressed the view that these were cases in which the references to arbitration were made by the court or in court proceedings of the disputes in the suit.
It was held that the arbitrator must be assumed in these cases to have the same power to award interest as the court.
Therefore, the grant of pendente lite interest on the analogy of section 34 of the Civil Procedure Code was permissible.
In regard to interest prior to the suit, it was held in most of these cases that since the Interest Act, 1839 was not applicable, interest could be awarded if there was an agreement to pay interest or a usage of trade having the force of law.
This Court held in the last mentioned case that they are not entitled to claim interest for the period prior to the commencement of the arbitration proceedings for the reason that the Interest Act did not apply to their case and there was no agreement to pay interest or any usage of trade.
It was further held that the claimants were not entitled to claim pendente lite interest as the arbitrator was not a court nor were the references to arbitration made in suits.
In deference to the latest pronouncement of this Court which is a pronouncement of three learned Judges, we must hold that the grant of pendente lite interest in this case was not justified.
Though the award in this case is a speaking award, it was not made clear on what basis the interest was awarded.
We are of the opinion that the arbitrator was in error in granting the interest in the manner he did.
It is true that in specific term there was no denial of this right to grant interest but there was denial as to get it in accordance with law.
In the aforesaid view of the matter so far as the interest of the award is concerned we are of the opinion that in awarding the interest the arbitrator committed an error of law.
With this modification the judgment and order of the High Court are confirmed.
The appeal is disposed of in these terms without any order as to costs.
S.L. Appeal disposed of.
|
From the Judgment and order dated 2.6.1987 of the Calcutta High Court in Appeal NQ. Gambhir and Vivek Gambhir for the Appellant. Dr. Shankar Ghosh and Rathin Das for the Respondent. The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted. The respondent was appointed a transport and handling contractor by the appellant subject to the terms and conditions mentioned in three successive agreements in writing entered into by both the parties. After disputes arose between the parties, as per the terrns of arbitration clause an arbitrator was appointed to adjudicate upon the disputes. Both the respondent and the appellant filed their respective claims and counter claims before the arbitrator. After considering the documents and evidence filed before the arbitrator, he made and published an award which was a speaking one. The arbitrator did not allow the appellant 's claim for demurrage and wharfage charges paid to Railways amounting to Rs.15,63,863.02 by reason of the alleged wrongful conduct of respondent but the arbitrator awarded only 55% of the claim. By the award the arbitrator awarded to the respondent Rs.12,64,175.97 and pendente lite interest at 6% per annum. The appellant filed objections in the High Court of Calcutta under sections 30 and 33 of the (hereinafter called 'the Act ') for setting aside the award. On 18th September, 19.80, the learned single judge of the High Court by his judgment and order set aside the award. There was an appeal to the Division Bench of the High Court. On 2nd June, 1987 the Division Bench of the High Court allowed the respondent 's appeal by its judgment and order and set aside the judgment of the learned single judge and upheld the award. Being aggrieved thereby the appellant has come up before this Court by special leave under Article 136 of the Constitution. While issuing notice on the application under Article 136 of the Constitution it was indicated that only three questions will be adjudicated upon in this appeal viz. Rs.13,94,982.46 which was the amount allowed on account of demurrage and wharfage charges mentioned in the award and secondly, the sum of Rs.2,35,769.46 and lastly on the question of interest. So far as the second question of the matter is concerned Sree A.K. Sen, counsel appearing for the appellant has not made any sub 333 mission before us. We also cannot find any substance in this aspect. Therefore, it is not necessary for us to deal with this aspect of the matter. 13,94,982.46 on account of demurrage and wharfage is concerned, which was allowed, the award dealt with the question as set out in the paper book. It appears that the total demurrage and wharfage charges paid by the Corporation to the Railways, in respect of the wagons cleared by the claimant firm, respondent herein, after obtaining such waiver as the Railways were persuaded to make was for Rs.15,63,863.21. The charges were alleged to have been paid under Credit Notes which were produced before the arbitrator. There was no dispute about the actual payment of the charges. Clauses 9, 9(a) and 9(b) of the agreement are as follows: 9. 9(a) The Agent shall be responsible for unloading/loading the wagons within the free period allowed by the Railways and also for loading/unloading for trucks/carts or any other transport vehicles expeditiously. The decision of the manager in this respect shall be final and binding on the Agent." " 9(b) The Agent be present himself or send his duly 334 authorised representative to be present at all weighments A with which the Agent is concerned under this Agreement and in case he fails or chooses not to do so, no claim what soever shall lie against the Corporation in this regard. " Under clause 9(a), according to the appellant, the Agent was liable to make good any compensation/demurrage/wharfage as per Railway rates in force during the period of contract, other charges or expenses that might be incurred by the Corporation on account of delay in loading/unloading of trucks/carts and unloading/loading or wagons unless the delay was for reasons beyond the Agent 's control. It appears that the appellant and periodically served notices upon the respondent firm calling upon it to pay demurrage and wharfage charges with liberty to prefer objections. Such objections as the respondent firm preferred were heard and disposed of by the District Manager. This procedure continued till the end of November, 1975. Then the respondent firm went to the Civil Court and obtained discontinuance of all proceedings for recovery of demurrage and wharfage charges. The respondent on the other hand claimed refund of the amount already deducted from the bills on the ground that it was not liable for any part of the demurrage and wharfage charges. The arbitrator noted that the respondent firm had impressive documentary evidence in support of its case. It had produced numerous letters in which it fully explained to the authorities concerned the difficulties it was experiencing in timely clearance of goods from railway wagons and sheds. It was claimed that it had produced month wise report of its work accounting for nearly all cases of demurrage and wharfage. On 9th of October, 1975 the respondent had informed the Corporation by a letter Exhibit 128 which inadvertently was not marked exhibit that it was resuming work (there had been a break in his contract) on the condition that it would not be required to clear more than 10 c.c. This is a belated and rather grudging acceptance of this condition by the letter, Exhibit 44 dated 3rd of August, 1976. 335 The Arbitrator noted that from the letters and reports it appeared that timely clearance was hampered, and often made impossible by arrival of too many wagons at a time, congestion at the sidings and at the weighbridges with consequent detention of lorries, labour unrest and chronic want of space in the Corporation 's godowns and by others. The Corporation sometimes prepared over ambitious programmes of work for the contractors, as if unaware. The arbitrator noted that the appellant had examined several witnesses from the sidings. But they did not according to the Arbitrator, prove anything beyond the procedure of work generally adopted at the sidings. The arbitrator further noted about the foregoing explanations that the very often the objection of the railway shed staff to the claimant regarding not clearing of the wagons timely from the railway shed because of non space there owing to heavy stock kept therein remaining uncleared, and further that the claimant under the direction and order of the respondent being given limited programme because of non space in the receiving depots/ godowns were causes of delay. Therefore, out of Rs.13,94,982.46 the Corporation, according to the arbitrator, could recover only Rs.3,48,745.61. The appellant felt aggrieved thereby and challenges this grant of 25%. The claimant firm had been granted relief in respect of Rs.1,21,884.55. Therefore, the arbitrator noted that the claimant, namely, the respondent was not entitled to any refund and that the appellant could recover only Rs.3,48,745.61 on account of demurrage and wharfage charges. As mentioned hereinbefore that is the main contention in this challenge before this Court. The appellant claimed that it should have been entitled to the benefit of Rs.13,94,982.46 and not to 25% of the same. Sree Sen submitted that according to clause 9(a) aforesaid the adjudication made by the manager was final and there was no dispute thereafter and therefore, there could be no determination beyond 25%. He drew our attention to that part of the 13 clause 9(a) to the following effect "the decision of the manager in this respect shall be final and binding on the Agent." He drew our attention to certain observation in Wadsworth vs Smith, L.R. Vol. On an application to make the agreement a rule of court under section 17 of the Common Law Procedure Act, 1854 of England, it was held by Cockburn, C.J., Blackburn and Mellor, JJ. that assuming the agreement to be "an agreement or submission to arbitration" within the section, the clause that there was to be no appeal against the decision of the architects amounted to "words purporting that the parties intended that it should not be made a rule of court. " The question was raised whether the agreement was not a submission to arbitration. Hannen, J. was of the view that this is not an agreement or submission to arbitration; the clause in question appeared to be no more than an extension of the ordinary clause in building contracts, that the certificate of the architect should be conclusive as to work done and the mode of doing it. If we proceed on this basis then the logical conclusion of this would be that where there is a decision by the manager as in the instant case that would be final. Where a dispute has been adjudicated by the manager in this aspect there was nothing for the arbitrator to decide. It appears to us on the facts as recorded by the arbitrator in his award that there was adjudication really by the Manager of the claims upto November, 1975. Thereafter there could be no adjudication as a result of injunction obtained from the court. Therefore, it appears to us that there was really, in fact, no adjudication of all the disputes. The remaining points were arbitrable because of the amplitude of the arbitration clause. The relevant arbitration clause in this case contained, inter alia, as follows: . The Award of such Arbitrator shall be final and binding on the parties to this Agreement . ." The point there having been decision before the Manager, that disallowance of the claim beyond 25% was beyond the jurisdiction of arbitration was not agitated before the High Court. Further, taking all the relevant materials into consideration, the learned arbitrator has made a finding in respect of the appellant 's 338 claim and respondent 's counter claim in respect of demur rage and wharfage charges. " It has not been brought to our notice that there has been any such decision by the Manager beyond the claim for the period of November, 1975 as mentioned hereinbefore. Therefore, in our opinion, the arbitrator was not in error in proceeding in the manner as he did. There was no other aspect of law on this aspect of the matter to which our attention was drawn. The submission on this aspect is, therefore, negatived. The challenge to the award on this aspect must, therefore, fail. So far as the grant of interest pendente lite in the award is concerned, reliance was placed on various decisions of this Court. Bachawat, J. speaking for the three learned Judges of this Court held that though in terms, section 34 of the Code of Civil Procedure did not apply to arbitrations, it was an implied term of the reference in the suit that the arbitrator would decide the dispute according to law and would give such relief with regard to pendente lite interest as the Court could give if it decided the dispute. This power of the arbitrator, it was held, was not fettered either by the arbitration agreement or by the . Steps were taken to appoint arbitrators and an umpire. 339 The appellant filed a petition in the District Judge 's Court, having jurisdiction over the matter for Setting aside the nominations. When the matter came up to this Court in appeal, this Court appointed a sole arbitrator with consent of the parties. The arbitrator gave his award, directing the payment of a certain sum by the appellant to the respondent with simple interest at 9% from the date anterior to the reference and filed the award in the Court the next day. This Court held that the claim for the payment of interest had been referred to the arbitrator. The contract did not provide that no interest was payable on the amount that might be found due. Therefore, the respondent was entitled under section 61(2) of the , to claim interest from the date on which the price became due and payable. The arbitrator had found that the price had become payable from a date anterior to the date of the award. Therefore, the award of interest from the anterior date was justified. The Court further held that the award of interest at 9% was also not exorbitant because the parties themselves claimed interest at 12%. Our attention was drawn by Dr. Ghosh to the observations in the case of M/s. Alopi Parshad & Sons, Ltd. vs The Union of India; , This Court reiterated the well settled principle that an award was liable to be set aside because of an error apparent on the face of the award. An arbitration award may be set aside on the ground of an error on the face of it when the reasons given for the C, decision, either in the award or in any document incorporated with it, are based upon any legal proposition which is erroneous. In a recent decision, Chinnappa Reddy, J. speaking for a bench of three learned Judges in Executive Engineer Irrigation Galimala 's case (supra) at paragraph 15 of the judgment considered the ques ll 340 tion of award of interest by an arbitrator. The learned Judge noted the decisions in Firm Madanlal Roshanlal Mahajan vs Hukamchand Hills Ltd. (supra) Ashok Construction Company vs Union of India, (supra. and the State of Madhya Pradesh vs M/s. Saith & Skelton Private Limited, (supra) and expressed the view that these were cases in which the references to arbitration were made by the court or in court proceedings of the disputes in the suit. It was held that the arbitrator must be assumed in these cases to have the same power to award interest as the court. Therefore, the grant of pendente lite interest on the analogy of section 34 of the Civil Procedure Code was permissible. This Court held in the last mentioned case that they are not entitled to claim interest for the period prior to the commencement of the arbitration proceedings for the reason that the Interest Act did not apply to their case and there was no agreement to pay interest or any usage of trade. Though the award in this case is a speaking award, it was not made clear on what basis the interest was awarded. We are of the opinion that the arbitrator was in error in granting the interest in the manner he did. It is true that in specific term there was no denial of this right to grant interest but there was denial as to get it in accordance with law. In the aforesaid view of the matter so far as the interest of the award is concerned we are of the opinion that in awarding the interest the arbitrator committed an error of law. With this modification the judgment and order of the High Court are confirmed. The appeal is disposed of in these terms without any order as to costs.
|
% The respondent was appointed a transport and handling Contractor by the appellant subject to the terms and conditions mentioned in three successive written agreements entered into by both the parties.
After disputes arose between the parties, an arbitrator was appointed as per the arbitration clause to adjudicate upon the disputes.
The arbitrator made and published an award which was a speaking one.
He did not allow the appellant 's claim for demurrage and wharfage charges paid to the Railways amounting to Rs.15,63,863.02 by reason of the alleged wrongful conduct of the respondent but awarded only 25% of the claim.
The arbitrator also did not allow the appellant 's claim for shortage in transit but reduced the claim by 40% and allowed only 60% of it amounting to Rs.52,971.99.
The arbitrator awarded to the respondent Rs.12,64,175.97 and pendente lite interest at 6% per annum.
The appellant filed objections in the High Court under sections 30 and 33 of the ( 'The Act ') for setting aside the award.
The High Court (Single Judge) set aside the award.
The respondent filed an appeal to the Division Bench of the High Court which allowed the same, setting aside the judgment of the learned single judge and upholding the award.
Being aggrieved by the decision of the High Court, the appellant appealed to This Court for relief by special leave under Article 136 of the Constitution.
Disposing of the appeal, this Court, ^ HELD: While issuing notice on the application under Article 136 of the Constitution, it was indicated that only three questions would be adjudicated upon in this appeal, viz, Rs.13,94,982.46 being the amount allowed on account of demurrage and wharfage charges mentioned in the award, secondly, the sum of Rs.2,35,769.46 and lastly, the question of interest.
[332G] 330 So far as the second question was concerned, counsel for the appellant did not make any submission before the Court.
The Court also could not find any substance in this aspect.
Therefore, it was not necessary to deal with this aspect of the matter.
[332H; 333A] So far as the amount of Rs.13,94,982.46 on account of demurrage and wharfage was concerned, which was allowed, it appeared that the total demurrage and wharfage charges paid by the Corporation to the Railways in respect of the wagons cleared by the claimant firm, respondent herein, after obtaining such waiver as the Railways were persuaded to make were Rs.15,63,863.21.
There was no dispute about the actual payment of the charges.
The appellant 's case was that it was entitled to recover the entire amount it had to pay on account of the demurrage and wharfage charges from the respondent under clause 9(a) of the agreement.
[333B C] Under clause 9(a) according to the appellant, the Agent was liable to make good any compensation/demurrage/wharfage as per Railway rates in force during the period of contract and other charges or expenses that might be incurred by the Corporation on account of delay in loading/unloading of trucks/carts and unloading/loading of wagons unless the delay was for reasons beyond the Agent 's control.
It appeared that the appellant had periodically served notices upon the respondent of firm calling upon it to pay demurrage and wharfage charges with liberty prefer objections.
Such objections as the respondent firm preferred were disposed of by the District Manager.
This procedure continued till the end of November, 1975.
Then the respondent firm went to the Civil Court and obtained discontinuance of all proceedings for the recovery of demurrage and wharfage charges.
The arbitrator noted that as a result of the hearings by the Corporation upto November, 1975, relief to the tune of Rs.1,21,884.55 was granted to the respondent firm and the recovery of Rs.45,996.20 was made from the respondent firm 's bills.
The Corporation, therefore, claimed before the arbitrator recovery of the remaining or the claim of Rs.13,94,982.46.
Counsel for the appellant drew this Court 's attention to clauses 9(a) and (b) of the agreement and submitted that the adjudication made by the Manager was final and there was no dispute thereafter.
According to him, no further deduction was possible from what had been granted by the Manager for determination on account of demurrage and wharfage charges, nor was it arbitrable because it was final.
[334B E] It appears on the facts as recorded by the arbitrator in his award that there was adjudication really by the Manager of the claims upto 331 November, 1975.
Thereafter, there could be no adjudication as a result of injunction obtained from the Court.
Therefore, it appeared that there was in fact no adjudication of all the disputes.
The remaining points were arbitrable because of the amplitude of the arbitration clause.
It was not brought to the notice of the Court that there was an adjudication by the Manager of the claim for the period beyond November, 1975, as mentioned hereinbefore.
Therefore, the arbitrator was not in error in proceeding in the manner he did.
There was no other aspect of law on this aspect of the matter to which the attention of the Court was drawn.
The submission on this aspect was, therefore, negatived and the challenge to the award on this aspect must fail.
[337C D; 338B] So far as the grant of interest pendente lite in the award was concerned, reliance was placed on various decisions of this Court.
In deference to the latest pronouncement of this Court, which is a pronouncement of three learned Judges, in Executive Engineer Irrigation Galimala & Ors.
vs Abaadute Jena, (J.T. , the Court held that the grant of pendente lite interest in this case was was not justified.
Though the award in this case was a speaking award, it was not made clear on what basis the interest was awarded.
The arbitrator was in error in granting the interest in the manner he did .
It was true that in specific terms there was no denial on this right to grant interest, but there was denial as to get it in accordance with law.[338C D; 340E F] In awarding the interest the arbitrator committed an error of law.
With this modification, the judgment and order of the High Court were affirmed.
[340F G] Wadsworth vs Smith, L.R. Vol.
VI Q.B. 332; State of Orissa and others, vs Construction India, J.T. [1987] 4 S.C. 588; Executive Engineer Irrigation Galimala & Ors.
vs Abaaduta Jena, J.T. , Firm Madan lal Roshanlal Mahajan vs Hukumchand Mills Ltd., Indore, [1987] 1 S.C.R. 105; State of Madhya Pradesh vs M/s. Saith & Skelton (P) Ltd., ; ; M/s. Ashok Construction Company vs Union of India, and M/s. Alopi Parshad referred to.
|
% The respondent was appointed a transport and handling Contractor by the appellant subject to the terms and conditions mentioned in three successive written agreements entered into by both the parties. The arbitrator made and published an award which was a speaking one. He did not allow the appellant 's claim for demurrage and wharfage charges paid to the Railways amounting to Rs.15,63,863.02 by reason of the alleged wrongful conduct of the respondent but awarded only 25% of the claim. The arbitrator awarded to the respondent Rs.12,64,175.97 and pendente lite interest at 6% per annum. The High Court (Single Judge) set aside the award. The respondent filed an appeal to the Division Bench of the High Court which allowed the same, setting aside the judgment of the learned single judge and upholding the award. Disposing of the appeal, this Court, ^ HELD: While issuing notice on the application under Article 136 of the Constitution, it was indicated that only three questions would be adjudicated upon in this appeal, viz, Rs.13,94,982.46 being the amount allowed on account of demurrage and wharfage charges mentioned in the award, secondly, the sum of Rs.2,35,769.46 and lastly, the question of interest. [332G] 330 So far as the second question was concerned, counsel for the appellant did not make any submission before the Court. The Court also could not find any substance in this aspect. Therefore, it was not necessary to deal with this aspect of the matter. [332H; 333A] So far as the amount of Rs.13,94,982.46 on account of demurrage and wharfage was concerned, which was allowed, it appeared that the total demurrage and wharfage charges paid by the Corporation to the Railways in respect of the wagons cleared by the claimant firm, respondent herein, after obtaining such waiver as the Railways were persuaded to make were Rs.15,63,863.21. There was no dispute about the actual payment of the charges. Such objections as the respondent firm preferred were disposed of by the District Manager. This procedure continued till the end of November, 1975. Counsel for the appellant drew this Court 's attention to clauses 9(a) and (b) of the agreement and submitted that the adjudication made by the Manager was final and there was no dispute thereafter. Thereafter, there could be no adjudication as a result of injunction obtained from the Court. The remaining points were arbitrable because of the amplitude of the arbitration clause. Therefore, the arbitrator was not in error in proceeding in the manner he did. There was no other aspect of law on this aspect of the matter to which the attention of the Court was drawn. The submission on this aspect was, therefore, negatived and the challenge to the award on this aspect must fail. [337C D; 338B] So far as the grant of interest pendente lite in the award was concerned, reliance was placed on various decisions of this Court. Though the award in this case was a speaking award, it was not made clear on what basis the interest was awarded. It was true that in specific terms there was no denial on this right to grant interest, but there was denial as to get it in accordance with law.[338C D; 340E F] In awarding the interest the arbitrator committed an error of law. With this modification, the judgment and order of the High Court were affirmed. VI Q.B. 332; State of Orissa and others, vs Construction India, J.T. [1987] 4 S.C. 588; Executive Engineer Irrigation Galimala & Ors.
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ivil Appeal Nos.
8623 24 of 1983.
From the Judgment and order dated 3.6.1983 of the High Court of Pun jab and Haryana in Writ Petition No. 1794 of 1980.
P.P. Rao and P.D. Sharma for the Appellant.
S.K. Bagga, C.M. Nayar, Mrs. Manik Karanjawala, R. Karanjawala and Mrs. Meenakshi Arora for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
These appeals are by special leave and are directed against two separate judgments of the Punjab and Haryana High Court.
The first one is against the decision of the High Court in a writ application for quo warranto filed by respondents 2 to 4 while the second one is against the dismissal of a writ petition filed by the appellant before the High Court challenging his reversion.
The short facts are that the appellant was appointed as a Professor of Ayurvedic Medicines under the Punjab Government.
Later, he was appointed as Deputy Director from which post he was further 366 promoted as Director.
By order dated 21.1().1981 he was reverted to the post of Deputy Director.
On 3 1st October, 1987, the appellant has superannuated.
The respondent Nos. 2, 3 and 4, once upon a time students of the appellant came before the High Court asking for a writ of quo warranto challenging the appellant 's appointment as Director on promotion on the plea that he did not possess the qualification prescribed by the Punjab Ayurvedic Department (Class I and Class Il) Rules, 1963.
Rule 6 of these Rules prescribes: "No person shall be appointed to the service, unless he possesses such qualifications, if any, as are shown in col umn 4 of Appendix 'A '.
" In Appendix 'A ' there is only one post under Class I that being the post of Director of Ayurved.
The requisite qualifications for that post as provided in Appendix 'A ' are the following: "(1) A degree (5 years or more of regular course) in Ayurvedic system of medicine of a Medical Board or Faculty of Indian Medicine recognised by the Government.
(2) Doctor of Science in Ayurvedic Medicine (Post Graduate) of any recognised University.
(3) Must have worked as an organisor in some Ayurvedic Institution of repute such as Government Ayurvedic Department in any State for a period of at least ten years.
(4) Has conducted original research in Ayurvedic Therapy.
(5) Must be an Ayurvedic Physician of at least 15 years standing.
" Challenge in the High Court was on the ground that the appellant did not possess the prescribed qualifications under Items l and 2.
The writ petition was filed soon after the appellant was promoted to the post of Director, and during the pendency of the writ petition the order of reversion as referred to above had been passed.
The appellant opposed the writ application by contending that he 367 possesses the requisite qualifications and, inter alia, averred in the return made to rule that the petitioners before the High Court were his students and on account of ill motive, they had filed the application challenging the appointment of the appellant as Director.
The State Government initially supported the appellant but later took a different stand.
The High Court has found that the appellant possessed the second qualification, namely, that he had obtained the Doctor of Science Degree in Ayurvedic as prescribed.
In regard to the first qualification, the High Court found that the appellant had a Degree in Ayurvedic system of Medicine from a recognised Institution and the degree that the appellant possesses has been duly recognised by the Government of Punjab, hut it found that the appellant had not studied in regular course for five years to obtain the degree and, therefore, came to the conclusion that the requisite qualification was not possessed by the appellant.
Accordingly, it allowed the writ petition and came to hold that the appellant was not qualified to hold the post of Director.
When the question of challenge to the reversion came for consideration in the connected writ petition, the High Court took the view that since the appellant did not possess the first qualification, he was not entitled to the post of Director and was not entitled to challenge the reversion to the post of Deputy Director.
We shall first deal with the appeal arising out of the quo warranto proceedings.
The first qualification which we have referred to above appears to be a common qualification for almost all the ranks covered by Appendix 'A ', namely, that a degree should have been obtained after five or more years of regular course having been gone through.
No dispute has been raised to the appellant 's appointment as Deputy Director.
Learned counsel appearing for the respondents who had petitioned the High Court pointed out with reference to the correspondence with the State Public Service Commission that in regard to the qualification for the post of Deputy Director, a degree or diploma was considered sufficient.
The State Public Service Commission had raised objection to the Government 's proposal of fixing the degree qualification by pointing out that since a degree after studying for five or more years of regular course was the requirement for the higher post of Director, a lesser qualification should be prescribed for the post of Deputy Director and accordingly the alternates had been adopted.
When we pointed out to her that for the post of Assistant Director it cannot be disputed that Deputy Director 's is a superior post the requirement was five years or more of regular course in Ayurvedic with a diploma, there was really no answer.
We would accordingly hold that the High Court should have looked into this 368 aspect to find out what exactly was the requirement.
In view of the fact that there was no challenge to the appointment of the appellant to the post of Deputy Director and the first item of the qualification is the same for the Director as also the Assistant Director and as Deputy Director, the appellant held a post between the two, we are not impressed by the stand of the respondents that the appellant was not possessed of the requisite qualification.
There is no dispute that the appellanthad been serving as Professor for several years.
The requisite qualification for that post as per Appendix 'A ', as far as relevant is: "A Degree (five years regular course) in Ayurvedic system of Medicine of a recognised university, or of a board of Indian System of Medicine established by law or from any Ayurvedic College recognised by Government." As far as this qualification goes, there is indeed no difference in the case of a Professor and that of Director.
In giving appointment to the appellant as Professor, it must follow that Government were satisfied that appellant had the requisite qualification.
There is material on record to show that in regard to the degree obtainable on completion of the five year course, the appellant had read as a regular student for three years in the first instance and for the remaining two years he was directly under a qualified Professor though it was not study in a regular institution.
After reading for five years he has obtained the degree which has been from a recognised University.
In the circumstances, it has become difficult to agree with the reasons given by the High Court for its conclusion that the appellant was not having the requisite qualification prescribed under the Rules.
Mr. Rao, counsel for the appellant relied upon a decision of this Court in Satesman (Private) Ltd. vs H.R. Deb & Ors., ; at page 621 of the Reports, Hidaytullah, CJ.
speaking for the Constitution Bench indicated: "The High Court in a quo warranto proceeding should be slow to pronounce upon the matter unless there is a clear infringement of the law" It the circumstances which we have narrated, it is indeed difficult to hold that the appellant did not have the requisite qualification.
Ayurveda is the traditional method of medical attention preva 369 lent in this country.
Modern science and people associated with the medical faculties of the modern age have gradually accepted the position that Ayurveda provided a fully developed medical process.
In the post medieval India the system had suffered a set back but in recent years, the Ayurved system has been revived.
In the post independence period, the system has been accepted as a regular course of study and recognised as a system of therapy.
The High Court should have given due consideration to the background and the history of the matter.
There is clear material that the petitioners before the High Court were the once upon a time students of the appellant.
Ordinarily one would expect obligations, piety and reverence in the conduct of the writ petitioners towards the appellant.
This expectation would be more justified in the traditional system of Ayurved culture.
Surprisingly that seems to have been totally wanting.
The appellant has, on the other hand, alleged that the writ petition was the outcome of malice and ill will.
The High Court did not appropriately advert to this aspect.
We are of the view that in the facts of this case, the reasonable conclusion to reach should have been that the writ petitioners had failed to establish that the appellant did not possess the requisite qualification.
The appeal has, therefore, to be a11owed, the judgment of the High Court has to be set aside and the writ petition has to be dismissed with costs.
Now we come to the appeal challenging the reversion.
The writ petition has been dismissed on the sole ground that the appellant was not possessed of the requisite qualification and, therefore, was not entitled to continue as Director.
Now that we have reversed the finding of the High Court on that score, the judgment of the High Court cannot be sustained.
Reversion as admitted by the State Government in its counter in the High Court was grounded upon non possession of the requisite qualification With our finding in the connected appeal.
the order of the High Court cannot be sustained.
Nor can the order of reversion be.
The other appeal too is allowed with costs.
The appellant shall be treated to have been regularly appointed as Director and shall be treated to have retired in the post of Director the order of reversion notwithstanding.
He shall be entitled to all the benefits prescribed for the post of Director from the date he came to the post till he retired.
All his dues shall be paid to him within three months from today.
Consolidated hearing fee of Rs.5,000 is allowed to the appellant and this shall be paid by the respondent State alone.
P.S.S. Appeals allowed.
|
% Rule 6 of the Punjab Ayurvedic Department (Class I and Class II) Rules, 1963 interdicts appointment to the service except duly qualified persons.
The requisite qualification laid down by Appendix 'A ' to the Rules for Class I post of Director of Ayurved includes (1) a five years ' degree course in Ayurvedic system of medicine, and (2) Doctor of Science in Ayurvedic Medicine.
For the posts of Professor, Assistant Director and deputy Director of Ayurved the requisite qualification is a five years regular course in Ayurvedic system of medicine.
The appellant had read as a regular student for three years in the first instance, and for the remaining two years he was directly under a qualified, Professor.
He had then obtained a degree from a recognised University.
Later he acquired the Doctor of Science Degree in Ayurved.
He was appointed as a Professor of Ayurvedic Medicine under the Punjab Government and later as Deputy Director.
He was further promoted as Director.
His appointment as Director was challenged for lack of requisite qualification in a writ of quo warranto by respondents, 2, 3 and 4.
In the return made to rule he averred that the petitioners respondents, his one time students, had filed the application on account of ill motive.
He was reverted to the post of Deputy Director on October 21, 1981 during 364 the pendency of the writ petition which he challenged in a connected writ petition.
he superannuated from the post of Deputy Director on October 31, 1987.
The High Court held that the appellant was not qualified to hold the post of Director since he had not studied in a regular course for five years to obtain the degree, though it found that he possessed the second qualification, namely, Doctor of Science Degree, and a degree in Ayurvedic system of medicine duly recognised by the Government of Punjab.
Consequently, in the connected writ petition the High Court took the view that he was not entitled to challenge reversion to the post of Deputy Director.
Allowing the appeals with costs, ^ HELD: 1.1.
The writ petitioners have failed to establish that the appellant did not possess the requisite qualification.
In fact he had read as a regular student for three years in the first instance and for the remaining two years he was directly under a qualified Professor.
After reading for five years he had obtained the degree which has been from a recognised University.
[368E] 1.2 The appellant had been serving as Professor for several years.
As far as the qualification goes there is no difference in the case of a Professor and that of a Director.
In giving appointment to the appellant as Professor, the Government must have been satisfied that he had the requisite qualification.
[368B] 1.3 There was no challenge to the appointment of the appellant to the post of Deputy Director.
The first item of the qualification is the same for the Director as also the Assistant Director and the Deputy Director.
The appellant held a post between the two.
The High Court should have looked into this aspect to find out what exactly was the requirement.
[368D; A] 1.4 The High Court should have given due consideration to the background and the history of the matter.
Ayurveda is the traditional method of medical attention.
In the post medieval India the system had suffered a set back but in the post independence period it has been accepted as a regular course of study and recognised as a system of therapy.
[369B; 368H] 1.5 The appellant has alleged that the writ petition was the out 365 come of malice and ill will.
The High Court did not appropriately advert to this aspect.
The petitioners respondents were the once upon a time students of the appellant.
Ordinarily one would except obligations, piety and reverence in their conduct towards the appellant, especially in the traditional system of Ayurved culture.
Surprisingly that seems to have been totally wanting.
[369C] 2.
Since the reversion of the appellant was grounded upon non possession of the requisite qualification the order of the High Court in the connected writ petition cannot be sustained.
[369F G] 3.
The appellant shall be treated to have been regularly appointed as Director of Ayurved and to have been retired in that post, the order of reversion notwithstanding.
He shall be entitled to all the benefits prescribed for the post of Director from the date he came to the post till he retired.
[369G H] Statesman (Private) Ltd. vs H.R. Deb & Ors., ; , referred to.
|
ivil Appeal Nos.
8623 24 of 1983.
From the Judgment and order dated 3.6.1983 of the High Court of Pun jab and Haryana in Writ Petition No. 1794 of 1980.
P.P. Rao and P.D. Sharma for the Appellant.
S.K. Bagga, C.M. Nayar, Mrs. Manik Karanjawala, R. Karanjawala and Mrs. Meenakshi Arora for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
These appeals are by special leave and are directed against two separate judgments of the Punjab and Haryana High Court.
The first one is against the decision of the High Court in a writ application for quo warranto filed by respondents 2 to 4 while the second one is against the dismissal of a writ petition filed by the appellant before the High Court challenging his reversion.
The short facts are that the appellant was appointed as a Professor of Ayurvedic Medicines under the Punjab Government.
Later, he was appointed as Deputy Director from which post he was further 366 promoted as Director.
By order dated 21.1().1981 he was reverted to the post of Deputy Director.
On 3 1st October, 1987, the appellant has superannuated.
The respondent Nos. 2, 3 and 4, once upon a time students of the appellant came before the High Court asking for a writ of quo warranto challenging the appellant 's appointment as Director on promotion on the plea that he did not possess the qualification prescribed by the Punjab Ayurvedic Department (Class I and Class Il) Rules, 1963.
Rule 6 of these Rules prescribes: "No person shall be appointed to the service, unless he possesses such qualifications, if any, as are shown in col umn 4 of Appendix 'A '.
" In Appendix 'A ' there is only one post under Class I that being the post of Director of Ayurved.
The requisite qualifications for that post as provided in Appendix 'A ' are the following: "(1) A degree (5 years or more of regular course) in Ayurvedic system of medicine of a Medical Board or Faculty of Indian Medicine recognised by the Government.
(2) Doctor of Science in Ayurvedic Medicine (Post Graduate) of any recognised University.
(3) Must have worked as an organisor in some Ayurvedic Institution of repute such as Government Ayurvedic Department in any State for a period of at least ten years.
(4) Has conducted original research in Ayurvedic Therapy.
(5) Must be an Ayurvedic Physician of at least 15 years standing.
" Challenge in the High Court was on the ground that the appellant did not possess the prescribed qualifications under Items l and 2.
The writ petition was filed soon after the appellant was promoted to the post of Director, and during the pendency of the writ petition the order of reversion as referred to above had been passed.
The appellant opposed the writ application by contending that he 367 possesses the requisite qualifications and, inter alia, averred in the return made to rule that the petitioners before the High Court were his students and on account of ill motive, they had filed the application challenging the appointment of the appellant as Director.
The State Government initially supported the appellant but later took a different stand.
The High Court has found that the appellant possessed the second qualification, namely, that he had obtained the Doctor of Science Degree in Ayurvedic as prescribed.
In regard to the first qualification, the High Court found that the appellant had a Degree in Ayurvedic system of Medicine from a recognised Institution and the degree that the appellant possesses has been duly recognised by the Government of Punjab, hut it found that the appellant had not studied in regular course for five years to obtain the degree and, therefore, came to the conclusion that the requisite qualification was not possessed by the appellant.
Accordingly, it allowed the writ petition and came to hold that the appellant was not qualified to hold the post of Director.
When the question of challenge to the reversion came for consideration in the connected writ petition, the High Court took the view that since the appellant did not possess the first qualification, he was not entitled to the post of Director and was not entitled to challenge the reversion to the post of Deputy Director.
We shall first deal with the appeal arising out of the quo warranto proceedings.
The first qualification which we have referred to above appears to be a common qualification for almost all the ranks covered by Appendix 'A ', namely, that a degree should have been obtained after five or more years of regular course having been gone through.
No dispute has been raised to the appellant 's appointment as Deputy Director.
Learned counsel appearing for the respondents who had petitioned the High Court pointed out with reference to the correspondence with the State Public Service Commission that in regard to the qualification for the post of Deputy Director, a degree or diploma was considered sufficient.
The State Public Service Commission had raised objection to the Government 's proposal of fixing the degree qualification by pointing out that since a degree after studying for five or more years of regular course was the requirement for the higher post of Director, a lesser qualification should be prescribed for the post of Deputy Director and accordingly the alternates had been adopted.
When we pointed out to her that for the post of Assistant Director it cannot be disputed that Deputy Director 's is a superior post the requirement was five years or more of regular course in Ayurvedic with a diploma, there was really no answer.
We would accordingly hold that the High Court should have looked into this 368 aspect to find out what exactly was the requirement.
In view of the fact that there was no challenge to the appointment of the appellant to the post of Deputy Director and the first item of the qualification is the same for the Director as also the Assistant Director and as Deputy Director, the appellant held a post between the two, we are not impressed by the stand of the respondents that the appellant was not possessed of the requisite qualification.
There is no dispute that the appellanthad been serving as Professor for several years.
The requisite qualification for that post as per Appendix 'A ', as far as relevant is: "A Degree (five years regular course) in Ayurvedic system of Medicine of a recognised university, or of a board of Indian System of Medicine established by law or from any Ayurvedic College recognised by Government." As far as this qualification goes, there is indeed no difference in the case of a Professor and that of Director.
In giving appointment to the appellant as Professor, it must follow that Government were satisfied that appellant had the requisite qualification.
There is material on record to show that in regard to the degree obtainable on completion of the five year course, the appellant had read as a regular student for three years in the first instance and for the remaining two years he was directly under a qualified Professor though it was not study in a regular institution.
After reading for five years he has obtained the degree which has been from a recognised University.
In the circumstances, it has become difficult to agree with the reasons given by the High Court for its conclusion that the appellant was not having the requisite qualification prescribed under the Rules.
Mr. Rao, counsel for the appellant relied upon a decision of this Court in Satesman (Private) Ltd. vs H.R. Deb & Ors., ; at page 621 of the Reports, Hidaytullah, CJ.
speaking for the Constitution Bench indicated: "The High Court in a quo warranto proceeding should be slow to pronounce upon the matter unless there is a clear infringement of the law" It the circumstances which we have narrated, it is indeed difficult to hold that the appellant did not have the requisite qualification.
Ayurveda is the traditional method of medical attention preva 369 lent in this country.
Modern science and people associated with the medical faculties of the modern age have gradually accepted the position that Ayurveda provided a fully developed medical process.
In the post medieval India the system had suffered a set back but in recent years, the Ayurved system has been revived.
In the post independence period, the system has been accepted as a regular course of study and recognised as a system of therapy.
The High Court should have given due consideration to the background and the history of the matter.
There is clear material that the petitioners before the High Court were the once upon a time students of the appellant.
Ordinarily one would expect obligations, piety and reverence in the conduct of the writ petitioners towards the appellant.
This expectation would be more justified in the traditional system of Ayurved culture.
Surprisingly that seems to have been totally wanting.
The appellant has, on the other hand, alleged that the writ petition was the outcome of malice and ill will.
The High Court did not appropriately advert to this aspect.
We are of the view that in the facts of this case, the reasonable conclusion to reach should have been that the writ petitioners had failed to establish that the appellant did not possess the requisite qualification.
The appeal has, therefore, to be a11owed, the judgment of the High Court has to be set aside and the writ petition has to be dismissed with costs.
Now we come to the appeal challenging the reversion.
The writ petition has been dismissed on the sole ground that the appellant was not possessed of the requisite qualification and, therefore, was not entitled to continue as Director.
Now that we have reversed the finding of the High Court on that score, the judgment of the High Court cannot be sustained.
Reversion as admitted by the State Government in its counter in the High Court was grounded upon non possession of the requisite qualification With our finding in the connected appeal.
the order of the High Court cannot be sustained.
Nor can the order of reversion be.
The other appeal too is allowed with costs.
The appellant shall be treated to have been regularly appointed as Director and shall be treated to have retired in the post of Director the order of reversion notwithstanding.
He shall be entitled to all the benefits prescribed for the post of Director from the date he came to the post till he retired.
All his dues shall be paid to him within three months from today.
Consolidated hearing fee of Rs.5,000 is allowed to the appellant and this shall be paid by the respondent State alone.
P.S.S. Appeals allowed.
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ivil Appeal Nos.
8623 24 of 1983.
From the Judgment and order dated 3.6.1983 of the High Court of Pun jab and Haryana in Writ Petition No. 1794 of 1980.
P.P. Rao and P.D. Sharma for the Appellant.
S.K. Bagga, C.M. Nayar, Mrs. Manik Karanjawala, R. Karanjawala and Mrs. Meenakshi Arora for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
These appeals are by special leave and are directed against two separate judgments of the Punjab and Haryana High Court.
The first one is against the decision of the High Court in a writ application for quo warranto filed by respondents 2 to 4 while the second one is against the dismissal of a writ petition filed by the appellant before the High Court challenging his reversion.
The short facts are that the appellant was appointed as a Professor of Ayurvedic Medicines under the Punjab Government.
Later, he was appointed as Deputy Director from which post he was further 366 promoted as Director.
By order dated 21.1().1981 he was reverted to the post of Deputy Director.
On 3 1st October, 1987, the appellant has superannuated.
The respondent Nos. 2, 3 and 4, once upon a time students of the appellant came before the High Court asking for a writ of quo warranto challenging the appellant 's appointment as Director on promotion on the plea that he did not possess the qualification prescribed by the Punjab Ayurvedic Department (Class I and Class Il) Rules, 1963.
Rule 6 of these Rules prescribes: "No person shall be appointed to the service, unless he possesses such qualifications, if any, as are shown in col umn 4 of Appendix 'A '.
" In Appendix 'A ' there is only one post under Class I that being the post of Director of Ayurved.
The requisite qualifications for that post as provided in Appendix 'A ' are the following: "(1) A degree (5 years or more of regular course) in Ayurvedic system of medicine of a Medical Board or Faculty of Indian Medicine recognised by the Government.
(2) Doctor of Science in Ayurvedic Medicine (Post Graduate) of any recognised University.
(3) Must have worked as an organisor in some Ayurvedic Institution of repute such as Government Ayurvedic Department in any State for a period of at least ten years.
(4) Has conducted original research in Ayurvedic Therapy.
(5) Must be an Ayurvedic Physician of at least 15 years standing.
" Challenge in the High Court was on the ground that the appellant did not possess the prescribed qualifications under Items l and 2.
The writ petition was filed soon after the appellant was promoted to the post of Director, and during the pendency of the writ petition the order of reversion as referred to above had been passed.
The appellant opposed the writ application by contending that he 367 possesses the requisite qualifications and, inter alia, averred in the return made to rule that the petitioners before the High Court were his students and on account of ill motive, they had filed the application challenging the appointment of the appellant as Director.
The State Government initially supported the appellant but later took a different stand.
The High Court has found that the appellant possessed the second qualification, namely, that he had obtained the Doctor of Science Degree in Ayurvedic as prescribed.
In regard to the first qualification, the High Court found that the appellant had a Degree in Ayurvedic system of Medicine from a recognised Institution and the degree that the appellant possesses has been duly recognised by the Government of Punjab, hut it found that the appellant had not studied in regular course for five years to obtain the degree and, therefore, came to the conclusion that the requisite qualification was not possessed by the appellant.
Accordingly, it allowed the writ petition and came to hold that the appellant was not qualified to hold the post of Director.
When the question of challenge to the reversion came for consideration in the connected writ petition, the High Court took the view that since the appellant did not possess the first qualification, he was not entitled to the post of Director and was not entitled to challenge the reversion to the post of Deputy Director.
We shall first deal with the appeal arising out of the quo warranto proceedings.
The first qualification which we have referred to above appears to be a common qualification for almost all the ranks covered by Appendix 'A ', namely, that a degree should have been obtained after five or more years of regular course having been gone through.
No dispute has been raised to the appellant 's appointment as Deputy Director.
Learned counsel appearing for the respondents who had petitioned the High Court pointed out with reference to the correspondence with the State Public Service Commission that in regard to the qualification for the post of Deputy Director, a degree or diploma was considered sufficient.
The State Public Service Commission had raised objection to the Government 's proposal of fixing the degree qualification by pointing out that since a degree after studying for five or more years of regular course was the requirement for the higher post of Director, a lesser qualification should be prescribed for the post of Deputy Director and accordingly the alternates had been adopted.
When we pointed out to her that for the post of Assistant Director it cannot be disputed that Deputy Director 's is a superior post the requirement was five years or more of regular course in Ayurvedic with a diploma, there was really no answer.
We would accordingly hold that the High Court should have looked into this 368 aspect to find out what exactly was the requirement.
In view of the fact that there was no challenge to the appointment of the appellant to the post of Deputy Director and the first item of the qualification is the same for the Director as also the Assistant Director and as Deputy Director, the appellant held a post between the two, we are not impressed by the stand of the respondents that the appellant was not possessed of the requisite qualification.
There is no dispute that the appellanthad been serving as Professor for several years.
The requisite qualification for that post as per Appendix 'A ', as far as relevant is: "A Degree (five years regular course) in Ayurvedic system of Medicine of a recognised university, or of a board of Indian System of Medicine established by law or from any Ayurvedic College recognised by Government." As far as this qualification goes, there is indeed no difference in the case of a Professor and that of Director.
In giving appointment to the appellant as Professor, it must follow that Government were satisfied that appellant had the requisite qualification.
There is material on record to show that in regard to the degree obtainable on completion of the five year course, the appellant had read as a regular student for three years in the first instance and for the remaining two years he was directly under a qualified Professor though it was not study in a regular institution.
After reading for five years he has obtained the degree which has been from a recognised University.
In the circumstances, it has become difficult to agree with the reasons given by the High Court for its conclusion that the appellant was not having the requisite qualification prescribed under the Rules.
Mr. Rao, counsel for the appellant relied upon a decision of this Court in Satesman (Private) Ltd. vs H.R. Deb & Ors., ; at page 621 of the Reports, Hidaytullah, CJ.
speaking for the Constitution Bench indicated: "The High Court in a quo warranto proceeding should be slow to pronounce upon the matter unless there is a clear infringement of the law" It the circumstances which we have narrated, it is indeed difficult to hold that the appellant did not have the requisite qualification.
Ayurveda is the traditional method of medical attention preva 369 lent in this country.
Modern science and people associated with the medical faculties of the modern age have gradually accepted the position that Ayurveda provided a fully developed medical process.
In the post medieval India the system had suffered a set back but in recent years, the Ayurved system has been revived.
In the post independence period, the system has been accepted as a regular course of study and recognised as a system of therapy.
The High Court should have given due consideration to the background and the history of the matter.
There is clear material that the petitioners before the High Court were the once upon a time students of the appellant.
Ordinarily one would expect obligations, piety and reverence in the conduct of the writ petitioners towards the appellant.
This expectation would be more justified in the traditional system of Ayurved culture.
Surprisingly that seems to have been totally wanting.
The appellant has, on the other hand, alleged that the writ petition was the outcome of malice and ill will.
The High Court did not appropriately advert to this aspect.
We are of the view that in the facts of this case, the reasonable conclusion to reach should have been that the writ petitioners had failed to establish that the appellant did not possess the requisite qualification.
The appeal has, therefore, to be a11owed, the judgment of the High Court has to be set aside and the writ petition has to be dismissed with costs.
Now we come to the appeal challenging the reversion.
The writ petition has been dismissed on the sole ground that the appellant was not possessed of the requisite qualification and, therefore, was not entitled to continue as Director.
Now that we have reversed the finding of the High Court on that score, the judgment of the High Court cannot be sustained.
Reversion as admitted by the State Government in its counter in the High Court was grounded upon non possession of the requisite qualification With our finding in the connected appeal.
the order of the High Court cannot be sustained.
Nor can the order of reversion be.
The other appeal too is allowed with costs.
The appellant shall be treated to have been regularly appointed as Director and shall be treated to have retired in the post of Director the order of reversion notwithstanding.
He shall be entitled to all the benefits prescribed for the post of Director from the date he came to the post till he retired.
All his dues shall be paid to him within three months from today.
Consolidated hearing fee of Rs.5,000 is allowed to the appellant and this shall be paid by the respondent State alone.
P.S.S. Appeals allowed.
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% Rule 6 of the Punjab Ayurvedic Department (Class I and Class II) Rules, 1963 interdicts appointment to the service except duly qualified persons.
The requisite qualification laid down by Appendix 'A ' to the Rules for Class I post of Director of Ayurved includes (1) a five years ' degree course in Ayurvedic system of medicine, and (2) Doctor of Science in Ayurvedic Medicine.
For the posts of Professor, Assistant Director and deputy Director of Ayurved the requisite qualification is a five years regular course in Ayurvedic system of medicine.
The appellant had read as a regular student for three years in the first instance, and for the remaining two years he was directly under a qualified, Professor.
He had then obtained a degree from a recognised University.
Later he acquired the Doctor of Science Degree in Ayurved.
He was appointed as a Professor of Ayurvedic Medicine under the Punjab Government and later as Deputy Director.
He was further promoted as Director.
His appointment as Director was challenged for lack of requisite qualification in a writ of quo warranto by respondents, 2, 3 and 4.
In the return made to rule he averred that the petitioners respondents, his one time students, had filed the application on account of ill motive.
He was reverted to the post of Deputy Director on October 21, 1981 during 364 the pendency of the writ petition which he challenged in a connected writ petition.
he superannuated from the post of Deputy Director on October 31, 1987.
The High Court held that the appellant was not qualified to hold the post of Director since he had not studied in a regular course for five years to obtain the degree, though it found that he possessed the second qualification, namely, Doctor of Science Degree, and a degree in Ayurvedic system of medicine duly recognised by the Government of Punjab.
Consequently, in the connected writ petition the High Court took the view that he was not entitled to challenge reversion to the post of Deputy Director.
Allowing the appeals with costs, ^ HELD: 1.1.
The writ petitioners have failed to establish that the appellant did not possess the requisite qualification.
In fact he had read as a regular student for three years in the first instance and for the remaining two years he was directly under a qualified Professor.
After reading for five years he had obtained the degree which has been from a recognised University.
[368E] 1.2 The appellant had been serving as Professor for several years.
As far as the qualification goes there is no difference in the case of a Professor and that of a Director.
In giving appointment to the appellant as Professor, the Government must have been satisfied that he had the requisite qualification.
[368B] 1.3 There was no challenge to the appointment of the appellant to the post of Deputy Director.
The first item of the qualification is the same for the Director as also the Assistant Director and the Deputy Director.
The appellant held a post between the two.
The High Court should have looked into this aspect to find out what exactly was the requirement.
[368D; A] 1.4 The High Court should have given due consideration to the background and the history of the matter.
Ayurveda is the traditional method of medical attention.
In the post medieval India the system had suffered a set back but in the post independence period it has been accepted as a regular course of study and recognised as a system of therapy.
[369B; 368H] 1.5 The appellant has alleged that the writ petition was the out 365 come of malice and ill will.
The High Court did not appropriately advert to this aspect.
The petitioners respondents were the once upon a time students of the appellant.
Ordinarily one would except obligations, piety and reverence in their conduct towards the appellant, especially in the traditional system of Ayurved culture.
Surprisingly that seems to have been totally wanting.
[369C] 2.
Since the reversion of the appellant was grounded upon non possession of the requisite qualification the order of the High Court in the connected writ petition cannot be sustained.
[369F G] 3.
The appellant shall be treated to have been regularly appointed as Director of Ayurved and to have been retired in that post, the order of reversion notwithstanding.
He shall be entitled to all the benefits prescribed for the post of Director from the date he came to the post till he retired.
[369G H] Statesman (Private) Ltd. vs H.R. Deb & Ors., ; , referred to.
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% Rule 6 of the Punjab Ayurvedic Department (Class I and Class II) Rules, 1963 interdicts appointment to the service except duly qualified persons.
The requisite qualification laid down by Appendix 'A ' to the Rules for Class I post of Director of Ayurved includes (1) a five years ' degree course in Ayurvedic system of medicine, and (2) Doctor of Science in Ayurvedic Medicine.
For the posts of Professor, Assistant Director and deputy Director of Ayurved the requisite qualification is a five years regular course in Ayurvedic system of medicine.
The appellant had read as a regular student for three years in the first instance, and for the remaining two years he was directly under a qualified, Professor.
He had then obtained a degree from a recognised University.
Later he acquired the Doctor of Science Degree in Ayurved.
He was appointed as a Professor of Ayurvedic Medicine under the Punjab Government and later as Deputy Director.
He was further promoted as Director.
His appointment as Director was challenged for lack of requisite qualification in a writ of quo warranto by respondents, 2, 3 and 4.
In the return made to rule he averred that the petitioners respondents, his one time students, had filed the application on account of ill motive.
He was reverted to the post of Deputy Director on October 21, 1981 during 364 the pendency of the writ petition which he challenged in a connected writ petition.
he superannuated from the post of Deputy Director on October 31, 1987.
The High Court held that the appellant was not qualified to hold the post of Director since he had not studied in a regular course for five years to obtain the degree, though it found that he possessed the second qualification, namely, Doctor of Science Degree, and a degree in Ayurvedic system of medicine duly recognised by the Government of Punjab.
Consequently, in the connected writ petition the High Court took the view that he was not entitled to challenge reversion to the post of Deputy Director.
Allowing the appeals with costs, ^ HELD: 1.1.
The writ petitioners have failed to establish that the appellant did not possess the requisite qualification.
In fact he had read as a regular student for three years in the first instance and for the remaining two years he was directly under a qualified Professor.
After reading for five years he had obtained the degree which has been from a recognised University.
[368E] 1.2 The appellant had been serving as Professor for several years.
As far as the qualification goes there is no difference in the case of a Professor and that of a Director.
In giving appointment to the appellant as Professor, the Government must have been satisfied that he had the requisite qualification.
[368B] 1.3 There was no challenge to the appointment of the appellant to the post of Deputy Director.
The first item of the qualification is the same for the Director as also the Assistant Director and the Deputy Director.
The appellant held a post between the two.
The High Court should have looked into this aspect to find out what exactly was the requirement.
[368D; A] 1.4 The High Court should have given due consideration to the background and the history of the matter.
Ayurveda is the traditional method of medical attention.
In the post medieval India the system had suffered a set back but in the post independence period it has been accepted as a regular course of study and recognised as a system of therapy.
[369B; 368H] 1.5 The appellant has alleged that the writ petition was the out 365 come of malice and ill will.
The High Court did not appropriately advert to this aspect.
The petitioners respondents were the once upon a time students of the appellant.
Ordinarily one would except obligations, piety and reverence in their conduct towards the appellant, especially in the traditional system of Ayurved culture.
Surprisingly that seems to have been totally wanting.
[369C] 2.
Since the reversion of the appellant was grounded upon non possession of the requisite qualification the order of the High Court in the connected writ petition cannot be sustained.
[369F G] 3.
The appellant shall be treated to have been regularly appointed as Director of Ayurved and to have been retired in that post, the order of reversion notwithstanding.
He shall be entitled to all the benefits prescribed for the post of Director from the date he came to the post till he retired.
[369G H] Statesman (Private) Ltd. vs H.R. Deb & Ors., ; , referred to.
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ION: Civil Appeal No. 495 of 1984.
From the Judgment and order dated 1.11.1983 of the Delhi High Court in L.P.A. No. 160 of 1983.
P. P. Rao and A. Mariaputham for the Appellant.
Dr. Anand Prakash, D.N. Dwivedi, Mrs. Anil Katiyar, C.V. Subba Rao, Vineet Kumar and Deepak K. Thakur for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal by special leave calls in question the judgment of a Division Bench of the Delhi High Court in a Letters Patent Appeal upholding the decision of a learned Single Judge rejecting the writ petition of the appellant.
The appellant was an employee of the Institute of Constitutional and Parliamentary Studies (hereafter referred to as ICPS for short) and in a disciplinary action he was dismissed from service by order dated 17th November, 1982.
When he assailed the order in a writ petition before the High Court, the question whether lCPS was 'State ' within the meaning of Article 12 of the Constitution came for consideration as the major issue arising in the matter.
The learned Single Judge dismissed the writ petition by holding that the employer was neither an agency nor an instrumentality of the Government and did not constitute 'State ' within the meaning of Article 12 and, therefore, was not subject to the writ jurisdiction of the High Court.
The appeal against the judgment of the learned Single Judge was dismissed on 1st November, 1983.
In course of hearing of the appeal Dr. Anand Prakash appearing for ICPS fairly stated that whether the Institute be 'State ' or not within the meaning of Article 12 of the Constitution, the employer 264 was prepared to give a fresh opportunity to the appellant to meet the charges so as to dispel from his mind the feeling that he has not been given reasonable opportunity to defend himself.
Ordinarily, with that concession the impugned order entailing the dismissal of the employee and the judicial determination against the appellant should have been set aside and the matter should have gone before the enquiry officer for affording reasonable opportunity to the appellant of being heard against the charges.
Dr. Anand Prakash, however, invited us to enter into the merits of the issue as to whether ICPS constitutes 'State ' within the constitutional meaning of the term The Union of India which appears before us through counsel also wanted that the question should be decided.
Thereupon we suggested to the appellant who was till then appearing in person to get represented through counsel so that the matter could be appropriately argued on his behalf also.
He has been rendered suitable assistance by the Supreme Court Legal Aid Committee and Mr. P.P.Rao, Senior Counsel, has appeared on his behalf.
The main question for consideration now, therefore, is whether ICPS is 'State '.
For appropriate consideration of this question it is necessary to look into the constitution of the body, the purpose for which it has been created, the manner of its functioning including the mode of its funding and the broad features which have been found by this Court in several decisions to be relevant in the matter of determining a dispute of this type.
Article 12 of the Constitution provides an inclusive definition of the term 'State ' by saying: "In this part, unless the context otherwise requires, 'the State ' includes the Government and Parliament of India and the Government and the State Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.
" obviously ICPS can become 'State ' only if it is found to be an authority within the territory of India or under the control of the Government of India.
ICPS, respondent No.2, is a society registered under the Societies Registration Act, 21 of 1860, and was registered on 9th March, 1965.
As would appear from its Memorandum of Association, the foundation members were 19 in number 13 being members besides a President and five Vice Presidents.
The first President of the Soci 265 ety was the then Speaker of the Lok Sabha.
The five Vice Presidents were the then Minister of Railways, Minister of Law and Social Security Minister of Communication and Parliamentary Affairs, a former (Chief Justice of India and a former Attorney General of India.
Dr. L.N. Singhvi, then a member of the Lok Sabha, was its Executive Chairman.
The Public Trustee in the Department of Company Affairs and Insurance in the Ministry of Finance was the Director and a member of the Lok Sabha was the Society 's Treasurer.
The then Minister of Cultural Affairs in the Ministry of Education along with three members of the Lok Sabha, a Senior Advocate of the Supreme Court, a member of the Rajya Sabha, the then Vice Chancellor of Rajasthan University.
the respective Secretaries of the Lok Sabha and the Rajya Sabha Secretariat and the Secretary in the Ministry of Law were its Members.
The registered office of the Society was initially located within the Parliament House but was later on shifted to the Vithalbhai Patel House, Rafi Marg, New Delhi .
The objects of the Society inter alia were: ( I) to promote and provide for constitutional and Parliamentary studies with special reference to comparative studies in constitutional systems of various countries and working of the Indian Constitution and parliamentary and governmental institutions in their various aspects; (2) to undertake study of courses and fundamental research relating to developments in constitutional law, conventions and practices, parliamentary procedure, legislative drafting, trends in judicial interpretation and allied matters; (3) to organise inter alia training programmes in constitutional problems and matters of current parliamentary importance; (4) to set up a legislative research and reference service for the benefit of all interested members of the Union Parliament and State Legislature irrespective of their party affiliations; (5) to undertake and provide for the publication of a journal and of research papers and of books and brochures with a view to disseminate democratic values and to foster broad based civic education and awareness, and in particular, to pro.
mote study of constitutional and parliamentary affairs; 266 (6) to establish and maintain libraries and information services to facilitate the study of constitutional and parliamentary subjects and spread information in regard thereto; (7) to invite as and when feasible, scholars who may or may not be members of the Society, to take advantage of the facilities offered by the Society and to benefit the Society by their knowledge and experience; and (8) to institute appropriate fellowships, offer prizes and arrange scholarships and stipends in furtherance of the objects of the society.
The Memorandum permitted the Society to accept gifts, donations and subscriptions of cash and securities and of any property either movable or immovable.
The rule classifies the members under heads like Founder Members, Life Members, Honorary Members, ordinary Members, Corporate Members and Associate Members.
ordinary membership, according to the Rules, would extend to Members of Parliament or of any State Legislature or those who have been or are members of the Judiciary or advocates of the Supreme Court or the High Courts or persons employed in public service or persons engaged in teaching of study of social sciences particularly of Political Science, Law or subjects related thereto.
In the category of Honorary Members were the President, the Vice President and the Prime Minister of India.
Though the Memorandum permitted receipt of gifts and donations from outside, it is not disputed that the main source of income of the society has been the annual Central Government grant.
We think it appropriate at this stage to turn attention to judicial precedents to find out as to what should be the test to be applied for determining when on institution like respondent No.2 would be treated as 'other authorities ' under Article 12 of the Constitution.
The first in point of time is the Constitution Bench judgment in the case of Rajasthan State Electricity Board, Jaipur vs Mohan Lal & Ors., ; Bhargava, J. who delivered the main judgment observed: "the meaning of the word 'authority ' given in Webster 's Third New International Dictionary, which can be applicable, is a "public administrative agency or corporation having quasi governmental powers and authorised to 267 administer a revenue producing public enterprise." This dictionary meaning of the word 'authority ' is clearly wide enough to include all bodies created by a statute on which powers are conferred to carry out governmental or quasi governmental functions.
The expression "other authorities" is wide enough to include within it every authority created by a statute and functioning within the territory of India, or under the control of the Government of India; and we do not see any reason to narrow down this meaning in the context in which the words 'other authorities ' are used in Article l 7 of the Constitution In Smt.
Ujjam Bai vs State of Uttar Pradesh, Ayyangar, J. had observed: "Again Article 12 winds up the list of authorities falling within the definition by referring to 'other authorities ' within the territory of India which cannot obviously be read as ejusoem generis with either the Government and the Legislatures or local authorities.
The words are of wide amplitude and capable of comprehending every authority created under a statute and functioning within the territory of India or under the control of the Government of India.
Shah, J., as he then was, added a note to the leading Judgment of Bhargava and observed: "I am unable, however, to agree that every constitutional or statutory authority on whom powers are conferred by law is 'other authority ' within the meaning of Article 12.
The expression 'authority ' in its etymological sense means a body invested with power to command or give an ultimate decision, or enforce obedience, or having a legal right to command and be obeyed.
In determining what the expression 'other authority ' in Article 12 connotes, regard must be had not only to the sweep of fundamental rights over the power of the authority, but also to the restrictions which may be imposed upon the exercise of certain fundamental rights (e.g., those declared by Article 19) by the authority.
Fundamental rights within their allotted fields trans 268 cend the legislative and executive power of the sovereign authority.
But some of the important fundamental rights are liable to be circumscribed by the imposition of reason able restrictions by the State.
The true content of the expression 'other authority ' in Article 12 must be deter mined in the light of this dual phase of fundamental rights.
In considering whether a statutory or constitutional body is an authority within the meaning of Article 12, it would he necessary to bear in mind not only whether against the authority fundamental rights in terms absolute are intended to be anforced, but also whether it was intended by the Constitution makers that the authority was invested with the sovereign power to impose restrictions on very important and basic fundamental freedoms.
In my judgment, authorities, constitutional or statutory invested with power by law but not sharing the sovereign power do not fall within the expression 'State ' as defined in Article 12.
Those authorities which are invested with sovereign power, i.e., power to make rules or regulations and to administer or enforce them to the detriment of citizens and others fall within the definition of 'State ' in Article 12, and constitutional or statutory bodies which do not share that sovereign power of the State are not, in my judgment, 'State ' within the meaning of Article 12 of the Constitution.
Two cases, the First of Sabhajit Tewary vs Union of India & Ors., and the other of Sukhdev Singh & Ors vs Bhagatram Sardar Singh Raghuvanshi & Anr., l 19 were disposed of by the same Constitution Bench on February 21, 1975.
In both these cases, the true meaning of Article 12 of the Constitution fell for consideration.
Sabhajit Tewary 's case was one where the status of the Council of Scientific and Industrial Research was examined.
This Court took note of the fact that the Council was a society registered under the Societies Registration Act.
Under Rule 3, the Prime Minister of India was the ex officio President of the Society and under Rule 30 the governing body consisted of persons appointed by the Government of India representing the administrative ministry under which the Council of Scientific and Industrial Research is included and the Ministry of Finance.
The Court also took note of the manner in which the affairs of the Society including funding were conducted.
Ray, CJ.,in the brief judgment that the 269 Court delivered in the case observed: A "Extracting the features as aforesaid, it was contented that these would indicate that the Council of Scientific and industrial Research was really an agency of the Government.
This contention is unsound.
The society does not have a statutory character like the oil and Natural Gas Commission, or the Life Insurance Corporation or Industrial Finance Corporation.
It is a society incorporated in accordance with the provisions of the Societies Registration Act.
The fact that the Prime Minister is the President or that the Government appoints nominees to the governing body or that the Government may terminate the membership will not establish anything more than the fact that the Government takes special care that the promotion, guidance and cooperation of scientific and industrial research, the institution and functioning of specific researches, establishment or development and assistance to special institutions or departments of the existing institutions for scientific study of problems affecting particular industry in a trade, the utilisation of the result of the researches conducted under the auspices of the Council towards the development of industries in the country are carried out in a responsible manner.
This Court has held in Praga Tools Corporation vs C.A. Imanual & Ors., ; ; Heavy Engineering Mazdoor Union vs The State of Bihar & Ors., and in S.L. Aggarwal vs General Manager, Hindustan Steel Ltd., ; that the Praga Tools Corporation, Heavy Engineering Mazdoor Union and Hindustan Steel Ltd. are all companies incorporated under the Companies Act and the employees of these companies Act and the employees of these companies do not enjoy the protection available to Government servants as contemplated in Article 311.
The companies were held in these cases lo have independent existence of the Government and by the law related to corporations.
These could not be hold to be departments of the Government.
" The ratio of this decision has been fully relied upon by the High Court in dismissing the claim of the appellant.
270 In Sukhdev Singh 's case (supra) the leading judgment was delivered also by Ray, CJ.
Two questions fell for consideration ( l) whether an order of.
removal from service contrary to Regulations would enable the employee to a declaration against the statutory corporation of continuance in service or would it end up in claim for damages only and (2) whether the employee of a statutory corporation is entitled to claim protection of Articles 14 and 16 against the Corporation.
The Court, therefore, straight went into the question as to whether statutory corporations were authorities within the meaning of Article 12.
As a fact, three corporations being the oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation were before the Court and each one of them had been set up under a special statute.
At page 641 of the Reports, the learned Chief Justice pointed out: "In the background of the provisions of the three Acts under consideration, the question arises as to whether these Corporations can be described to be authorities within the meaning of Article 12 of the Constitution . " At page 642 of the Reports the conclusion was reached to the effect that "these statutory bodies are 'authorities ' within the meaning of Article 12 of the Constitution.
" We are really concerned with what Mathew J., added to the judgment He observed: "The test propounded by the majority is satisfied so far as the oil and Natural Gas Commission is concerned as section 25 of the oil and Natural Gas Commission Act provides for issuing, binding direction to third parties not to prevent the employees of the Commission from entering upon their property if the Commission so directs.
In other words, as section 25 authorises the Commission to issue binding directions to third parties not to prevent the employees of the Commission from entering into their land and as disobedience of such directions is punishable under the relevant provision of the Indian penal Code since those employees are deemed to be pubic servants under section 21 of the Indian Penal Code by virtue of section 27 of the Act, the Commission is an 'authority ' within the meaning of the expression 'other authorities ' in Article 12 271 Though this would be sufficient to make the commission a 'State ' according to the decision of this Court in the Rajasthan Electricity Board case (supra), there is a larger question which has a direct bearing so far as the other two corporations are concerned, viz., whether, despite the fact that there are no provisions for issuing binding directions to third parties the disobedience of which would entail penal consequences, the corporations set up under statutes to carry on business of public importance of which is fundamental to the life of the people can be considered as 'State ' within the meaning of Article 12.
" Mathew, J. referred to the precedents and other authorities from England, France and United States and at page 654 of the Reports stated: "The ultimate question which is relevant for our purpose is whether such a corporation is an agency or instrumentality of the government for carrying on a business for the benefit of the public.
In other words, the question is, for whose benefit was the corporation carrying on the business? When it is seen from the provisions of that Act that on liquidation of the corporation, its assets should be divided among the shareholders, namely, the Central and State governments and others, if any, the implication is clear that the benefit of the accumulated income would go to the Central and State Governments.
Nobody will deny that an agent has a legal personality different from that of the principal.
The fact that the agent is subject to the direction of the principal does not mean that he has no legal personality of his own . . .
The crux of the matter is that public corporation is a new type of institution which has sprung from the new social and economic functions of government and that it therefore does not neatly fit into old legal categories.
Instead of forcing it into them, the later should be adapted to the needs of changing times and conditions.
I do not think there is any basis for the apprehension expressed that by holding that these public corporations are 'State ' within the meaning of Article 12, the employees of these corporations would become government servants.
I also wish to make it clear that I express no opinion on 272 the question whether private corporations or other like organisations, though they exercise power over their employees which might violate their fundamental rights, would be 'State ' within the meaning of Article 12.
" Then comes the case of Ramana Dayaram Shetty vs The International Airport Authority of India & Ors., ; The question before the Court was whether the International Airport Authority of India was 'State ' within the meaning of Article 12 so as to be subjected to enforcement of fundamental rights against it.
Examining this aspect, Bhagwati, J., as he then was spoke for the three Judge Bench thus: "Now it is obvious that the government which represents the executive authority of the State , may act through the instrumentality or agency of natural persons or it may employ the instrumentality or agency of judicial persons to carry out its functions.
In the early days, when the Government had limited functions it could operate effectively through natural persons constituting its civil service and they were found adequate to discharge governmental functions, which were of traditional vintage.
But as the tasks of the government multiplied with the advent of the welfare State, it began lo be increasingly felt that the frame work of civil service was not sufficient to handle the new tasks which were often of specialised and highly technical character.
The inadequacy of the civil service to deal with these new problems came to be realised and it became necessary to force a new instrumentality or administrative device for handling these new problems.
It was in these circumstances and with a view to supplying this administrative need that the public corporation came into being as the third arm of the Government.
As early as 1819 the Supreme Court of the United States in Mac Cullough v .
Maryland, (4 Wheat 315) held that the Congress has power to charter corporations as incidental to or in aid of governmental functions and , as pointed out by Mathew J., in Sukhdev vs Bhagat Ram, (supra) such federal corporations would ex hypothesi be agencies of the Government.
In Great Britain too, the policy of public administration through separate corporations was gradually evovled and the conduct of basic industries through giant corporations has now become a permanent feature 273 of public life.
So far as India is concerned, the genesis of the emergence of corporations as instrumentalities or agencies of Government is to be found in the Government of India Resolution on Industrial Policy dated with April, 1948 where it was stated inter alia that 'management of state enterprises will as a rule be through the medium of public corporation under the statutory control of the Central Government who will assume such powers as may be necessary to ensure this. ' It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial policy that corporations were created by Government for setting up and management of public enterprises and carrying out other public functions.
Ordinarily, these functions could have been carried out by Government departmentally through service personnel, but the instrumentality or agency of the corporations was resorted to in these cases having regard to the nature of the task to be performed.
The corporations acting as instrumentality or agency of Government would obviously be subject to the same limitations in the field of constitutional and administrative law as Government itself, though in the eye of the law, they would be distinct and independent legal entities.
If the Government acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori that Government acting through the instrumentality or agency of corporations should equally be subject to the same limitations.
But the question is how to determine whether a corporation is acting as instrumentality or agency of Government.
It is a question not entirely free from difficulty.
" It was again pointed out in the same case that: "A corporation may be created in one of two ways.
It may be either established by statute or incorporated under a Law such as the or the .
Where a corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government . " 274 The Court further stated: "But the public nature of the function, if impregnated with governmental character or 'tied or ent wined with government ' or fortified by some other additional factor may render the corporation an instrumentality or agency of Government.
Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference.
It will thus be seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government.
We have referred to some of these factors and they may be summarised as under: whether there is any financial assistance given by the State, and if so, what is the magnitude of such assistance whether there is any other form of assistance, given by the State, and if so whether it is of the usual kind or it is extraordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys State confer red or State protected monopoly status and whether the functions carried out by the corporation are public functions closely related to governmental functions This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks growing complexities of management and administration and the necessity of continuing adjustment in relations between the corporations and Government calling for flexibility, adapt ability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is governmental instrumentality or agency.
At page 1052 of the Reports the Court proceeded to consider whether International Airport Authority of India could be said to be an 'authority ' falling within the meaning of 'State ' in Article 12.
The constitution of the body, the manner of filling it up? Government 's power of control in the matter of appointment of members and termination of membership were utilised as tests for examining whether 275 the Airport authority was 'State '.
After referring to the special A aspects, the Court observed: "It will be seen from these provisions that there are certain features of the respondent which are eloquent and throw considerable light on the true nature of the first respondent.
In the first place, the Chairman and Members of the first respondent are all persons nominated by the Central Government and the Central Government has also the power to terminate their appointment as also to review them in certain specified circumstances.
The Central Government is also vested with the power to take away the management of any airport from the first respondent and to entrust it to any other person or authority and for certain specified reasons, the Central Government can also supersede the first respondent.
The Central Government has also power to give directions in writing from time to time on questions of policy and these directions are declared binding on the first respondent.
" Reference was made to the case of Sabhajit Tewary (supra).
Bhagwati, J. referring thereto stated : "This decision does not lay down any principle or test for the purpose of determining when a corporation can be said to be an authority.
If at all, any test can be gleaned from the decision, it is whether the corporation is really an agency of the Government." and ultimately it was held that the Authority was 'State ' under Article 12.
This case clearly approves the treatment of the matter by Mathew, J. in Sukhdev Singh 's case (supra).
The two Judge Bench in the case of Managing Director, Uttar Pradesh Warehousing Corporation & Anr.
vs Vinay Narayan Vajpayee, ; was cited but we do not consider it necessary to refer to the same.
On the other hand reference to the two later decisions of this Court may be more useful.
Those are Ajay Hasia etc.
vs Khalid Mujib Sehravardi & Ors. etc.
; , of a Constitution Beocll and the other is Som Prakash Rekhi vs Union of India & Anr., ; being a three Judge Bench decision.
It is pertinent to indicate that both the judgments were delivered on November 13, 1980.
276 In Ajay Hasia 's case an Engineering College was also a Society registered under the Jammu & Kashmir Registration of Societies Act, l898, and the question that fell for consideration was whether it was an authority within the meaning of Article 12.
The Court found that the Memorandum of Association of the Society in clause (3) set out the objects for which the Society was incorporated and they included among other things establishment of the college with a view to providing instructions and research in such branches of engineering and technology as the college may think fit and for the advancement of learning and knowledge in such branches.
Reference was made to the Memorandum of Association, the objects and the powers of the State Government to make appointments and to the fact that the State government with the approval of the Central Government had the power to take such action and to issue such directions as are necessary in respect of all matters relating to the functioning of the college as noticed in the review of the activities.
the Court also took note of the fact that the founding members of the society were enumerated in clause (9) of the memorandum and they were the Chairmen to be appointed by the State Government with the approval of the Central Government, two representatives of the State Government, one representative of the Central Government, two representatives of the All India Council for Technical Education to be nominated by the Northern Regional Committee, one representative of the University of Jammu & Kashmir, one nonofficial representative of each of the Punjab, Rajasthan, UttarPradesh and Jammu & Kashmir States and to be appointed by the respective Governments in consultation with the Central Government and the principal who shall also be the ex officio Secretary.
The rules of the Society were referred to with a view to finding out the details of functioning.
Sabhajit Tewary 's case was referred to and distinguished and the tests laid down in the International Airport Authority 's case (supra) were approved.
Ultimately the Court summarised the position as under: " The tests for determining as to when a corporation can be said to be an instrumentality or agency of Government may now be culled out from the judgment in the International Airport Authority 's case.
These tests ate not conclusive or clinching, but they are merely indicative indicia which have to be used with care and caution because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities '.
it must be realised that it should not stretched so far as to bring in 277 every autonomous body which has some nexus with the Government within the sweep of the expression.
A wide enlargment of the meaning must be tempered by a wise limitation.
We may summarise the relevant tests gathered from the decision in the International Airport Authority 's case as follows: (1) "one thing is clear that if the entire share capital of the corporation is held by Government it would go a long way towards indicating that the corporation is an instrumentality or agency of (Government (2) "Where the financial assistance of the State is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being inpregnated with governmental character. " (3) "It may also be a relevant factor whether the corporation enjoys monopoly status which is State conferred or State protected." (4) "Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality." (5) "If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government.
(6) "Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government.
" The Court thereafter proceeded to say: "We may point out that it is immaterial for this purpose whether the corporation is created by a statute or under a statute.
The test is whether it is an instrumentality 278 or agency of the Government and not as to how it is created.
The inquiry has to be not as to how the juristic person is born but why it has been brought into existence.
The corporation may be a statutory corporation created by a statute or it may be a Government Company or a company formed under the or it may be a society registered under the or any other similar statute.
Whatever be its genetical origin, it would be an 'authority ' within the meaning of Article 12 if it is an instrumentality or agency of the Government and that would have to be decided on a proper assessment of the facts in the light of the relevant factors.
The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of the Government so as to come within the meaning of the expression 'authority ' in Article 12.
" At pages 99 and 100 of the Reports, the Constitution Bench referred to the facts of the particular case and came to hold that the society was an instrumentality or agency of the State.
In Som Prakash Rekhi 's case (supra) at page 137 of the Reports, Krishna Iyer, J. referred to the five tests and concluded by saying that: "The finale is reached when the cumulative effect of all the relevant factors above set out is assessed and once the body is found to be an instrument or agency of Government, the further conclusion emerges that it is 'State ' and is subject to the same constitutional limitations as Government At page 138 the criticism against the conclusions reached in the c, Airport Authority 's case was taken note of and the learned Judge observed: "There is no doubt that Bhagwati, J. broadened the scope of State under Article 12 and according to Shri G.B. Pai the observations spill over beyond the requirements of the case and must be dismissed as obiter.
" 279 Pathak, J., as he then was, added a brief note to the judgment by A saying: "I must confess to some hesitation in accepting the proposition that the Bharat Petroleum Corporation Limited is a 'State ' within the meaning of Article 12 of the Constitution.
But in view of the direction taken by the law in this Court since Ramana Dayarama Shetty vs International Airport Authority I find I must lean in favour of that conclusion.
I would have welcomed a wider range of debate before us on the fundamental principles involved in the issue and on the implications flowing from the definition in the of a 'Government Company '? but perhaps a future case may provide that.
" We have thus the tests available in the two decisions to be applied to the facts of the case in hand for determination as to whether ICPS is 'State ' within the meaning of Article 12.
There are two more cases to which brief reference may now be made B.S. Minhas vs Indian Statistical Institute & Ors., ; and P.K. Ramachandra Iyer & Ors.
vs Union of India & Ors.
, ; The case of the Indian Statistical Institute is also of a society registered under the .
The Court found that the entire money required for funding the Institute was provided by the Central Government and even if any other money was to be received by the Institute it could be done only with the approval of the Central Government and the accounts of the Institute were to be submitted to the Central Government for its scrutiny and satisfaction.
The Society had to comlpy with all directions as may be issued by the Central Government. 'The control of the Central Government was deep and pervasive and, therefore, it was an instrumentality of the Central Government and as such was an authority within the meaning of Article 12 of the Constitution.
ln coming to this conclusion, the Court relied upon the tests indicated in the International Airport Authority 's case as also in the case of Ajay Hasia.
In Ramchandra Iyer 's case, the question for consideration was whether the Indian Council of Agricultural Research (ICAR) was a set up within the meaning of Article 12 of the Constitution.
ICAR is also a Society registered under the .
The Court found that when it was set up, it was an attached office of the 280 Government of Tndia and had not undergone any change when it got transferred into a Society.
Applying the tests indicated in International Airport Authority case as also the case of Ajay Hasia, the Court came to the conclusion that there was little doubt that it was an instrumentality or agency of the State.
It further stated: "ICAR came into existence as an integral department of the Government of India and later on became an attached office of the Central Government.
The composition of the ICAR as evidenced by Rule 3 could not have been more governmental in character than any department of the Government.
" It is time to turn to the facts of the present case to find out as to what the conclusion should be when the tests formulated by the several cases of this Court referred to above are applied.
There cannot indeed be a strait jacket formula.
It is not necessary that all the tests should he satisfied for reaching the conclusion either for or against r holding an institution to be 'State '.
In a given case some of the features may emerge so boldly and prominently that a second view may not be possible.
There may yet be other cases where the matter would be on the border line and it would be difficult to take one view or the other outright.
Our struggle for independence which spread over a century bore fruit in 1947.
During the long period of struggle, the British Government following the pattern of the democratic system prevailing in their own country had patronised the evolution of a process of self government.
The Government of India Act of 1935 which was a positive improvement on the previous Acts had introduced provincial autonomy and the Indian Independence Act, 1947, adopted that pat tern of Government.
Even the Constitution which the people of India gave unto themselves in 1949 and which came into force from the 26th of January, 1950, followed that pattern, of course, with considerable modifications.
Thus when we became independent a democratic pattern had evolved in this country through more or less an historical process.
Soon the princely States disappeared by a process of merger and the Constitution ultimately came to have a federal base the federating States as the units and the federation at the Centre.
Democracy pre supposes certain conditions for its successful working.
It is necessary that there must be a deep sense of understanding, mutual confidence and tolerance and regard and acceptance 281 Of the views of others.
In the early years of freedom, the spirit of sacrifice and a sense of obligation to the leadership that had helped the dream of freedom to materialise had been accepted.
The emergence of a new generation within less than two decades of independence gave rise to a feeling that the people 's representatives in the Legislatures required the acquisition of the appropriate democratic bias and spirit.
ICPS was born as a voluntary organisation to fulfil this requirement.
At the inception it was certainly not a governmental organisation and it has not been the case of the parties in their pleadings nor have we been told at the bar during the long arguments that had been advanced that the objects of ICPS are those which are a State obligation to fulfil.
The Society was thus born out of a feeling that there should be a voluntary association mostly consisting of Members of the two Houses of Parliament with some external support to fulfil the objects which were adopted by the Society.
To Start with, the Society was accommodated in the Parliament House but in due course it shifted out.
The President of India inaugurated the Society.
Very appropriately the Speaker of the Lok Sabha became its first President and three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice Presidents.
Some of the public officers were also associated in the administrative set up of the Society.
Individual Members of Parliament and the corporate body known as Parliament are certainly two different concepts.
Services of some of the employees of Parliament were lent to the Society.
While Article 12 refers to Parliament as such, a few Members of Parliament cannot be considered as Parliament so as to constitute that body as referred to in Article 12.
The Speaker and the Ministers who joined as Vice Presidents of the Society were there in their individual capacities and not as Ministers, though designations were indicated.
In the category of Vice Presidents, Executive Chairman, Treasurer and members, there were many people who were really not a part of Government as such and some of them did not belong to Parliament.
The objects of the Society were not governmental business but were certainly the aspects which were expected to equip Members of Parliament and the State Legislatures with the requisite knowledge and experience for better functioning.
Many of the objects adopted by the Society were not confined to the two Houses of Parliament and were intended to have an impact on society at large.
The Memorandum of the Society permitted acceptance of gifts, 282 donations and subscriptions.
There is material to show that the Ford Foundation, a US based Trust had extended support for some time.
Undoubtedly, the annual contribution from the Government has been substantial and it would not be wrong to say that they perhaps constitute the main source of funding, Yet some money has been coming from other sources.
In later years, foreign funding came to be regulated and, therefore, it became necessary to provide that without Government clearance like any other institution, ICPS was not to receive foreign donations.
No material has been placed before us f the stand that the Society was not entitled to receive Contributions from any indigenous source without Government sanction.
Since Government money has been coming, the usual conditions attached to Government grants have been applied and enforced.
If the society 's affairs were really intended to be carrier on as a part of the Lok Sabha or Parliament as such, the manner of functioning would have been different.
The accounts of the Society are separately maintained and subject to audit in the same way as the affairs of societies receiving Government grants are to be audited.
Government usually impose certain conditions and restrictions when grants are made.
No exception has been made in respect of the Society and the mere fact that such restrictions are made is not a determinative aspect.
Considerable attempt has been made by Mr. Rao, learned counsel for the appellant, to show that in the functioning of the Society there is deep and pervasive control of government.
We have examined meticulously the correspondence and the instances where control was attempted to be exercised or has, as a fact, been exercised but these again are features which appear to have been explained away We were taken through the report submitted by the Tripathi Committee which had been set up to suggest changes in the set up and affairs of the Society.
The report and the steps taken on the basis of the report are also not material which can be taken to be indisputable features for reaching the conclusion one way or the other.
We were shown the correspondence by the Minister of Law with the Executive Chairman of the Society.
Undoubtedly the Minister has tried to exercise his authority as the controlling department of Government in the matter of making the grant.
As we have already pointed that itself may not be a conclusive feature.
We have several cases of societies registered under which have been treated as 'State ' but in each of 283 those cases it would appear on analysis that either governmental business had been undertaken by the Society or what was expected to be the public obligation of the 'State ' had been undertaken to be performed as a part of the Society 's function.
In a Welfare State, as has been pointed out on more than one occasion by this Court, Governmental control is very pervasive and in fact touches all aspects of social existence.
ln the absence of a fair application of the tests to be made, there is possibility of turning every non governmental society into an agency or instrumentality of the State.
That obviously would not serve the purpose and may be far from reality.
A broad picture of the matter has to be taken and a discerning mind has to be applied keeping the realities and human experiences in view so as to reach a reasonable conclusion.
Having given our anxious consideration to the facts of this case, we are not in a position to hold that ICPS is either an agency or instrumentality of the State so as to come within the purview of 'other authorities ' in Article 12 of the Constitution.
We must say that ICPS is a case of its type typical in many ways and the normal tests may perhaps not properly apply to test its character.
While we were referring to the cases in an earlier part of our judgment, we have noticed the caution indicated by this Court that even if some institution becomes 'State ' within the meaning of Article 12, its employees do not become holders of civil posts so as to become entitled to the cover of Article 311.
They would, however, be entitled to the benefits of Part III of the Constitution.
It is unnecessary to examine the appellant 's case keeping Articles 14 and 16 of the Constitution in view as on the concession of Dr. Anand Prakash the proceedings will have to reopen.
Before we part with this case, we must indicate what reliefs the appellant would be entitled to.
Now that the order of the dismissal is set aside and the proceedings have been restored to the stage of enquiry, the appellant shall be deemed to have been restored to service.
The appellant would have become entitled to the normal relief available in such a situation.
He should be deemed to be in service and we do not agree with Dr. Anand Prakash that his suspension should continue.
His suspension which had merged into dismissal has been vacated.
It shall, however, be open for the employer to make any direction as is deemed appropriate in that behalf in future.
The appellant, therefore, becomes entitled to the salary for the past period subject to his satisfying the authorities that he has not earned any other income during that period.
The appellant shall be given reasonable opportunity by the enquiring officer to meet the charges 284 and the enquiry shall be completed with in four months.
The appellant has personally assured us in Court that he will fully cooperate in the enquiry.
The enquiry officer shall allow inspection to the appellant of all records relevant to the enquiry.
We make no order as to costs.
S.L. Appeal disposed of.
|
% The appellant, an employee of the Institute of Constitutional and Parliamentary Studies (I.C.P.S., for short), was dismissed from service by order dated November 17, 1982, as a result of disciplinary action.
He challenged the dismissal order by a writ petition before the High Court.
The question whether the I.C.P.S. was a 'State ' within the meaning of Article 12 of the Constitution arose for consideration as a major issue in the matter before the High Court.
A Single Judge of the High Court dismissed the petition, holding that the employer was neither an agency nor an instrumentality of the government and did not constitute 'State ' as above said, and, therefore, was not subject to the writ jurisdiction of the High Court.
The appeal against that judgment of the Single Judge was dismissed by the Division Bench of the High Court.
Aggrieved by the decision of the High Court, the appellant moved this Court by special leave.
Disposing of the appeal, the Court, ^ HELD: In the course of hearing, Dr. Anand Prakash, counsel for the I.C.P.S., respondent No. 2, stated that whether the Institute be 'State ' or not within the meaning of Article 12 of the Constitution, the employer was prepared to give a fresh opportunity to the appellant to meet the charges against him.
With that concession, the order of dismissal, etc.
passed against the appellant should have been set aside and the matter should have gone before the enquiry officer, but Dr. Anand Prakash as also counsel for the Union of India invited the Court to decide the issue as to whether the I.C.P.S. constituted 'State ' within the constitutional meaning of the term.
[263H; 264A C] The main question for consideration then was whether I.C.P.S. was a 'State '.
I.C.P.S. could become 'State ' only if it was found to be an authority within the territory of India or under the control of the Government of India.
[264D,G] 261 I.C.P.S. is a registered society.
The emergence of a new generation within less than two decades of independence gave rise to a feeling that the people 's representatives in the Legislatures required the acquisition of the appropriate democratic bias and spirit.
I.C.P.S. was born as a voluntary organisation to fulfil this requirement.
The Speaker of the Lok Sabha was its first President.
Three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice Presidents.
Some of the public officers were associated in its Administrative set up.
Services of some employees of Parliament were lent to it.
While Article 12 refers to Parliament as such, a few members of Parliament cannot be considered as Parliament so as to constitute that body as referred to in Article 12.
The Speaker and the Ministers who joined as Vice Presidents of the Society were there in their personal capacities and not as Ministers, etc.
There were many people in the category of Vice President, Executive Chairman, Treasurer and members, who were not a part of the Government, and some of them did not belong to Parliament.
[281A F] The objects of the Society were not governmental business.
Many of the objects of the Society were not confined to the two Houses of Parliament and were intended to have an impact on Society at large.
[281G H] The Memorandum of the Society permitted acceptance of gifts, donations and subscriptions.
No material was placed before the Court for the stand that the Society was not entitled to receive contributions from any indigenous source without government sanction.
Since government money has been coming, the usual conditions attached to government grants have been applied and enforced.
If the Society 's affairs were really intended to be carried on as a part of the Lok Sabha or Parliament as such, the manner of functioning would have been different.
The accounts of the Society are subject to audit as the affairs of the Societies receiving government grants are.
Government imposes conditions and restrictions when grants are made, and the Society is also subject to the same, and the mere fact that such restrictions are made is not a determinative aspect.[281H; 282 A D] There are registered societies which have been treated as 'State ', but in the case of each of them, either governmental business had been undertaken by the Society or what was expected to be the public obligation of the 'State ' had been undertaken to be performed as a part of the Society 's function.
[282H; 283A] 262 Having given anxious consideration to the facts of the case, the Court is not in a position to hold that I.C.P.S. is either an agency or an instrumentality of the State so as to come within the purview of other authorities"in Article 12 of the Constitution.
I.C.P.S. is a case of its type typical in many ways and normal tests may, perhaps, not properly apply to test its character.
Even if some institution becomes 'State ' within the meaning of Article 12, its employees do not become holders of Civil posts so as to become entitled to the cover of Article 311 of the Constitution.
They would, however, be entitled to the benefits of Part III of the Constitution.
It is unnecessary to examine the appellant 's case, keeping Articles 14 and 16 of the Constitution in view, as, on the concession of counsel for I.C.P.S., the proceedings would have to re open.
[283C E] In the result, the appellant would be entitled to the following reliefs.
The order of dismissal set aside and the proceedings restored to the stage of enquiry.
[283F] The appellant shall be deemed to have been restored to service and he would become entitled to normal relief available in such a situation.
He should be deemed to be in service and his suspension would not continue.
His suspension, which had merged into dismissal is vacated.
It shall, however, be open to the employer to make any direction as is deemed appropriate in that behalf in future.
[283F G] The appellant becomes entitled to salary for the past period subject to his satisfying the authorities that he had not earned any income during that period.
[283H] The appellant shall be given a reasonable opportunity by the enquiring officer to meet the charges and the enquiry shall be completed within four months.
[283H; 284A] The enquiry officer shall allow inspection to the appellant of all records relevant to the enquiry.
[284B] Rajasthan State Electricity Board, Jaipur vs Mohan Lal and Ors.
, ; ; Smt.
Ujjam Bai vs State of Uttar Pradesh, [1963] l SCR 778; Sabhajit Tewary vs Union of India Sardar Singh Raghuvanshi & Anr.
, ; ; Ramana Dayaram Shetty vs The 263 International Airport Authority of India & Ors., ; ; Managing Director, Uttar Pradesh Warehousing Corporation & Anr.
vs Vinay Narayan Vajpayee, ; ; Ajay Hasia, etc.
vs Khalid Mujib Sehravardi & Ors. etc.
; , ; Som Prakash Rekhi v Union of India and Anr., ; ; B.S.Minhas vs Indian Statistical Institute & Ors., ; and P. K Ramachandra Iyer and Ors.
vs Union of India and Ors.
|
ION: Civil Appeal No. 495 of 1984.
From the Judgment and order dated 1.11.1983 of the Delhi High Court in L.P.A. No. 160 of 1983.
P. P. Rao and A. Mariaputham for the Appellant.
Dr. Anand Prakash, D.N. Dwivedi, Mrs. Anil Katiyar, C.V. Subba Rao, Vineet Kumar and Deepak K. Thakur for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal by special leave calls in question the judgment of a Division Bench of the Delhi High Court in a Letters Patent Appeal upholding the decision of a learned Single Judge rejecting the writ petition of the appellant.
The appellant was an employee of the Institute of Constitutional and Parliamentary Studies (hereafter referred to as ICPS for short) and in a disciplinary action he was dismissed from service by order dated 17th November, 1982.
When he assailed the order in a writ petition before the High Court, the question whether lCPS was 'State ' within the meaning of Article 12 of the Constitution came for consideration as the major issue arising in the matter.
The learned Single Judge dismissed the writ petition by holding that the employer was neither an agency nor an instrumentality of the Government and did not constitute 'State ' within the meaning of Article 12 and, therefore, was not subject to the writ jurisdiction of the High Court.
The appeal against the judgment of the learned Single Judge was dismissed on 1st November, 1983.
In course of hearing of the appeal Dr. Anand Prakash appearing for ICPS fairly stated that whether the Institute be 'State ' or not within the meaning of Article 12 of the Constitution, the employer 264 was prepared to give a fresh opportunity to the appellant to meet the charges so as to dispel from his mind the feeling that he has not been given reasonable opportunity to defend himself.
Ordinarily, with that concession the impugned order entailing the dismissal of the employee and the judicial determination against the appellant should have been set aside and the matter should have gone before the enquiry officer for affording reasonable opportunity to the appellant of being heard against the charges.
Dr. Anand Prakash, however, invited us to enter into the merits of the issue as to whether ICPS constitutes 'State ' within the constitutional meaning of the term The Union of India which appears before us through counsel also wanted that the question should be decided.
Thereupon we suggested to the appellant who was till then appearing in person to get represented through counsel so that the matter could be appropriately argued on his behalf also.
He has been rendered suitable assistance by the Supreme Court Legal Aid Committee and Mr. P.P.Rao, Senior Counsel, has appeared on his behalf.
The main question for consideration now, therefore, is whether ICPS is 'State '.
For appropriate consideration of this question it is necessary to look into the constitution of the body, the purpose for which it has been created, the manner of its functioning including the mode of its funding and the broad features which have been found by this Court in several decisions to be relevant in the matter of determining a dispute of this type.
Article 12 of the Constitution provides an inclusive definition of the term 'State ' by saying: "In this part, unless the context otherwise requires, 'the State ' includes the Government and Parliament of India and the Government and the State Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.
" obviously ICPS can become 'State ' only if it is found to be an authority within the territory of India or under the control of the Government of India.
ICPS, respondent No.2, is a society registered under the Societies Registration Act, 21 of 1860, and was registered on 9th March, 1965.
As would appear from its Memorandum of Association, the foundation members were 19 in number 13 being members besides a President and five Vice Presidents.
The first President of the Soci 265 ety was the then Speaker of the Lok Sabha.
The five Vice Presidents were the then Minister of Railways, Minister of Law and Social Security Minister of Communication and Parliamentary Affairs, a former (Chief Justice of India and a former Attorney General of India.
Dr. L.N. Singhvi, then a member of the Lok Sabha, was its Executive Chairman.
The Public Trustee in the Department of Company Affairs and Insurance in the Ministry of Finance was the Director and a member of the Lok Sabha was the Society 's Treasurer.
The then Minister of Cultural Affairs in the Ministry of Education along with three members of the Lok Sabha, a Senior Advocate of the Supreme Court, a member of the Rajya Sabha, the then Vice Chancellor of Rajasthan University.
the respective Secretaries of the Lok Sabha and the Rajya Sabha Secretariat and the Secretary in the Ministry of Law were its Members.
The registered office of the Society was initially located within the Parliament House but was later on shifted to the Vithalbhai Patel House, Rafi Marg, New Delhi .
The objects of the Society inter alia were: ( I) to promote and provide for constitutional and Parliamentary studies with special reference to comparative studies in constitutional systems of various countries and working of the Indian Constitution and parliamentary and governmental institutions in their various aspects; (2) to undertake study of courses and fundamental research relating to developments in constitutional law, conventions and practices, parliamentary procedure, legislative drafting, trends in judicial interpretation and allied matters; (3) to organise inter alia training programmes in constitutional problems and matters of current parliamentary importance; (4) to set up a legislative research and reference service for the benefit of all interested members of the Union Parliament and State Legislature irrespective of their party affiliations; (5) to undertake and provide for the publication of a journal and of research papers and of books and brochures with a view to disseminate democratic values and to foster broad based civic education and awareness, and in particular, to pro.
mote study of constitutional and parliamentary affairs; 266 (6) to establish and maintain libraries and information services to facilitate the study of constitutional and parliamentary subjects and spread information in regard thereto; (7) to invite as and when feasible, scholars who may or may not be members of the Society, to take advantage of the facilities offered by the Society and to benefit the Society by their knowledge and experience; and (8) to institute appropriate fellowships, offer prizes and arrange scholarships and stipends in furtherance of the objects of the society.
The Memorandum permitted the Society to accept gifts, donations and subscriptions of cash and securities and of any property either movable or immovable.
The rule classifies the members under heads like Founder Members, Life Members, Honorary Members, ordinary Members, Corporate Members and Associate Members.
ordinary membership, according to the Rules, would extend to Members of Parliament or of any State Legislature or those who have been or are members of the Judiciary or advocates of the Supreme Court or the High Courts or persons employed in public service or persons engaged in teaching of study of social sciences particularly of Political Science, Law or subjects related thereto.
In the category of Honorary Members were the President, the Vice President and the Prime Minister of India.
Though the Memorandum permitted receipt of gifts and donations from outside, it is not disputed that the main source of income of the society has been the annual Central Government grant.
We think it appropriate at this stage to turn attention to judicial precedents to find out as to what should be the test to be applied for determining when on institution like respondent No.2 would be treated as 'other authorities ' under Article 12 of the Constitution.
The first in point of time is the Constitution Bench judgment in the case of Rajasthan State Electricity Board, Jaipur vs Mohan Lal & Ors., ; Bhargava, J. who delivered the main judgment observed: "the meaning of the word 'authority ' given in Webster 's Third New International Dictionary, which can be applicable, is a "public administrative agency or corporation having quasi governmental powers and authorised to 267 administer a revenue producing public enterprise." This dictionary meaning of the word 'authority ' is clearly wide enough to include all bodies created by a statute on which powers are conferred to carry out governmental or quasi governmental functions.
The expression "other authorities" is wide enough to include within it every authority created by a statute and functioning within the territory of India, or under the control of the Government of India; and we do not see any reason to narrow down this meaning in the context in which the words 'other authorities ' are used in Article l 7 of the Constitution In Smt.
Ujjam Bai vs State of Uttar Pradesh, Ayyangar, J. had observed: "Again Article 12 winds up the list of authorities falling within the definition by referring to 'other authorities ' within the territory of India which cannot obviously be read as ejusoem generis with either the Government and the Legislatures or local authorities.
The words are of wide amplitude and capable of comprehending every authority created under a statute and functioning within the territory of India or under the control of the Government of India.
Shah, J., as he then was, added a note to the leading Judgment of Bhargava and observed: "I am unable, however, to agree that every constitutional or statutory authority on whom powers are conferred by law is 'other authority ' within the meaning of Article 12.
The expression 'authority ' in its etymological sense means a body invested with power to command or give an ultimate decision, or enforce obedience, or having a legal right to command and be obeyed.
In determining what the expression 'other authority ' in Article 12 connotes, regard must be had not only to the sweep of fundamental rights over the power of the authority, but also to the restrictions which may be imposed upon the exercise of certain fundamental rights (e.g., those declared by Article 19) by the authority.
Fundamental rights within their allotted fields trans 268 cend the legislative and executive power of the sovereign authority.
But some of the important fundamental rights are liable to be circumscribed by the imposition of reason able restrictions by the State.
The true content of the expression 'other authority ' in Article 12 must be deter mined in the light of this dual phase of fundamental rights.
In considering whether a statutory or constitutional body is an authority within the meaning of Article 12, it would he necessary to bear in mind not only whether against the authority fundamental rights in terms absolute are intended to be anforced, but also whether it was intended by the Constitution makers that the authority was invested with the sovereign power to impose restrictions on very important and basic fundamental freedoms.
In my judgment, authorities, constitutional or statutory invested with power by law but not sharing the sovereign power do not fall within the expression 'State ' as defined in Article 12.
Those authorities which are invested with sovereign power, i.e., power to make rules or regulations and to administer or enforce them to the detriment of citizens and others fall within the definition of 'State ' in Article 12, and constitutional or statutory bodies which do not share that sovereign power of the State are not, in my judgment, 'State ' within the meaning of Article 12 of the Constitution.
Two cases, the First of Sabhajit Tewary vs Union of India & Ors., and the other of Sukhdev Singh & Ors vs Bhagatram Sardar Singh Raghuvanshi & Anr., l 19 were disposed of by the same Constitution Bench on February 21, 1975.
In both these cases, the true meaning of Article 12 of the Constitution fell for consideration.
Sabhajit Tewary 's case was one where the status of the Council of Scientific and Industrial Research was examined.
This Court took note of the fact that the Council was a society registered under the Societies Registration Act.
Under Rule 3, the Prime Minister of India was the ex officio President of the Society and under Rule 30 the governing body consisted of persons appointed by the Government of India representing the administrative ministry under which the Council of Scientific and Industrial Research is included and the Ministry of Finance.
The Court also took note of the manner in which the affairs of the Society including funding were conducted.
Ray, CJ.,in the brief judgment that the 269 Court delivered in the case observed: A "Extracting the features as aforesaid, it was contented that these would indicate that the Council of Scientific and industrial Research was really an agency of the Government.
This contention is unsound.
The society does not have a statutory character like the oil and Natural Gas Commission, or the Life Insurance Corporation or Industrial Finance Corporation.
It is a society incorporated in accordance with the provisions of the Societies Registration Act.
The fact that the Prime Minister is the President or that the Government appoints nominees to the governing body or that the Government may terminate the membership will not establish anything more than the fact that the Government takes special care that the promotion, guidance and cooperation of scientific and industrial research, the institution and functioning of specific researches, establishment or development and assistance to special institutions or departments of the existing institutions for scientific study of problems affecting particular industry in a trade, the utilisation of the result of the researches conducted under the auspices of the Council towards the development of industries in the country are carried out in a responsible manner.
This Court has held in Praga Tools Corporation vs C.A. Imanual & Ors., ; ; Heavy Engineering Mazdoor Union vs The State of Bihar & Ors., and in S.L. Aggarwal vs General Manager, Hindustan Steel Ltd., ; that the Praga Tools Corporation, Heavy Engineering Mazdoor Union and Hindustan Steel Ltd. are all companies incorporated under the Companies Act and the employees of these companies Act and the employees of these companies do not enjoy the protection available to Government servants as contemplated in Article 311.
The companies were held in these cases lo have independent existence of the Government and by the law related to corporations.
These could not be hold to be departments of the Government.
" The ratio of this decision has been fully relied upon by the High Court in dismissing the claim of the appellant.
270 In Sukhdev Singh 's case (supra) the leading judgment was delivered also by Ray, CJ.
Two questions fell for consideration ( l) whether an order of.
removal from service contrary to Regulations would enable the employee to a declaration against the statutory corporation of continuance in service or would it end up in claim for damages only and (2) whether the employee of a statutory corporation is entitled to claim protection of Articles 14 and 16 against the Corporation.
The Court, therefore, straight went into the question as to whether statutory corporations were authorities within the meaning of Article 12.
As a fact, three corporations being the oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation were before the Court and each one of them had been set up under a special statute.
At page 641 of the Reports, the learned Chief Justice pointed out: "In the background of the provisions of the three Acts under consideration, the question arises as to whether these Corporations can be described to be authorities within the meaning of Article 12 of the Constitution . " At page 642 of the Reports the conclusion was reached to the effect that "these statutory bodies are 'authorities ' within the meaning of Article 12 of the Constitution.
" We are really concerned with what Mathew J., added to the judgment He observed: "The test propounded by the majority is satisfied so far as the oil and Natural Gas Commission is concerned as section 25 of the oil and Natural Gas Commission Act provides for issuing, binding direction to third parties not to prevent the employees of the Commission from entering upon their property if the Commission so directs.
In other words, as section 25 authorises the Commission to issue binding directions to third parties not to prevent the employees of the Commission from entering into their land and as disobedience of such directions is punishable under the relevant provision of the Indian penal Code since those employees are deemed to be pubic servants under section 21 of the Indian Penal Code by virtue of section 27 of the Act, the Commission is an 'authority ' within the meaning of the expression 'other authorities ' in Article 12 271 Though this would be sufficient to make the commission a 'State ' according to the decision of this Court in the Rajasthan Electricity Board case (supra), there is a larger question which has a direct bearing so far as the other two corporations are concerned, viz., whether, despite the fact that there are no provisions for issuing binding directions to third parties the disobedience of which would entail penal consequences, the corporations set up under statutes to carry on business of public importance of which is fundamental to the life of the people can be considered as 'State ' within the meaning of Article 12.
" Mathew, J. referred to the precedents and other authorities from England, France and United States and at page 654 of the Reports stated: "The ultimate question which is relevant for our purpose is whether such a corporation is an agency or instrumentality of the government for carrying on a business for the benefit of the public.
In other words, the question is, for whose benefit was the corporation carrying on the business? When it is seen from the provisions of that Act that on liquidation of the corporation, its assets should be divided among the shareholders, namely, the Central and State governments and others, if any, the implication is clear that the benefit of the accumulated income would go to the Central and State Governments.
Nobody will deny that an agent has a legal personality different from that of the principal.
The fact that the agent is subject to the direction of the principal does not mean that he has no legal personality of his own . . .
The crux of the matter is that public corporation is a new type of institution which has sprung from the new social and economic functions of government and that it therefore does not neatly fit into old legal categories.
Instead of forcing it into them, the later should be adapted to the needs of changing times and conditions.
I do not think there is any basis for the apprehension expressed that by holding that these public corporations are 'State ' within the meaning of Article 12, the employees of these corporations would become government servants.
I also wish to make it clear that I express no opinion on 272 the question whether private corporations or other like organisations, though they exercise power over their employees which might violate their fundamental rights, would be 'State ' within the meaning of Article 12.
" Then comes the case of Ramana Dayaram Shetty vs The International Airport Authority of India & Ors., ; The question before the Court was whether the International Airport Authority of India was 'State ' within the meaning of Article 12 so as to be subjected to enforcement of fundamental rights against it.
Examining this aspect, Bhagwati, J., as he then was spoke for the three Judge Bench thus: "Now it is obvious that the government which represents the executive authority of the State , may act through the instrumentality or agency of natural persons or it may employ the instrumentality or agency of judicial persons to carry out its functions.
In the early days, when the Government had limited functions it could operate effectively through natural persons constituting its civil service and they were found adequate to discharge governmental functions, which were of traditional vintage.
But as the tasks of the government multiplied with the advent of the welfare State, it began lo be increasingly felt that the frame work of civil service was not sufficient to handle the new tasks which were often of specialised and highly technical character.
The inadequacy of the civil service to deal with these new problems came to be realised and it became necessary to force a new instrumentality or administrative device for handling these new problems.
It was in these circumstances and with a view to supplying this administrative need that the public corporation came into being as the third arm of the Government.
As early as 1819 the Supreme Court of the United States in Mac Cullough v .
Maryland, (4 Wheat 315) held that the Congress has power to charter corporations as incidental to or in aid of governmental functions and , as pointed out by Mathew J., in Sukhdev vs Bhagat Ram, (supra) such federal corporations would ex hypothesi be agencies of the Government.
In Great Britain too, the policy of public administration through separate corporations was gradually evovled and the conduct of basic industries through giant corporations has now become a permanent feature 273 of public life.
So far as India is concerned, the genesis of the emergence of corporations as instrumentalities or agencies of Government is to be found in the Government of India Resolution on Industrial Policy dated with April, 1948 where it was stated inter alia that 'management of state enterprises will as a rule be through the medium of public corporation under the statutory control of the Central Government who will assume such powers as may be necessary to ensure this. ' It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial policy that corporations were created by Government for setting up and management of public enterprises and carrying out other public functions.
Ordinarily, these functions could have been carried out by Government departmentally through service personnel, but the instrumentality or agency of the corporations was resorted to in these cases having regard to the nature of the task to be performed.
The corporations acting as instrumentality or agency of Government would obviously be subject to the same limitations in the field of constitutional and administrative law as Government itself, though in the eye of the law, they would be distinct and independent legal entities.
If the Government acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori that Government acting through the instrumentality or agency of corporations should equally be subject to the same limitations.
But the question is how to determine whether a corporation is acting as instrumentality or agency of Government.
It is a question not entirely free from difficulty.
" It was again pointed out in the same case that: "A corporation may be created in one of two ways.
It may be either established by statute or incorporated under a Law such as the or the .
Where a corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government . " 274 The Court further stated: "But the public nature of the function, if impregnated with governmental character or 'tied or ent wined with government ' or fortified by some other additional factor may render the corporation an instrumentality or agency of Government.
Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference.
It will thus be seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government.
We have referred to some of these factors and they may be summarised as under: whether there is any financial assistance given by the State, and if so, what is the magnitude of such assistance whether there is any other form of assistance, given by the State, and if so whether it is of the usual kind or it is extraordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys State confer red or State protected monopoly status and whether the functions carried out by the corporation are public functions closely related to governmental functions This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks growing complexities of management and administration and the necessity of continuing adjustment in relations between the corporations and Government calling for flexibility, adapt ability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is governmental instrumentality or agency.
At page 1052 of the Reports the Court proceeded to consider whether International Airport Authority of India could be said to be an 'authority ' falling within the meaning of 'State ' in Article 12.
The constitution of the body, the manner of filling it up? Government 's power of control in the matter of appointment of members and termination of membership were utilised as tests for examining whether 275 the Airport authority was 'State '.
After referring to the special A aspects, the Court observed: "It will be seen from these provisions that there are certain features of the respondent which are eloquent and throw considerable light on the true nature of the first respondent.
In the first place, the Chairman and Members of the first respondent are all persons nominated by the Central Government and the Central Government has also the power to terminate their appointment as also to review them in certain specified circumstances.
The Central Government is also vested with the power to take away the management of any airport from the first respondent and to entrust it to any other person or authority and for certain specified reasons, the Central Government can also supersede the first respondent.
The Central Government has also power to give directions in writing from time to time on questions of policy and these directions are declared binding on the first respondent.
" Reference was made to the case of Sabhajit Tewary (supra).
Bhagwati, J. referring thereto stated : "This decision does not lay down any principle or test for the purpose of determining when a corporation can be said to be an authority.
If at all, any test can be gleaned from the decision, it is whether the corporation is really an agency of the Government." and ultimately it was held that the Authority was 'State ' under Article 12.
This case clearly approves the treatment of the matter by Mathew, J. in Sukhdev Singh 's case (supra).
The two Judge Bench in the case of Managing Director, Uttar Pradesh Warehousing Corporation & Anr.
vs Vinay Narayan Vajpayee, ; was cited but we do not consider it necessary to refer to the same.
On the other hand reference to the two later decisions of this Court may be more useful.
Those are Ajay Hasia etc.
vs Khalid Mujib Sehravardi & Ors. etc.
; , of a Constitution Beocll and the other is Som Prakash Rekhi vs Union of India & Anr., ; being a three Judge Bench decision.
It is pertinent to indicate that both the judgments were delivered on November 13, 1980.
276 In Ajay Hasia 's case an Engineering College was also a Society registered under the Jammu & Kashmir Registration of Societies Act, l898, and the question that fell for consideration was whether it was an authority within the meaning of Article 12.
The Court found that the Memorandum of Association of the Society in clause (3) set out the objects for which the Society was incorporated and they included among other things establishment of the college with a view to providing instructions and research in such branches of engineering and technology as the college may think fit and for the advancement of learning and knowledge in such branches.
Reference was made to the Memorandum of Association, the objects and the powers of the State Government to make appointments and to the fact that the State government with the approval of the Central Government had the power to take such action and to issue such directions as are necessary in respect of all matters relating to the functioning of the college as noticed in the review of the activities.
the Court also took note of the fact that the founding members of the society were enumerated in clause (9) of the memorandum and they were the Chairmen to be appointed by the State Government with the approval of the Central Government, two representatives of the State Government, one representative of the Central Government, two representatives of the All India Council for Technical Education to be nominated by the Northern Regional Committee, one representative of the University of Jammu & Kashmir, one nonofficial representative of each of the Punjab, Rajasthan, UttarPradesh and Jammu & Kashmir States and to be appointed by the respective Governments in consultation with the Central Government and the principal who shall also be the ex officio Secretary.
The rules of the Society were referred to with a view to finding out the details of functioning.
Sabhajit Tewary 's case was referred to and distinguished and the tests laid down in the International Airport Authority 's case (supra) were approved.
Ultimately the Court summarised the position as under: " The tests for determining as to when a corporation can be said to be an instrumentality or agency of Government may now be culled out from the judgment in the International Airport Authority 's case.
These tests ate not conclusive or clinching, but they are merely indicative indicia which have to be used with care and caution because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities '.
it must be realised that it should not stretched so far as to bring in 277 every autonomous body which has some nexus with the Government within the sweep of the expression.
A wide enlargment of the meaning must be tempered by a wise limitation.
We may summarise the relevant tests gathered from the decision in the International Airport Authority 's case as follows: (1) "one thing is clear that if the entire share capital of the corporation is held by Government it would go a long way towards indicating that the corporation is an instrumentality or agency of (Government (2) "Where the financial assistance of the State is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being inpregnated with governmental character. " (3) "It may also be a relevant factor whether the corporation enjoys monopoly status which is State conferred or State protected." (4) "Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality." (5) "If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government.
(6) "Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government.
" The Court thereafter proceeded to say: "We may point out that it is immaterial for this purpose whether the corporation is created by a statute or under a statute.
The test is whether it is an instrumentality 278 or agency of the Government and not as to how it is created.
The inquiry has to be not as to how the juristic person is born but why it has been brought into existence.
The corporation may be a statutory corporation created by a statute or it may be a Government Company or a company formed under the or it may be a society registered under the or any other similar statute.
Whatever be its genetical origin, it would be an 'authority ' within the meaning of Article 12 if it is an instrumentality or agency of the Government and that would have to be decided on a proper assessment of the facts in the light of the relevant factors.
The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of the Government so as to come within the meaning of the expression 'authority ' in Article 12.
" At pages 99 and 100 of the Reports, the Constitution Bench referred to the facts of the particular case and came to hold that the society was an instrumentality or agency of the State.
In Som Prakash Rekhi 's case (supra) at page 137 of the Reports, Krishna Iyer, J. referred to the five tests and concluded by saying that: "The finale is reached when the cumulative effect of all the relevant factors above set out is assessed and once the body is found to be an instrument or agency of Government, the further conclusion emerges that it is 'State ' and is subject to the same constitutional limitations as Government At page 138 the criticism against the conclusions reached in the c, Airport Authority 's case was taken note of and the learned Judge observed: "There is no doubt that Bhagwati, J. broadened the scope of State under Article 12 and according to Shri G.B. Pai the observations spill over beyond the requirements of the case and must be dismissed as obiter.
" 279 Pathak, J., as he then was, added a brief note to the judgment by A saying: "I must confess to some hesitation in accepting the proposition that the Bharat Petroleum Corporation Limited is a 'State ' within the meaning of Article 12 of the Constitution.
But in view of the direction taken by the law in this Court since Ramana Dayarama Shetty vs International Airport Authority I find I must lean in favour of that conclusion.
I would have welcomed a wider range of debate before us on the fundamental principles involved in the issue and on the implications flowing from the definition in the of a 'Government Company '? but perhaps a future case may provide that.
" We have thus the tests available in the two decisions to be applied to the facts of the case in hand for determination as to whether ICPS is 'State ' within the meaning of Article 12.
There are two more cases to which brief reference may now be made B.S. Minhas vs Indian Statistical Institute & Ors., ; and P.K. Ramachandra Iyer & Ors.
vs Union of India & Ors.
, ; The case of the Indian Statistical Institute is also of a society registered under the .
The Court found that the entire money required for funding the Institute was provided by the Central Government and even if any other money was to be received by the Institute it could be done only with the approval of the Central Government and the accounts of the Institute were to be submitted to the Central Government for its scrutiny and satisfaction.
The Society had to comlpy with all directions as may be issued by the Central Government. 'The control of the Central Government was deep and pervasive and, therefore, it was an instrumentality of the Central Government and as such was an authority within the meaning of Article 12 of the Constitution.
ln coming to this conclusion, the Court relied upon the tests indicated in the International Airport Authority 's case as also in the case of Ajay Hasia.
In Ramchandra Iyer 's case, the question for consideration was whether the Indian Council of Agricultural Research (ICAR) was a set up within the meaning of Article 12 of the Constitution.
ICAR is also a Society registered under the .
The Court found that when it was set up, it was an attached office of the 280 Government of Tndia and had not undergone any change when it got transferred into a Society.
Applying the tests indicated in International Airport Authority case as also the case of Ajay Hasia, the Court came to the conclusion that there was little doubt that it was an instrumentality or agency of the State.
It further stated: "ICAR came into existence as an integral department of the Government of India and later on became an attached office of the Central Government.
The composition of the ICAR as evidenced by Rule 3 could not have been more governmental in character than any department of the Government.
" It is time to turn to the facts of the present case to find out as to what the conclusion should be when the tests formulated by the several cases of this Court referred to above are applied.
There cannot indeed be a strait jacket formula.
It is not necessary that all the tests should he satisfied for reaching the conclusion either for or against r holding an institution to be 'State '.
In a given case some of the features may emerge so boldly and prominently that a second view may not be possible.
There may yet be other cases where the matter would be on the border line and it would be difficult to take one view or the other outright.
Our struggle for independence which spread over a century bore fruit in 1947.
During the long period of struggle, the British Government following the pattern of the democratic system prevailing in their own country had patronised the evolution of a process of self government.
The Government of India Act of 1935 which was a positive improvement on the previous Acts had introduced provincial autonomy and the Indian Independence Act, 1947, adopted that pat tern of Government.
Even the Constitution which the people of India gave unto themselves in 1949 and which came into force from the 26th of January, 1950, followed that pattern, of course, with considerable modifications.
Thus when we became independent a democratic pattern had evolved in this country through more or less an historical process.
Soon the princely States disappeared by a process of merger and the Constitution ultimately came to have a federal base the federating States as the units and the federation at the Centre.
Democracy pre supposes certain conditions for its successful working.
It is necessary that there must be a deep sense of understanding, mutual confidence and tolerance and regard and acceptance 281 Of the views of others.
In the early years of freedom, the spirit of sacrifice and a sense of obligation to the leadership that had helped the dream of freedom to materialise had been accepted.
The emergence of a new generation within less than two decades of independence gave rise to a feeling that the people 's representatives in the Legislatures required the acquisition of the appropriate democratic bias and spirit.
ICPS was born as a voluntary organisation to fulfil this requirement.
At the inception it was certainly not a governmental organisation and it has not been the case of the parties in their pleadings nor have we been told at the bar during the long arguments that had been advanced that the objects of ICPS are those which are a State obligation to fulfil.
The Society was thus born out of a feeling that there should be a voluntary association mostly consisting of Members of the two Houses of Parliament with some external support to fulfil the objects which were adopted by the Society.
To Start with, the Society was accommodated in the Parliament House but in due course it shifted out.
The President of India inaugurated the Society.
Very appropriately the Speaker of the Lok Sabha became its first President and three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice Presidents.
Some of the public officers were also associated in the administrative set up of the Society.
Individual Members of Parliament and the corporate body known as Parliament are certainly two different concepts.
Services of some of the employees of Parliament were lent to the Society.
While Article 12 refers to Parliament as such, a few Members of Parliament cannot be considered as Parliament so as to constitute that body as referred to in Article 12.
The Speaker and the Ministers who joined as Vice Presidents of the Society were there in their individual capacities and not as Ministers, though designations were indicated.
In the category of Vice Presidents, Executive Chairman, Treasurer and members, there were many people who were really not a part of Government as such and some of them did not belong to Parliament.
The objects of the Society were not governmental business but were certainly the aspects which were expected to equip Members of Parliament and the State Legislatures with the requisite knowledge and experience for better functioning.
Many of the objects adopted by the Society were not confined to the two Houses of Parliament and were intended to have an impact on society at large.
The Memorandum of the Society permitted acceptance of gifts, 282 donations and subscriptions.
There is material to show that the Ford Foundation, a US based Trust had extended support for some time.
Undoubtedly, the annual contribution from the Government has been substantial and it would not be wrong to say that they perhaps constitute the main source of funding, Yet some money has been coming from other sources.
In later years, foreign funding came to be regulated and, therefore, it became necessary to provide that without Government clearance like any other institution, ICPS was not to receive foreign donations.
No material has been placed before us f the stand that the Society was not entitled to receive Contributions from any indigenous source without Government sanction.
Since Government money has been coming, the usual conditions attached to Government grants have been applied and enforced.
If the society 's affairs were really intended to be carrier on as a part of the Lok Sabha or Parliament as such, the manner of functioning would have been different.
The accounts of the Society are separately maintained and subject to audit in the same way as the affairs of societies receiving Government grants are to be audited.
Government usually impose certain conditions and restrictions when grants are made.
No exception has been made in respect of the Society and the mere fact that such restrictions are made is not a determinative aspect.
Considerable attempt has been made by Mr. Rao, learned counsel for the appellant, to show that in the functioning of the Society there is deep and pervasive control of government.
We have examined meticulously the correspondence and the instances where control was attempted to be exercised or has, as a fact, been exercised but these again are features which appear to have been explained away We were taken through the report submitted by the Tripathi Committee which had been set up to suggest changes in the set up and affairs of the Society.
The report and the steps taken on the basis of the report are also not material which can be taken to be indisputable features for reaching the conclusion one way or the other.
We were shown the correspondence by the Minister of Law with the Executive Chairman of the Society.
Undoubtedly the Minister has tried to exercise his authority as the controlling department of Government in the matter of making the grant.
As we have already pointed that itself may not be a conclusive feature.
We have several cases of societies registered under which have been treated as 'State ' but in each of 283 those cases it would appear on analysis that either governmental business had been undertaken by the Society or what was expected to be the public obligation of the 'State ' had been undertaken to be performed as a part of the Society 's function.
In a Welfare State, as has been pointed out on more than one occasion by this Court, Governmental control is very pervasive and in fact touches all aspects of social existence.
ln the absence of a fair application of the tests to be made, there is possibility of turning every non governmental society into an agency or instrumentality of the State.
That obviously would not serve the purpose and may be far from reality.
A broad picture of the matter has to be taken and a discerning mind has to be applied keeping the realities and human experiences in view so as to reach a reasonable conclusion.
Having given our anxious consideration to the facts of this case, we are not in a position to hold that ICPS is either an agency or instrumentality of the State so as to come within the purview of 'other authorities ' in Article 12 of the Constitution.
We must say that ICPS is a case of its type typical in many ways and the normal tests may perhaps not properly apply to test its character.
While we were referring to the cases in an earlier part of our judgment, we have noticed the caution indicated by this Court that even if some institution becomes 'State ' within the meaning of Article 12, its employees do not become holders of civil posts so as to become entitled to the cover of Article 311.
They would, however, be entitled to the benefits of Part III of the Constitution.
It is unnecessary to examine the appellant 's case keeping Articles 14 and 16 of the Constitution in view as on the concession of Dr. Anand Prakash the proceedings will have to reopen.
Before we part with this case, we must indicate what reliefs the appellant would be entitled to.
Now that the order of the dismissal is set aside and the proceedings have been restored to the stage of enquiry, the appellant shall be deemed to have been restored to service.
The appellant would have become entitled to the normal relief available in such a situation.
He should be deemed to be in service and we do not agree with Dr. Anand Prakash that his suspension should continue.
His suspension which had merged into dismissal has been vacated.
It shall, however, be open for the employer to make any direction as is deemed appropriate in that behalf in future.
The appellant, therefore, becomes entitled to the salary for the past period subject to his satisfying the authorities that he has not earned any other income during that period.
The appellant shall be given reasonable opportunity by the enquiring officer to meet the charges 284 and the enquiry shall be completed with in four months.
The appellant has personally assured us in Court that he will fully cooperate in the enquiry.
The enquiry officer shall allow inspection to the appellant of all records relevant to the enquiry.
We make no order as to costs.
S.L. Appeal disposed of.
|
From the Judgment and order dated 1.11.1983 of the Delhi High Court in L.P.A. No. P. P. Rao and A. Mariaputham for the Appellant. Ordinarily, with that concession the impugned order entailing the dismissal of the employee and the judicial determination against the appellant should have been set aside and the matter should have gone before the enquiry officer for affording reasonable opportunity to the appellant of being heard against the charges. Dr. Anand Prakash, however, invited us to enter into the merits of the issue as to whether ICPS constitutes 'State ' within the constitutional meaning of the term The Union of India which appears before us through counsel also wanted that the question should be decided. The main question for consideration now, therefore, is whether ICPS is 'State '. " obviously ICPS can become 'State ' only if it is found to be an authority within the territory of India or under the control of the Government of India. The five Vice Presidents were the then Minister of Railways, Minister of Law and Social Security Minister of Communication and Parliamentary Affairs, a former (Chief Justice of India and a former Attorney General of India. Dr. L.N. Singhvi, then a member of the Lok Sabha, was its Executive Chairman. the respective Secretaries of the Lok Sabha and the Rajya Sabha Secretariat and the Secretary in the Ministry of Law were its Members. mote study of constitutional and parliamentary affairs; 266 (6) to establish and maintain libraries and information services to facilitate the study of constitutional and parliamentary subjects and spread information in regard thereto; (7) to invite as and when feasible, scholars who may or may not be members of the Society, to take advantage of the facilities offered by the Society and to benefit the Society by their knowledge and experience; and (8) to institute appropriate fellowships, offer prizes and arrange scholarships and stipends in furtherance of the objects of the society. The Memorandum permitted the Society to accept gifts, donations and subscriptions of cash and securities and of any property either movable or immovable. The rule classifies the members under heads like Founder Members, Life Members, Honorary Members, ordinary Members, Corporate Members and Associate Members. In the category of Honorary Members were the President, the Vice President and the Prime Minister of India. The first in point of time is the Constitution Bench judgment in the case of Rajasthan State Electricity Board, Jaipur vs Mohan Lal & Ors., ; Ujjam Bai vs State of Uttar Pradesh, Ayyangar, J. had observed: "Again Article 12 winds up the list of authorities falling within the definition by referring to 'other authorities ' within the territory of India which cannot obviously be read as ejusoem generis with either the Government and the Legislatures or local authorities. Shah, J., as he then was, added a note to the leading Judgment of Bhargava and observed: "I am unable, however, to agree that every constitutional or statutory authority on whom powers are conferred by law is 'other authority ' within the meaning of Article 12. But some of the important fundamental rights are liable to be circumscribed by the imposition of reason able restrictions by the State. Those authorities which are invested with sovereign power, i.e., power to make rules or regulations and to administer or enforce them to the detriment of citizens and others fall within the definition of 'State ' in Article 12, and constitutional or statutory bodies which do not share that sovereign power of the State are not, in my judgment, 'State ' within the meaning of Article 12 of the Constitution. In both these cases, the true meaning of Article 12 of the Constitution fell for consideration. Under Rule 3, the Prime Minister of India was the ex officio President of the Society and under Rule 30 the governing body consisted of persons appointed by the Government of India representing the administrative ministry under which the Council of Scientific and Industrial Research is included and the Ministry of Finance. The Court also took note of the manner in which the affairs of the Society including funding were conducted. The society does not have a statutory character like the oil and Natural Gas Commission, or the Life Insurance Corporation or Industrial Finance Corporation. It is a society incorporated in accordance with the provisions of the Societies Registration Act. Heavy Engineering Mazdoor Union vs The State of Bihar & Ors., The companies were held in these cases lo have independent existence of the Government and by the law related to corporations. These could not be hold to be departments of the Government. Two questions fell for consideration ( l) whether an order of. As a fact, three corporations being the oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation were before the Court and each one of them had been set up under a special statute. Nobody will deny that an agent has a legal personality different from that of the principal. The crux of the matter is that public corporation is a new type of institution which has sprung from the new social and economic functions of government and that it therefore does not neatly fit into old legal categories. In the early days, when the Government had limited functions it could operate effectively through natural persons constituting its civil service and they were found adequate to discharge governmental functions, which were of traditional vintage. As early as 1819 the Supreme Court of the United States in Mac Cullough v . So far as India is concerned, the genesis of the emergence of corporations as instrumentalities or agencies of Government is to be found in the Government of India Resolution on Industrial Policy dated with April, 1948 where it was stated inter alia that 'management of state enterprises will as a rule be through the medium of public corporation under the statutory control of the Central Government who will assume such powers as may be necessary to ensure this. ' It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial policy that corporations were created by Government for setting up and management of public enterprises and carrying out other public functions. Ordinarily, these functions could have been carried out by Government departmentally through service personnel, but the instrumentality or agency of the corporations was resorted to in these cases having regard to the nature of the task to be performed. But the question is how to determine whether a corporation is acting as instrumentality or agency of Government. It is a question not entirely free from difficulty. It may be either established by statute or incorporated under a Law such as the or the . Where a corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government . " 274 The Court further stated: "But the public nature of the function, if impregnated with governmental character or 'tied or ent wined with government ' or fortified by some other additional factor may render the corporation an instrumentality or agency of Government. Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference. At page 1052 of the Reports the Court proceeded to consider whether International Airport Authority of India could be said to be an 'authority ' falling within the meaning of 'State ' in Article 12. The constitution of the body, the manner of filling it up? In the first place, the Chairman and Members of the first respondent are all persons nominated by the Central Government and the Central Government has also the power to terminate their appointment as also to review them in certain specified circumstances. The Central Government has also power to give directions in writing from time to time on questions of policy and these directions are declared binding on the first respondent. Bhagwati, J. referring thereto stated : "This decision does not lay down any principle or test for the purpose of determining when a corporation can be said to be an authority. If at all, any test can be gleaned from the decision, it is whether the corporation is really an agency of the Government." and ultimately it was held that the Authority was 'State ' under Article 12. This case clearly approves the treatment of the matter by Mathew, J. in Sukhdev Singh 's case (supra). vs Vinay Narayan Vajpayee, ; was cited but we do not consider it necessary to refer to the same. On the other hand reference to the two later decisions of this Court may be more useful. ; , of a Constitution Beocll and the other is Som Prakash Rekhi vs Union of India & Anr., ; 3) "It may also be a relevant factor whether the corporation enjoys monopoly status which is State conferred or State protected." ( " The Court thereafter proceeded to say: "We may point out that it is immaterial for this purpose whether the corporation is created by a statute or under a statute. The test is whether it is an instrumentality 278 or agency of the Government and not as to how it is created. The inquiry has to be not as to how the juristic person is born but why it has been brought into existence. The corporation may be a statutory corporation created by a statute or it may be a Government Company or a company formed under the or it may be a society registered under the or any other similar statute. but perhaps a future case may provide that. There are two more cases to which brief reference may now be made B.S. Minhas vs Indian Statistical Institute & Ors., ; The Court found that the entire money required for funding the Institute was provided by the Central Government and even if any other money was to be received by the Institute it could be done only with the approval of the Central Government and the accounts of the Institute were to be submitted to the Central Government for its scrutiny and satisfaction. The Society had to comlpy with all directions as may be issued by the Central Government. ' The control of the Central Government was deep and pervasive and, therefore, it was an instrumentality of the Central Government and as such was an authority within the meaning of Article 12 of the Constitution. In Ramchandra Iyer 's case, the question for consideration was whether the Indian Council of Agricultural Research (ICAR) was a set up within the meaning of Article 12 of the Constitution. ICAR is also a Society registered under the . The Court found that when it was set up, it was an attached office of the 280 Government of Tndia and had not undergone any change when it got transferred into a Society. There cannot indeed be a strait jacket formula. It is not necessary that all the tests should he satisfied for reaching the conclusion either for or against r holding an institution to be 'State '. In a given case some of the features may emerge so boldly and prominently that a second view may not be possible. There may yet be other cases where the matter would be on the border line and it would be difficult to take one view or the other outright. Our struggle for independence which spread over a century bore fruit in 1947. Even the Constitution which the people of India gave unto themselves in 1949 and which came into force from the 26th of January, 1950, followed that pattern, of course, with considerable modifications. Thus when we became independent a democratic pattern had evolved in this country through more or less an historical process. Democracy pre supposes certain conditions for its successful working. In the early years of freedom, the spirit of sacrifice and a sense of obligation to the leadership that had helped the dream of freedom to materialise had been accepted. ICPS was born as a voluntary organisation to fulfil this requirement. The Society was thus born out of a feeling that there should be a voluntary association mostly consisting of Members of the two Houses of Parliament with some external support to fulfil the objects which were adopted by the Society. To Start with, the Society was accommodated in the Parliament House but in due course it shifted out. The President of India inaugurated the Society. Individual Members of Parliament and the corporate body known as Parliament are certainly two different concepts. Services of some of the employees of Parliament were lent to the Society. The Speaker and the Ministers who joined as Vice Presidents of the Society were there in their individual capacities and not as Ministers, though designations were indicated. There is material to show that the Ford Foundation, a US based Trust had extended support for some time. Undoubtedly, the annual contribution from the Government has been substantial and it would not be wrong to say that they perhaps constitute the main source of funding, Yet some money has been coming from other sources. In later years, foreign funding came to be regulated and, therefore, it became necessary to provide that without Government clearance like any other institution, ICPS was not to receive foreign donations. Since Government money has been coming, the usual conditions attached to Government grants have been applied and enforced. Government usually impose certain conditions and restrictions when grants are made. We were shown the correspondence by the Minister of Law with the Executive Chairman of the Society. ln the absence of a fair application of the tests to be made, there is possibility of turning every non governmental society into an agency or instrumentality of the State. That obviously would not serve the purpose and may be far from reality. Having given our anxious consideration to the facts of this case, we are not in a position to hold that ICPS is either an agency or instrumentality of the State so as to come within the purview of 'other authorities ' in Article 12 of the Constitution. We must say that ICPS is a case of its type typical in many ways and the normal tests may perhaps not properly apply to test its character. He should be deemed to be in service and we do not agree with Dr. Anand Prakash that his suspension should continue. His suspension which had merged into dismissal has been vacated. It shall, however, be open for the employer to make any direction as is deemed appropriate in that behalf in future. The appellant, therefore, becomes entitled to the salary for the past period subject to his satisfying the authorities that he has not earned any other income during that period. The appellant has personally assured us in Court that he will fully cooperate in the enquiry.
|
% The appellant, an employee of the Institute of Constitutional and Parliamentary Studies (I.C.P.S., for short), was dismissed from service by order dated November 17, 1982, as a result of disciplinary action.
He challenged the dismissal order by a writ petition before the High Court.
The question whether the I.C.P.S. was a 'State ' within the meaning of Article 12 of the Constitution arose for consideration as a major issue in the matter before the High Court.
A Single Judge of the High Court dismissed the petition, holding that the employer was neither an agency nor an instrumentality of the government and did not constitute 'State ' as above said, and, therefore, was not subject to the writ jurisdiction of the High Court.
The appeal against that judgment of the Single Judge was dismissed by the Division Bench of the High Court.
Aggrieved by the decision of the High Court, the appellant moved this Court by special leave.
Disposing of the appeal, the Court, ^ HELD: In the course of hearing, Dr. Anand Prakash, counsel for the I.C.P.S., respondent No. 2, stated that whether the Institute be 'State ' or not within the meaning of Article 12 of the Constitution, the employer was prepared to give a fresh opportunity to the appellant to meet the charges against him.
With that concession, the order of dismissal, etc.
passed against the appellant should have been set aside and the matter should have gone before the enquiry officer, but Dr. Anand Prakash as also counsel for the Union of India invited the Court to decide the issue as to whether the I.C.P.S. constituted 'State ' within the constitutional meaning of the term.
[263H; 264A C] The main question for consideration then was whether I.C.P.S. was a 'State '.
I.C.P.S. could become 'State ' only if it was found to be an authority within the territory of India or under the control of the Government of India.
[264D,G] 261 I.C.P.S. is a registered society.
The emergence of a new generation within less than two decades of independence gave rise to a feeling that the people 's representatives in the Legislatures required the acquisition of the appropriate democratic bias and spirit.
I.C.P.S. was born as a voluntary organisation to fulfil this requirement.
The Speaker of the Lok Sabha was its first President.
Three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice Presidents.
Some of the public officers were associated in its Administrative set up.
Services of some employees of Parliament were lent to it.
While Article 12 refers to Parliament as such, a few members of Parliament cannot be considered as Parliament so as to constitute that body as referred to in Article 12.
The Speaker and the Ministers who joined as Vice Presidents of the Society were there in their personal capacities and not as Ministers, etc.
There were many people in the category of Vice President, Executive Chairman, Treasurer and members, who were not a part of the Government, and some of them did not belong to Parliament.
[281A F] The objects of the Society were not governmental business.
Many of the objects of the Society were not confined to the two Houses of Parliament and were intended to have an impact on Society at large.
[281G H] The Memorandum of the Society permitted acceptance of gifts, donations and subscriptions.
No material was placed before the Court for the stand that the Society was not entitled to receive contributions from any indigenous source without government sanction.
Since government money has been coming, the usual conditions attached to government grants have been applied and enforced.
If the Society 's affairs were really intended to be carried on as a part of the Lok Sabha or Parliament as such, the manner of functioning would have been different.
The accounts of the Society are subject to audit as the affairs of the Societies receiving government grants are.
Government imposes conditions and restrictions when grants are made, and the Society is also subject to the same, and the mere fact that such restrictions are made is not a determinative aspect.[281H; 282 A D] There are registered societies which have been treated as 'State ', but in the case of each of them, either governmental business had been undertaken by the Society or what was expected to be the public obligation of the 'State ' had been undertaken to be performed as a part of the Society 's function.
[282H; 283A] 262 Having given anxious consideration to the facts of the case, the Court is not in a position to hold that I.C.P.S. is either an agency or an instrumentality of the State so as to come within the purview of other authorities"in Article 12 of the Constitution.
I.C.P.S. is a case of its type typical in many ways and normal tests may, perhaps, not properly apply to test its character.
Even if some institution becomes 'State ' within the meaning of Article 12, its employees do not become holders of Civil posts so as to become entitled to the cover of Article 311 of the Constitution.
They would, however, be entitled to the benefits of Part III of the Constitution.
It is unnecessary to examine the appellant 's case, keeping Articles 14 and 16 of the Constitution in view, as, on the concession of counsel for I.C.P.S., the proceedings would have to re open.
[283C E] In the result, the appellant would be entitled to the following reliefs.
The order of dismissal set aside and the proceedings restored to the stage of enquiry.
[283F] The appellant shall be deemed to have been restored to service and he would become entitled to normal relief available in such a situation.
He should be deemed to be in service and his suspension would not continue.
His suspension, which had merged into dismissal is vacated.
It shall, however, be open to the employer to make any direction as is deemed appropriate in that behalf in future.
[283F G] The appellant becomes entitled to salary for the past period subject to his satisfying the authorities that he had not earned any income during that period.
[283H] The appellant shall be given a reasonable opportunity by the enquiring officer to meet the charges and the enquiry shall be completed within four months.
[283H; 284A] The enquiry officer shall allow inspection to the appellant of all records relevant to the enquiry.
[284B] Rajasthan State Electricity Board, Jaipur vs Mohan Lal and Ors.
, ; ; Smt.
Ujjam Bai vs State of Uttar Pradesh, [1963] l SCR 778; Sabhajit Tewary vs Union of India Sardar Singh Raghuvanshi & Anr.
, ; ; Ramana Dayaram Shetty vs The 263 International Airport Authority of India & Ors., ; ; Managing Director, Uttar Pradesh Warehousing Corporation & Anr.
vs Vinay Narayan Vajpayee, ; ; Ajay Hasia, etc.
vs Khalid Mujib Sehravardi & Ors. etc.
; , ; Som Prakash Rekhi v Union of India and Anr., ; ; B.S.Minhas vs Indian Statistical Institute & Ors., ; and P. K Ramachandra Iyer and Ors.
vs Union of India and Ors.
|
% The appellant, an employee of the Institute of Constitutional and Parliamentary Studies (I.C.P.S., for short), was dismissed from service by order dated November 17, 1982, as a result of disciplinary action. He challenged the dismissal order by a writ petition before the High Court. The question whether the I.C.P.S. was a 'State ' within the meaning of Article 12 of the Constitution arose for consideration as a major issue in the matter before the High Court. A Single Judge of the High Court dismissed the petition, holding that the employer was neither an agency nor an instrumentality of the government and did not constitute 'State ' as above said, and, therefore, was not subject to the writ jurisdiction of the High Court. The appeal against that judgment of the Single Judge was dismissed by the Division Bench of the High Court. With that concession, the order of dismissal, etc. I.C.P.S. could become 'State ' only if it was found to be an authority within the territory of India or under the control of the Government of India. [264D,G] 261 I.C.P.S. is a registered society. I.C.P.S. was born as a voluntary organisation to fulfil this requirement. The Speaker of the Lok Sabha was its first President. Three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice Presidents. Some of the public officers were associated in its Administrative set up. Services of some employees of Parliament were lent to it. There were many people in the category of Vice President, Executive Chairman, Treasurer and members, who were not a part of the Government, and some of them did not belong to Parliament. [281A F] The objects of the Society were not governmental business. Since government money has been coming, the usual conditions attached to government grants have been applied and enforced. If the Society 's affairs were really intended to be carried on as a part of the Lok Sabha or Parliament as such, the manner of functioning would have been different. The accounts of the Society are subject to audit as the affairs of the Societies receiving government grants are. Government imposes conditions and restrictions when grants are made, and the Society is also subject to the same, and the mere fact that such restrictions are made is not a determinative aspect.[281H; 282 A D] There are registered societies which have been treated as 'State ', but in the case of each of them, either governmental business had been undertaken by the Society or what was expected to be the public obligation of the 'State ' had been undertaken to be performed as a part of the Society 's function. They would, however, be entitled to the benefits of Part III of the Constitution. It is unnecessary to examine the appellant 's case, keeping Articles 14 and 16 of the Constitution in view, as, on the concession of counsel for I.C.P.S., the proceedings would have to re open. He should be deemed to be in service and his suspension would not continue. His suspension, which had merged into dismissal is vacated. It shall, however, be open to the employer to make any direction as is deemed appropriate in that behalf in future. [283H; 284A] The enquiry officer shall allow inspection to the appellant of all records relevant to the enquiry. [284B] Rajasthan State Electricity Board, Jaipur vs Mohan Lal and Ors. , ; ; Ramana Dayaram Shetty vs The 263 International Airport Authority of India & Ors., ; ; Managing Director, Uttar Pradesh Warehousing Corporation & Anr. vs Vinay Narayan Vajpayee, ; ; Ajay Hasia, etc. ; , ; Som Prakash Rekhi v Union of India and Anr., ; ;
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| 0.681015
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Civil Appeal Nos.
3023 3029 OF 1979.
From the Judgment and order dated 14.6.
1979 of the High Court of Gauhati in Civil Rule Nos.
509 to 512 of 1973.
R.F. Nariman, P.H Parekh.
M.K.S. Mench and Sanjay Bharthri for the Appellants.
Prabir Chaudhary for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals arise out of the Judgment and order dated 14th June, 1979 of the High Court of Gauhati in Assam setting aside the order and notice of demand under the Assam Taxation (on Goods carried by Road or Inland Waterways) Act, hereinafter called the Act, but declining to order any refund of the taxes paid.
In 1954 Assam Taxation (on Goods carried by Road or Inland Waterways) Act was first enacted.
This Court struck down the Act as ultra vires the Constitution of India.
See Atiabari Tea Co. Ltd. vs The State of Assam & Ors., ; On 6th of April, 1961 a new Act passed received the assent of the President.
The High Court again struck down the Act declaring it ultra vires the Constitution on 1.8.63.
On 13.12.63 Khyerbar Tea Co. Ltd. & another vs State of Assam, [1964] 5 SCR ts 975 in a challenge to the Act under Article 32 of the Constitution, this Court held the Act to be intra vires.
On 19th December, 1966, Judgment was passed in Civil Rule No. 190/ 1965.
On Ist April 1968, the appeals preferred by the State of Assam against the 479 High Court order dated 13.12.63 were allowed on the basis of the declaration of the Act to be intra vires the Constitution.
Thereafter notices were issued by Superintendent of Taxes, Nowgong, requiring the appellant under section 7(2) of the Act to submit returns for the period ending 30.6.61, 30.9.61, 31.12.61 and 31.3.62.
Returns were duly filed.
Assessment orders were passed under section 9(3) of the said Act.
On 10th July, 1973, the High Court passed judgment in Loong Soong Tea Estate, (Civil Rule No. 1005 of 1969) declaring the assessment as without jurisdiction.
It is the case of the appellant petitioner that in view of the above judgment, the appellant came to know about the mistake in paying the tax as per assessment order and also that the appellant became entitled to refund of the amount paid.
The present Writ Petition was filed in November, 1973 before the High Court of Assam.
Thereafter in June, 1976, the learned Single Judge of the High Court referred the matter to a larger Bench.
The Division Bench on June 14, 1979, passed judgment setting aside the orders and notices of demand but refused relief of refund claimed by the appellant.
Aggrieved thereby, the appellant has preferred the present appeals.
The appellant petitioner claimed in all these petitions that the assessments were illegal and prayed that directions be given to the respondents to refund the tax collected in pursuance of those orders.
The Legislature of Assam passed the Act, as mentioned hereinbefore in 1954 called the Assam Taxation (on Goods carried by Road and Inland Waterways) Act, 1954 which purported to levy tax on manufactured tea and jute carried by road and inland waterways.
The Act was declared ultra vires the Constitution by this Court in Atiabari case (supra) on the ground that previous sanction of the President was not taken.
Thereafter the Legislature passed the Act which received the assent of the President on 6.4.61.
The validity of the Act was also challenged and the High Court declared that Act to be ultra vires on 1st August, 1963.
Against the judgment and order passed by the High Court, the State of Assam and other respondents preferred appeals before this Court.
In the meantime, M/s Khyerabari Tea Co. Ltd. challenged the provisions of the Act directly before this Court by filing an application under Article 32 of the Constitution and this Court in its judgment dated 13.12.63 held the Act to be intra vires.
Following the aforesaid decision of this Court, the appeals filed by the State of Assam and others against the judgment of the High Court were allowed by this Court on the 1st April, 1968.
It was after this decision that the respondents required the appellant by a notice under section 480 7(2) of the Act issued on 8.7.68 to submit returns for four periods mentioned hereinbefore.
Due to penal consequences mentioned in the said notices in the event of failure to file return and pay the taxes, the appellant filed return on July 11, 1968 and paid the various taxes.
In the judgment under appeal after elaborate discussion, the High Court came to the conclusion that when a petitioner approaches the High Court with the sole claim for refund of money by writ of mandamus, the same is normally not granted but where the refund is prayed as a consequential relief the same is normally entertained if there is no obstruction or if there be no triable issue like that of limitation which could not be conveniently tried in writ petition.
In this case indisputably it appears that tax was collected without the authority of law.
Indeed the appellant had to pay the tax in view of the notices which were without jurisdiction.
It appears that the assessment was made under section 9(3) of the Act.
Therefore, it was with out jurisdiction.
In the premises it is manifest that the respondents had no authority to retain the money collected without the authority of law and as such the money was liable to refund.
The only question that falls for consideration here is whether in an application under Article 226 of the Constitution the Court should have directed refund.
It is the case of the appellant that it was after the judgment in the case of Loong Soong Tea Estate the cause of action arose.
That judgment was passed in July 1973.
It appears thus that the High Court was in error in coming to the conclusion that it was possible for the appellant to know about the legality of the tax sought to be imposed as early as 1963, when the Act in question was declared ultra vires as mentioned hereinbefore.
Thereafter the taxes were paid in 1968.
Therefore the claim in November, 1973 was belated.
We are unable to agree with this conclusion.
As mentioned hereinbefore the question that arises in this case is whether the Court should direct refund of the amount in question.
Courts have made a distinction between those cases where a claimant approaches a High Court seeking relief of obtaining refund only and those where refund is sought as a consequential relief after striking down of the order of assessment etc.
Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law.
Equally, as a corollary of the said statement of law it follows that taxes collected without the authority of law as in this case from a citizen should be refunded because no State has the right to receive or to retain taxes or monies realised from citizens without the authority of 481 In Suganmal vs State of Madhya Pradesh and others, AIR 1965 SC 1740, this Court held that the High Courts have power to pass any appropriate order in the exercise of the powers conferred on them under Article 226 of the Constitution.
A petition solely praying for the issue of a writ of mandamus directing the State to refund the money alleged to have been illegally collected by the State as tax was not ordinarily maintainable for the simple reason that a claim for such refund can always be made in a suit against the authority which had illegally collected the money as a tax and in such a suit it was open to the State to raise all possible defences to the claim, defences which cannot in most cases,, be appropriately raised and considered in the exercise of writ jurisdiction.
It appears that Section 23 of the Act deals with refund.
In the facts of this case, the case did not come within section 23 of the Act.
But in the instant appeal, it is clear as the High Court found in our opinion rightly that the claim for refund was a consequential relief.
In Tilokchand Motichand & Ors.
vs H.B. Munshi & Anr., , claimants in that case contended that they did pay taxes under section 2 1(4) of the Bombay Sales Tax Act, 1953 which was ultra vires on the particular ground on which it was struck down by this Court.
On 28th March, 1958 the petitioners in that case filed a writ petition in the High Court and contended that section 2 1(4) of the said Act was ultra vires the powers of the State Legislature and was violative of Articles 19(1)(f) and 265 of the Constitution.
The single Judge of the High Court dismissed the petition on the ground that the petitioners defrauded their customers and so were not entitled to any relief even if there was a violation of fundamental rights.
The appellate bench of the High Court dismissed the appeal on the ground that it would not interfere with the discretionary order of the single Judge.
Thereafter, it appears that on December 24, 1958, the Collector attached the properties of the petitioners for recovering the amount as arrears of land revenue and the petitioners paid the amount in instalments between August 1959 and August 1960.
On September 29, 1967 this Court in Kantilal Babulal vs H. C. Patel, 2 1 S.T.C. 174 struck down section 12A(4) of the Bombay Sales Tax Act, 1946 corresponding to section 21(4) of the 1953 Act, on the ground that it was violative of Article 19(1)(f) of the Constitution inasmuch as the power conferred by the section was unguided, uncanalised and uncontrolled and so was not a reasonable restriction on the fundamental right guaranteed under that Article.
On the assumption that section 21(4) of the 1953 Act was also liable to be struck down on the same ground, on February 9, 1968, the petitioners therein filed a writ petition under Article 32 of 482 the Constitution claiming a refund of the amount.
The petitioners contended that they did not know that the section was ultra vires on the particular ground on which this Court had struck it down and they had paid the amounts under coercion or mistake, that the mistake was discovered on September 29, 1967 (the date of the judgment of this Court) and that they were entitled to the refund under section 72 of the .
It was held by the majority that the petition should be dismissed on the ground of laches.
Hidayatullah, C.J. held that Article 32 gave the right to move the Court by appropriate proceedings for enforcement of fundamental rights and the State cannot place any hindrance in the way of an aggrieved person.
But once the matter had reached this Court, the extent or manner of interference is for this Court to decide.
(emphasis supplied).
The Chief Justice reiterated that this Court had put itself in restraint in the matter of petitions under Article 32.
For example, this Court, reiterated the Chief Justice? refrained from acting under the Article if the party had already moved the High Court under Article 226 and if the High Court had exercised its parallel jurisdiction.
It was said in such a case, the Court would not allow fresh proceedings to be started under Article 32 but would insist on the decision of the High Court being brought before it on appeal.
Similarly, in inquiring into belated and stale claims, this Court should take note of evidence of neglect of the petitioner 's own rights for a long time or of the rights of innocent parties which might have emerged by reason of the delay.
The Chief Justice emphasised that it was not possible for this Court to lay down any specific period as the ultimate limit of action and each case will have to be considered on its own facts.
A petition under Article 32 was neither a suit nor an application to which the applied.
Further, putting curbs in the way of enforcement of fundamental rights through such legislative action might be questioned under Article 13(2) for, if a short period of limitation was prescribed the fundamental right might be frustrated.
Therefore, for the matter of relief in each case, this Court had to exercise its description from case to case and where there was appearance of an avoidable delay and the delay affected the merits of the claim, this Court held the party disentitled to invoke its extraordinary jurisdiction.
In the facts of that case, the majority Judges found that by his own conduct, the petitioner had abandoned his own litigation years ago and the Court would not apply the analogy of the Article in the in cases of mistake of law and give him relief.
Bachawat, J. in a concurring judgment observed that the normal 483 remedy for recovery of money paid to the State under coercion or mistake of law is by suit.
The right to move this Court for enforcement of fundamental rights was guaranteed by Article 32, and no period of limitation was prescribed for such a petition.
Bachawat, J. reiterated that the writ issues as a matter of course if a breach of a fundamental right is established, but this did not mean that in giving relief under the Article this Court might ignore all laws of procedure.
The extraordinary remedies under Articles 32 and 226 of the Constitution, said Bachawat, J., are not intended to enable a claimant to recover monies the recovery of which by suit is barred by limitation.
In the absence of any rules of procedure under Article 145(1)(c), the Court may adopt any reasonable rule.
Bachawat, J. emphasised that for example, the Court will not allow a petitioner to move this Court under Article 32 on a petition containing misleading and inaccurate statements.
Similarly, the general principles of res judicata were applied where applicable on grounds of public policy.
Bachawat, J. emphasised that where the remedy in a writ application under Article 32 or Article 226 corresponded to a remedy in an ordinary suit and the latter remedy was subject to the bar of a statute of limitation, the Court imposed on analogy the same limitation on the summary remedy in the writ jurisdiction even though there was no express statutory bar of limitation, on grounds of public policy and on the principle that the laws aid the vigilant and not those who slumber.
Mitter, J. more or less expressed the same view.
Sikri, J. allowed the appeal because he was of the opinion that the petitioners were under a mistake of law, the mistake was discovered, like all assessees, when the Court struck down section 12A(4) of the 1946 Act and they came to this Court within six months of that date and hence there was no delay.
Hegde, J. allowed the petition.
He was of the opinion that in the facts of that case, there was no delay.
He observed that mere impression of a party that a provision of law might be ultra vires cannot be equated to knowledge that the provision was invalid.
Under Article 113 of the the limitation was the period of three years from the date the right to sue accrues.
It may be noted that in the instant case under section 23 of the Act, it was provided that the Commissioner shall, in the prescribed manner refund to a producer or a dealer any sum paid or realised in excess of the sum due from him under this Act either by case or, at the option of the producer or dealer, be set off against the sum due from him in 484 respect of any other period.
Section 23 applies only in a case where money is paid under the Act.
If there is no provision for realisation of the money under the Act, the act of payment was ultra vires, the money had not been paid under the Act.
In that view of the matter section 23 would not apply.
The High Court in the instant case after analysing the various decisions came to the conclusion that where a petitioner approached the High Court with the sole prayer of claiming refund of money by writ of mandamus, the same was normally not granted but where the refund was prayed as a consequential relief the same was normally entertained if there was no obstruction or if there was no triable issue like that of limitation.
We agree that normally in a case where tax or money has been realised without the authority of law, the same should be refunded and in an application under Article 226 of the Constitution the Court has power to direct the refund unless there had been avoidable laches on the part of the petitioner which indicate either the abandonment of his claims or which is of such nature for which there is no probable explanation or which will cause any injury either to respondent or any third party.
It is true that in some case the period of three years is normally taken as a period beyond which the Court should not grant relief but that is not an inflexible rule.
It depends upon the facts of each case.
In this case, however, the High Court refused to grant the relief on the ground that when the section was declared ultra vires originally that was the time when refund should have been claimed.
But it appears to us, it is only when the Loong Soong case was decided by the High Court in 1973 that the appellant became aware of his crystal right of having the assessment declared ultra vires and in that view of the matter in October, 1973 when the judgment was delivered in July, 1973 the appellant came to know that there is mistake in paying the tax and the appellant was entitled to refund of the amount paid.
That was the time when the appellant came to know of it.
Within a month in November 1973 the present petition was filed.
There was no unexplained delay.
There was no fact indicated to the High Court from which it could be inferred that the appellant had either abandoned his claims or the respondent had changed his position in such a way that granting relief of refund would cause either injury to the respondent or anybody else.
On the other hand, refunding the amount as a consequence of declaring the assessment to be bad and recovery to be illegal will be in consonance with justice, equity and good conscience.
We are, therefore of the view that the view of the High Court in this matter cannot be sustained.
485 Chandra Bhushan & Anr.
vs Deputy Director of Consolidation (Regional), U.P. & ors.
; , was a case where this Court observed that the High Court erred in exalting a rule of practice into a rule of limitation and rejecting the petition of the appellant for refund without considering whether the appellant was guilty of laches and undue delay.
Shah, J. delivering the judgment of the Court observed that the primary question in each case is whether the applicant had been guilty of laches or undue delay.
Reference may be made in this connection to R.L. Kapur vs State of Madras, ; There the question arose about punishing for contempt.
The jurisdiction conferred on the High Court under Article 215 of the Constitution to punish for contempt of itself was a special one, not arising or derived from the , and therefore, not within the purview of the Penal Code.
Such a position is also clear from the provisions of the .
The effect of section 5 of that Act was only to widen the scope of the existing jurisdiction of a special kind and not conferring a new jurisdiction.
So far as contempt of the High Court itself is concerned, as distinguished from that of court subordinate to it, the Constitution vested these rights in every High Court, and so no Act of a legislature could take away that jurisdiction and confer it afresh by virtue of its own authority.
That being the position, this Court held that section 25 of the General Clauses Act would not apply.
Similarly, it appears to us that this was a tax realised in breach of the section, the refund being of the money realised without the authority of law.
The realisation is bad and there is a concomitant duty to refund the realisation as a corollary of the constitutional inhabitation that should be respected unless it causes injustice or loss in any specific case or violates any specific provision of law.
In that view of the matter in the facts of this case we are of the opinion that the money was refundable to the appellant.
The appellant had proceeded diligently.
There is nothing to indicate that had the appellant been more diligent, the appellant could have discovered the constitutional inhibition in 1966.
The position is not clear even if there is any triable issue.
The position becomes clearer only after the decision in Loong Soong 's case as mentioned hereinbefore.
Our attention was drawn on behalf of the respondents that under section 16 of the Act an appeal lay in the prescribed manner within thirty days from the date of service of any order of assessment but the 486 challenge to the assessment on the ground that the assessment was bad could not be made in an appeal under the Act because the right to appeal being a creature of the Act, if the Act is ultra vires that right would not enure to the benefit of the appellant.
In State of Madhya Pradesh vs Bhailal Bhai & ors.
; , this Court had occasion to consider what was unreasonable delay in moving the court when tax was paid under a mistake.
There the respondents were dealers in tobacco in the State of Madhya Bharat.
The State had imposed sales tax on the sale of imported tobacco by the respondents.
But no such tax was imposed on the sale of indigenous tobacco.
The respondents filed writ petitions under Article 226 of the Constitution for the issue of writ of mandamus directing the refund of sales tax collected from them.
They contended that the impugned tax was violative under Article 301(a) of the Constitution and they paid the tax under a mistake of law and the tax so paid was refundable under section 72 of the .
The appellant contended that there was no violation of Article 301 of the Constitution, and even if there was such violation the tax came within the special provision under Article 304(a) of the Constitution and the High Court had no power to direct refund of tax already paid and in any event the High Court should not exercise its discretionary power of issuing a writ of mandamus directing this to be done since there was unreasonable delay in filing the petition.
The High Court rejected all the contentions of the appellant and a writ of mandamus was issued as prayed for.
It was held that tax was violative under Article 301 of the Constitution.
But it was held that even though the tax contravened Article 30 1 of the Constitution, it was valid if it came within the saving provisions of Article 304 of the Constitution.
Tobacco manufactured or produced in the appellant State, similar to the tobacco imported from outside had not been subjected to the tax and therefore the tax was not within the saving provisions of Article 304(a) of the Constitution.
It was reiterated that the tax which had already been paid was so paid under a mistake of law under section 72 of the .
The High Courts had power for the purpose of enforcement of.
fundamental rights and statutory rights to grant consequential reliefs by ordering repayment of money realised by the Government without the authority of law.
It was reiterated that as a general rule if there has been unreasonable delay the court ought not ordinarily to lend its air to a party by the extraordinary remedy of mandamus.
Even if there is no such delay, in cases where the opposite party raises a prima facie issue as regards the availability of such relief on the merits on grounds like limitation the Court should ordinarily refuse to issue the writ of 487 mandamus.
Though the provisions of the did not as such, it was further held, apply to the granting of relief under Article 226, the maximum period fixed by the legislature as the time within which relief by a suit in a Civil Court must be claimed may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under Article 226 could be measured.
The Court might consider the delay unreasonable even if it is less than the period of limitation prescribed for a civil action for the remedy.
Where the delay is more than that period it will almost always be proper for the court to hold that it is unreasonable.
The period of limitation prescribed for recovery of money paid by mistake under the was three years from the date when the mistake was known.
In this case knowledge is attributable from the date of the judgment in Loong Soong 's case on 10th July, 1973 and there being a statement that the appellant came to know of that fact in October, 1973 and there being no denial by the averment made on this ground, the High Court, in our opinion, in the instant case was in error in presuming that there was a triable issue on this ground and refusing to grant refund.
In Ramachandra Shankar Deodhar & Ors.
vs The State of Maharashtra & ors.
; , in a different context, it was observed that laches or existence of alternative remedy may be ground for not granting relief.
But in view of the facts of this case, it is not necessary to deal with that case in any detail.
In A. V. Venkateswaran, Collector of Customs, Bombay vs Ramchand Sobhraj Wadhwani and another; , this Court held that the High Court was in error in its view that though the respondent had failed to exercise his statutory remedy, the fact that it had become time barred at the date of the hearing of the appeal against the order in the petition under Article 226, was a good ground for the Court to exercise its discretion in granting the relief prayed for by the respondent in his petition.
Learned counsel drew our attention to Rule 55 of the Act where it was stated that no claim to any refund shall be allowed unless it was made within one year from the date of the original order of assessment or within one year of the final order passed on appeal or revision as the case may be, in respect of such assessment.
It was contended on behalf of the respondents that here a fixed period of limitation was prescribed and by virtue of Article 226 of the Constitution, we should not allow to subvert that rule.
This principle, in our opinion, in view of the fact that the rule was unconstitutional will have no application.
488 In Shiv Shanker Dal Mills etc.
vs State of Haryana & Ors. etc.
, [1980] l S.C.R. 1170 Krishna Iyer, J. speaking on behalf of him self as well as on behalf of R.S. Pathak, J. as the learned Chief Justice then was and A.D. Koshal, J. Observed that where public bodies under colour of public laws recover people 's money, later discovered to be erroneous levies the dharma of the situation admits of no equivocation.
There was no law of limitation especially for public bodies on the virtue of returning what was wrongly recovered to whom it belongs.
In our jurisprudence it is not palatable to turn down the prayer for high prerogative writs on the negative plea of alternative remedy, since the root principle of law married to justice, is ubi jus ibi remedium.
His Lordship observed as follows: "Since the root principle of law married to justice, is ubi jus ibi remedium.
Long ago Dicey wrote: 'The law ubi jus ibi remedium, becomes from this Point of view something more important than a mere tautological proposition.
In its bearing upon constitutional law, it means that the Englishmen whose labours gradually formed the complicated set of laws and institutions which we call the Constitution, fixed their minds far more intently on providing remedies for the enforcement of particular rights or for averting definite wrongs, than upon any declarations of the Rights of Man or English men.
The Constitution of the United States and the Constitutions of the separate States are embodied in written or printed documents, and contain declaration of rights.
But the statesmen of America have shown an unrivalled skill in providing means for giving legal security to the rights declared by American Constitutions.
The rule of law is as marked a feature of the United States as of England.
Another point.
In our jurisdiction, social justice is a pervasive presence; and so, save in special situations it is fair to be guided by the strategy of equity by asking those who claim the service of the judicial process to embrace the basic rule of distributive justice, while moulding the relief, by consenting to restore little sums, taken in little transactions, from little persons, to whom they belong.
" 489 We are in respectful agreement with this approach.
A ln State of Madhya Pradesh and others etc.
vs Nandlal Jaiswal and others etc.
; , this principle was reiterated by Bhagwati, C.J. that it was well settled that the power of the High Court to issue an appropriate writ under Article 226 of the Constitution was discretionary and the High Court in the exercise of its discretion did not ordinarily assist the tardy and the indolent or the acquiescent and the lethargic.
If there was inordinate delay on the part of the petitioner in filing a writ petition and such delay was not satisfactorily explained, the High Court might decline to intervene and grant relief in the exercise of its writ jurisdiction.
The evolution of this rule of laches or delay was premised upon a number of factors.
The High Court did not ordinarily permit a belated resort to the extraordinary remedy under the writ jurisdiction because it was likely to cause confusion and public inconvenience and bring in its train new injustices.
It was emphasised that this rule of laches or delay is not a rigid rule which can be cast in a straitjacket formula.
There may be cases where despite delay and creation of third party rights the High Court may still in the exercise of its discretion interfere and grant relief to the petitioner.
But where the demand of justice is so compelling that the High Court would be inclined to interfere in spite of delay or creation of third party rights would by their very nature be few and far between.
Ultimately it would be a matter within the discretion of the Court; ex hypotheses every discretion must be exercised fairly and justly so as to promote justice and not to defeat it.
We are in respectful agreement with this approach also.
In this case looked at from one point of view, it is only on the delivery of the judgment in Loong Soong 's case in 1973, the appellant realised the right to claim the relief of refund as a consequential relief, setting aside the assessment and the assessment was set aside by the very order itself in this case.
That right has been granted by the High Court, the High Court has not refused the setting aside on the ground of delay.
It would be inconsistent for the High Court to refuse to grant consequential relief after setting aside the assessment.
If the realisation was without the authority of law and that was declined by the High Court by the judgment in this case which claimed also the consequential relief, that relief must automatically follow and the High Court was wrong in taking the view that a triable issue of limitation arises in this case.
In the absence of any averment to the contrary, the averment of the appellant in the petition that they came to know only after the Loong Soong 's case must be accepted.
The High Court was wrong in 490 contending that they should have been more diligent.
After all the discretion must be fair and equitable.
In the facts of this case, we are of the opinion that the High Court was in error in the approach it took.
We, therefore, set aside the judgment and order of the High Court and direct refund of the tax illegally realised by the respondent.
The appeals are allowed.
We set aside the judgment and order to the extent that it refused refund of the tax illegally realised.
In the facts of this case the parties will pay and bear their own costs.
section RANGANATHAN J. I agree with the order proposed by my learned brother but would like to add a word of reservation.
In view of the judgment of this Court in Superintendent of Taxes vs Onkarmal Nathmal Trust, [ 1975] Supp SCR 365, there can be no doubt that the assessments on the appellants were illegal and that.
the taxes demanded on the basis thereof had been collected without the authority of law from the appellants.
The appellant 's contention is that they had paid the taxes under a mistake of law and are entitled to seek refund thereof.
It is difficult to see how the High Court could have allowed the appellant 's prayer for quashing the assessments but refused the prayer for the refund of the illegally collected taxes.
The appeals have, therefore, to be allowed.
Counsel for the respondents, however, places strong reliance on the following observations of a Constitution Bench of this Court in State of M.P. vs Bhailal Bhai, ; "Though the provisions of the do not, as such, apply to the granting of relief under article 226, the maximum period fixed by the Legislature as the time within which relief by a suit in a Civil Court must be claimed may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under article 226 could be measured XXXX Where the delay is more than that period it will almost always be proper for the Court to hold that it is unreasonable. " He also relies on Cawasji & Co. vs State, and drawn our attention to the decision in Vallabh Glass Works vs Union, ; where the claim for refund in respect of a period beyond 491 three years was rejected.
He contends, on the strength of the above decisions, that the High Court rightly rejected the appellants ' claims for refund.
On the other hand, it is contended for the appellants that a writ petition seeking refund of taxes collected without the authority of law cannot be rejected on the ground of limitation or delay unless such delay can be said to amount to laches or has caused some irreparable prejudice to the opposite party or some other like forceful reason exists.
Counsel refers in this context to Venkateswaran vs Ramchand, [1962] 1 SCR 75; Chandra Bhushan vs Deputy Director, ; ; Tilokchand Motichand vs Munshi, ; Ramachandra section Deodhar vs State; , ; Joginder Nath vs Union, [ ; Shiv shankar Dal Mills vs State, [ ; and State of M.P. vs Nandlal Jaiswal, ; and contends that these decisions have qualified the observations of Das Gupta, J. in Bhailal Bhai 's case.
As pointed out by my learned brother, in the present case, the appellants ' averment that they realised their mistake only when they came to know about the decision in the Loong Soong Tea Estate case in July 1973 stands uncontroverted.
There is nothing on record either to show that the appellants had realised their mistake even earlier, at about the time when the writ petition in the Loong Soong Tea Estate case was filed or at the time when the earlier decision of 1966 referred in the Loong Soong Tea Estate case judgment was rendered.
On this finding of fact, the writ petitions, filed by the appellants in November 1973, were filed within the period of limitation prescribed in Article 113 read with section 23 of the .
Thus the petitions were within time even by the test enunciated in Bhailal Bhai 's case.
I think, therefore, that, for the purposes of the present case, it is unnecessary to consider the larger question whether the bar of limitation should be considered as fatal to a writ petition as to a suit for recovery or whether it is only a relevant but not conclusive factor that should be taken into account by the court in exercising a discretion.
P.S.S. Appeals allowed.
|
% The Assam Taxation (on Goods Carried by Road or Inland Water ways) Act,1954 was struck down as ultra vires the Constitution in Atiabari Tea Co. Lld.
vs State of Assam, ; A new Act was thereafter passed which received the President 's assent on April 6, 1961.
The High Court declared the said Act to be ultra vires on August 1, 1963.
The State and other respondents preferred appeals before Supreme Court against the decision.
In the meantime, in Khyerbari Tea Co. Ltd. & Anr.
vs State of Assam, ; the Court held the Act to be intra vires on December 13, 1963.
Following the decision in Khyerbari case the appeals filed by the State and others were allowed by this Court on April 1, 1968.
After this decision the respondents required the appellants by notices under section 7(2) of the Act issued on July 8, 1968 to submit return for the period ending June 30, 1961, September 30, 1961, December 31, 1961 and March 31, 1962.
Due to the penal consequences mentioned in the said notices the appellants filed returns on July 11, 1968.
The assessment orders were passed under section 9(3) of the Act.
The tax was duly paid.
In November 1973 the appellants filed writ petitions before the High Court seeking direction for refund of the tax paid under mistake relying on the High Court 's Judgment in Loong Soong Tea Estate (Civil Rule No. 1005 of 1969) dated July lO, 1973 declaring the assessment as without jurisdiction.
475 The High Court set aside the orders and notices of demand but refused claim of refund on the ground of delay and laches.
It took the view that it was possible for the appellants to know about the legality of the tax sought to be imposed as early as 1963, when the Act in question was declared ultra vires.
The taxes having been paid in 1968 the claim in November 1973 was belated.
It, however, held that the claim for refund was a consequential relief.
In the appeals to this Court it was contended for the appellants that they had paid the tax under a mistake of law and were entitled to seek refund thereof, and a writ petition seeking refund of tax realised without the authority of law cannot be rejected on the ground of limitation or delay unless such delay can be said to amount to laches or has caused some irreparable prejudice to the opposite party.
Allowing the appeals, ^ HELD: By the Court: (Per Sabyasachi Mukharji & Ranganathan, JJ.) The money was refundable to the appellants.
The writ petitions were within time.
[4X4H] Per Mukharji, J. 1.
No State has the right to receive or to retain taxes or monies realised from citizens without the authority of law.
There is in such cases concomitant duty to refund the realisation as a corollary of the constitutional inhibition that should be respected unless it causes injustice or loss in any specific case or violates any specific provision of law.
[480H; 485E F] In the instant case, tax was collected without the authority of law.
The notices were without jurisdiction.
So was the assessment made under section 9(3) of the Act.
The respondents, therefore, had no authority to retain the money so collected, and as such the money was liable to refund.
[480D] 2.1 In an application under Article 226 of the Constitution the Court has power to direct the refund unless there has been avoidable laches on the part of the petitioner which indicate either the abandonment of his claims or which is of such nature for which there is no probable explanation or which will cause an injury either to respondent or any third party.
[484C D] 476 2.2 Courts have, however, made a distinction between those cases where a claimant approaches a High Court seeking relief of obtaining refund only and those where refund is sought as a consequential relief after striking down of the order of assessment etc.
A petition of the former nature is not ordinarily maintainable for the simple reason that a claim for such a refund can always be made in a suit wherein it is open to the State to raise all possible defences to the claim, defences which cannot in most cases be appropriately raised and considered in the exercise of writ jurisdiction.
[480F H; 48;B] In the instant case, s.23 of the Assam Act provided for refund to a producer or a dealer any sum paid or realised in excess of the sum due from him under that Act.
The section thus applies only in a case where money is paid under the Act.
If there is no provision for realisation of the money under the Act, the act of payment was ultra vires, the money had not been paid under the Act.
In that view of the matter the case did not come within section 23 of the Act.
The High Court having found that the claim for refund was a consequential relief, it could have directed the State to refund the amount in question.
[483 G H;484A B] 2.3 Exercise of every discretion must be fair and equitable.
The period of limitation prescribed for recovery of money paid by mistake under the was three years from the date when the mistake was known.
In the instant case, knowledge is attributable from the date of judgment in Loong Soong 's case on 10th July, 1973.
There being a statement that the appellants came to know of that fact in October 1973 and there being no denial by the averment made on this ground, the High Court was in error in presuming that there was a triable issue on this ground and refusing to grant refund.
Within a month in November 1973 the present petitions were filed.
There was no unexplained delay.
The appellants had proceeded diligently.
There is nothing to indicate that had they been more diligent, the appellants could have discovered the constitutional inhibition earlier.
The position is not clear even if there is a triable issue.
The position becomes clearer only after the decision in Loong Soong 's case.
It could not, therefore, be said that the appellants had abandoned their claims.
[487B D] Suganmal vs State of Madhya Pradesh and others.
, AIR 1965 SC 1740; Tilokchand Motichand & Ors.
vs H.B. Munshi & Anr., ; Kantilal Babulal vs H.C. Patel 21 S.T.C. 174; Chandra Bhushan & Anr.
vs Deputy Director of Consolidation (Regional), U.P. & Ors., ; ; R.L. Kapur vs State of Madras, ; ; State of Madhya Pradesh vs Bhailal Bhai & Ors.
J [1964] 6 477 SCR. 261; Ramchandra Shankar Deodhar & ors.
vs The State of Maharashtra & Ors., ; ; A.V. Venkateswaran, Collector of Customs, Bombay vs Ramchand Sobhraj Wadhwani and another; , ; Shiv Shankar Dal Mills etc.
vs State of Haryana & Ors. etc.
; , and State of Madhya Pradesh and others etc.
vs Nandlal Jaiswal and others etc.
; , referred to.
It is only on the delivery of the judgment in Loong Soong 's case in 1973, the appellants realised the right to claim the relief of refund as a consequential relief, setting aside the assessment and the assessment was set aside by the very order itself.
That right has been granted by the High Court.
The High Court has not refused the setting aside on the ground of delay.
It would be inconsistent for the High Court to refuse to grant consequential relief after setting aside the assessment.
If the realisation was without the authority of law and that was declined by the High Court by the judgment in the instant case, which claimed also the consequential relief, that relief must automatically follow.
Refunding the amount as a consequence of declaring the assessment to be bad and recovery to be illegal will be in consonance with justice, equity and good conscience.
[489F H] 4.
The challenge to the assessment on the ground that the assessment was bad could not be made in an appeal under the Act because the right to appeal being a creature of the Act, if the Act is ultra vires that right would not ensure to the benefit of the appellant.
Section 16 of the Act under which an appeal lay within thirty days from the date of service of an assessment order therefore had no application.
Similarly, rule 55 of the Rules framed under the Act barring claims of refund unless made within one year from the date of the original order of assessment being unconstitutional had no application.
[485H; 486A B; 487H] 1.
The assessments on the appellants were illegal.
The taxes demanded on the basis thereof had been collected without the authority of law.
The High Court, therefore, while allowing the appellant 's prayer for quashing the assessment should also have allowed the refund of the illegally collected taxes.
[490D] Superintendent of Taxes vs Onkarmal Nathmal Trust, [1975] Supp.
SCR 365, applied.
478 The petitions filed in November, 1973 were within the period of limitation prescribed in Article 113 of the read with section 23 of the Assam Act.
The appellants ' averment that they realised their mistake only when they came to know about the decision of Loong Soong Tea Estate case in July, 1973 stands uncontroverted.
There is nothing on record to show that the appellants had realised their mistake earlier[491D f] State of M. P. vs Bhailal Bhai [1964]6 SCR 261 referred to.
It was considered unnecessary therefore to consider the larger question whether the bar of limitation would be fatal to a writ petition for refund.
|
Civil Appeal Nos.
3023 3029 OF 1979.
From the Judgment and order dated 14.6.
1979 of the High Court of Gauhati in Civil Rule Nos.
509 to 512 of 1973.
R.F. Nariman, P.H Parekh.
M.K.S. Mench and Sanjay Bharthri for the Appellants.
Prabir Chaudhary for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals arise out of the Judgment and order dated 14th June, 1979 of the High Court of Gauhati in Assam setting aside the order and notice of demand under the Assam Taxation (on Goods carried by Road or Inland Waterways) Act, hereinafter called the Act, but declining to order any refund of the taxes paid.
In 1954 Assam Taxation (on Goods carried by Road or Inland Waterways) Act was first enacted.
This Court struck down the Act as ultra vires the Constitution of India.
See Atiabari Tea Co. Ltd. vs The State of Assam & Ors., ; On 6th of April, 1961 a new Act passed received the assent of the President.
The High Court again struck down the Act declaring it ultra vires the Constitution on 1.8.63.
On 13.12.63 Khyerbar Tea Co. Ltd. & another vs State of Assam, [1964] 5 SCR ts 975 in a challenge to the Act under Article 32 of the Constitution, this Court held the Act to be intra vires.
On 19th December, 1966, Judgment was passed in Civil Rule No. 190/ 1965.
On Ist April 1968, the appeals preferred by the State of Assam against the 479 High Court order dated 13.12.63 were allowed on the basis of the declaration of the Act to be intra vires the Constitution.
Thereafter notices were issued by Superintendent of Taxes, Nowgong, requiring the appellant under section 7(2) of the Act to submit returns for the period ending 30.6.61, 30.9.61, 31.12.61 and 31.3.62.
Returns were duly filed.
Assessment orders were passed under section 9(3) of the said Act.
On 10th July, 1973, the High Court passed judgment in Loong Soong Tea Estate, (Civil Rule No. 1005 of 1969) declaring the assessment as without jurisdiction.
It is the case of the appellant petitioner that in view of the above judgment, the appellant came to know about the mistake in paying the tax as per assessment order and also that the appellant became entitled to refund of the amount paid.
The present Writ Petition was filed in November, 1973 before the High Court of Assam.
Thereafter in June, 1976, the learned Single Judge of the High Court referred the matter to a larger Bench.
The Division Bench on June 14, 1979, passed judgment setting aside the orders and notices of demand but refused relief of refund claimed by the appellant.
Aggrieved thereby, the appellant has preferred the present appeals.
The appellant petitioner claimed in all these petitions that the assessments were illegal and prayed that directions be given to the respondents to refund the tax collected in pursuance of those orders.
The Legislature of Assam passed the Act, as mentioned hereinbefore in 1954 called the Assam Taxation (on Goods carried by Road and Inland Waterways) Act, 1954 which purported to levy tax on manufactured tea and jute carried by road and inland waterways.
The Act was declared ultra vires the Constitution by this Court in Atiabari case (supra) on the ground that previous sanction of the President was not taken.
Thereafter the Legislature passed the Act which received the assent of the President on 6.4.61.
The validity of the Act was also challenged and the High Court declared that Act to be ultra vires on 1st August, 1963.
Against the judgment and order passed by the High Court, the State of Assam and other respondents preferred appeals before this Court.
In the meantime, M/s Khyerabari Tea Co. Ltd. challenged the provisions of the Act directly before this Court by filing an application under Article 32 of the Constitution and this Court in its judgment dated 13.12.63 held the Act to be intra vires.
Following the aforesaid decision of this Court, the appeals filed by the State of Assam and others against the judgment of the High Court were allowed by this Court on the 1st April, 1968.
It was after this decision that the respondents required the appellant by a notice under section 480 7(2) of the Act issued on 8.7.68 to submit returns for four periods mentioned hereinbefore.
Due to penal consequences mentioned in the said notices in the event of failure to file return and pay the taxes, the appellant filed return on July 11, 1968 and paid the various taxes.
In the judgment under appeal after elaborate discussion, the High Court came to the conclusion that when a petitioner approaches the High Court with the sole claim for refund of money by writ of mandamus, the same is normally not granted but where the refund is prayed as a consequential relief the same is normally entertained if there is no obstruction or if there be no triable issue like that of limitation which could not be conveniently tried in writ petition.
In this case indisputably it appears that tax was collected without the authority of law.
Indeed the appellant had to pay the tax in view of the notices which were without jurisdiction.
It appears that the assessment was made under section 9(3) of the Act.
Therefore, it was with out jurisdiction.
In the premises it is manifest that the respondents had no authority to retain the money collected without the authority of law and as such the money was liable to refund.
The only question that falls for consideration here is whether in an application under Article 226 of the Constitution the Court should have directed refund.
It is the case of the appellant that it was after the judgment in the case of Loong Soong Tea Estate the cause of action arose.
That judgment was passed in July 1973.
It appears thus that the High Court was in error in coming to the conclusion that it was possible for the appellant to know about the legality of the tax sought to be imposed as early as 1963, when the Act in question was declared ultra vires as mentioned hereinbefore.
Thereafter the taxes were paid in 1968.
Therefore the claim in November, 1973 was belated.
We are unable to agree with this conclusion.
As mentioned hereinbefore the question that arises in this case is whether the Court should direct refund of the amount in question.
Courts have made a distinction between those cases where a claimant approaches a High Court seeking relief of obtaining refund only and those where refund is sought as a consequential relief after striking down of the order of assessment etc.
Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law.
Equally, as a corollary of the said statement of law it follows that taxes collected without the authority of law as in this case from a citizen should be refunded because no State has the right to receive or to retain taxes or monies realised from citizens without the authority of 481 In Suganmal vs State of Madhya Pradesh and others, AIR 1965 SC 1740, this Court held that the High Courts have power to pass any appropriate order in the exercise of the powers conferred on them under Article 226 of the Constitution.
A petition solely praying for the issue of a writ of mandamus directing the State to refund the money alleged to have been illegally collected by the State as tax was not ordinarily maintainable for the simple reason that a claim for such refund can always be made in a suit against the authority which had illegally collected the money as a tax and in such a suit it was open to the State to raise all possible defences to the claim, defences which cannot in most cases,, be appropriately raised and considered in the exercise of writ jurisdiction.
It appears that Section 23 of the Act deals with refund.
In the facts of this case, the case did not come within section 23 of the Act.
But in the instant appeal, it is clear as the High Court found in our opinion rightly that the claim for refund was a consequential relief.
In Tilokchand Motichand & Ors.
vs H.B. Munshi & Anr., , claimants in that case contended that they did pay taxes under section 2 1(4) of the Bombay Sales Tax Act, 1953 which was ultra vires on the particular ground on which it was struck down by this Court.
On 28th March, 1958 the petitioners in that case filed a writ petition in the High Court and contended that section 2 1(4) of the said Act was ultra vires the powers of the State Legislature and was violative of Articles 19(1)(f) and 265 of the Constitution.
The single Judge of the High Court dismissed the petition on the ground that the petitioners defrauded their customers and so were not entitled to any relief even if there was a violation of fundamental rights.
The appellate bench of the High Court dismissed the appeal on the ground that it would not interfere with the discretionary order of the single Judge.
Thereafter, it appears that on December 24, 1958, the Collector attached the properties of the petitioners for recovering the amount as arrears of land revenue and the petitioners paid the amount in instalments between August 1959 and August 1960.
On September 29, 1967 this Court in Kantilal Babulal vs H. C. Patel, 2 1 S.T.C. 174 struck down section 12A(4) of the Bombay Sales Tax Act, 1946 corresponding to section 21(4) of the 1953 Act, on the ground that it was violative of Article 19(1)(f) of the Constitution inasmuch as the power conferred by the section was unguided, uncanalised and uncontrolled and so was not a reasonable restriction on the fundamental right guaranteed under that Article.
On the assumption that section 21(4) of the 1953 Act was also liable to be struck down on the same ground, on February 9, 1968, the petitioners therein filed a writ petition under Article 32 of 482 the Constitution claiming a refund of the amount.
The petitioners contended that they did not know that the section was ultra vires on the particular ground on which this Court had struck it down and they had paid the amounts under coercion or mistake, that the mistake was discovered on September 29, 1967 (the date of the judgment of this Court) and that they were entitled to the refund under section 72 of the .
It was held by the majority that the petition should be dismissed on the ground of laches.
Hidayatullah, C.J. held that Article 32 gave the right to move the Court by appropriate proceedings for enforcement of fundamental rights and the State cannot place any hindrance in the way of an aggrieved person.
But once the matter had reached this Court, the extent or manner of interference is for this Court to decide.
(emphasis supplied).
The Chief Justice reiterated that this Court had put itself in restraint in the matter of petitions under Article 32.
For example, this Court, reiterated the Chief Justice? refrained from acting under the Article if the party had already moved the High Court under Article 226 and if the High Court had exercised its parallel jurisdiction.
It was said in such a case, the Court would not allow fresh proceedings to be started under Article 32 but would insist on the decision of the High Court being brought before it on appeal.
Similarly, in inquiring into belated and stale claims, this Court should take note of evidence of neglect of the petitioner 's own rights for a long time or of the rights of innocent parties which might have emerged by reason of the delay.
The Chief Justice emphasised that it was not possible for this Court to lay down any specific period as the ultimate limit of action and each case will have to be considered on its own facts.
A petition under Article 32 was neither a suit nor an application to which the applied.
Further, putting curbs in the way of enforcement of fundamental rights through such legislative action might be questioned under Article 13(2) for, if a short period of limitation was prescribed the fundamental right might be frustrated.
Therefore, for the matter of relief in each case, this Court had to exercise its description from case to case and where there was appearance of an avoidable delay and the delay affected the merits of the claim, this Court held the party disentitled to invoke its extraordinary jurisdiction.
In the facts of that case, the majority Judges found that by his own conduct, the petitioner had abandoned his own litigation years ago and the Court would not apply the analogy of the Article in the in cases of mistake of law and give him relief.
Bachawat, J. in a concurring judgment observed that the normal 483 remedy for recovery of money paid to the State under coercion or mistake of law is by suit.
The right to move this Court for enforcement of fundamental rights was guaranteed by Article 32, and no period of limitation was prescribed for such a petition.
Bachawat, J. reiterated that the writ issues as a matter of course if a breach of a fundamental right is established, but this did not mean that in giving relief under the Article this Court might ignore all laws of procedure.
The extraordinary remedies under Articles 32 and 226 of the Constitution, said Bachawat, J., are not intended to enable a claimant to recover monies the recovery of which by suit is barred by limitation.
In the absence of any rules of procedure under Article 145(1)(c), the Court may adopt any reasonable rule.
Bachawat, J. emphasised that for example, the Court will not allow a petitioner to move this Court under Article 32 on a petition containing misleading and inaccurate statements.
Similarly, the general principles of res judicata were applied where applicable on grounds of public policy.
Bachawat, J. emphasised that where the remedy in a writ application under Article 32 or Article 226 corresponded to a remedy in an ordinary suit and the latter remedy was subject to the bar of a statute of limitation, the Court imposed on analogy the same limitation on the summary remedy in the writ jurisdiction even though there was no express statutory bar of limitation, on grounds of public policy and on the principle that the laws aid the vigilant and not those who slumber.
Mitter, J. more or less expressed the same view.
Sikri, J. allowed the appeal because he was of the opinion that the petitioners were under a mistake of law, the mistake was discovered, like all assessees, when the Court struck down section 12A(4) of the 1946 Act and they came to this Court within six months of that date and hence there was no delay.
Hegde, J. allowed the petition.
He was of the opinion that in the facts of that case, there was no delay.
He observed that mere impression of a party that a provision of law might be ultra vires cannot be equated to knowledge that the provision was invalid.
Under Article 113 of the the limitation was the period of three years from the date the right to sue accrues.
It may be noted that in the instant case under section 23 of the Act, it was provided that the Commissioner shall, in the prescribed manner refund to a producer or a dealer any sum paid or realised in excess of the sum due from him under this Act either by case or, at the option of the producer or dealer, be set off against the sum due from him in 484 respect of any other period.
Section 23 applies only in a case where money is paid under the Act.
If there is no provision for realisation of the money under the Act, the act of payment was ultra vires, the money had not been paid under the Act.
In that view of the matter section 23 would not apply.
The High Court in the instant case after analysing the various decisions came to the conclusion that where a petitioner approached the High Court with the sole prayer of claiming refund of money by writ of mandamus, the same was normally not granted but where the refund was prayed as a consequential relief the same was normally entertained if there was no obstruction or if there was no triable issue like that of limitation.
We agree that normally in a case where tax or money has been realised without the authority of law, the same should be refunded and in an application under Article 226 of the Constitution the Court has power to direct the refund unless there had been avoidable laches on the part of the petitioner which indicate either the abandonment of his claims or which is of such nature for which there is no probable explanation or which will cause any injury either to respondent or any third party.
It is true that in some case the period of three years is normally taken as a period beyond which the Court should not grant relief but that is not an inflexible rule.
It depends upon the facts of each case.
In this case, however, the High Court refused to grant the relief on the ground that when the section was declared ultra vires originally that was the time when refund should have been claimed.
But it appears to us, it is only when the Loong Soong case was decided by the High Court in 1973 that the appellant became aware of his crystal right of having the assessment declared ultra vires and in that view of the matter in October, 1973 when the judgment was delivered in July, 1973 the appellant came to know that there is mistake in paying the tax and the appellant was entitled to refund of the amount paid.
That was the time when the appellant came to know of it.
Within a month in November 1973 the present petition was filed.
There was no unexplained delay.
There was no fact indicated to the High Court from which it could be inferred that the appellant had either abandoned his claims or the respondent had changed his position in such a way that granting relief of refund would cause either injury to the respondent or anybody else.
On the other hand, refunding the amount as a consequence of declaring the assessment to be bad and recovery to be illegal will be in consonance with justice, equity and good conscience.
We are, therefore of the view that the view of the High Court in this matter cannot be sustained.
485 Chandra Bhushan & Anr.
vs Deputy Director of Consolidation (Regional), U.P. & ors.
; , was a case where this Court observed that the High Court erred in exalting a rule of practice into a rule of limitation and rejecting the petition of the appellant for refund without considering whether the appellant was guilty of laches and undue delay.
Shah, J. delivering the judgment of the Court observed that the primary question in each case is whether the applicant had been guilty of laches or undue delay.
Reference may be made in this connection to R.L. Kapur vs State of Madras, ; There the question arose about punishing for contempt.
The jurisdiction conferred on the High Court under Article 215 of the Constitution to punish for contempt of itself was a special one, not arising or derived from the , and therefore, not within the purview of the Penal Code.
Such a position is also clear from the provisions of the .
The effect of section 5 of that Act was only to widen the scope of the existing jurisdiction of a special kind and not conferring a new jurisdiction.
So far as contempt of the High Court itself is concerned, as distinguished from that of court subordinate to it, the Constitution vested these rights in every High Court, and so no Act of a legislature could take away that jurisdiction and confer it afresh by virtue of its own authority.
That being the position, this Court held that section 25 of the General Clauses Act would not apply.
Similarly, it appears to us that this was a tax realised in breach of the section, the refund being of the money realised without the authority of law.
The realisation is bad and there is a concomitant duty to refund the realisation as a corollary of the constitutional inhabitation that should be respected unless it causes injustice or loss in any specific case or violates any specific provision of law.
In that view of the matter in the facts of this case we are of the opinion that the money was refundable to the appellant.
The appellant had proceeded diligently.
There is nothing to indicate that had the appellant been more diligent, the appellant could have discovered the constitutional inhibition in 1966.
The position is not clear even if there is any triable issue.
The position becomes clearer only after the decision in Loong Soong 's case as mentioned hereinbefore.
Our attention was drawn on behalf of the respondents that under section 16 of the Act an appeal lay in the prescribed manner within thirty days from the date of service of any order of assessment but the 486 challenge to the assessment on the ground that the assessment was bad could not be made in an appeal under the Act because the right to appeal being a creature of the Act, if the Act is ultra vires that right would not enure to the benefit of the appellant.
In State of Madhya Pradesh vs Bhailal Bhai & ors.
; , this Court had occasion to consider what was unreasonable delay in moving the court when tax was paid under a mistake.
There the respondents were dealers in tobacco in the State of Madhya Bharat.
The State had imposed sales tax on the sale of imported tobacco by the respondents.
But no such tax was imposed on the sale of indigenous tobacco.
The respondents filed writ petitions under Article 226 of the Constitution for the issue of writ of mandamus directing the refund of sales tax collected from them.
They contended that the impugned tax was violative under Article 301(a) of the Constitution and they paid the tax under a mistake of law and the tax so paid was refundable under section 72 of the .
The appellant contended that there was no violation of Article 301 of the Constitution, and even if there was such violation the tax came within the special provision under Article 304(a) of the Constitution and the High Court had no power to direct refund of tax already paid and in any event the High Court should not exercise its discretionary power of issuing a writ of mandamus directing this to be done since there was unreasonable delay in filing the petition.
The High Court rejected all the contentions of the appellant and a writ of mandamus was issued as prayed for.
It was held that tax was violative under Article 301 of the Constitution.
But it was held that even though the tax contravened Article 30 1 of the Constitution, it was valid if it came within the saving provisions of Article 304 of the Constitution.
Tobacco manufactured or produced in the appellant State, similar to the tobacco imported from outside had not been subjected to the tax and therefore the tax was not within the saving provisions of Article 304(a) of the Constitution.
It was reiterated that the tax which had already been paid was so paid under a mistake of law under section 72 of the .
The High Courts had power for the purpose of enforcement of.
fundamental rights and statutory rights to grant consequential reliefs by ordering repayment of money realised by the Government without the authority of law.
It was reiterated that as a general rule if there has been unreasonable delay the court ought not ordinarily to lend its air to a party by the extraordinary remedy of mandamus.
Even if there is no such delay, in cases where the opposite party raises a prima facie issue as regards the availability of such relief on the merits on grounds like limitation the Court should ordinarily refuse to issue the writ of 487 mandamus.
Though the provisions of the did not as such, it was further held, apply to the granting of relief under Article 226, the maximum period fixed by the legislature as the time within which relief by a suit in a Civil Court must be claimed may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under Article 226 could be measured.
The Court might consider the delay unreasonable even if it is less than the period of limitation prescribed for a civil action for the remedy.
Where the delay is more than that period it will almost always be proper for the court to hold that it is unreasonable.
The period of limitation prescribed for recovery of money paid by mistake under the was three years from the date when the mistake was known.
In this case knowledge is attributable from the date of the judgment in Loong Soong 's case on 10th July, 1973 and there being a statement that the appellant came to know of that fact in October, 1973 and there being no denial by the averment made on this ground, the High Court, in our opinion, in the instant case was in error in presuming that there was a triable issue on this ground and refusing to grant refund.
In Ramachandra Shankar Deodhar & Ors.
vs The State of Maharashtra & ors.
; , in a different context, it was observed that laches or existence of alternative remedy may be ground for not granting relief.
But in view of the facts of this case, it is not necessary to deal with that case in any detail.
In A. V. Venkateswaran, Collector of Customs, Bombay vs Ramchand Sobhraj Wadhwani and another; , this Court held that the High Court was in error in its view that though the respondent had failed to exercise his statutory remedy, the fact that it had become time barred at the date of the hearing of the appeal against the order in the petition under Article 226, was a good ground for the Court to exercise its discretion in granting the relief prayed for by the respondent in his petition.
Learned counsel drew our attention to Rule 55 of the Act where it was stated that no claim to any refund shall be allowed unless it was made within one year from the date of the original order of assessment or within one year of the final order passed on appeal or revision as the case may be, in respect of such assessment.
It was contended on behalf of the respondents that here a fixed period of limitation was prescribed and by virtue of Article 226 of the Constitution, we should not allow to subvert that rule.
This principle, in our opinion, in view of the fact that the rule was unconstitutional will have no application.
488 In Shiv Shanker Dal Mills etc.
vs State of Haryana & Ors. etc.
, [1980] l S.C.R. 1170 Krishna Iyer, J. speaking on behalf of him self as well as on behalf of R.S. Pathak, J. as the learned Chief Justice then was and A.D. Koshal, J. Observed that where public bodies under colour of public laws recover people 's money, later discovered to be erroneous levies the dharma of the situation admits of no equivocation.
There was no law of limitation especially for public bodies on the virtue of returning what was wrongly recovered to whom it belongs.
In our jurisprudence it is not palatable to turn down the prayer for high prerogative writs on the negative plea of alternative remedy, since the root principle of law married to justice, is ubi jus ibi remedium.
His Lordship observed as follows: "Since the root principle of law married to justice, is ubi jus ibi remedium.
Long ago Dicey wrote: 'The law ubi jus ibi remedium, becomes from this Point of view something more important than a mere tautological proposition.
In its bearing upon constitutional law, it means that the Englishmen whose labours gradually formed the complicated set of laws and institutions which we call the Constitution, fixed their minds far more intently on providing remedies for the enforcement of particular rights or for averting definite wrongs, than upon any declarations of the Rights of Man or English men.
The Constitution of the United States and the Constitutions of the separate States are embodied in written or printed documents, and contain declaration of rights.
But the statesmen of America have shown an unrivalled skill in providing means for giving legal security to the rights declared by American Constitutions.
The rule of law is as marked a feature of the United States as of England.
Another point.
In our jurisdiction, social justice is a pervasive presence; and so, save in special situations it is fair to be guided by the strategy of equity by asking those who claim the service of the judicial process to embrace the basic rule of distributive justice, while moulding the relief, by consenting to restore little sums, taken in little transactions, from little persons, to whom they belong.
" 489 We are in respectful agreement with this approach.
A ln State of Madhya Pradesh and others etc.
vs Nandlal Jaiswal and others etc.
; , this principle was reiterated by Bhagwati, C.J. that it was well settled that the power of the High Court to issue an appropriate writ under Article 226 of the Constitution was discretionary and the High Court in the exercise of its discretion did not ordinarily assist the tardy and the indolent or the acquiescent and the lethargic.
If there was inordinate delay on the part of the petitioner in filing a writ petition and such delay was not satisfactorily explained, the High Court might decline to intervene and grant relief in the exercise of its writ jurisdiction.
The evolution of this rule of laches or delay was premised upon a number of factors.
The High Court did not ordinarily permit a belated resort to the extraordinary remedy under the writ jurisdiction because it was likely to cause confusion and public inconvenience and bring in its train new injustices.
It was emphasised that this rule of laches or delay is not a rigid rule which can be cast in a straitjacket formula.
There may be cases where despite delay and creation of third party rights the High Court may still in the exercise of its discretion interfere and grant relief to the petitioner.
But where the demand of justice is so compelling that the High Court would be inclined to interfere in spite of delay or creation of third party rights would by their very nature be few and far between.
Ultimately it would be a matter within the discretion of the Court; ex hypotheses every discretion must be exercised fairly and justly so as to promote justice and not to defeat it.
We are in respectful agreement with this approach also.
In this case looked at from one point of view, it is only on the delivery of the judgment in Loong Soong 's case in 1973, the appellant realised the right to claim the relief of refund as a consequential relief, setting aside the assessment and the assessment was set aside by the very order itself in this case.
That right has been granted by the High Court, the High Court has not refused the setting aside on the ground of delay.
It would be inconsistent for the High Court to refuse to grant consequential relief after setting aside the assessment.
If the realisation was without the authority of law and that was declined by the High Court by the judgment in this case which claimed also the consequential relief, that relief must automatically follow and the High Court was wrong in taking the view that a triable issue of limitation arises in this case.
In the absence of any averment to the contrary, the averment of the appellant in the petition that they came to know only after the Loong Soong 's case must be accepted.
The High Court was wrong in 490 contending that they should have been more diligent.
After all the discretion must be fair and equitable.
In the facts of this case, we are of the opinion that the High Court was in error in the approach it took.
We, therefore, set aside the judgment and order of the High Court and direct refund of the tax illegally realised by the respondent.
The appeals are allowed.
We set aside the judgment and order to the extent that it refused refund of the tax illegally realised.
In the facts of this case the parties will pay and bear their own costs.
section RANGANATHAN J. I agree with the order proposed by my learned brother but would like to add a word of reservation.
In view of the judgment of this Court in Superintendent of Taxes vs Onkarmal Nathmal Trust, [ 1975] Supp SCR 365, there can be no doubt that the assessments on the appellants were illegal and that.
the taxes demanded on the basis thereof had been collected without the authority of law from the appellants.
The appellant 's contention is that they had paid the taxes under a mistake of law and are entitled to seek refund thereof.
It is difficult to see how the High Court could have allowed the appellant 's prayer for quashing the assessments but refused the prayer for the refund of the illegally collected taxes.
The appeals have, therefore, to be allowed.
Counsel for the respondents, however, places strong reliance on the following observations of a Constitution Bench of this Court in State of M.P. vs Bhailal Bhai, ; "Though the provisions of the do not, as such, apply to the granting of relief under article 226, the maximum period fixed by the Legislature as the time within which relief by a suit in a Civil Court must be claimed may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under article 226 could be measured XXXX Where the delay is more than that period it will almost always be proper for the Court to hold that it is unreasonable. " He also relies on Cawasji & Co. vs State, and drawn our attention to the decision in Vallabh Glass Works vs Union, ; where the claim for refund in respect of a period beyond 491 three years was rejected.
He contends, on the strength of the above decisions, that the High Court rightly rejected the appellants ' claims for refund.
On the other hand, it is contended for the appellants that a writ petition seeking refund of taxes collected without the authority of law cannot be rejected on the ground of limitation or delay unless such delay can be said to amount to laches or has caused some irreparable prejudice to the opposite party or some other like forceful reason exists.
Counsel refers in this context to Venkateswaran vs Ramchand, [1962] 1 SCR 75; Chandra Bhushan vs Deputy Director, ; ; Tilokchand Motichand vs Munshi, ; Ramachandra section Deodhar vs State; , ; Joginder Nath vs Union, [ ; Shiv shankar Dal Mills vs State, [ ; and State of M.P. vs Nandlal Jaiswal, ; and contends that these decisions have qualified the observations of Das Gupta, J. in Bhailal Bhai 's case.
As pointed out by my learned brother, in the present case, the appellants ' averment that they realised their mistake only when they came to know about the decision in the Loong Soong Tea Estate case in July 1973 stands uncontroverted.
There is nothing on record either to show that the appellants had realised their mistake even earlier, at about the time when the writ petition in the Loong Soong Tea Estate case was filed or at the time when the earlier decision of 1966 referred in the Loong Soong Tea Estate case judgment was rendered.
On this finding of fact, the writ petitions, filed by the appellants in November 1973, were filed within the period of limitation prescribed in Article 113 read with section 23 of the .
Thus the petitions were within time even by the test enunciated in Bhailal Bhai 's case.
I think, therefore, that, for the purposes of the present case, it is unnecessary to consider the larger question whether the bar of limitation should be considered as fatal to a writ petition as to a suit for recovery or whether it is only a relevant but not conclusive factor that should be taken into account by the court in exercising a discretion.
P.S.S. Appeals allowed.
|
1979 of the High Court of Gauhati in Civil Rule Nos. M.K.S. Mench and Sanjay Bharthri for the Appellants. In 1954 Assam Taxation (on Goods carried by Road or Inland Waterways) Act was first enacted. This Court struck down the Act as ultra vires the Constitution of India. See Atiabari Tea Co. Ltd. vs The State of Assam & Ors., ; On 6th of April, 1961 a new Act passed received the assent of the President. On 13.12.63 Khyerbar Tea Co. Ltd. & another vs State of Assam, [1964] 5 SCR ts 975 in a challenge to the Act under Article 32 of the Constitution, this Court held the Act to be intra vires. On 19th December, 1966, Judgment was passed in Civil Rule No. On 10th July, 1973, the High Court passed judgment in Loong Soong Tea Estate, (Civil Rule No. 1005 of 1969) declaring the assessment as without jurisdiction. It is the case of the appellant petitioner that in view of the above judgment, the appellant came to know about the mistake in paying the tax as per assessment order and also that the appellant became entitled to refund of the amount paid. The present Writ Petition was filed in November, 1973 before the High Court of Assam. Thereafter in June, 1976, the learned Single Judge of the High Court referred the matter to a larger Bench. Aggrieved thereby, the appellant has preferred the present appeals. The Legislature of Assam passed the Act, as mentioned hereinbefore in 1954 called the Assam Taxation (on Goods carried by Road and Inland Waterways) Act, 1954 which purported to levy tax on manufactured tea and jute carried by road and inland waterways. Thereafter the Legislature passed the Act which received the assent of the President on 6.4.61. Against the judgment and order passed by the High Court, the State of Assam and other respondents preferred appeals before this Court. It was after this decision that the respondents required the appellant by a notice under section 480 7(2) of the Act issued on 8.7.68 to submit returns for four periods mentioned hereinbefore. In the judgment under appeal after elaborate discussion, the High Court came to the conclusion that when a petitioner approaches the High Court with the sole claim for refund of money by writ of mandamus, the same is normally not granted but where the refund is prayed as a consequential relief the same is normally entertained if there is no obstruction or if there be no triable issue like that of limitation which could not be conveniently tried in writ petition. In this case indisputably it appears that tax was collected without the authority of law. Indeed the appellant had to pay the tax in view of the notices which were without jurisdiction. It appears that the assessment was made under section 9(3) of the Act. It is the case of the appellant that it was after the judgment in the case of Loong Soong Tea Estate the cause of action arose. It appears thus that the High Court was in error in coming to the conclusion that it was possible for the appellant to know about the legality of the tax sought to be imposed as early as 1963, when the Act in question was declared ultra vires as mentioned hereinbefore. Therefore the claim in November, 1973 was belated. We are unable to agree with this conclusion. Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law. It appears that Section 23 of the Act deals with refund. In the facts of this case, the case did not come within section 23 of the Act. The appellate bench of the High Court dismissed the appeal on the ground that it would not interfere with the discretionary order of the single Judge. On September 29, 1967 this Court in Kantilal Babulal vs H. C. Patel, 2 1 S.T.C. 174 struck down section 12A(4) of the Bombay Sales Tax Act, 1946 corresponding to section 21(4) of the 1953 Act, on the ground that it was violative of Article 19(1)(f) of the Constitution inasmuch as the power conferred by the section was unguided, uncanalised and uncontrolled and so was not a reasonable restriction on the fundamental right guaranteed under that Article. On the assumption that section 21(4) of the 1953 Act was also liable to be struck down on the same ground, on February 9, 1968, the petitioners therein filed a writ petition under Article 32 of 482 the Constitution claiming a refund of the amount. It was held by the majority that the petition should be dismissed on the ground of laches. Hidayatullah, C.J. held that Article 32 gave the right to move the Court by appropriate proceedings for enforcement of fundamental rights and the State cannot place any hindrance in the way of an aggrieved person. But once the matter had reached this Court, the extent or manner of interference is for this Court to decide. For example, this Court, reiterated the Chief Justice? refrained from acting under the Article if the party had already moved the High Court under Article 226 and if the High Court had exercised its parallel jurisdiction. Similarly, in inquiring into belated and stale claims, this Court should take note of evidence of neglect of the petitioner 's own rights for a long time or of the rights of innocent parties which might have emerged by reason of the delay. A petition under Article 32 was neither a suit nor an application to which the applied. In the absence of any rules of procedure under Article 145(1)(c), the Court may adopt any reasonable rule. Similarly, the general principles of res judicata were applied where applicable on grounds of public policy. Mitter, J. more or less expressed the same view. He was of the opinion that in the facts of that case, there was no delay. Under Article 113 of the the limitation was the period of three years from the date the right to sue accrues. Section 23 applies only in a case where money is paid under the Act. In that view of the matter section 23 would not apply. But it appears to us, it is only when the Loong Soong case was decided by the High Court in 1973 that the appellant became aware of his crystal right of having the assessment declared ultra vires and in that view of the matter in October, 1973 when the judgment was delivered in July, 1973 the appellant came to know that there is mistake in paying the tax and the appellant was entitled to refund of the amount paid. That was the time when the appellant came to know of it. Within a month in November 1973 the present petition was filed. We are, therefore of the view that the view of the High Court in this matter cannot be sustained. vs Deputy Director of Consolidation (Regional), U.P. & ors. Reference may be made in this connection to R.L. Kapur vs State of Madras, ; There the question arose about punishing for contempt. Such a position is also clear from the provisions of the . The effect of section 5 of that Act was only to widen the scope of the existing jurisdiction of a special kind and not conferring a new jurisdiction. Similarly, it appears to us that this was a tax realised in breach of the section, the refund being of the money realised without the authority of law. The position is not clear even if there is any triable issue. The position becomes clearer only after the decision in Loong Soong 's case as mentioned hereinbefore. In State of Madhya Pradesh vs Bhailal Bhai & ors. ; , this Court had occasion to consider what was unreasonable delay in moving the court when tax was paid under a mistake. There the respondents were dealers in tobacco in the State of Madhya Bharat. The State had imposed sales tax on the sale of imported tobacco by the respondents. But no such tax was imposed on the sale of indigenous tobacco. The respondents filed writ petitions under Article 226 of the Constitution for the issue of writ of mandamus directing the refund of sales tax collected from them. It was held that tax was violative under Article 301 of the Constitution. The High Courts had power for the purpose of enforcement of. fundamental rights and statutory rights to grant consequential reliefs by ordering repayment of money realised by the Government without the authority of law. It was reiterated that as a general rule if there has been unreasonable delay the court ought not ordinarily to lend its air to a party by the extraordinary remedy of mandamus. Though the provisions of the did not as such, it was further held, apply to the granting of relief under Article 226, the maximum period fixed by the legislature as the time within which relief by a suit in a Civil Court must be claimed may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under Article 226 could be measured. The Court might consider the delay unreasonable even if it is less than the period of limitation prescribed for a civil action for the remedy. Where the delay is more than that period it will almost always be proper for the court to hold that it is unreasonable. The period of limitation prescribed for recovery of money paid by mistake under the was three years from the date when the mistake was known. ; , in a different context, it was observed that laches or existence of alternative remedy may be ground for not granting relief. But in view of the facts of this case, it is not necessary to deal with that case in any detail. In A. V. Venkateswaran, Collector of Customs, Bombay vs Ramchand Sobhraj Wadhwani and another; , this Court held that the High Court was in error in its view that though the respondent had failed to exercise his statutory remedy, the fact that it had become time barred at the date of the hearing of the appeal against the order in the petition under Article 226, was a good ground for the Court to exercise its discretion in granting the relief prayed for by the respondent in his petition. This principle, in our opinion, in view of the fact that the rule was unconstitutional will have no application. His Lordship observed as follows: "Since the root principle of law married to justice, is ubi jus ibi remedium. Long ago Dicey wrote: 'The law ubi jus ibi remedium, becomes from this Point of view something more important than a mere tautological proposition. The Constitution of the United States and the Constitutions of the separate States are embodied in written or printed documents, and contain declaration of rights. The rule of law is as marked a feature of the United States as of England. In our jurisdiction, social justice is a pervasive presence; and so, save in special situations it is fair to be guided by the strategy of equity by asking those who claim the service of the judicial process to embrace the basic rule of distributive justice, while moulding the relief, by consenting to restore little sums, taken in little transactions, from little persons, to whom they belong. " 489 We are in respectful agreement with this approach. A ln State of Madhya Pradesh and others etc. It was emphasised that this rule of laches or delay is not a rigid rule which can be cast in a straitjacket formula. There may be cases where despite delay and creation of third party rights the High Court may still in the exercise of its discretion interfere and grant relief to the petitioner. Ultimately it would be a matter within the discretion of the Court; ex hypotheses every discretion must be exercised fairly and justly so as to promote justice and not to defeat it. We are in respectful agreement with this approach also. In the absence of any averment to the contrary, the averment of the appellant in the petition that they came to know only after the Loong Soong 's case must be accepted. The High Court was wrong in 490 contending that they should have been more diligent. After all the discretion must be fair and equitable. In the facts of this case, we are of the opinion that the High Court was in error in the approach it took. In the facts of this case the parties will pay and bear their own costs. section RANGANATHAN J. I agree with the order proposed by my learned brother but would like to add a word of reservation. the taxes demanded on the basis thereof had been collected without the authority of law from the appellants. It is difficult to see how the High Court could have allowed the appellant 's prayer for quashing the assessments but refused the prayer for the refund of the illegally collected taxes. The appeals have, therefore, to be allowed. He also relies on Cawasji & Co. vs State, and drawn our attention to the decision in Vallabh Glass Works vs Union, ; where the claim for refund in respect of a period beyond 491 three years was rejected. Thus the petitions were within time even by the test enunciated in Bhailal Bhai 's case.
|
% The Assam Taxation (on Goods Carried by Road or Inland Water ways) Act,1954 was struck down as ultra vires the Constitution in Atiabari Tea Co. Lld.
vs State of Assam, ; A new Act was thereafter passed which received the President 's assent on April 6, 1961.
The High Court declared the said Act to be ultra vires on August 1, 1963.
The State and other respondents preferred appeals before Supreme Court against the decision.
In the meantime, in Khyerbari Tea Co. Ltd. & Anr.
vs State of Assam, ; the Court held the Act to be intra vires on December 13, 1963.
Following the decision in Khyerbari case the appeals filed by the State and others were allowed by this Court on April 1, 1968.
After this decision the respondents required the appellants by notices under section 7(2) of the Act issued on July 8, 1968 to submit return for the period ending June 30, 1961, September 30, 1961, December 31, 1961 and March 31, 1962.
Due to the penal consequences mentioned in the said notices the appellants filed returns on July 11, 1968.
The assessment orders were passed under section 9(3) of the Act.
The tax was duly paid.
In November 1973 the appellants filed writ petitions before the High Court seeking direction for refund of the tax paid under mistake relying on the High Court 's Judgment in Loong Soong Tea Estate (Civil Rule No. 1005 of 1969) dated July lO, 1973 declaring the assessment as without jurisdiction.
475 The High Court set aside the orders and notices of demand but refused claim of refund on the ground of delay and laches.
It took the view that it was possible for the appellants to know about the legality of the tax sought to be imposed as early as 1963, when the Act in question was declared ultra vires.
The taxes having been paid in 1968 the claim in November 1973 was belated.
It, however, held that the claim for refund was a consequential relief.
In the appeals to this Court it was contended for the appellants that they had paid the tax under a mistake of law and were entitled to seek refund thereof, and a writ petition seeking refund of tax realised without the authority of law cannot be rejected on the ground of limitation or delay unless such delay can be said to amount to laches or has caused some irreparable prejudice to the opposite party.
Allowing the appeals, ^ HELD: By the Court: (Per Sabyasachi Mukharji & Ranganathan, JJ.) The money was refundable to the appellants.
The writ petitions were within time.
[4X4H] Per Mukharji, J. 1.
No State has the right to receive or to retain taxes or monies realised from citizens without the authority of law.
There is in such cases concomitant duty to refund the realisation as a corollary of the constitutional inhibition that should be respected unless it causes injustice or loss in any specific case or violates any specific provision of law.
[480H; 485E F] In the instant case, tax was collected without the authority of law.
The notices were without jurisdiction.
So was the assessment made under section 9(3) of the Act.
The respondents, therefore, had no authority to retain the money so collected, and as such the money was liable to refund.
[480D] 2.1 In an application under Article 226 of the Constitution the Court has power to direct the refund unless there has been avoidable laches on the part of the petitioner which indicate either the abandonment of his claims or which is of such nature for which there is no probable explanation or which will cause an injury either to respondent or any third party.
[484C D] 476 2.2 Courts have, however, made a distinction between those cases where a claimant approaches a High Court seeking relief of obtaining refund only and those where refund is sought as a consequential relief after striking down of the order of assessment etc.
A petition of the former nature is not ordinarily maintainable for the simple reason that a claim for such a refund can always be made in a suit wherein it is open to the State to raise all possible defences to the claim, defences which cannot in most cases be appropriately raised and considered in the exercise of writ jurisdiction.
[480F H; 48;B] In the instant case, s.23 of the Assam Act provided for refund to a producer or a dealer any sum paid or realised in excess of the sum due from him under that Act.
The section thus applies only in a case where money is paid under the Act.
If there is no provision for realisation of the money under the Act, the act of payment was ultra vires, the money had not been paid under the Act.
In that view of the matter the case did not come within section 23 of the Act.
The High Court having found that the claim for refund was a consequential relief, it could have directed the State to refund the amount in question.
[483 G H;484A B] 2.3 Exercise of every discretion must be fair and equitable.
The period of limitation prescribed for recovery of money paid by mistake under the was three years from the date when the mistake was known.
In the instant case, knowledge is attributable from the date of judgment in Loong Soong 's case on 10th July, 1973.
There being a statement that the appellants came to know of that fact in October 1973 and there being no denial by the averment made on this ground, the High Court was in error in presuming that there was a triable issue on this ground and refusing to grant refund.
Within a month in November 1973 the present petitions were filed.
There was no unexplained delay.
The appellants had proceeded diligently.
There is nothing to indicate that had they been more diligent, the appellants could have discovered the constitutional inhibition earlier.
The position is not clear even if there is a triable issue.
The position becomes clearer only after the decision in Loong Soong 's case.
It could not, therefore, be said that the appellants had abandoned their claims.
[487B D] Suganmal vs State of Madhya Pradesh and others.
, AIR 1965 SC 1740; Tilokchand Motichand & Ors.
vs H.B. Munshi & Anr., ; Kantilal Babulal vs H.C. Patel 21 S.T.C. 174; Chandra Bhushan & Anr.
vs Deputy Director of Consolidation (Regional), U.P. & Ors., ; ; R.L. Kapur vs State of Madras, ; ; State of Madhya Pradesh vs Bhailal Bhai & Ors.
J [1964] 6 477 SCR. 261; Ramchandra Shankar Deodhar & ors.
vs The State of Maharashtra & Ors., ; ; A.V. Venkateswaran, Collector of Customs, Bombay vs Ramchand Sobhraj Wadhwani and another; , ; Shiv Shankar Dal Mills etc.
vs State of Haryana & Ors. etc.
; , and State of Madhya Pradesh and others etc.
vs Nandlal Jaiswal and others etc.
; , referred to.
It is only on the delivery of the judgment in Loong Soong 's case in 1973, the appellants realised the right to claim the relief of refund as a consequential relief, setting aside the assessment and the assessment was set aside by the very order itself.
That right has been granted by the High Court.
The High Court has not refused the setting aside on the ground of delay.
It would be inconsistent for the High Court to refuse to grant consequential relief after setting aside the assessment.
If the realisation was without the authority of law and that was declined by the High Court by the judgment in the instant case, which claimed also the consequential relief, that relief must automatically follow.
Refunding the amount as a consequence of declaring the assessment to be bad and recovery to be illegal will be in consonance with justice, equity and good conscience.
[489F H] 4.
The challenge to the assessment on the ground that the assessment was bad could not be made in an appeal under the Act because the right to appeal being a creature of the Act, if the Act is ultra vires that right would not ensure to the benefit of the appellant.
Section 16 of the Act under which an appeal lay within thirty days from the date of service of an assessment order therefore had no application.
Similarly, rule 55 of the Rules framed under the Act barring claims of refund unless made within one year from the date of the original order of assessment being unconstitutional had no application.
[485H; 486A B; 487H] 1.
The assessments on the appellants were illegal.
The taxes demanded on the basis thereof had been collected without the authority of law.
The High Court, therefore, while allowing the appellant 's prayer for quashing the assessment should also have allowed the refund of the illegally collected taxes.
[490D] Superintendent of Taxes vs Onkarmal Nathmal Trust, [1975] Supp.
SCR 365, applied.
478 The petitions filed in November, 1973 were within the period of limitation prescribed in Article 113 of the read with section 23 of the Assam Act.
The appellants ' averment that they realised their mistake only when they came to know about the decision of Loong Soong Tea Estate case in July, 1973 stands uncontroverted.
There is nothing on record to show that the appellants had realised their mistake earlier[491D f] State of M. P. vs Bhailal Bhai [1964]6 SCR 261 referred to.
It was considered unnecessary therefore to consider the larger question whether the bar of limitation would be fatal to a writ petition for refund.
|
% The Assam Taxation (on Goods Carried by Road or Inland Water ways) Act,1954 was struck down as ultra vires the Constitution in Atiabari Tea Co. Lld. vs State of Assam, ; A new Act was thereafter passed which received the President 's assent on April 6, 1961. The State and other respondents preferred appeals before Supreme Court against the decision. vs State of Assam, ; the Court held the Act to be intra vires on December 13, 1963. Following the decision in Khyerbari case the appeals filed by the State and others were allowed by this Court on April 1, 1968. The assessment orders were passed under section 9(3) of the Act. 1005 of 1969) dated July lO, 1973 declaring the assessment as without jurisdiction. The taxes having been paid in 1968 the claim in November 1973 was belated. It, however, held that the claim for refund was a consequential relief. The money was refundable to the appellants. So was the assessment made under section 9(3) of the Act. The respondents, therefore, had no authority to retain the money so collected, and as such the money was liable to refund. [484C D] 476 2.2 Courts have, however, made a distinction between those cases where a claimant approaches a High Court seeking relief of obtaining refund only and those where refund is sought as a consequential relief after striking down of the order of assessment etc. If there is no provision for realisation of the money under the Act, the act of payment was ultra vires, the money had not been paid under the Act. The period of limitation prescribed for recovery of money paid by mistake under the was three years from the date when the mistake was known. In the instant case, knowledge is attributable from the date of judgment in Loong Soong 's case on 10th July, 1973. Within a month in November 1973 the present petitions were filed. The position becomes clearer only after the decision in Loong Soong 's case. , AIR 1965 SC 1740; Tilokchand Motichand & Ors. vs Deputy Director of Consolidation (Regional), U.P. & Ors., ; ; R.L. Kapur vs State of Madras, ; ; State of Madhya Pradesh vs Bhailal Bhai & Ors. ; , and State of Madhya Pradesh and others etc. That right has been granted by the High Court. Refunding the amount as a consequence of declaring the assessment to be bad and recovery to be illegal will be in consonance with justice, equity and good conscience. The assessments on the appellants were illegal. The High Court, therefore, while allowing the appellant 's prayer for quashing the assessment should also have allowed the refund of the illegally collected taxes. [490D] Superintendent of Taxes vs Onkarmal Nathmal Trust, [1975] Supp. There is nothing on record to show that the appellants had realised their mistake earlier[491D f] State of M. P. vs Bhailal Bhai [1964]6 SCR 261 referred to.
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Writ Petition (CRL) No. 745 of 1987.
(Under Article 32 of the Constitution of India).
J.M. Khanna for the Petitioner Ravindra Bana, G. Venkatesh Rao and C.V. Subba Rao for the Respondents.
The following order of the Court was delivered: O R D E R The petitioner has been convicted for the offence of murder and sentenced to imprisonment for life.
He claims in this application under Article 32 of the Constitution the benefit of the Punjab Borstal Act and has placed reliance on a decision of this Court in the case of Hava Singh vs State of Haryana, AIR 1987 SC 2001.
A counter affidavit has been filed disputing the tenability of the claim.
In Hava Singh 's case (supra) a two Judge Bench (including one of us) was considering the claim of a convict for an offence of murder to release taking into account the period the prisoner had stayed in the Borstal institution.
In that case, it was observed: "It is evident from the averments made in the writ petition as well as in the said counter affidavit that the petitioner was admittedly adolescent at the time of his con 558 viction was sent to Borstal Institute at Hissar.
Subsequently, he has been transferred to the District Jail at Rohtak and is undergoing the sentence of imprisonment for life.
It appears from the objects and reasons of Punjab Borstal Act, 1926 that the object of the Act is to provide for segregation of adolescent prisoners from those of more mature age, and their subsequent training in separate institutions.
These Borstal Institutions meant for detaining adolescent offenders and to impart to them such industrial training and other instructions and subject them to such disciplinary and moral influence as will conduce to their reformation.
This is evident from the provisions of section 2(1) of Punjab Borstal Act, 1926.
Sub section (2) of section 2 defines detained as detained in and detention as detention in a Borstal Institution.
Section 5 of the said Act which is very vital for the purpose of decision of this case is quoted hereinbelow: '5.
Powers of courts to pass a sentence of detention in a Borstal Institution in the case of a convict under twenty one years of age in lieu of transportation or rigorous imprisonment (1) When any male person less than twenty one years of age is convicted of an offence by a court of sessions, a Magistrate specially empowered under section 30 of the Code of Criminal Procedure, 1898, or a Judicial Magistrate of the first class, or is ordered to give security for good behaviour and fails to give such security, and when by reason of this criminal habits or tendencies or associations with persons of bad character it is expedient in the opinion of the Judge or Magistrate, that he should be detained, such Judge or Magistrate may, in lieu of passing a sentence of transportation or rigorous imprisonment, pass an order of detention for a term which shall not be less than two years and shall not exceed seven years when the order is passed by a Court of sessions or a Magistrate specially empowered under section 30 of the Code of Criminal Procedure, 1898, and shall not be less than two years nor exceed three years, when the order is passed by a judicial magistrate of the first class not so empowered.
(2) . . . . . . . 559 (3). . . . . . . .
This court further stated: "The petitioner who was adolescent admittedly being less than twenty one years of age at the time of his conviction though convicted under Section 302/34 I.P.C. and sentenced to imprisonment for life, was sent to the Borstal Institute in accordance with the provisions of Punjab Borstal Act, 1926.
On his attaining the age of about twenty one years he was transferred back to the Jail.
There is no provision except section 20 under the said Act for transferring back an adolescent convict on his attaining the age of twenty one years from the Borstal Institute to Jail for undergoing the unexpired term of imprisonment.
The Court then referred to section 20 of the Act dealing with incorrigibles and observed: n "The section empowers the State Government to commute the residue of the term of detention of an inmate in Borstal Institute to such term of imprisonment of either description not exceeding the residue as the State Government may direct and also to order transfer of the inmate to any jail in Punjab in order to complete the said term of imprisomnent when such an inmate is reported to be incorrigible or is exercising bad influence on the other inmates of the Institution or such an inmate has committed a major Borstal Institution offence as provided in the rules.
" The Court then stated: "This Court while considering an indentical case in the State of Andhra Pradesh vs Vallabhapuram Ravi; , has observed that a person detained in a Borstal School under section 10 a has to be released after he has served the full term of 5 years of detention or on his completing 23 years of age.
He cannot be retransferred thereafter to prison.
Such a retransfer would defeat the very object and purpose of the Act of providing for detention of young offenders in Borstal School for the purpose of reformation and rehabilitation of such offenders '.
It is to be 560 noted in this connection that sentence of detention is passed in lieu of sentence of imprisonment which may have been passed.
Hence the detention order under section S of the said Act is not imprisonment and Borstal School where the adolescent offender is detained is not a prison.
It has also been observed further that section 433 A, Cr.
P.C. would not operate where a person is detained by an order under section 10 a of the Act.
Section 433 A of the Code was introduced not to set at naught provisions like 10 A of the Act which dealt with a special class of offenders like adolescent offenders but only to regulate capricious and arbitrary decisions under Section 432 of the Code and the remission rules sometimes reducing the sentence of imprisonment for life imposed on persons who had been convicted of capital offences but had been sentenced to imprisonment for life to short periods like five to six years.
" Under the Punjab Act, 'offence ' has been defined in section 2(4) to mean "an offence punishable with transportation or rigorous imprisonment under the Indian Penal Code other than (a) an offence punishable with death;." Hava Singh 's case did not refer to the definition of 'offence ' and relied upon the decision in the case of Ravi (supra) though the scheme of the Andhra Act was very different.
The Andhra Act known as the Andhra Pradesh Borstal Schools Act, 1925, does not have the definition of 'offence ' and there is no exclusion as provided in the Pun jab Act.
What is excepted in the definition is an offence which is punishable with death.
Section 302 of the Indian Penal Code provides: "Whoever commits murder shall be punished with death or imprisonment for life and shall also be liable to fine. " One of the punishments for the offence of murder is death and, therefore, the offence of murder would be covered within section 2(4)(i)(a) of the Punjab Act and to such a conviction the Punjab Borstal Act would have no application.
Support for such a view is available from 561 several decisions of different High Courts.
Section 562(1) of the Code A of Criminal Procedure of 1898 as amended in 1923 brought in the phrase: "Punishable with death or transportation for life".
In Emperor vs Mt. Janki & Anr., AIR 1932 Nag. 130 that phrase was interpreted disjunctively and women convicted of an offence for which transportation for life was one of the punishments provided were held ineligible for release on probation under section 562.
It was pointed out that the words 'death or transportation for life ' must be read as referring to offences the penalty for which provided by the Penal Code contains either death or transportation for life as one of the punishments awarded and not necessarily both.
Reliance was placed on a full Bench decision of the Rangoon High Court in King Emperor vs Nga San Htwa & Ors., AIR 1927 Rangoon 205 which was dealing with a similar phrase occurring in section 497 of the old Code.
A Division Bench of the Madhya Pradesh High Court in Chetti vs State of Madhya Pradesh, AIR 1959 MP 241 also took the same view.
In Emperor vs Bahawati, AIR 1928 Lahore 920 it was held that as one of the alternative punishments for that offence under section 307 of the Penal Code, is transportation for life, it is obvious that section 562 is not applicable and the accused must be sentenced to rigorous imprisonment and fine.
The Allahabad High Court in the case of State vs Sheo Shanker, AIR 1956 All. 326, the Madras High Court in Public Prosecutor of Madras vs Paneswar Rao, AIR 1946 Mad.
178, the Rajasthan High Court in Sarkar vs Jalam Singh, AIR 1950 Raj, 28 and the Bombay High Court in Naranji Premji vs Emperor, AIR 1928 Bom.
244 have taken the same view.
In Hava Singh 's case the definition was not placed for consideration before the Court and, therefore, the conclusion which has been reached is not correct.
The Punjab Borstal Act does not have application to an offence punishable under section 302 IPC.
therefore, the conclusion in Hava Singh 's case is not correct.
The petitioner is not entitled to the benefit of the Punjab Borstal Act as he has been sentenced to imprisonment for life for the offence of murder punishable under section 302 IPC for which the sentence of death is prescribed as an alternate.
The writ petition is dismissed.
P.S.S. Petition dismissed.
|
% Sectlon 5 of the Punjab Borstal Act, 1926 empowers courts to pass a sentence of detention in a Borstal institution in the case of male persons less than twenty one years of age convicted of an offence, in lieu of transportation or rigorous imprisonment.
Section 2(4)(i)(a) of the Act which defines 'offence ' takes in offences other than an offence punishable with death.
In his writ petition under Article 32 of the Constitution, the petitioner who has been convicted for the offence of murder and sentenced to imprisonment for life claimed benefit of the Punjab Borstal Act relying on Hava Singh vs State of Haryana, AIR 1987 SC 2001.
The State contested his claim Dismissing the writ petition. ^ HELD: l. l The Punjab Borstal Act does not have application to an offence punishable under section 302 I.P.C.[561F G] 1.2 What is excepted in the definition of 'offence ' in section 2(4)(i)(a) of the Act is an offence which is punishable with death.
One of the punishments under section 302 I.P.C. for the offence of murder is death, and.
therefore, the offence of murder would be covered with section 2(4)(i)(a) of the Act and to such a conviction the Punjab Borstal Act would have no application.
[560F G] 1.3 The petitioner is, therefore, not entitled to the benefit of the Punjab Borstal Act as he has been sentenced to imprisonment for life for the offence of murder punishable under section 302 I.P.C. for which the sentence of death is prescribed as an alternate.
[561G] 557 1.4 In Hava Singh 's, case the definition of offence was not placed for consideration before the court and, therefore, the conclusion which has been reached is not correct.
[561F] Emperor vs Mt. Janki & Anr., AIR 1932 Nag. 130; King Emperor vs Nga San Htwa & Ors., AIR 1927 Rangoon 205; Chetti vs State of Madhya Pradesh, AIR 1959 MP 291; Emperor vs Bahawati, AIR 1928 Lahore 920; State vs Sheo Shankar, AIR 1956 All. 326; Public Prosecutor of Madras vs Paneswar Rao, AIR 1946 Mad. 178; Sarkar vs Jalam Singh, AIR 1950 Raj.
28 and Narauji Premji vs Emperor, AIR 1928 Bom.
referred to.
Hava Singh vs State of Haryana, AIR 1987 SC 2001 overruled.
|
Writ Petition (CRL) No. 745 of 1987.
(Under Article 32 of the Constitution of India).
J.M. Khanna for the Petitioner Ravindra Bana, G. Venkatesh Rao and C.V. Subba Rao for the Respondents.
The following order of the Court was delivered: O R D E R The petitioner has been convicted for the offence of murder and sentenced to imprisonment for life.
He claims in this application under Article 32 of the Constitution the benefit of the Punjab Borstal Act and has placed reliance on a decision of this Court in the case of Hava Singh vs State of Haryana, AIR 1987 SC 2001.
A counter affidavit has been filed disputing the tenability of the claim.
In Hava Singh 's case (supra) a two Judge Bench (including one of us) was considering the claim of a convict for an offence of murder to release taking into account the period the prisoner had stayed in the Borstal institution.
In that case, it was observed: "It is evident from the averments made in the writ petition as well as in the said counter affidavit that the petitioner was admittedly adolescent at the time of his con 558 viction was sent to Borstal Institute at Hissar.
Subsequently, he has been transferred to the District Jail at Rohtak and is undergoing the sentence of imprisonment for life.
It appears from the objects and reasons of Punjab Borstal Act, 1926 that the object of the Act is to provide for segregation of adolescent prisoners from those of more mature age, and their subsequent training in separate institutions.
These Borstal Institutions meant for detaining adolescent offenders and to impart to them such industrial training and other instructions and subject them to such disciplinary and moral influence as will conduce to their reformation.
This is evident from the provisions of section 2(1) of Punjab Borstal Act, 1926.
Sub section (2) of section 2 defines detained as detained in and detention as detention in a Borstal Institution.
Section 5 of the said Act which is very vital for the purpose of decision of this case is quoted hereinbelow: '5.
Powers of courts to pass a sentence of detention in a Borstal Institution in the case of a convict under twenty one years of age in lieu of transportation or rigorous imprisonment (1) When any male person less than twenty one years of age is convicted of an offence by a court of sessions, a Magistrate specially empowered under section 30 of the Code of Criminal Procedure, 1898, or a Judicial Magistrate of the first class, or is ordered to give security for good behaviour and fails to give such security, and when by reason of this criminal habits or tendencies or associations with persons of bad character it is expedient in the opinion of the Judge or Magistrate, that he should be detained, such Judge or Magistrate may, in lieu of passing a sentence of transportation or rigorous imprisonment, pass an order of detention for a term which shall not be less than two years and shall not exceed seven years when the order is passed by a Court of sessions or a Magistrate specially empowered under section 30 of the Code of Criminal Procedure, 1898, and shall not be less than two years nor exceed three years, when the order is passed by a judicial magistrate of the first class not so empowered.
(2) . . . . . . . 559 (3). . . . . . . .
This court further stated: "The petitioner who was adolescent admittedly being less than twenty one years of age at the time of his conviction though convicted under Section 302/34 I.P.C. and sentenced to imprisonment for life, was sent to the Borstal Institute in accordance with the provisions of Punjab Borstal Act, 1926.
On his attaining the age of about twenty one years he was transferred back to the Jail.
There is no provision except section 20 under the said Act for transferring back an adolescent convict on his attaining the age of twenty one years from the Borstal Institute to Jail for undergoing the unexpired term of imprisonment.
The Court then referred to section 20 of the Act dealing with incorrigibles and observed: n "The section empowers the State Government to commute the residue of the term of detention of an inmate in Borstal Institute to such term of imprisonment of either description not exceeding the residue as the State Government may direct and also to order transfer of the inmate to any jail in Punjab in order to complete the said term of imprisomnent when such an inmate is reported to be incorrigible or is exercising bad influence on the other inmates of the Institution or such an inmate has committed a major Borstal Institution offence as provided in the rules.
" The Court then stated: "This Court while considering an indentical case in the State of Andhra Pradesh vs Vallabhapuram Ravi; , has observed that a person detained in a Borstal School under section 10 a has to be released after he has served the full term of 5 years of detention or on his completing 23 years of age.
He cannot be retransferred thereafter to prison.
Such a retransfer would defeat the very object and purpose of the Act of providing for detention of young offenders in Borstal School for the purpose of reformation and rehabilitation of such offenders '.
It is to be 560 noted in this connection that sentence of detention is passed in lieu of sentence of imprisonment which may have been passed.
Hence the detention order under section S of the said Act is not imprisonment and Borstal School where the adolescent offender is detained is not a prison.
It has also been observed further that section 433 A, Cr.
P.C. would not operate where a person is detained by an order under section 10 a of the Act.
Section 433 A of the Code was introduced not to set at naught provisions like 10 A of the Act which dealt with a special class of offenders like adolescent offenders but only to regulate capricious and arbitrary decisions under Section 432 of the Code and the remission rules sometimes reducing the sentence of imprisonment for life imposed on persons who had been convicted of capital offences but had been sentenced to imprisonment for life to short periods like five to six years.
" Under the Punjab Act, 'offence ' has been defined in section 2(4) to mean "an offence punishable with transportation or rigorous imprisonment under the Indian Penal Code other than (a) an offence punishable with death;." Hava Singh 's case did not refer to the definition of 'offence ' and relied upon the decision in the case of Ravi (supra) though the scheme of the Andhra Act was very different.
The Andhra Act known as the Andhra Pradesh Borstal Schools Act, 1925, does not have the definition of 'offence ' and there is no exclusion as provided in the Pun jab Act.
What is excepted in the definition is an offence which is punishable with death.
Section 302 of the Indian Penal Code provides: "Whoever commits murder shall be punished with death or imprisonment for life and shall also be liable to fine. " One of the punishments for the offence of murder is death and, therefore, the offence of murder would be covered within section 2(4)(i)(a) of the Punjab Act and to such a conviction the Punjab Borstal Act would have no application.
Support for such a view is available from 561 several decisions of different High Courts.
Section 562(1) of the Code A of Criminal Procedure of 1898 as amended in 1923 brought in the phrase: "Punishable with death or transportation for life".
In Emperor vs Mt. Janki & Anr., AIR 1932 Nag. 130 that phrase was interpreted disjunctively and women convicted of an offence for which transportation for life was one of the punishments provided were held ineligible for release on probation under section 562.
It was pointed out that the words 'death or transportation for life ' must be read as referring to offences the penalty for which provided by the Penal Code contains either death or transportation for life as one of the punishments awarded and not necessarily both.
Reliance was placed on a full Bench decision of the Rangoon High Court in King Emperor vs Nga San Htwa & Ors., AIR 1927 Rangoon 205 which was dealing with a similar phrase occurring in section 497 of the old Code.
A Division Bench of the Madhya Pradesh High Court in Chetti vs State of Madhya Pradesh, AIR 1959 MP 241 also took the same view.
In Emperor vs Bahawati, AIR 1928 Lahore 920 it was held that as one of the alternative punishments for that offence under section 307 of the Penal Code, is transportation for life, it is obvious that section 562 is not applicable and the accused must be sentenced to rigorous imprisonment and fine.
The Allahabad High Court in the case of State vs Sheo Shanker, AIR 1956 All. 326, the Madras High Court in Public Prosecutor of Madras vs Paneswar Rao, AIR 1946 Mad.
178, the Rajasthan High Court in Sarkar vs Jalam Singh, AIR 1950 Raj, 28 and the Bombay High Court in Naranji Premji vs Emperor, AIR 1928 Bom.
244 have taken the same view.
In Hava Singh 's case the definition was not placed for consideration before the Court and, therefore, the conclusion which has been reached is not correct.
The Punjab Borstal Act does not have application to an offence punishable under section 302 IPC.
therefore, the conclusion in Hava Singh 's case is not correct.
The petitioner is not entitled to the benefit of the Punjab Borstal Act as he has been sentenced to imprisonment for life for the offence of murder punishable under section 302 IPC for which the sentence of death is prescribed as an alternate.
The writ petition is dismissed.
P.S.S. Petition dismissed.
|
Writ Petition (CRL) No. 745 of 1987.
(Under Article 32 of the Constitution of India).
J.M. Khanna for the Petitioner Ravindra Bana, G. Venkatesh Rao and C.V. Subba Rao for the Respondents.
The following order of the Court was delivered: O R D E R The petitioner has been convicted for the offence of murder and sentenced to imprisonment for life.
He claims in this application under Article 32 of the Constitution the benefit of the Punjab Borstal Act and has placed reliance on a decision of this Court in the case of Hava Singh vs State of Haryana, AIR 1987 SC 2001.
A counter affidavit has been filed disputing the tenability of the claim.
In Hava Singh 's case (supra) a two Judge Bench (including one of us) was considering the claim of a convict for an offence of murder to release taking into account the period the prisoner had stayed in the Borstal institution.
In that case, it was observed: "It is evident from the averments made in the writ petition as well as in the said counter affidavit that the petitioner was admittedly adolescent at the time of his con 558 viction was sent to Borstal Institute at Hissar.
Subsequently, he has been transferred to the District Jail at Rohtak and is undergoing the sentence of imprisonment for life.
It appears from the objects and reasons of Punjab Borstal Act, 1926 that the object of the Act is to provide for segregation of adolescent prisoners from those of more mature age, and their subsequent training in separate institutions.
These Borstal Institutions meant for detaining adolescent offenders and to impart to them such industrial training and other instructions and subject them to such disciplinary and moral influence as will conduce to their reformation.
This is evident from the provisions of section 2(1) of Punjab Borstal Act, 1926.
Sub section (2) of section 2 defines detained as detained in and detention as detention in a Borstal Institution.
Section 5 of the said Act which is very vital for the purpose of decision of this case is quoted hereinbelow: '5.
Powers of courts to pass a sentence of detention in a Borstal Institution in the case of a convict under twenty one years of age in lieu of transportation or rigorous imprisonment (1) When any male person less than twenty one years of age is convicted of an offence by a court of sessions, a Magistrate specially empowered under section 30 of the Code of Criminal Procedure, 1898, or a Judicial Magistrate of the first class, or is ordered to give security for good behaviour and fails to give such security, and when by reason of this criminal habits or tendencies or associations with persons of bad character it is expedient in the opinion of the Judge or Magistrate, that he should be detained, such Judge or Magistrate may, in lieu of passing a sentence of transportation or rigorous imprisonment, pass an order of detention for a term which shall not be less than two years and shall not exceed seven years when the order is passed by a Court of sessions or a Magistrate specially empowered under section 30 of the Code of Criminal Procedure, 1898, and shall not be less than two years nor exceed three years, when the order is passed by a judicial magistrate of the first class not so empowered.
(2) . . . . . . . 559 (3). . . . . . . .
This court further stated: "The petitioner who was adolescent admittedly being less than twenty one years of age at the time of his conviction though convicted under Section 302/34 I.P.C. and sentenced to imprisonment for life, was sent to the Borstal Institute in accordance with the provisions of Punjab Borstal Act, 1926.
On his attaining the age of about twenty one years he was transferred back to the Jail.
There is no provision except section 20 under the said Act for transferring back an adolescent convict on his attaining the age of twenty one years from the Borstal Institute to Jail for undergoing the unexpired term of imprisonment.
The Court then referred to section 20 of the Act dealing with incorrigibles and observed: n "The section empowers the State Government to commute the residue of the term of detention of an inmate in Borstal Institute to such term of imprisonment of either description not exceeding the residue as the State Government may direct and also to order transfer of the inmate to any jail in Punjab in order to complete the said term of imprisomnent when such an inmate is reported to be incorrigible or is exercising bad influence on the other inmates of the Institution or such an inmate has committed a major Borstal Institution offence as provided in the rules.
" The Court then stated: "This Court while considering an indentical case in the State of Andhra Pradesh vs Vallabhapuram Ravi; , has observed that a person detained in a Borstal School under section 10 a has to be released after he has served the full term of 5 years of detention or on his completing 23 years of age.
He cannot be retransferred thereafter to prison.
Such a retransfer would defeat the very object and purpose of the Act of providing for detention of young offenders in Borstal School for the purpose of reformation and rehabilitation of such offenders '.
It is to be 560 noted in this connection that sentence of detention is passed in lieu of sentence of imprisonment which may have been passed.
Hence the detention order under section S of the said Act is not imprisonment and Borstal School where the adolescent offender is detained is not a prison.
It has also been observed further that section 433 A, Cr.
P.C. would not operate where a person is detained by an order under section 10 a of the Act.
Section 433 A of the Code was introduced not to set at naught provisions like 10 A of the Act which dealt with a special class of offenders like adolescent offenders but only to regulate capricious and arbitrary decisions under Section 432 of the Code and the remission rules sometimes reducing the sentence of imprisonment for life imposed on persons who had been convicted of capital offences but had been sentenced to imprisonment for life to short periods like five to six years.
" Under the Punjab Act, 'offence ' has been defined in section 2(4) to mean "an offence punishable with transportation or rigorous imprisonment under the Indian Penal Code other than (a) an offence punishable with death;." Hava Singh 's case did not refer to the definition of 'offence ' and relied upon the decision in the case of Ravi (supra) though the scheme of the Andhra Act was very different.
The Andhra Act known as the Andhra Pradesh Borstal Schools Act, 1925, does not have the definition of 'offence ' and there is no exclusion as provided in the Pun jab Act.
What is excepted in the definition is an offence which is punishable with death.
Section 302 of the Indian Penal Code provides: "Whoever commits murder shall be punished with death or imprisonment for life and shall also be liable to fine. " One of the punishments for the offence of murder is death and, therefore, the offence of murder would be covered within section 2(4)(i)(a) of the Punjab Act and to such a conviction the Punjab Borstal Act would have no application.
Support for such a view is available from 561 several decisions of different High Courts.
Section 562(1) of the Code A of Criminal Procedure of 1898 as amended in 1923 brought in the phrase: "Punishable with death or transportation for life".
In Emperor vs Mt. Janki & Anr., AIR 1932 Nag. 130 that phrase was interpreted disjunctively and women convicted of an offence for which transportation for life was one of the punishments provided were held ineligible for release on probation under section 562.
It was pointed out that the words 'death or transportation for life ' must be read as referring to offences the penalty for which provided by the Penal Code contains either death or transportation for life as one of the punishments awarded and not necessarily both.
Reliance was placed on a full Bench decision of the Rangoon High Court in King Emperor vs Nga San Htwa & Ors., AIR 1927 Rangoon 205 which was dealing with a similar phrase occurring in section 497 of the old Code.
A Division Bench of the Madhya Pradesh High Court in Chetti vs State of Madhya Pradesh, AIR 1959 MP 241 also took the same view.
In Emperor vs Bahawati, AIR 1928 Lahore 920 it was held that as one of the alternative punishments for that offence under section 307 of the Penal Code, is transportation for life, it is obvious that section 562 is not applicable and the accused must be sentenced to rigorous imprisonment and fine.
The Allahabad High Court in the case of State vs Sheo Shanker, AIR 1956 All. 326, the Madras High Court in Public Prosecutor of Madras vs Paneswar Rao, AIR 1946 Mad.
178, the Rajasthan High Court in Sarkar vs Jalam Singh, AIR 1950 Raj, 28 and the Bombay High Court in Naranji Premji vs Emperor, AIR 1928 Bom.
244 have taken the same view.
In Hava Singh 's case the definition was not placed for consideration before the Court and, therefore, the conclusion which has been reached is not correct.
The Punjab Borstal Act does not have application to an offence punishable under section 302 IPC.
therefore, the conclusion in Hava Singh 's case is not correct.
The petitioner is not entitled to the benefit of the Punjab Borstal Act as he has been sentenced to imprisonment for life for the offence of murder punishable under section 302 IPC for which the sentence of death is prescribed as an alternate.
The writ petition is dismissed.
P.S.S. Petition dismissed.
|
% Sectlon 5 of the Punjab Borstal Act, 1926 empowers courts to pass a sentence of detention in a Borstal institution in the case of male persons less than twenty one years of age convicted of an offence, in lieu of transportation or rigorous imprisonment.
Section 2(4)(i)(a) of the Act which defines 'offence ' takes in offences other than an offence punishable with death.
In his writ petition under Article 32 of the Constitution, the petitioner who has been convicted for the offence of murder and sentenced to imprisonment for life claimed benefit of the Punjab Borstal Act relying on Hava Singh vs State of Haryana, AIR 1987 SC 2001.
The State contested his claim Dismissing the writ petition. ^ HELD: l. l The Punjab Borstal Act does not have application to an offence punishable under section 302 I.P.C.[561F G] 1.2 What is excepted in the definition of 'offence ' in section 2(4)(i)(a) of the Act is an offence which is punishable with death.
One of the punishments under section 302 I.P.C. for the offence of murder is death, and.
therefore, the offence of murder would be covered with section 2(4)(i)(a) of the Act and to such a conviction the Punjab Borstal Act would have no application.
[560F G] 1.3 The petitioner is, therefore, not entitled to the benefit of the Punjab Borstal Act as he has been sentenced to imprisonment for life for the offence of murder punishable under section 302 I.P.C. for which the sentence of death is prescribed as an alternate.
[561G] 557 1.4 In Hava Singh 's, case the definition of offence was not placed for consideration before the court and, therefore, the conclusion which has been reached is not correct.
[561F] Emperor vs Mt. Janki & Anr., AIR 1932 Nag. 130; King Emperor vs Nga San Htwa & Ors., AIR 1927 Rangoon 205; Chetti vs State of Madhya Pradesh, AIR 1959 MP 291; Emperor vs Bahawati, AIR 1928 Lahore 920; State vs Sheo Shankar, AIR 1956 All. 326; Public Prosecutor of Madras vs Paneswar Rao, AIR 1946 Mad. 178; Sarkar vs Jalam Singh, AIR 1950 Raj.
28 and Narauji Premji vs Emperor, AIR 1928 Bom.
referred to.
Hava Singh vs State of Haryana, AIR 1987 SC 2001 overruled.
|
% Sectlon 5 of the Punjab Borstal Act, 1926 empowers courts to pass a sentence of detention in a Borstal institution in the case of male persons less than twenty one years of age convicted of an offence, in lieu of transportation or rigorous imprisonment.
Section 2(4)(i)(a) of the Act which defines 'offence ' takes in offences other than an offence punishable with death.
In his writ petition under Article 32 of the Constitution, the petitioner who has been convicted for the offence of murder and sentenced to imprisonment for life claimed benefit of the Punjab Borstal Act relying on Hava Singh vs State of Haryana, AIR 1987 SC 2001.
The State contested his claim Dismissing the writ petition. ^ HELD: l. l The Punjab Borstal Act does not have application to an offence punishable under section 302 I.P.C.[561F G] 1.2 What is excepted in the definition of 'offence ' in section 2(4)(i)(a) of the Act is an offence which is punishable with death.
One of the punishments under section 302 I.P.C. for the offence of murder is death, and.
therefore, the offence of murder would be covered with section 2(4)(i)(a) of the Act and to such a conviction the Punjab Borstal Act would have no application.
[560F G] 1.3 The petitioner is, therefore, not entitled to the benefit of the Punjab Borstal Act as he has been sentenced to imprisonment for life for the offence of murder punishable under section 302 I.P.C. for which the sentence of death is prescribed as an alternate.
[561G] 557 1.4 In Hava Singh 's, case the definition of offence was not placed for consideration before the court and, therefore, the conclusion which has been reached is not correct.
[561F] Emperor vs Mt. Janki & Anr., AIR 1932 Nag. 130; King Emperor vs Nga San Htwa & Ors., AIR 1927 Rangoon 205; Chetti vs State of Madhya Pradesh, AIR 1959 MP 291; Emperor vs Bahawati, AIR 1928 Lahore 920; State vs Sheo Shankar, AIR 1956 All. 326; Public Prosecutor of Madras vs Paneswar Rao, AIR 1946 Mad. 178; Sarkar vs Jalam Singh, AIR 1950 Raj.
28 and Narauji Premji vs Emperor, AIR 1928 Bom.
referred to.
Hava Singh vs State of Haryana, AIR 1987 SC 2001 overruled.
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ivil Appeal No. 2873 of 1987.
From the Judgment and Order dated 5.8.1987 of the Punjab & Haryana High Court in Civil Revision No. 2209 of 1979.
Harbans Lal, S.K. Mehta, Dhruv Mehta and Aman Vachher for the Appellant.
Rajinder Sachhar, K.C. Dua and Ms. Manju Chopra for the Respondent.
N.S. Das Behl, (Not present) The Judgment of the Court was delivered by 425 RANGANATH MISRA, J.
This is a tenant 's appeal by special leave challenging his eviction from a business premises located at Jallandhar.
Under a rent note (Exh.
A I), the appellant had taken the premises on rent from the respondent landlord.
The use to which the premises was intended to be put was running of a cycle and rickshaw repairing shop.
As far as relevant, on the allegation that the tenant had put the premises to different use, an application for his eviction was made under section 13(2)(ii)(b) of the East Punjab Urban Rent Restric tion Act, 1949.
The Controller found that the appellant had continued the business of repairing of cycles and rickshaws but side by side had for a period of about seven months been selling televisions in the premises but he stopped the same as it was not viable.
According to the Controller, this did not constitute user for a purpose other than that for which the premises was leased and he accordingly rejected the peti tion.
The appellate authority at the landlord 's instance held that the statutory condition was satisfied and granted eviction.
The High Court when moved by the tenant declined to interfere.
The short question that arises for consideration is whether there has been a violation of the terms of tenancy by using the premises for a purpose other than that for which the premises had been leased.
The tenant did not dispute that he had taken the premises for running a repair shop of cycles and rickshaws.
In his statement he said that he had commenced the business of selling the televisions side by side in view of the slump in the cycle and rickshaw repairing business.
He also accepted the position that he had not obtained the consent of the landlord when he started the TV business.
The landlord has accepted the position that in the rent note it was not written that the respondent would not do any business in the shop in dispute except the cycle or rickshaw repairs.
On these facts it has now to be decided as to whether the premises has been used for a purpose other than that for which it had been leased.
Reliance was placed on the Full Bench decision of the Punjab High court in Des Raj vs Sham Lal, AIR 1980 P & H 229 where the question for consideration was as to whether when the lease was for the purpose of a shop without anything more specific, user thereof as a godown amounted to change of user.
The High Court in course of the discussion in the judgment rightly drew the distinction between resi 426 dential and non residential premises and also classified non residential buildings into known categories like shop, godown, restaurant, cinema, hotel etc.
In course of the discussion the Full Bench referred to the decision of this Court in Moti Ram vs State of Madhya Pradesh, ; and came to the conclusion that when the letting out purpose was location of a shop and it .was exclusively used as a godown, it amounted to a change of user.
Not much of support is directly available for the resolution of the present dispute from that judgment.
Reliance was also placed on a decision of this Court in the case of Mohan Lal vs Jai Bhagwan, ; where the very provision of the East Punjab Act was considered in a case of eviction.
The decision of this Court in the case of Maharaj Kishan Kesar vs Milkha Singh, (C.A. No. 1086/64 decided on November 10, 1965) was referred to therein.
That again was a decision under the very Act and the dispute related to the allegation of change of user when petrol was sold as an allied business of the avowed purpose of locating the workshop.
The Court found.
that location of a petrol pump could not be regarded as not being a part of motor workshop business.
Rightly, our learned brother Mukharji, J. indicated that the ratio in Maharaj Kishan Kesar 's case did not provide any guideline of general nature.
What was said in pars 9 of his judgment is perhaps useful.
Our learned Brother quoted the observations of Lord Diplock, J. in Duport Steels Ltd. vs Sirs, and said: "While respectfully agreeing with the said observations of Lord Diplock, that the; Par liament Legislates to remedy and the judiciary interprets them, it has to be borne in mind that the meaning of the expression must be found in the felt necessities of the time.
In the background of the purpose of rent legisla tion and inasmuch as in the instant case the change of the user would not cause any mis chief or detriment or impairment of the shop in question and in one sense could be called an allied business in the expanding concept of departmental stores, in our opinion, in this case there was no change of user which at tracted the mischief of section 13(2)(ii)(b).
" On that conclusion, the order of eviction was reversed.
Letting of a premises can broadly be for residential or commercial purpose.
The restriction which is statutorily.
provided in section 13(2)(ii)(b) of the Act is obviously one to protect the interests of the landlord .and is intended to restrict the use of the landlord 's premises 427 taken by the tenant under lease.
It is akin to the provision contained in section 108(0) of the dealing with the obligations of a lessee.
That clause pro vides: 'The lessee may use the property and its products, if.
any, as a person of ordinary prudence would use then if they were of his own; but be must not use or permit another to use the property for a purpose other than that for which it was leased . ' A house let for residential purpose would not be available for being used as a shop even without structural alteration.
The concept of injury to the premises which forms the foundation of cl.
(o) is the main basis for providing cl.(b) in section 13(2)(ii) of the Act as a ground for the tenant 's eviction.
The Privy Council in U Po Naing vs Burma Oil Co., AIR 1929 PC 108 adopted the same considera tion.
The Kerala High Court has held that premises let out for conducting trade in gold if also used for a wine store would not amount to an act destructive of or permanently injurious to the leased property Simi larly, the Bombay High Court has held that when the lease deed provided for user of the premises for business of fret work and the lessee used the premises for business in plas tic goods, change in the nature of business did not bring about change of user as contemplated in section 108(o) of the The landlord parts with possession of the premises by giving a lease of the property to the tenant for a consider ation.
Ordinarily, as long as the interest of the landlord is not prejudiced, a small change in the user would not be actionable.
In this case, the premises was let out for running of a repair shop.
Along with the repair business, sale of televi sions was temporarily .carried on.
We do not think this constituted a change of user within the meaning of section 13(2)(ii)(b) of the Act so as to give a cause of action to the landlord to seek eviction of the tenant.
The appeal is allowed and the order of eviction passed by the appellate authority and affirmed by the High Court is vacated and the order of the Controller is restored.
Parties are directed to bear their own costs throughout.
T.N.A. Appeal allowed.
|
The appellant had taken the premises on rent from the respondent landlord for running a cycle and rickshaw repair ing shop.
In the rent note there was no stipulation that the appellant would not do any business in the shop except the cycle or rickshaw repairs.
Along with the repair business the appellant temporarily carried on sale of televisions also in the premises.
The landlord filed an application for eviction under section 13(2)(ii)(b) of the East Punjab Urban Rent Restriction Act, 1949 alleging that the tenant had put the premises to different use.
The Rent Controller rejected the application by holding that the temporary sale of televisions did not constitute user for a purpose other than that for which the premises was leased.
On an appeal filed by the landlord the appellate authority granted eviction by holding that the statutory condition was satisfied.
The appeal filed by the tenant against the decision of the appellate authority was dis missed by the High Court.
Hence this appeal by the tenant.
Allowing the appeal and setting aside the order of eviction, HELD: Letting of a premises can broadly be for residen tial or commercial purpose.
The restriction which is statu torily provided in section 13(2)(ii)(b) of the Act is obvi ously one to protect the interests of the landlord and is intended to restrict the use of landlord 's premises taken by the tenant under lease.
It is akin to the provision con tained in section 108(o) of the dealing with the obliga 424 tions of a lessee.
A house let for residential purpose would not be available for being used as a shop even without structural alteration.
The concept of injury to the premises which forms the foundation of clause (o) is the main basis for providing clause (b) in section 13(2)(ii) of the Act as a ground for the tenant 's eviction.
[426H, 427A B] The landlord parts with possession of the premises by giving a lease of the property to the tenant for a consider ation.
Ordinarily, as long as the interest of the landlord is not prejudiced, a small change in the user would not be actionable.
In the instant case, the premises was let out for running of a repair shop.
Along with the repair busi ness, sale of televisions was temporarily carried on.
This did not constitute a change of user within the meaning of section 13(2)(ii)(b) of the Act so as to give a cause of action to the landlord to seek eviction of the tenant.
[427E, F] Mohan Lal vs Jai Bhagwan, ; , applied.
Des Raj vs Sham Lal, A.I.R. 1980 P & H 229, held inapplica ble.
Moti Ram vs State of Mahdya Pradesh, A.I.R. 1978 S.C. 1594; Maharaj Krishan Kesar vs Milkha Singh, Civil Appeal No. 1086 of 1964 decided on November 10, 1965 (S.C.); Dup port Steel Ltd. vs Sirs, ; U.P. Naing vs Burma Oil Co., A.I.R. 1929 P.C. 108; Raghavan Pillai vs Sainaba Beevi, [1977] Kerala L.T. 417 and Dattatraya vs Gulab Rao, , referred to.
|
ivil Appeal No. 2873 of 1987.
From the Judgment and Order dated 5.8.1987 of the Punjab & Haryana High Court in Civil Revision No. 2209 of 1979.
Harbans Lal, S.K. Mehta, Dhruv Mehta and Aman Vachher for the Appellant.
Rajinder Sachhar, K.C. Dua and Ms. Manju Chopra for the Respondent.
N.S. Das Behl, (Not present) The Judgment of the Court was delivered by 425 RANGANATH MISRA, J.
This is a tenant 's appeal by special leave challenging his eviction from a business premises located at Jallandhar.
Under a rent note (Exh.
A I), the appellant had taken the premises on rent from the respondent landlord.
The use to which the premises was intended to be put was running of a cycle and rickshaw repairing shop.
As far as relevant, on the allegation that the tenant had put the premises to different use, an application for his eviction was made under section 13(2)(ii)(b) of the East Punjab Urban Rent Restric tion Act, 1949.
The Controller found that the appellant had continued the business of repairing of cycles and rickshaws but side by side had for a period of about seven months been selling televisions in the premises but he stopped the same as it was not viable.
According to the Controller, this did not constitute user for a purpose other than that for which the premises was leased and he accordingly rejected the peti tion.
The appellate authority at the landlord 's instance held that the statutory condition was satisfied and granted eviction.
The High Court when moved by the tenant declined to interfere.
The short question that arises for consideration is whether there has been a violation of the terms of tenancy by using the premises for a purpose other than that for which the premises had been leased.
The tenant did not dispute that he had taken the premises for running a repair shop of cycles and rickshaws.
In his statement he said that he had commenced the business of selling the televisions side by side in view of the slump in the cycle and rickshaw repairing business.
He also accepted the position that he had not obtained the consent of the landlord when he started the TV business.
The landlord has accepted the position that in the rent note it was not written that the respondent would not do any business in the shop in dispute except the cycle or rickshaw repairs.
On these facts it has now to be decided as to whether the premises has been used for a purpose other than that for which it had been leased.
Reliance was placed on the Full Bench decision of the Punjab High court in Des Raj vs Sham Lal, AIR 1980 P & H 229 where the question for consideration was as to whether when the lease was for the purpose of a shop without anything more specific, user thereof as a godown amounted to change of user.
The High Court in course of the discussion in the judgment rightly drew the distinction between resi 426 dential and non residential premises and also classified non residential buildings into known categories like shop, godown, restaurant, cinema, hotel etc.
In course of the discussion the Full Bench referred to the decision of this Court in Moti Ram vs State of Madhya Pradesh, ; and came to the conclusion that when the letting out purpose was location of a shop and it .was exclusively used as a godown, it amounted to a change of user.
Not much of support is directly available for the resolution of the present dispute from that judgment.
Reliance was also placed on a decision of this Court in the case of Mohan Lal vs Jai Bhagwan, ; where the very provision of the East Punjab Act was considered in a case of eviction.
The decision of this Court in the case of Maharaj Kishan Kesar vs Milkha Singh, (C.A. No. 1086/64 decided on November 10, 1965) was referred to therein.
That again was a decision under the very Act and the dispute related to the allegation of change of user when petrol was sold as an allied business of the avowed purpose of locating the workshop.
The Court found.
that location of a petrol pump could not be regarded as not being a part of motor workshop business.
Rightly, our learned brother Mukharji, J. indicated that the ratio in Maharaj Kishan Kesar 's case did not provide any guideline of general nature.
What was said in pars 9 of his judgment is perhaps useful.
Our learned Brother quoted the observations of Lord Diplock, J. in Duport Steels Ltd. vs Sirs, and said: "While respectfully agreeing with the said observations of Lord Diplock, that the; Par liament Legislates to remedy and the judiciary interprets them, it has to be borne in mind that the meaning of the expression must be found in the felt necessities of the time.
In the background of the purpose of rent legisla tion and inasmuch as in the instant case the change of the user would not cause any mis chief or detriment or impairment of the shop in question and in one sense could be called an allied business in the expanding concept of departmental stores, in our opinion, in this case there was no change of user which at tracted the mischief of section 13(2)(ii)(b).
" On that conclusion, the order of eviction was reversed.
Letting of a premises can broadly be for residential or commercial purpose.
The restriction which is statutorily.
provided in section 13(2)(ii)(b) of the Act is obviously one to protect the interests of the landlord .and is intended to restrict the use of the landlord 's premises 427 taken by the tenant under lease.
It is akin to the provision contained in section 108(0) of the dealing with the obligations of a lessee.
That clause pro vides: 'The lessee may use the property and its products, if.
any, as a person of ordinary prudence would use then if they were of his own; but be must not use or permit another to use the property for a purpose other than that for which it was leased . ' A house let for residential purpose would not be available for being used as a shop even without structural alteration.
The concept of injury to the premises which forms the foundation of cl.
(o) is the main basis for providing cl.(b) in section 13(2)(ii) of the Act as a ground for the tenant 's eviction.
The Privy Council in U Po Naing vs Burma Oil Co., AIR 1929 PC 108 adopted the same considera tion.
The Kerala High Court has held that premises let out for conducting trade in gold if also used for a wine store would not amount to an act destructive of or permanently injurious to the leased property Simi larly, the Bombay High Court has held that when the lease deed provided for user of the premises for business of fret work and the lessee used the premises for business in plas tic goods, change in the nature of business did not bring about change of user as contemplated in section 108(o) of the The landlord parts with possession of the premises by giving a lease of the property to the tenant for a consider ation.
Ordinarily, as long as the interest of the landlord is not prejudiced, a small change in the user would not be actionable.
In this case, the premises was let out for running of a repair shop.
Along with the repair business, sale of televi sions was temporarily .carried on.
We do not think this constituted a change of user within the meaning of section 13(2)(ii)(b) of the Act so as to give a cause of action to the landlord to seek eviction of the tenant.
The appeal is allowed and the order of eviction passed by the appellate authority and affirmed by the High Court is vacated and the order of the Controller is restored.
Parties are directed to bear their own costs throughout.
T.N.A. Appeal allowed.
|
ivil Appeal No. 2873 of 1987.
From the Judgment and Order dated 5.8.1987 of the Punjab & Haryana High Court in Civil Revision No. 2209 of 1979.
Harbans Lal, S.K. Mehta, Dhruv Mehta and Aman Vachher for the Appellant.
Rajinder Sachhar, K.C. Dua and Ms. Manju Chopra for the Respondent.
N.S. Das Behl, (Not present) The Judgment of the Court was delivered by 425 RANGANATH MISRA, J.
This is a tenant 's appeal by special leave challenging his eviction from a business premises located at Jallandhar.
Under a rent note (Exh.
A I), the appellant had taken the premises on rent from the respondent landlord.
The use to which the premises was intended to be put was running of a cycle and rickshaw repairing shop.
As far as relevant, on the allegation that the tenant had put the premises to different use, an application for his eviction was made under section 13(2)(ii)(b) of the East Punjab Urban Rent Restric tion Act, 1949.
The Controller found that the appellant had continued the business of repairing of cycles and rickshaws but side by side had for a period of about seven months been selling televisions in the premises but he stopped the same as it was not viable.
According to the Controller, this did not constitute user for a purpose other than that for which the premises was leased and he accordingly rejected the peti tion.
The appellate authority at the landlord 's instance held that the statutory condition was satisfied and granted eviction.
The High Court when moved by the tenant declined to interfere.
The short question that arises for consideration is whether there has been a violation of the terms of tenancy by using the premises for a purpose other than that for which the premises had been leased.
The tenant did not dispute that he had taken the premises for running a repair shop of cycles and rickshaws.
In his statement he said that he had commenced the business of selling the televisions side by side in view of the slump in the cycle and rickshaw repairing business.
He also accepted the position that he had not obtained the consent of the landlord when he started the TV business.
The landlord has accepted the position that in the rent note it was not written that the respondent would not do any business in the shop in dispute except the cycle or rickshaw repairs.
On these facts it has now to be decided as to whether the premises has been used for a purpose other than that for which it had been leased.
Reliance was placed on the Full Bench decision of the Punjab High court in Des Raj vs Sham Lal, AIR 1980 P & H 229 where the question for consideration was as to whether when the lease was for the purpose of a shop without anything more specific, user thereof as a godown amounted to change of user.
The High Court in course of the discussion in the judgment rightly drew the distinction between resi 426 dential and non residential premises and also classified non residential buildings into known categories like shop, godown, restaurant, cinema, hotel etc.
In course of the discussion the Full Bench referred to the decision of this Court in Moti Ram vs State of Madhya Pradesh, ; and came to the conclusion that when the letting out purpose was location of a shop and it .was exclusively used as a godown, it amounted to a change of user.
Not much of support is directly available for the resolution of the present dispute from that judgment.
Reliance was also placed on a decision of this Court in the case of Mohan Lal vs Jai Bhagwan, ; where the very provision of the East Punjab Act was considered in a case of eviction.
The decision of this Court in the case of Maharaj Kishan Kesar vs Milkha Singh, (C.A. No. 1086/64 decided on November 10, 1965) was referred to therein.
That again was a decision under the very Act and the dispute related to the allegation of change of user when petrol was sold as an allied business of the avowed purpose of locating the workshop.
The Court found.
that location of a petrol pump could not be regarded as not being a part of motor workshop business.
Rightly, our learned brother Mukharji, J. indicated that the ratio in Maharaj Kishan Kesar 's case did not provide any guideline of general nature.
What was said in pars 9 of his judgment is perhaps useful.
Our learned Brother quoted the observations of Lord Diplock, J. in Duport Steels Ltd. vs Sirs, and said: "While respectfully agreeing with the said observations of Lord Diplock, that the; Par liament Legislates to remedy and the judiciary interprets them, it has to be borne in mind that the meaning of the expression must be found in the felt necessities of the time.
In the background of the purpose of rent legisla tion and inasmuch as in the instant case the change of the user would not cause any mis chief or detriment or impairment of the shop in question and in one sense could be called an allied business in the expanding concept of departmental stores, in our opinion, in this case there was no change of user which at tracted the mischief of section 13(2)(ii)(b).
" On that conclusion, the order of eviction was reversed.
Letting of a premises can broadly be for residential or commercial purpose.
The restriction which is statutorily.
provided in section 13(2)(ii)(b) of the Act is obviously one to protect the interests of the landlord .and is intended to restrict the use of the landlord 's premises 427 taken by the tenant under lease.
It is akin to the provision contained in section 108(0) of the dealing with the obligations of a lessee.
That clause pro vides: 'The lessee may use the property and its products, if.
any, as a person of ordinary prudence would use then if they were of his own; but be must not use or permit another to use the property for a purpose other than that for which it was leased . ' A house let for residential purpose would not be available for being used as a shop even without structural alteration.
The concept of injury to the premises which forms the foundation of cl.
(o) is the main basis for providing cl.(b) in section 13(2)(ii) of the Act as a ground for the tenant 's eviction.
The Privy Council in U Po Naing vs Burma Oil Co., AIR 1929 PC 108 adopted the same considera tion.
The Kerala High Court has held that premises let out for conducting trade in gold if also used for a wine store would not amount to an act destructive of or permanently injurious to the leased property Simi larly, the Bombay High Court has held that when the lease deed provided for user of the premises for business of fret work and the lessee used the premises for business in plas tic goods, change in the nature of business did not bring about change of user as contemplated in section 108(o) of the The landlord parts with possession of the premises by giving a lease of the property to the tenant for a consider ation.
Ordinarily, as long as the interest of the landlord is not prejudiced, a small change in the user would not be actionable.
In this case, the premises was let out for running of a repair shop.
Along with the repair business, sale of televi sions was temporarily .carried on.
We do not think this constituted a change of user within the meaning of section 13(2)(ii)(b) of the Act so as to give a cause of action to the landlord to seek eviction of the tenant.
The appeal is allowed and the order of eviction passed by the appellate authority and affirmed by the High Court is vacated and the order of the Controller is restored.
Parties are directed to bear their own costs throughout.
T.N.A. Appeal allowed.
|
The appellant had taken the premises on rent from the respondent landlord for running a cycle and rickshaw repair ing shop.
In the rent note there was no stipulation that the appellant would not do any business in the shop except the cycle or rickshaw repairs.
Along with the repair business the appellant temporarily carried on sale of televisions also in the premises.
The landlord filed an application for eviction under section 13(2)(ii)(b) of the East Punjab Urban Rent Restriction Act, 1949 alleging that the tenant had put the premises to different use.
The Rent Controller rejected the application by holding that the temporary sale of televisions did not constitute user for a purpose other than that for which the premises was leased.
On an appeal filed by the landlord the appellate authority granted eviction by holding that the statutory condition was satisfied.
The appeal filed by the tenant against the decision of the appellate authority was dis missed by the High Court.
Hence this appeal by the tenant.
Allowing the appeal and setting aside the order of eviction, HELD: Letting of a premises can broadly be for residen tial or commercial purpose.
The restriction which is statu torily provided in section 13(2)(ii)(b) of the Act is obvi ously one to protect the interests of the landlord and is intended to restrict the use of landlord 's premises taken by the tenant under lease.
It is akin to the provision con tained in section 108(o) of the dealing with the obliga 424 tions of a lessee.
A house let for residential purpose would not be available for being used as a shop even without structural alteration.
The concept of injury to the premises which forms the foundation of clause (o) is the main basis for providing clause (b) in section 13(2)(ii) of the Act as a ground for the tenant 's eviction.
[426H, 427A B] The landlord parts with possession of the premises by giving a lease of the property to the tenant for a consider ation.
Ordinarily, as long as the interest of the landlord is not prejudiced, a small change in the user would not be actionable.
In the instant case, the premises was let out for running of a repair shop.
Along with the repair busi ness, sale of televisions was temporarily carried on.
This did not constitute a change of user within the meaning of section 13(2)(ii)(b) of the Act so as to give a cause of action to the landlord to seek eviction of the tenant.
[427E, F] Mohan Lal vs Jai Bhagwan, ; , applied.
Des Raj vs Sham Lal, A.I.R. 1980 P & H 229, held inapplica ble.
Moti Ram vs State of Mahdya Pradesh, A.I.R. 1978 S.C. 1594; Maharaj Krishan Kesar vs Milkha Singh, Civil Appeal No. 1086 of 1964 decided on November 10, 1965 (S.C.); Dup port Steel Ltd. vs Sirs, ; U.P. Naing vs Burma Oil Co., A.I.R. 1929 P.C. 108; Raghavan Pillai vs Sainaba Beevi, [1977] Kerala L.T. 417 and Dattatraya vs Gulab Rao, , referred to.
|
The appellant had taken the premises on rent from the respondent landlord for running a cycle and rickshaw repair ing shop.
In the rent note there was no stipulation that the appellant would not do any business in the shop except the cycle or rickshaw repairs.
Along with the repair business the appellant temporarily carried on sale of televisions also in the premises.
The landlord filed an application for eviction under section 13(2)(ii)(b) of the East Punjab Urban Rent Restriction Act, 1949 alleging that the tenant had put the premises to different use.
The Rent Controller rejected the application by holding that the temporary sale of televisions did not constitute user for a purpose other than that for which the premises was leased.
On an appeal filed by the landlord the appellate authority granted eviction by holding that the statutory condition was satisfied.
The appeal filed by the tenant against the decision of the appellate authority was dis missed by the High Court.
Hence this appeal by the tenant.
Allowing the appeal and setting aside the order of eviction, HELD: Letting of a premises can broadly be for residen tial or commercial purpose.
The restriction which is statu torily provided in section 13(2)(ii)(b) of the Act is obvi ously one to protect the interests of the landlord and is intended to restrict the use of landlord 's premises taken by the tenant under lease.
It is akin to the provision con tained in section 108(o) of the dealing with the obliga 424 tions of a lessee.
A house let for residential purpose would not be available for being used as a shop even without structural alteration.
The concept of injury to the premises which forms the foundation of clause (o) is the main basis for providing clause (b) in section 13(2)(ii) of the Act as a ground for the tenant 's eviction.
[426H, 427A B] The landlord parts with possession of the premises by giving a lease of the property to the tenant for a consider ation.
Ordinarily, as long as the interest of the landlord is not prejudiced, a small change in the user would not be actionable.
In the instant case, the premises was let out for running of a repair shop.
Along with the repair busi ness, sale of televisions was temporarily carried on.
This did not constitute a change of user within the meaning of section 13(2)(ii)(b) of the Act so as to give a cause of action to the landlord to seek eviction of the tenant.
[427E, F] Mohan Lal vs Jai Bhagwan, ; , applied.
Des Raj vs Sham Lal, A.I.R. 1980 P & H 229, held inapplica ble.
Moti Ram vs State of Mahdya Pradesh, A.I.R. 1978 S.C. 1594; Maharaj Krishan Kesar vs Milkha Singh, Civil Appeal No. 1086 of 1964 decided on November 10, 1965 (S.C.); Dup port Steel Ltd. vs Sirs, ; U.P. Naing vs Burma Oil Co., A.I.R. 1929 P.C. 108; Raghavan Pillai vs Sainaba Beevi, [1977] Kerala L.T. 417 and Dattatraya vs Gulab Rao, , referred to.
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ivil Appeal Nos.
953 954 (NT)/ 1975.
From the Judgment and order dated the 15th February 1974 of the High Court of Allahabad in Civil Misc.
Writ Petitions Nos. 6904 and 6906 of 1973.
S.C. Manchanda and A.K. Srivastava for the Appellants.
Harish N. Salve, Mrs. A.K. Verma, J. Peres and D.N. Mishra for the Respondent.
The Judgment of the Court was delivered by RANGANATHAN, J.
These are two appeals by certificate from the common order.
dated 15.2.74, of the Allahabad High Court in Civil Miscellaneous Petition Nos.
6904 and 6906 of 1973.
They can be disposed of together since the question raised is the same.
This common question arises out of the assessment to central sales tax of the respondent, oriental Coal Corporation of Moradabad (hereinafter referred to as the assessee), for the assessment year 1967 68 and 196869.
The relevant facts bearing on the controversy may be briefly stated.
The assessee is a firm of coal merchants with its place of business in Jharia (Bihar State) and an office at Moradabad (in U.P.).
It is not registered either under the Central or the State Sales Tax Act.
According to the assessee it places orders for coal on the collieries at Jharia on behalf of constituents in Uttar Pradesh, realises the sale proceeds and remits the same to Jharia.
The Sales Tax officer assessed the assessee to sales tax in respect of the turnover of the coal thus 565 supplied by the assessee.
The assessee filed two writ petitions alleging that the assessment orders were without jurisdiction on several grounds.
The High Court allowed the writ petitions on one of these grounds and hence did not go into the other contentions.
It referred to section 9 of the , as it stood at the relevant time, and held that the provision cast a liability to tax only on a registered dealer and not an unregistered dealer like the assessee.
It is the correctness of this decision that is challenged in the present appeals.
Section 9 relied upon by the High Court, reads thus: 3.
"9.(1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter state trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provisions of subsection (2), in the State from which the movement of the goods commenced.
Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such sale does not fall within subsection (2) of section 6, be levied and collected in the State from which the registered dealer effecting the subsequent sale obtained or, as the case may be, could have obtained, the form prescribed for the purpose of clause (a) of subsection (4) of section 8 in connection with the purchase of such goods.
(2) Subject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, re assess, collect and enforce payment of any tax under general sales tax law of the appropriate State shall, on behalf of the Government of India, assess, re assess, collect and enforce payment of tax, including any penalty, payable by a dealer under this Act as if the tax or penalty payable by such a dealer under this Act is a tax or penalty payable under the general sales tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the Provisions of such law, including provi 566 sions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of or successor to such business transfer of liability of any fir n or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appe als, reviews, revisions, references, 3(refunds, rebates, penal ties) compounding of offences and treatment of documents furnished by a dealer as confidential, shall apply accordingly: Provided that if in any State or part thereof there is no general sales tax law in force, the Central Government may, by rules made in this behalf make necessary provision for all or any of the matters specified in this sub section.
" The High Court pointed out that, under the terms of the section, tax on sales of goods effected by a dealer in the course of inter state trade or commerce shall be levied in the State from which the movement of the goods commenced: in this case, the State of Bihar.
The proviso, however, carves out an exception.
It provides that, if there is a subseq uent sale of the same goods in the course of their movement from one State to another and such sale is effected by a registered dealer, tax can be levied and collected in the State from which such dealer obtained or could have obtained the forms prescribed under section 8(4)(a) (popularly known as 'the Form '): in this case, the State of Uttar Pradesh.
But, the High Court pointed out, the assessee was not a registered dealer and so there was no scope for his being taxed in the State of U.P.
The High Court accordingly quashed the assessments in question and hence these appeals by the State.
We may at once say that the conclusion of the High Court is unassailable in view of the decision of this Court in State vs Kasturi Lal Harlal, 3 S.C. 234 affirming the view taken on this issue by the Allahabad High Court in an earlier case Kasturilal Harlal vs State, [1972] 29 STC 495.
Shri Manchanda, however, submits that this view can no longer hold the field in view of a retrospective amendment of the by the Central Sales Tax (Amendment) Act No. 103 of 1976.
Two provisions of this Amendment Act may be extracted: "6.
Amendment of section 9.
In section 9 of the Principal Act (a) in sub section (1) for proviso, the following pro 567 viso shall be substituted, namely.
A "Provided that, in the case of sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods and being also a sale which does not fall within sub section (2) of section 6, the tax shall be levied and collected (a) where such subsequent sale has been effected by a registered dealer, in the State from which the registered dealer obtained or, as the case may be could have obtained, the form prescribed for the purposes of clause (a) of subsection (4) of section 8 in connection with the purchase of such goods, and (b) where such subsequent sale has been effected by an unregistered dealer in the State from which such subsequent sale has been effected." (b) in sub section (2), before the words "compounding of offences", the words "charging or payment of interest", shall be inserted and shall be deemed always to have been inserted .
(c) after sub section (2), the following sub section shall be inserted, namely: (2A) All the provisions relating to offences and penalties (including provisions relating to penalties in lieu of prosecution for an offence or in addition to the penalties or punishment for an offence but excluding the provisions relating to matters provided for in sections 10 and lOA) of the general sales tax law of each State shall, with necessary modifications, apply in relation to the assessment, reassessment, collection and the enforcement, of payment of any tax required to be collected under this Act in such State or in relation to any process connected with such assessment, re assessment, collection or enforcement of payment as if the tax under this Act were a tax under such sales tax law.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 568 9.
Validation ( 1) The provisions of section 9 of the principal Act shall have effect and shall be deemed always to have had effect in relation to the period commencing on the 5th day of January, 1957, and ending with the date immediately preceding the date of commencement of this Act as if that section also provided (a) that all the provisions relating to penalties (including provisions relating to penalties in lieu of prosecution for an offence or in addition to the penalties or punishment on conviction for an offence but excluding the provisions relating to matters provided for in sections 10 and 10A of the principal Act and the provisions relating to offences) of the general sales tax law of each State shall, with necessary modifications, apply in relation to (i) the assessment, re assessment, collection and enforcement or payment of any tax required to be collected under the principal Act in such State; and (ii) any process connected with such assessment, re assessment, collection or enforcement of payment, and (b) that for the purpose of the application of the provisions of such law, the tax under the principal Act shall be deemed to be tax under such law.
(2) Notwithstanding anything contained in any judgment, decree or order of any court or tribunal or other authority, all penalties under the general sales tax law of any State imposed or purporting to have been imposed in pursuance of the provisions of section 9 of the principal Act, and all proceedings, acts or things taken or done for the purpose of, or in relation to, the imposition or collection of such penalties, before the commencement of this Act shall, for all purposes be deemed to be and to have always been imposed, taken or done as validly and effectively as if the provisions of sub section (1) had been in force when such penalties were imposed or proceedings or acts or things were taken or done and accordingly, (a) no suit or other proceedings shall be maintained or continued in or before any court or any tribunal or other 569 authority for the refund of any amount received or realised by way of such penalty; (b) no court, tribunal or other authority shall enforce any decree or order directing the refund of any amount received or realised by way of such penalty; (c) where any amount which had been received or realised by way of such penalty had been refunded before the commencement of this Act and such refund would not have been allowed if the provisions of sub section (1) had been in force or the date on which the order for such refund was passed, the amount so refunded may be recovered as an arrear of tax under the principal Act; (d) any proceeding, act or thing which could have been validly taken, continued or done for the imposition of such penalty at any time before the commencement of this Act if the provisions of sub section (1) had then been in force but which had not been taken continued or done, may after such commencement be taken, continued or done.
(3) Nothing in sub section (2) shall be construed as preventing any Person (a) from questioning the imposition or collection of any penalty or any proceedings, act or thing in connection, therewith or (b) from claiming any refund, in accordance with the provisions of the principal Act read with sub section(1).
" Shri Manchanda contends that, by virtue of section 9 of the Amendment Act, clause (b) of the proviso to section 9 (1) of the is deemed to have been in force since 5.1.1957.
The position according to him, therefore, is as if the Act had always imposed a liability to pay tax even on unregistered dealers just as it had originally done on registered dealers.
We may mention that, while deciding section T. O. vs Coal & Coke Supplies Corporation, JT , we had assumed the correctness of the contention of Sri Manchanda as, in that case, the above argument that the amendment was retrospective was uncontroverted.
570 Sri Harish Salve, appearing for the assessee in this case, however, contests the correctness of Sri Manchanda 's contention.
We have therefore considered this aspect and reached the conclusion that Sri Salve is right and that no retrospective operation to clause (b) of section 9(1) can be spelt out as suggested by counsel for the appellant.
received the assent of the President on 7.9.1976 which is, apparently, what is referred to as the date of its commencement in section 9(1) of the said Act.
The Act amended several sections of the and it did not when its words when it desired to give any degree of retrospective effect to any particular amendment.
The amendments to sections 3 and 4 of the Principal Act thus are clearly retrospective: the provisions added thereto, it is declared, "shall be inserted and shall always be deemed to have been inserted w.e.f. 1.4.1964.
" The amendments to Sections 2, 7, 14 and IS of the Principal Act are obviously intended to be only prospective.
The amendment to section 9 of the Principal Act, with which we are at present concerned, presents an amalgam.
section 6 of the Amending Act makes three amendments in section 9 of the Principal Act by its three clauses (a), (b) and (c).
In clause (a), there is no hint of any retrospectivity whereas the amendment by clause (b) is expressed to be fully retrospective from 1956.
The amendment by clause (b) attracts the penal provisions (including offences) of the relevant State Law and can, in view of Article 20 of the Constitution, only be prospective.
However, it appears that, even under the statute as originally framed, such penal provisions had been enforced in several cases and this action needed retrospective validation (in so far as penalties, other than offences were concerned) in view of the decision of this Court in Khemka vs State, ; This was the raison d 'etre of section 9 of the Amendment Act which has been extracted above: (see Shiv Dutt Rai vs Union, [ ; This is also clear from paragraph 3 of the Statement of objects and Reasons of the Amendment Act, which reads: "Sub section (2) of section 9 of the empowers the State sales tax authorities to assess, re assess collect and enforce payment of Central sales tax.
The sub section also authorises the authorities under the State sales tax laws to exercise all the powers which they have under those laws (including inter alia the power to impose penalties) for the purposes of the also.
In Khemka & Co. (Agencies) Private Ltd. vs State of Maharashtra, 35 S.T.C. 57 1, the Supreme Court, by a ma 571 jority of 3:2, held that the provisions of the State sales tax laws as to penalties do not apply for purposes of the Central Sales Tax.
In view of this judgment, the State Governments are faced with the problem of having to refund the amounts collected in the past by way of penalties.
The judgment has also resulted in a vacuum being created in regard to levy of penalties, it is, therefore, necessary to amend section 9 of the to provide expressly that the provisions relating to offences and penalties under the general sales tax law of each State shall.
with necessary modifications, apply in relation to the assessment, re assessment collection and the enforcement of tax under the .
It is also necessary to validate the penalties which have been levied in the past.
for the purposes of the , on the basis of the provisions of the State sales tax laws.
" Where the statute thus, on its face, clearly indicates retrospective effect where intended, there can be no justification to read retrospectivity into the amendment made by clause (a) of section 6 of the amending Act which does not contain any words to that effect.
Counsel for the appellant, however, relied on two circunstances to say that such retrospective effect must necessarily have been intended.
Firstly, he placed emphasis (a) on the fact that section 9( l) of the Amendment Act refers to section 9 of the principal Act and not merely to section 9(2) and (b) on the use of the words"as if that section also provided." He submitted that this language can only mean that the legislature intended retrospective effect also to the amendment effected in section 9 by section 6 of the Validation Act.
Secondly, he submitted that under section 6 of the Central Sales Act, all dealers registered or unregistered, are liable to pay tax on sales effected by them in the course of inter state trade or commerce.
section 9(1) imposes the liability on the dealer in the State from which the movement of the goods commences but this is without prejudice to the liability of dealers who make subsequent sales during the course of such movement.
Such subsequent sale may be by a registered dealer or an unregistered dealer.
It may be to a registered or an unregistered dealer.
If the sale is to a registered dealer it is exempt under section 6(2), whether it is by a registered dealer or an unregistered dealer.
Under the proviso to section 9(1), as it originally stood, if the sale was by registered dealer to an unregistered dealer, it would be taxed in the State from which the registered dealer obtained or could have obtained the Forms.
When 572 even a sale by a registered dealer is thus made liable, counsel argues, it A could not have been the intention of the State to exempt from liability a sale by an unregistered dealer.
The amendment only clarifies this position.
It imposes no fresh substantive liability.
It is only an amendment of a procedural nature shifting chargeability, in such cases, from the State from which the goods moves, to the State in which the subsequent sale takes place.
In this view of the matter, counsel contends the amendment only affects the venue of taxation and, being procedural in nature, requires to be construed retrospectively.
We are unable to accept these contentions.
So far as the first point is concerned, the language of the validation section clearly concerns only penalties which are dealt with under section 9(2).
The amending Act refers to section 9 in general and not to section 9(2) only perhaps because section 9( l) also contains a reference to sub section (2).
From this circumstance alone, it cannot be inferred that retrospectivity to the amendment of section 9(1) also is intended.
The use of the word 'also ' does not also have the result suggested by counsel.
All that the provision requires is that, for the period 5.1.57 to 7.9.1976, the section is to be read as if it also included the additional substantive provisions referred to therein.
It was earlier not clear whether all these provisions could be read into the section before 7.9.1976, the date when the Amendment Act came into force.
So the validation section declares that the section should be read, even earlier, as if it comprehended also these substantive provisions.
It is in this context that the word "also" is used.
The employment of this word cannot therefore be treated as an indication of intention by the legislature that the amendment ot section 9(1) by section 6 of the amending Act was to be effective from 5.1.1957.
If the Legislature had intended it, the intention could and would have been expressed clearly in clause (a) of section 6 itself as it had been in the other clauses .
and in the other sections.
If section 9(1) of the Amendment Act had been inserted as clause (d) in section 6 thereof, it could not have changed the prospective effect of clause (a).
The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act.
section 9(1) of the Amendment Act talks only of reading these extra words into section 9(1) of the principal Act between 5.1.57 and 7.9.76.
It does not contain any operative words that require section 9(1) of the Principal Act being read in the form in which it has been amended by section 6 during that earlier period.
We, therefore, do not see in section 9 of the Amending Act any support to the contention of the counsel for the appellant.
The contention that the amendment is purely procedural is 573 also misconceived.
Assuming the correctness of the contention that a A purely procedural amendment should ordinarily be construed to be retrospective, we are unable to agree that the present amendment is of such nature.
The decision of this Court in Kasturi Lal 's case, 4JT had held that an unregistered dealer is not taxable under the proviso.
The amendment changes this position and imposes a substantive liability on such a dealer.
It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot.
It is thus a substantive provision.
That apart, even the question whether a charge to tax can be imposed in one State or another is not a mere question of venue.
It may have an impact on the rate of tax in certain cases and it also regulates the rights inter se of States to levy taxes on such inter state sales.
It is, therefore, difficult to accept the contention that the amendment should be treated as purely procedural and hence necessarily retrospective.
In the result, we are of opinion that clause (b) of section 9(1) of the is operative only from 7.9.1976.
The present case is, therefore, governed by the earlier provision and the decision of this Court in Kasturi Lal 's case, (supra).
The appeals therefore, fail and are dismissed.
We, however, make no order as to costs.
N.P.V. Appeals dismissed.
|
% The respondent, an unregistered firm of coal merchants with its place of business in Bihar and an office in U.P., was assessed to sales tax by the first appellant in respect of the turnover of coal supplied by the respondent assessee for the assessment years 1967 68 and 1968 69.
The assessee filed writ petitions alleging that the assessment orders were without jurisdiction on several grounds.
The High Court allowed the writ petitions holding that section 9 of the as it stood at the relevant time cast a liability to tax only on a 'registered dealer ' and not an 'unregistered dealer '.
In the appeals it was contended on behalf of the Department that by virtue of section 9 of the Central Sales Tax (Amendment) Act, 1976, cl.
(b) of the proviso to section 9(1) of the was deemed to have been in force since 5.1.57 and, therefore, the position was as if the Act had always imposed a liability to pay tax even on unregistered dealers just as it had originally done on registered dealers, and that the amendment only affected the venue of taxation, and being procedural in nature, it was required to be construed retrospectively, Dismissing the appeals, ^ HELD: 1.
Clause (b) of section 9(1) of the is operative only from 7.9.76.
[573] The instant case is, therefore, governed by the earlier provision, and the respondent assessee being an unregistered dealer is not liable to pay tax.
[573D] State vs Kasturi Lal Har Lal, [1987] 67 STC 154 SC, relied on.
563 2.1 Where the statute, Central Sales Tax (Amendment) Act, 1976, on its face, clearly indicates retrospective effect where intended, there can be no justification to read retrospectivity into the amendment made by cl.
(c) of section /6 of the Amending Act, which does not contain any words to that effect.
[571D] 2.2 The language of the validation section clearly concerns only penalties which are dealt with under section 9(2).
The amending Act refers to section 9 in general and not to section 9(2) only because section 9(1) also contains a reference to sub section (2).
From this circumstance alone it cannot be inferred that retrospectivity to the amendment of section 9(1) also is intended.
[572C D] 2.3 The employment of word "also" cannot be treated as an indication of intention by the Legislature that the amendment of section 9(1) by section 6 of the Amending Act was to be effective from 5.1.57.
If the Legislature had intended it, the intention could and would have been expressed clearly in cl.
(a) of section 6 itself as it had been in the other clauses and in the other sections.
If section 9(1) of the Amendment Act had been inserted as cl.
(d) in section 6 thereof, it could not have changed the prospective effect of cl.
The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act.
Section 9(1) of the Amendment Act talks only of reading these extra words into section 9(1) of the Principal Act between 5.1.57 and 7.9.76.
It does not contain any operative words that require section 9(1) of the Principal Act being read in the form in which it has been amended by section 6 during that earlier period.
[572E G] All that the provision requires is that for the period 5.1.57 to 7.9.76, the section is to be read as if it also included the additional substantive provisions referred to therein.
It was earlier not clear whether all these provisions could be read into the section before 7.9.76, the date when the amendment Act came into force.
So, the validation section declares that the section should be read, even earlier, as if it comprehended also these substantive provisions.
It is in this context that the word "also" is used.
[572D E] 2.4 The question whether a charge to tax can be imposed in one State or another is not a mere question of venue.
It may have an impact on the rate of tax in certain cases and it also regulates the rights inter se of States to levy taxes on such inter state sales.
[573B C] The amendment changes the position that an unregistered dealer 564 is not taxable under the proviso and imposes a substantive liability on such a dealer.
It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot.
It is thus a substantive provision.
[573B] The amendment cannot, therefore, be treated as purely procedural and hence necessarily retrospective.
[573C] S.T.O. vs Coal & Coke Supplies Corporation JT, [19871 4 S.C. 472; Khemka vs State, ; and Shiv Dutt Rai vs Union, 119831 3 S.C.C. 529 referred to.
|
ivil Appeal Nos.
953 954 (NT)/ 1975.
From the Judgment and order dated the 15th February 1974 of the High Court of Allahabad in Civil Misc.
Writ Petitions Nos. 6904 and 6906 of 1973.
S.C. Manchanda and A.K. Srivastava for the Appellants.
Harish N. Salve, Mrs. A.K. Verma, J. Peres and D.N. Mishra for the Respondent.
The Judgment of the Court was delivered by RANGANATHAN, J.
These are two appeals by certificate from the common order.
dated 15.2.74, of the Allahabad High Court in Civil Miscellaneous Petition Nos.
6904 and 6906 of 1973.
They can be disposed of together since the question raised is the same.
This common question arises out of the assessment to central sales tax of the respondent, oriental Coal Corporation of Moradabad (hereinafter referred to as the assessee), for the assessment year 1967 68 and 196869.
The relevant facts bearing on the controversy may be briefly stated.
The assessee is a firm of coal merchants with its place of business in Jharia (Bihar State) and an office at Moradabad (in U.P.).
It is not registered either under the Central or the State Sales Tax Act.
According to the assessee it places orders for coal on the collieries at Jharia on behalf of constituents in Uttar Pradesh, realises the sale proceeds and remits the same to Jharia.
The Sales Tax officer assessed the assessee to sales tax in respect of the turnover of the coal thus 565 supplied by the assessee.
The assessee filed two writ petitions alleging that the assessment orders were without jurisdiction on several grounds.
The High Court allowed the writ petitions on one of these grounds and hence did not go into the other contentions.
It referred to section 9 of the , as it stood at the relevant time, and held that the provision cast a liability to tax only on a registered dealer and not an unregistered dealer like the assessee.
It is the correctness of this decision that is challenged in the present appeals.
Section 9 relied upon by the High Court, reads thus: 3.
"9.(1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter state trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provisions of subsection (2), in the State from which the movement of the goods commenced.
Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such sale does not fall within subsection (2) of section 6, be levied and collected in the State from which the registered dealer effecting the subsequent sale obtained or, as the case may be, could have obtained, the form prescribed for the purpose of clause (a) of subsection (4) of section 8 in connection with the purchase of such goods.
(2) Subject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, re assess, collect and enforce payment of any tax under general sales tax law of the appropriate State shall, on behalf of the Government of India, assess, re assess, collect and enforce payment of tax, including any penalty, payable by a dealer under this Act as if the tax or penalty payable by such a dealer under this Act is a tax or penalty payable under the general sales tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the Provisions of such law, including provi 566 sions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of or successor to such business transfer of liability of any fir n or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appe als, reviews, revisions, references, 3(refunds, rebates, penal ties) compounding of offences and treatment of documents furnished by a dealer as confidential, shall apply accordingly: Provided that if in any State or part thereof there is no general sales tax law in force, the Central Government may, by rules made in this behalf make necessary provision for all or any of the matters specified in this sub section.
" The High Court pointed out that, under the terms of the section, tax on sales of goods effected by a dealer in the course of inter state trade or commerce shall be levied in the State from which the movement of the goods commenced: in this case, the State of Bihar.
The proviso, however, carves out an exception.
It provides that, if there is a subseq uent sale of the same goods in the course of their movement from one State to another and such sale is effected by a registered dealer, tax can be levied and collected in the State from which such dealer obtained or could have obtained the forms prescribed under section 8(4)(a) (popularly known as 'the Form '): in this case, the State of Uttar Pradesh.
But, the High Court pointed out, the assessee was not a registered dealer and so there was no scope for his being taxed in the State of U.P.
The High Court accordingly quashed the assessments in question and hence these appeals by the State.
We may at once say that the conclusion of the High Court is unassailable in view of the decision of this Court in State vs Kasturi Lal Harlal, 3 S.C. 234 affirming the view taken on this issue by the Allahabad High Court in an earlier case Kasturilal Harlal vs State, [1972] 29 STC 495.
Shri Manchanda, however, submits that this view can no longer hold the field in view of a retrospective amendment of the by the Central Sales Tax (Amendment) Act No. 103 of 1976.
Two provisions of this Amendment Act may be extracted: "6.
Amendment of section 9.
In section 9 of the Principal Act (a) in sub section (1) for proviso, the following pro 567 viso shall be substituted, namely.
A "Provided that, in the case of sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods and being also a sale which does not fall within sub section (2) of section 6, the tax shall be levied and collected (a) where such subsequent sale has been effected by a registered dealer, in the State from which the registered dealer obtained or, as the case may be could have obtained, the form prescribed for the purposes of clause (a) of subsection (4) of section 8 in connection with the purchase of such goods, and (b) where such subsequent sale has been effected by an unregistered dealer in the State from which such subsequent sale has been effected." (b) in sub section (2), before the words "compounding of offences", the words "charging or payment of interest", shall be inserted and shall be deemed always to have been inserted .
(c) after sub section (2), the following sub section shall be inserted, namely: (2A) All the provisions relating to offences and penalties (including provisions relating to penalties in lieu of prosecution for an offence or in addition to the penalties or punishment for an offence but excluding the provisions relating to matters provided for in sections 10 and lOA) of the general sales tax law of each State shall, with necessary modifications, apply in relation to the assessment, reassessment, collection and the enforcement, of payment of any tax required to be collected under this Act in such State or in relation to any process connected with such assessment, re assessment, collection or enforcement of payment as if the tax under this Act were a tax under such sales tax law.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 568 9.
Validation ( 1) The provisions of section 9 of the principal Act shall have effect and shall be deemed always to have had effect in relation to the period commencing on the 5th day of January, 1957, and ending with the date immediately preceding the date of commencement of this Act as if that section also provided (a) that all the provisions relating to penalties (including provisions relating to penalties in lieu of prosecution for an offence or in addition to the penalties or punishment on conviction for an offence but excluding the provisions relating to matters provided for in sections 10 and 10A of the principal Act and the provisions relating to offences) of the general sales tax law of each State shall, with necessary modifications, apply in relation to (i) the assessment, re assessment, collection and enforcement or payment of any tax required to be collected under the principal Act in such State; and (ii) any process connected with such assessment, re assessment, collection or enforcement of payment, and (b) that for the purpose of the application of the provisions of such law, the tax under the principal Act shall be deemed to be tax under such law.
(2) Notwithstanding anything contained in any judgment, decree or order of any court or tribunal or other authority, all penalties under the general sales tax law of any State imposed or purporting to have been imposed in pursuance of the provisions of section 9 of the principal Act, and all proceedings, acts or things taken or done for the purpose of, or in relation to, the imposition or collection of such penalties, before the commencement of this Act shall, for all purposes be deemed to be and to have always been imposed, taken or done as validly and effectively as if the provisions of sub section (1) had been in force when such penalties were imposed or proceedings or acts or things were taken or done and accordingly, (a) no suit or other proceedings shall be maintained or continued in or before any court or any tribunal or other 569 authority for the refund of any amount received or realised by way of such penalty; (b) no court, tribunal or other authority shall enforce any decree or order directing the refund of any amount received or realised by way of such penalty; (c) where any amount which had been received or realised by way of such penalty had been refunded before the commencement of this Act and such refund would not have been allowed if the provisions of sub section (1) had been in force or the date on which the order for such refund was passed, the amount so refunded may be recovered as an arrear of tax under the principal Act; (d) any proceeding, act or thing which could have been validly taken, continued or done for the imposition of such penalty at any time before the commencement of this Act if the provisions of sub section (1) had then been in force but which had not been taken continued or done, may after such commencement be taken, continued or done.
(3) Nothing in sub section (2) shall be construed as preventing any Person (a) from questioning the imposition or collection of any penalty or any proceedings, act or thing in connection, therewith or (b) from claiming any refund, in accordance with the provisions of the principal Act read with sub section(1).
" Shri Manchanda contends that, by virtue of section 9 of the Amendment Act, clause (b) of the proviso to section 9 (1) of the is deemed to have been in force since 5.1.1957.
The position according to him, therefore, is as if the Act had always imposed a liability to pay tax even on unregistered dealers just as it had originally done on registered dealers.
We may mention that, while deciding section T. O. vs Coal & Coke Supplies Corporation, JT , we had assumed the correctness of the contention of Sri Manchanda as, in that case, the above argument that the amendment was retrospective was uncontroverted.
570 Sri Harish Salve, appearing for the assessee in this case, however, contests the correctness of Sri Manchanda 's contention.
We have therefore considered this aspect and reached the conclusion that Sri Salve is right and that no retrospective operation to clause (b) of section 9(1) can be spelt out as suggested by counsel for the appellant.
received the assent of the President on 7.9.1976 which is, apparently, what is referred to as the date of its commencement in section 9(1) of the said Act.
The Act amended several sections of the and it did not when its words when it desired to give any degree of retrospective effect to any particular amendment.
The amendments to sections 3 and 4 of the Principal Act thus are clearly retrospective: the provisions added thereto, it is declared, "shall be inserted and shall always be deemed to have been inserted w.e.f. 1.4.1964.
" The amendments to Sections 2, 7, 14 and IS of the Principal Act are obviously intended to be only prospective.
The amendment to section 9 of the Principal Act, with which we are at present concerned, presents an amalgam.
section 6 of the Amending Act makes three amendments in section 9 of the Principal Act by its three clauses (a), (b) and (c).
In clause (a), there is no hint of any retrospectivity whereas the amendment by clause (b) is expressed to be fully retrospective from 1956.
The amendment by clause (b) attracts the penal provisions (including offences) of the relevant State Law and can, in view of Article 20 of the Constitution, only be prospective.
However, it appears that, even under the statute as originally framed, such penal provisions had been enforced in several cases and this action needed retrospective validation (in so far as penalties, other than offences were concerned) in view of the decision of this Court in Khemka vs State, ; This was the raison d 'etre of section 9 of the Amendment Act which has been extracted above: (see Shiv Dutt Rai vs Union, [ ; This is also clear from paragraph 3 of the Statement of objects and Reasons of the Amendment Act, which reads: "Sub section (2) of section 9 of the empowers the State sales tax authorities to assess, re assess collect and enforce payment of Central sales tax.
The sub section also authorises the authorities under the State sales tax laws to exercise all the powers which they have under those laws (including inter alia the power to impose penalties) for the purposes of the also.
In Khemka & Co. (Agencies) Private Ltd. vs State of Maharashtra, 35 S.T.C. 57 1, the Supreme Court, by a ma 571 jority of 3:2, held that the provisions of the State sales tax laws as to penalties do not apply for purposes of the Central Sales Tax.
In view of this judgment, the State Governments are faced with the problem of having to refund the amounts collected in the past by way of penalties.
The judgment has also resulted in a vacuum being created in regard to levy of penalties, it is, therefore, necessary to amend section 9 of the to provide expressly that the provisions relating to offences and penalties under the general sales tax law of each State shall.
with necessary modifications, apply in relation to the assessment, re assessment collection and the enforcement of tax under the .
It is also necessary to validate the penalties which have been levied in the past.
for the purposes of the , on the basis of the provisions of the State sales tax laws.
" Where the statute thus, on its face, clearly indicates retrospective effect where intended, there can be no justification to read retrospectivity into the amendment made by clause (a) of section 6 of the amending Act which does not contain any words to that effect.
Counsel for the appellant, however, relied on two circunstances to say that such retrospective effect must necessarily have been intended.
Firstly, he placed emphasis (a) on the fact that section 9( l) of the Amendment Act refers to section 9 of the principal Act and not merely to section 9(2) and (b) on the use of the words"as if that section also provided." He submitted that this language can only mean that the legislature intended retrospective effect also to the amendment effected in section 9 by section 6 of the Validation Act.
Secondly, he submitted that under section 6 of the Central Sales Act, all dealers registered or unregistered, are liable to pay tax on sales effected by them in the course of inter state trade or commerce.
section 9(1) imposes the liability on the dealer in the State from which the movement of the goods commences but this is without prejudice to the liability of dealers who make subsequent sales during the course of such movement.
Such subsequent sale may be by a registered dealer or an unregistered dealer.
It may be to a registered or an unregistered dealer.
If the sale is to a registered dealer it is exempt under section 6(2), whether it is by a registered dealer or an unregistered dealer.
Under the proviso to section 9(1), as it originally stood, if the sale was by registered dealer to an unregistered dealer, it would be taxed in the State from which the registered dealer obtained or could have obtained the Forms.
When 572 even a sale by a registered dealer is thus made liable, counsel argues, it A could not have been the intention of the State to exempt from liability a sale by an unregistered dealer.
The amendment only clarifies this position.
It imposes no fresh substantive liability.
It is only an amendment of a procedural nature shifting chargeability, in such cases, from the State from which the goods moves, to the State in which the subsequent sale takes place.
In this view of the matter, counsel contends the amendment only affects the venue of taxation and, being procedural in nature, requires to be construed retrospectively.
We are unable to accept these contentions.
So far as the first point is concerned, the language of the validation section clearly concerns only penalties which are dealt with under section 9(2).
The amending Act refers to section 9 in general and not to section 9(2) only perhaps because section 9( l) also contains a reference to sub section (2).
From this circumstance alone, it cannot be inferred that retrospectivity to the amendment of section 9(1) also is intended.
The use of the word 'also ' does not also have the result suggested by counsel.
All that the provision requires is that, for the period 5.1.57 to 7.9.1976, the section is to be read as if it also included the additional substantive provisions referred to therein.
It was earlier not clear whether all these provisions could be read into the section before 7.9.1976, the date when the Amendment Act came into force.
So the validation section declares that the section should be read, even earlier, as if it comprehended also these substantive provisions.
It is in this context that the word "also" is used.
The employment of this word cannot therefore be treated as an indication of intention by the legislature that the amendment ot section 9(1) by section 6 of the amending Act was to be effective from 5.1.1957.
If the Legislature had intended it, the intention could and would have been expressed clearly in clause (a) of section 6 itself as it had been in the other clauses .
and in the other sections.
If section 9(1) of the Amendment Act had been inserted as clause (d) in section 6 thereof, it could not have changed the prospective effect of clause (a).
The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act.
section 9(1) of the Amendment Act talks only of reading these extra words into section 9(1) of the principal Act between 5.1.57 and 7.9.76.
It does not contain any operative words that require section 9(1) of the Principal Act being read in the form in which it has been amended by section 6 during that earlier period.
We, therefore, do not see in section 9 of the Amending Act any support to the contention of the counsel for the appellant.
The contention that the amendment is purely procedural is 573 also misconceived.
Assuming the correctness of the contention that a A purely procedural amendment should ordinarily be construed to be retrospective, we are unable to agree that the present amendment is of such nature.
The decision of this Court in Kasturi Lal 's case, 4JT had held that an unregistered dealer is not taxable under the proviso.
The amendment changes this position and imposes a substantive liability on such a dealer.
It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot.
It is thus a substantive provision.
That apart, even the question whether a charge to tax can be imposed in one State or another is not a mere question of venue.
It may have an impact on the rate of tax in certain cases and it also regulates the rights inter se of States to levy taxes on such inter state sales.
It is, therefore, difficult to accept the contention that the amendment should be treated as purely procedural and hence necessarily retrospective.
In the result, we are of opinion that clause (b) of section 9(1) of the is operative only from 7.9.1976.
The present case is, therefore, governed by the earlier provision and the decision of this Court in Kasturi Lal 's case, (supra).
The appeals therefore, fail and are dismissed.
We, however, make no order as to costs.
N.P.V. Appeals dismissed.
|
From the Judgment and order dated the 15th February 1974 of the High Court of Allahabad in Civil Misc. S.C. Manchanda and A.K. Srivastava for the Appellants. Harish N. Salve, Mrs. A.K. Verma, J. Peres and D.N. Mishra for the Respondent. The Judgment of the Court was delivered by RANGANATHAN, J.
These are two appeals by certificate from the common order. dated 15.2.74, of the Allahabad High Court in Civil Miscellaneous Petition Nos. They can be disposed of together since the question raised is the same. This common question arises out of the assessment to central sales tax of the respondent, oriental Coal Corporation of Moradabad (hereinafter referred to as the assessee), for the assessment year 1967 68 and 196869. The relevant facts bearing on the controversy may be briefly stated. The assessee is a firm of coal merchants with its place of business in Jharia (Bihar State) and an office at Moradabad (in U.P.). It is not registered either under the Central or the State Sales Tax Act. The Sales Tax officer assessed the assessee to sales tax in respect of the turnover of the coal thus 565 supplied by the assessee. The assessee filed two writ petitions alleging that the assessment orders were without jurisdiction on several grounds. The High Court allowed the writ petitions on one of these grounds and hence did not go into the other contentions. It referred to section 9 of the , as it stood at the relevant time, and held that the provision cast a liability to tax only on a registered dealer and not an unregistered dealer like the assessee. It is the correctness of this decision that is challenged in the present appeals. Section 9 relied upon by the High Court, reads thus: 3. "9.(1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter state trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provisions of subsection (2), in the State from which the movement of the goods commenced. Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such sale does not fall within subsection (2) of section 6, be levied and collected in the State from which the registered dealer effecting the subsequent sale obtained or, as the case may be, could have obtained, the form prescribed for the purpose of clause (a) of subsection (4) of section 8 in connection with the purchase of such goods. The proviso, however, carves out an exception. It provides that, if there is a subseq uent sale of the same goods in the course of their movement from one State to another and such sale is effected by a registered dealer, tax can be levied and collected in the State from which such dealer obtained or could have obtained the forms prescribed under section 8(4)(a) (popularly known as 'the Form '): in this case, the State of Uttar Pradesh. But, the High Court pointed out, the assessee was not a registered dealer and so there was no scope for his being taxed in the State of U.P.
The High Court accordingly quashed the assessments in question and hence these appeals by the State. We may at once say that the conclusion of the High Court is unassailable in view of the decision of this Court in State vs Kasturi Lal Harlal, 3 S.C. 234 affirming the view taken on this issue by the Allahabad High Court in an earlier case Kasturilal Harlal vs State, [1972] 29 STC 495. Shri Manchanda, however, submits that this view can no longer hold the field in view of a retrospective amendment of the by the Central Sales Tax (Amendment) Act No. Two provisions of this Amendment Act may be extracted: "6. In section 9 of the Principal Act (a) in sub section (1) for proviso, the following pro 567 viso shall be substituted, namely. b) in sub section (2), before the words "compounding of offences", the words "charging or payment of interest", shall be inserted and shall be deemed always to have been inserted . xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 568 9. The position according to him, therefore, is as if the Act had always imposed a liability to pay tax even on unregistered dealers just as it had originally done on registered dealers. 570 Sri Harish Salve, appearing for the assessee in this case, however, contests the correctness of Sri Manchanda 's contention. We have therefore considered this aspect and reached the conclusion that Sri Salve is right and that no retrospective operation to clause (b) of section 9(1) can be spelt out as suggested by counsel for the appellant. received the assent of the President on 7.9.1976 which is, apparently, what is referred to as the date of its commencement in section 9(1) of the said Act. The Act amended several sections of the and it did not when its words when it desired to give any degree of retrospective effect to any particular amendment. The amendments to sections 3 and 4 of the Principal Act thus are clearly retrospective: the provisions added thereto, it is declared, "shall be inserted and shall always be deemed to have been inserted w.e.f. " The amendments to Sections 2, 7, 14 and IS of the Principal Act are obviously intended to be only prospective. The amendment to section 9 of the Principal Act, with which we are at present concerned, presents an amalgam. section 6 of the Amending Act makes three amendments in section 9 of the Principal Act by its three clauses (a), (b) and (c). In clause (a), there is no hint of any retrospectivity whereas the amendment by clause (b) is expressed to be fully retrospective from 1956. The sub section also authorises the authorities under the State sales tax laws to exercise all the powers which they have under those laws (including inter alia the power to impose penalties) for the purposes of the also. In view of this judgment, the State Governments are faced with the problem of having to refund the amounts collected in the past by way of penalties. The judgment has also resulted in a vacuum being created in regard to levy of penalties, it is, therefore, necessary to amend section 9 of the to provide expressly that the provisions relating to offences and penalties under the general sales tax law of each State shall. with necessary modifications, apply in relation to the assessment, re assessment collection and the enforcement of tax under the . It is also necessary to validate the penalties which have been levied in the past. for the purposes of the , on the basis of the provisions of the State sales tax laws. " Where the statute thus, on its face, clearly indicates retrospective effect where intended, there can be no justification to read retrospectivity into the amendment made by clause (a) of section 6 of the amending Act which does not contain any words to that effect. Firstly, he placed emphasis (a) on the fact that section 9( l) of the Amendment Act refers to section 9 of the principal Act and not merely to section 9(2) and (b) on the use of the words"as if that section also provided." He submitted that this language can only mean that the legislature intended retrospective effect also to the amendment effected in section 9 by section 6 of the Validation Act. Secondly, he submitted that under section 6 of the Central Sales Act, all dealers registered or unregistered, are liable to pay tax on sales effected by them in the course of inter state trade or commerce. section 9(1) imposes the liability on the dealer in the State from which the movement of the goods commences but this is without prejudice to the liability of dealers who make subsequent sales during the course of such movement. Such subsequent sale may be by a registered dealer or an unregistered dealer. It may be to a registered or an unregistered dealer. If the sale is to a registered dealer it is exempt under section 6(2), whether it is by a registered dealer or an unregistered dealer. The amendment only clarifies this position. It imposes no fresh substantive liability. In this view of the matter, counsel contends the amendment only affects the venue of taxation and, being procedural in nature, requires to be construed retrospectively. We are unable to accept these contentions. So far as the first point is concerned, the language of the validation section clearly concerns only penalties which are dealt with under section 9(2). The amending Act refers to section 9 in general and not to section 9(2) only perhaps because section 9( l) also contains a reference to sub section (2). The use of the word 'also ' does not also have the result suggested by counsel. All that the provision requires is that, for the period 5.1.57 to 7.9.1976, the section is to be read as if it also included the additional substantive provisions referred to therein. It was earlier not clear whether all these provisions could be read into the section before 7.9.1976, the date when the Amendment Act came into force. So the validation section declares that the section should be read, even earlier, as if it comprehended also these substantive provisions. It is in this context that the word "also" is used. The employment of this word cannot therefore be treated as an indication of intention by the legislature that the amendment ot section 9(1) by section 6 of the amending Act was to be effective from 5.1.1957. If section 9(1) of the Amendment Act had been inserted as clause (d) in section 6 thereof, it could not have changed the prospective effect of clause (a). The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act. section 9(1) of the Amendment Act talks only of reading these extra words into section 9(1) of the principal Act between 5.1.57 and 7.9.76. We, therefore, do not see in section 9 of the Amending Act any support to the contention of the counsel for the appellant. The contention that the amendment is purely procedural is 573 also misconceived. Assuming the correctness of the contention that a A purely procedural amendment should ordinarily be construed to be retrospective, we are unable to agree that the present amendment is of such nature. The decision of this Court in Kasturi Lal 's case, 4JT had held that an unregistered dealer is not taxable under the proviso. The amendment changes this position and imposes a substantive liability on such a dealer. It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot. That apart, even the question whether a charge to tax can be imposed in one State or another is not a mere question of venue. It may have an impact on the rate of tax in certain cases and it also regulates the rights inter se of States to levy taxes on such inter state sales. It is, therefore, difficult to accept the contention that the amendment should be treated as purely procedural and hence necessarily retrospective. In the result, we are of opinion that clause (b) of section 9(1) of the is operative only from 7.9.1976. The appeals therefore, fail and are dismissed.
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% The respondent, an unregistered firm of coal merchants with its place of business in Bihar and an office in U.P., was assessed to sales tax by the first appellant in respect of the turnover of coal supplied by the respondent assessee for the assessment years 1967 68 and 1968 69.
The assessee filed writ petitions alleging that the assessment orders were without jurisdiction on several grounds.
The High Court allowed the writ petitions holding that section 9 of the as it stood at the relevant time cast a liability to tax only on a 'registered dealer ' and not an 'unregistered dealer '.
In the appeals it was contended on behalf of the Department that by virtue of section 9 of the Central Sales Tax (Amendment) Act, 1976, cl.
(b) of the proviso to section 9(1) of the was deemed to have been in force since 5.1.57 and, therefore, the position was as if the Act had always imposed a liability to pay tax even on unregistered dealers just as it had originally done on registered dealers, and that the amendment only affected the venue of taxation, and being procedural in nature, it was required to be construed retrospectively, Dismissing the appeals, ^ HELD: 1.
Clause (b) of section 9(1) of the is operative only from 7.9.76.
[573] The instant case is, therefore, governed by the earlier provision, and the respondent assessee being an unregistered dealer is not liable to pay tax.
[573D] State vs Kasturi Lal Har Lal, [1987] 67 STC 154 SC, relied on.
563 2.1 Where the statute, Central Sales Tax (Amendment) Act, 1976, on its face, clearly indicates retrospective effect where intended, there can be no justification to read retrospectivity into the amendment made by cl.
(c) of section /6 of the Amending Act, which does not contain any words to that effect.
[571D] 2.2 The language of the validation section clearly concerns only penalties which are dealt with under section 9(2).
The amending Act refers to section 9 in general and not to section 9(2) only because section 9(1) also contains a reference to sub section (2).
From this circumstance alone it cannot be inferred that retrospectivity to the amendment of section 9(1) also is intended.
[572C D] 2.3 The employment of word "also" cannot be treated as an indication of intention by the Legislature that the amendment of section 9(1) by section 6 of the Amending Act was to be effective from 5.1.57.
If the Legislature had intended it, the intention could and would have been expressed clearly in cl.
(a) of section 6 itself as it had been in the other clauses and in the other sections.
If section 9(1) of the Amendment Act had been inserted as cl.
(d) in section 6 thereof, it could not have changed the prospective effect of cl.
The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act.
Section 9(1) of the Amendment Act talks only of reading these extra words into section 9(1) of the Principal Act between 5.1.57 and 7.9.76.
It does not contain any operative words that require section 9(1) of the Principal Act being read in the form in which it has been amended by section 6 during that earlier period.
[572E G] All that the provision requires is that for the period 5.1.57 to 7.9.76, the section is to be read as if it also included the additional substantive provisions referred to therein.
It was earlier not clear whether all these provisions could be read into the section before 7.9.76, the date when the amendment Act came into force.
So, the validation section declares that the section should be read, even earlier, as if it comprehended also these substantive provisions.
It is in this context that the word "also" is used.
[572D E] 2.4 The question whether a charge to tax can be imposed in one State or another is not a mere question of venue.
It may have an impact on the rate of tax in certain cases and it also regulates the rights inter se of States to levy taxes on such inter state sales.
[573B C] The amendment changes the position that an unregistered dealer 564 is not taxable under the proviso and imposes a substantive liability on such a dealer.
It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot.
It is thus a substantive provision.
[573B] The amendment cannot, therefore, be treated as purely procedural and hence necessarily retrospective.
[573C] S.T.O. vs Coal & Coke Supplies Corporation JT, [19871 4 S.C. 472; Khemka vs State, ; and Shiv Dutt Rai vs Union, 119831 3 S.C.C. 529 referred to.
|
% The respondent, an unregistered firm of coal merchants with its place of business in Bihar and an office in U.P., was assessed to sales tax by the first appellant in respect of the turnover of coal supplied by the respondent assessee for the assessment years 1967 68 and 1968 69. The assessee filed writ petitions alleging that the assessment orders were without jurisdiction on several grounds. The High Court allowed the writ petitions holding that section 9 of the as it stood at the relevant time cast a liability to tax only on a 'registered dealer ' and not an 'unregistered dealer '. In the appeals it was contended on behalf of the Department that by virtue of section 9 of the Central Sales Tax (Amendment) Act, 1976, cl. Clause (b) of section 9(1) of the is operative only from 7.9.76. [573] The instant case is, therefore, governed by the earlier provision, and the respondent assessee being an unregistered dealer is not liable to pay tax. [573D] State vs Kasturi Lal Har Lal, [1987] 67 STC 154 SC, relied on. (c) of section /6 of the Amending Act, which does not contain any words to that effect. [571D] 2.2 The language of the validation section clearly concerns only penalties which are dealt with under section 9(2). The amending Act refers to section 9 in general and not to section 9(2) only because section 9(1) also contains a reference to sub section (2). From this circumstance alone it cannot be inferred that retrospectivity to the amendment of section 9(1) also is intended. [572C D] 2.3 The employment of word "also" cannot be treated as an indication of intention by the Legislature that the amendment of section 9(1) by section 6 of the Amending Act was to be effective from 5.1.57. If the Legislature had intended it, the intention could and would have been expressed clearly in cl. (a) of section 6 itself as it had been in the other clauses and in the other sections. If section 9(1) of the Amendment Act had been inserted as cl. (d) in section 6 thereof, it could not have changed the prospective effect of cl. The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act. Section 9(1) of the Amendment Act talks only of reading these extra words into section 9(1) of the Principal Act between 5.1.57 and 7.9.76. It does not contain any operative words that require section 9(1) of the Principal Act being read in the form in which it has been amended by section 6 during that earlier period. [572E G] All that the provision requires is that for the period 5.1.57 to 7.9.76, the section is to be read as if it also included the additional substantive provisions referred to therein. It was earlier not clear whether all these provisions could be read into the section before 7.9.76, the date when the amendment Act came into force. So, the validation section declares that the section should be read, even earlier, as if it comprehended also these substantive provisions. It is in this context that the word "also" is used. [572D E] 2.4 The question whether a charge to tax can be imposed in one State or another is not a mere question of venue. It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot. [573B] The amendment cannot, therefore, be treated as purely procedural and hence necessarily retrospective.
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ppeal No. 286 of 1960.
Appeal by special leave from the judgment and decree dated March 26, 1958, of the Patna High Court in Second Appeal No. 1330 of 1954.
N.C. Chatterjee and R. C. Prasad, for the appellant.
section N. Andley and section P. Varma, for the respondent No. 1. 1962.
November 9.
The judgment of the Court was delivered by DAS GUPTA, J.
The subject matter of this litigation is a plot of land measuring 1267 sq.
in the Sakchi New Planning area in the town of Jamshedpur.
On June 23,1937, Abdul Gani, through whom the present appellant claims to be interested in the land, applied for settlement of this plot of land to the Land Officer of the owner of the land, the Tata Iron and Steel Company Ltd. The application was allowed and the land was let out to Abdul Gani as a tenant from month to month at a rent of Re. 1/per month.
The suit out of which this appeal has arisen was brought in 1949 for ejectment of the tenant after determination of the tenancy by a notice to quit the premises.
There was also, a prayer for arrears of rent at Re 1/ per month.
The defence of Abdul Gani was that he was an agriculturist tenant as contemplated under the 3 Ghotanagpur Tenancy Act and not a monthly tenant and that no monthly rent was paid for the land It 'was, also pleaded that the lease being for agricultural and horticultural purposes at an annual rent, the defendant acquired a valid occupancy right and was not liable to ejectment.
The present appellant was added as a defendant by an order dated May 25, 1953.
He also filed a written statement contending that by operation of the provisions of Chotanagpur Tenancy Act, Abdul Gani had acquired occupancy right, that the purpose for which settlement was made with Abdul Gani could not create a monthly tenancy and the plaintiff was not entitled to Khas possession.
The Trial Court (The Additional Munsif, Jamshedpur), accepted the defence plea that the tenancy created in favour of Abdul Gani was agricultural, that Abdul Gani had acquired an occupancy raiyat 's right therein and as the tenancy Act was governed by the Chotanagpur Tenancy Act the suit was not triable by a civil court.
Accordingly, he dismissed the suit.
On appeal the Subordinate Judge, Singhbhum, with the findings of the Trial Court that the holding was agricultural and therefore governed by the Chotanagpur Tenancy Act and accordingly affirmed the judgment and decree of the Trial Court.
The High Court of judicature at Patna however came to the conclusion in Second Appeal that the lease was not for agricultural and horticultural purposes and there was no question.
of the defendant having acquired the right of occupancy in the land.
The High Court allowed the appeal, set aside the judgment and decree of the courts below and decreed the plaintiffs suit.
Against this decision of the High Court this appeal has been filed by special leave granted by this Court.
4 In support of the appeal it is urged before us by Mr. N. Chatterjee, that the High Court erred in holding that the lease was not for agricultural or horticultural purposes.
He points out that the application for lease of the land mentions ""garden purpose" as the purpose of the tenancy, and argues that that is sufficient to make Abdul Gani a raiyat within the meaning of section 6 of the Chotanagpur Tenancy Act.
Section 4 of the Act states that for the purpose of this Act there shall be four classes of tenants, namely, (1) tenure holders,(2) raiyats, (3) under raiyats and(4)Munderi Khunt kattidars.
Admittedly ' and obviously, Abdul Gani was not a tenant under classes 1, 3 and 4 and the only way he could come within the ambit of Chotanagpur Tenancy Act was by being a "raiyat" as mentioned in class (2).
"Raiyat" is defined in section 6 of this Act to mean "primarily a person who has acquired a right to hold land for the purpose of cultivating it by himself or by 'members of his family or by hired servants. or with the aid of partners ; and includes the successors in interest of persons who have acquired such a right It has been settled by a number of decisions of the Calcutta and the Patna High Courts that the purpose of planting an orchard comes within " 'the purpose of cultivation.
" If it appears that Abdul Gani took lease of the land in dispute for the purpose of growing an orchard he clearly became a raiyat ' under the Chotanagpur Tenancy Act.
While there is no document creating the lease we have, in the present case, Abdul Gani 's application for lease and the landlord 's order granting the lease.
The application is in these words: "I beg to apply for a plot of land measuring 1267 sq It.
in Sakchi New Planning for Garden Purpose and for permission to retain one step in the east side.
I agree to hold the land on monthly tenancy and to abide by the terms and conditions of the 5 Company and the house building rules.
I also agree to abide by the rules and bye laws of the Jamshedpur Notified Area Committee in force from time to time.
I agree to pay the security deposit to be fixed by you in respect of my tenancy as soon as the plot IS allotted to me and shall submit the plan of MY proposed house for approval of the Chief Town Engineer before I start construction.
I therefore request that you will kindly allot me a plot of land in the above mentioned Basti on your usual terms." Mr. Chatterjee fastens on the words "for garden purpose" and argues that that shows clearly that the purpose was to grow an orchard.
It will not be proper however to look only at this one phrase "for garden purpose" and to ignore the rest of the document.
It has to be noticed that after stating in the first sentence that he wanted the land "for garden purpose" Abdul Gani stated in the next paragraph that he agreed to hold the land "on monthly tenancy" and again that he agreed "to abide by the terms and conditions of the Company and the house building.
rules.
" It is difficult to conceive of a lease for cultivation being taken on a monthly tenancy.
It is even more difficult to understand why Abdul Gani would agree "to abide by the house building rules" if I the purpose was only to grow an orchard.
These two facts, namely, that the land would be held on monthly tenancy and the tenant would abide by the house building rules, have to be considered along with the earlier statement that the land was being applied " 'for garden purpose.
" The terms of the application for lease are, in our opinion, sufficient to show that the lease was not for an agricultural or horticultural purpose.
In view of this, it is unnecessary to investigate how the land was actually used.
It may be mentioned however that if one did examine the evidence to 6 find out such user, it becomes clear that while a part of the land was used for growing some guava, trees and some flowers, a pacca room was also erected: on a portion of the land.
On a consideration of all these things we find ourselves in agreement with the High Court that the purpose of the lease was not agricultural or horticultural.
We have, therefore, come to the conclusion that the High Court was right in decreeing the plaintiff 's suit.
The appeal is accordingly dismissed with costs.
Appeal dismissed.
|
The predecessor in interest of the present appellant applied to the land officer of the respondents for the settlement of the subject,matter of dispute, situated in,Jamshedpur.
The land was let out to him as tenant from month to month at a rent of Re. 1 / per month.
There was no document creating the lease.
The application for settlement contained averments to the effect that the applicant wanted it 1 for garden purposes" that he agreed to hold the land "on monthly tenancy" and that would abide by the "house building rules".
Following a notice to quit the respondents who are the owners of the plot filed a suit for eviction of the appellant and for arrears of rent.
The defence raised was that there was no monthly tenancy and the lease was for agricultural and horticultural purposes and the appellant was an agricultural tenant within the meaning of sections 4 and 6 of the Chotanagpur Tenancy Act who has fixity of tenure.
_The trial court upheld the contention and on appeal it was confirmed by the Subordinate Judge.
On second appeal the High Court of Patna held that the lease was not for agri cultural purposes and ordered eviction.
The present appeal is by way of special leave granted by this Court.
The main contention before this Court was that since the application for Jew made it clear that the land was for "garden 2 purpose" the appellant was raiyat within the meaning of section 6 of the Act.
Held, that the statement of the purpose had to considered alongwith the other facts mentioned in the document, viz. that the application was for a monthly tenancy, and that the applicant agreed to abide by the house building rules.
On such consideration, it was clear that the lease was not for horticultural or agricultural purposes.
|
ppeal No. 286 of 1960.
Appeal by special leave from the judgment and decree dated March 26, 1958, of the Patna High Court in Second Appeal No. 1330 of 1954.
N.C. Chatterjee and R. C. Prasad, for the appellant.
section N. Andley and section P. Varma, for the respondent No. 1. 1962.
November 9.
The judgment of the Court was delivered by DAS GUPTA, J.
The subject matter of this litigation is a plot of land measuring 1267 sq.
in the Sakchi New Planning area in the town of Jamshedpur.
On June 23,1937, Abdul Gani, through whom the present appellant claims to be interested in the land, applied for settlement of this plot of land to the Land Officer of the owner of the land, the Tata Iron and Steel Company Ltd. The application was allowed and the land was let out to Abdul Gani as a tenant from month to month at a rent of Re. 1/per month.
The suit out of which this appeal has arisen was brought in 1949 for ejectment of the tenant after determination of the tenancy by a notice to quit the premises.
There was also, a prayer for arrears of rent at Re 1/ per month.
The defence of Abdul Gani was that he was an agriculturist tenant as contemplated under the 3 Ghotanagpur Tenancy Act and not a monthly tenant and that no monthly rent was paid for the land It 'was, also pleaded that the lease being for agricultural and horticultural purposes at an annual rent, the defendant acquired a valid occupancy right and was not liable to ejectment.
The present appellant was added as a defendant by an order dated May 25, 1953.
He also filed a written statement contending that by operation of the provisions of Chotanagpur Tenancy Act, Abdul Gani had acquired occupancy right, that the purpose for which settlement was made with Abdul Gani could not create a monthly tenancy and the plaintiff was not entitled to Khas possession.
The Trial Court (The Additional Munsif, Jamshedpur), accepted the defence plea that the tenancy created in favour of Abdul Gani was agricultural, that Abdul Gani had acquired an occupancy raiyat 's right therein and as the tenancy Act was governed by the Chotanagpur Tenancy Act the suit was not triable by a civil court.
Accordingly, he dismissed the suit.
On appeal the Subordinate Judge, Singhbhum, with the findings of the Trial Court that the holding was agricultural and therefore governed by the Chotanagpur Tenancy Act and accordingly affirmed the judgment and decree of the Trial Court.
The High Court of judicature at Patna however came to the conclusion in Second Appeal that the lease was not for agricultural and horticultural purposes and there was no question.
of the defendant having acquired the right of occupancy in the land.
The High Court allowed the appeal, set aside the judgment and decree of the courts below and decreed the plaintiffs suit.
Against this decision of the High Court this appeal has been filed by special leave granted by this Court.
4 In support of the appeal it is urged before us by Mr. N. Chatterjee, that the High Court erred in holding that the lease was not for agricultural or horticultural purposes.
He points out that the application for lease of the land mentions ""garden purpose" as the purpose of the tenancy, and argues that that is sufficient to make Abdul Gani a raiyat within the meaning of section 6 of the Chotanagpur Tenancy Act.
Section 4 of the Act states that for the purpose of this Act there shall be four classes of tenants, namely, (1) tenure holders,(2) raiyats, (3) under raiyats and(4)Munderi Khunt kattidars.
Admittedly ' and obviously, Abdul Gani was not a tenant under classes 1, 3 and 4 and the only way he could come within the ambit of Chotanagpur Tenancy Act was by being a "raiyat" as mentioned in class (2).
"Raiyat" is defined in section 6 of this Act to mean "primarily a person who has acquired a right to hold land for the purpose of cultivating it by himself or by 'members of his family or by hired servants. or with the aid of partners ; and includes the successors in interest of persons who have acquired such a right It has been settled by a number of decisions of the Calcutta and the Patna High Courts that the purpose of planting an orchard comes within " 'the purpose of cultivation.
" If it appears that Abdul Gani took lease of the land in dispute for the purpose of growing an orchard he clearly became a raiyat ' under the Chotanagpur Tenancy Act.
While there is no document creating the lease we have, in the present case, Abdul Gani 's application for lease and the landlord 's order granting the lease.
The application is in these words: "I beg to apply for a plot of land measuring 1267 sq It.
in Sakchi New Planning for Garden Purpose and for permission to retain one step in the east side.
I agree to hold the land on monthly tenancy and to abide by the terms and conditions of the 5 Company and the house building rules.
I also agree to abide by the rules and bye laws of the Jamshedpur Notified Area Committee in force from time to time.
I agree to pay the security deposit to be fixed by you in respect of my tenancy as soon as the plot IS allotted to me and shall submit the plan of MY proposed house for approval of the Chief Town Engineer before I start construction.
I therefore request that you will kindly allot me a plot of land in the above mentioned Basti on your usual terms." Mr. Chatterjee fastens on the words "for garden purpose" and argues that that shows clearly that the purpose was to grow an orchard.
It will not be proper however to look only at this one phrase "for garden purpose" and to ignore the rest of the document.
It has to be noticed that after stating in the first sentence that he wanted the land "for garden purpose" Abdul Gani stated in the next paragraph that he agreed to hold the land "on monthly tenancy" and again that he agreed "to abide by the terms and conditions of the Company and the house building.
rules.
" It is difficult to conceive of a lease for cultivation being taken on a monthly tenancy.
It is even more difficult to understand why Abdul Gani would agree "to abide by the house building rules" if I the purpose was only to grow an orchard.
These two facts, namely, that the land would be held on monthly tenancy and the tenant would abide by the house building rules, have to be considered along with the earlier statement that the land was being applied " 'for garden purpose.
" The terms of the application for lease are, in our opinion, sufficient to show that the lease was not for an agricultural or horticultural purpose.
In view of this, it is unnecessary to investigate how the land was actually used.
It may be mentioned however that if one did examine the evidence to 6 find out such user, it becomes clear that while a part of the land was used for growing some guava, trees and some flowers, a pacca room was also erected: on a portion of the land.
On a consideration of all these things we find ourselves in agreement with the High Court that the purpose of the lease was not agricultural or horticultural.
We have, therefore, come to the conclusion that the High Court was right in decreeing the plaintiff 's suit.
The appeal is accordingly dismissed with costs.
Appeal dismissed.
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ppeal No. 286 of 1960.
Appeal by special leave from the judgment and decree dated March 26, 1958, of the Patna High Court in Second Appeal No. 1330 of 1954.
N.C. Chatterjee and R. C. Prasad, for the appellant.
section N. Andley and section P. Varma, for the respondent No. 1. 1962.
November 9.
The judgment of the Court was delivered by DAS GUPTA, J.
The subject matter of this litigation is a plot of land measuring 1267 sq.
in the Sakchi New Planning area in the town of Jamshedpur.
On June 23,1937, Abdul Gani, through whom the present appellant claims to be interested in the land, applied for settlement of this plot of land to the Land Officer of the owner of the land, the Tata Iron and Steel Company Ltd. The application was allowed and the land was let out to Abdul Gani as a tenant from month to month at a rent of Re. 1/per month.
The suit out of which this appeal has arisen was brought in 1949 for ejectment of the tenant after determination of the tenancy by a notice to quit the premises.
There was also, a prayer for arrears of rent at Re 1/ per month.
The defence of Abdul Gani was that he was an agriculturist tenant as contemplated under the 3 Ghotanagpur Tenancy Act and not a monthly tenant and that no monthly rent was paid for the land It 'was, also pleaded that the lease being for agricultural and horticultural purposes at an annual rent, the defendant acquired a valid occupancy right and was not liable to ejectment.
The present appellant was added as a defendant by an order dated May 25, 1953.
He also filed a written statement contending that by operation of the provisions of Chotanagpur Tenancy Act, Abdul Gani had acquired occupancy right, that the purpose for which settlement was made with Abdul Gani could not create a monthly tenancy and the plaintiff was not entitled to Khas possession.
The Trial Court (The Additional Munsif, Jamshedpur), accepted the defence plea that the tenancy created in favour of Abdul Gani was agricultural, that Abdul Gani had acquired an occupancy raiyat 's right therein and as the tenancy Act was governed by the Chotanagpur Tenancy Act the suit was not triable by a civil court.
Accordingly, he dismissed the suit.
On appeal the Subordinate Judge, Singhbhum, with the findings of the Trial Court that the holding was agricultural and therefore governed by the Chotanagpur Tenancy Act and accordingly affirmed the judgment and decree of the Trial Court.
The High Court of judicature at Patna however came to the conclusion in Second Appeal that the lease was not for agricultural and horticultural purposes and there was no question.
of the defendant having acquired the right of occupancy in the land.
The High Court allowed the appeal, set aside the judgment and decree of the courts below and decreed the plaintiffs suit.
Against this decision of the High Court this appeal has been filed by special leave granted by this Court.
4 In support of the appeal it is urged before us by Mr. N. Chatterjee, that the High Court erred in holding that the lease was not for agricultural or horticultural purposes.
He points out that the application for lease of the land mentions ""garden purpose" as the purpose of the tenancy, and argues that that is sufficient to make Abdul Gani a raiyat within the meaning of section 6 of the Chotanagpur Tenancy Act.
Section 4 of the Act states that for the purpose of this Act there shall be four classes of tenants, namely, (1) tenure holders,(2) raiyats, (3) under raiyats and(4)Munderi Khunt kattidars.
Admittedly ' and obviously, Abdul Gani was not a tenant under classes 1, 3 and 4 and the only way he could come within the ambit of Chotanagpur Tenancy Act was by being a "raiyat" as mentioned in class (2).
"Raiyat" is defined in section 6 of this Act to mean "primarily a person who has acquired a right to hold land for the purpose of cultivating it by himself or by 'members of his family or by hired servants. or with the aid of partners ; and includes the successors in interest of persons who have acquired such a right It has been settled by a number of decisions of the Calcutta and the Patna High Courts that the purpose of planting an orchard comes within " 'the purpose of cultivation.
" If it appears that Abdul Gani took lease of the land in dispute for the purpose of growing an orchard he clearly became a raiyat ' under the Chotanagpur Tenancy Act.
While there is no document creating the lease we have, in the present case, Abdul Gani 's application for lease and the landlord 's order granting the lease.
The application is in these words: "I beg to apply for a plot of land measuring 1267 sq It.
in Sakchi New Planning for Garden Purpose and for permission to retain one step in the east side.
I agree to hold the land on monthly tenancy and to abide by the terms and conditions of the 5 Company and the house building rules.
I also agree to abide by the rules and bye laws of the Jamshedpur Notified Area Committee in force from time to time.
I agree to pay the security deposit to be fixed by you in respect of my tenancy as soon as the plot IS allotted to me and shall submit the plan of MY proposed house for approval of the Chief Town Engineer before I start construction.
I therefore request that you will kindly allot me a plot of land in the above mentioned Basti on your usual terms." Mr. Chatterjee fastens on the words "for garden purpose" and argues that that shows clearly that the purpose was to grow an orchard.
It will not be proper however to look only at this one phrase "for garden purpose" and to ignore the rest of the document.
It has to be noticed that after stating in the first sentence that he wanted the land "for garden purpose" Abdul Gani stated in the next paragraph that he agreed to hold the land "on monthly tenancy" and again that he agreed "to abide by the terms and conditions of the Company and the house building.
rules.
" It is difficult to conceive of a lease for cultivation being taken on a monthly tenancy.
It is even more difficult to understand why Abdul Gani would agree "to abide by the house building rules" if I the purpose was only to grow an orchard.
These two facts, namely, that the land would be held on monthly tenancy and the tenant would abide by the house building rules, have to be considered along with the earlier statement that the land was being applied " 'for garden purpose.
" The terms of the application for lease are, in our opinion, sufficient to show that the lease was not for an agricultural or horticultural purpose.
In view of this, it is unnecessary to investigate how the land was actually used.
It may be mentioned however that if one did examine the evidence to 6 find out such user, it becomes clear that while a part of the land was used for growing some guava, trees and some flowers, a pacca room was also erected: on a portion of the land.
On a consideration of all these things we find ourselves in agreement with the High Court that the purpose of the lease was not agricultural or horticultural.
We have, therefore, come to the conclusion that the High Court was right in decreeing the plaintiff 's suit.
The appeal is accordingly dismissed with costs.
Appeal dismissed.
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The predecessor in interest of the present appellant applied to the land officer of the respondents for the settlement of the subject,matter of dispute, situated in,Jamshedpur.
The land was let out to him as tenant from month to month at a rent of Re. 1 / per month.
There was no document creating the lease.
The application for settlement contained averments to the effect that the applicant wanted it 1 for garden purposes" that he agreed to hold the land "on monthly tenancy" and that would abide by the "house building rules".
Following a notice to quit the respondents who are the owners of the plot filed a suit for eviction of the appellant and for arrears of rent.
The defence raised was that there was no monthly tenancy and the lease was for agricultural and horticultural purposes and the appellant was an agricultural tenant within the meaning of sections 4 and 6 of the Chotanagpur Tenancy Act who has fixity of tenure.
_The trial court upheld the contention and on appeal it was confirmed by the Subordinate Judge.
On second appeal the High Court of Patna held that the lease was not for agri cultural purposes and ordered eviction.
The present appeal is by way of special leave granted by this Court.
The main contention before this Court was that since the application for Jew made it clear that the land was for "garden 2 purpose" the appellant was raiyat within the meaning of section 6 of the Act.
Held, that the statement of the purpose had to considered alongwith the other facts mentioned in the document, viz. that the application was for a monthly tenancy, and that the applicant agreed to abide by the house building rules.
On such consideration, it was clear that the lease was not for horticultural or agricultural purposes.
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The predecessor in interest of the present appellant applied to the land officer of the respondents for the settlement of the subject,matter of dispute, situated in,Jamshedpur.
The land was let out to him as tenant from month to month at a rent of Re. 1 / per month.
There was no document creating the lease.
The application for settlement contained averments to the effect that the applicant wanted it 1 for garden purposes" that he agreed to hold the land "on monthly tenancy" and that would abide by the "house building rules".
Following a notice to quit the respondents who are the owners of the plot filed a suit for eviction of the appellant and for arrears of rent.
The defence raised was that there was no monthly tenancy and the lease was for agricultural and horticultural purposes and the appellant was an agricultural tenant within the meaning of sections 4 and 6 of the Chotanagpur Tenancy Act who has fixity of tenure.
_The trial court upheld the contention and on appeal it was confirmed by the Subordinate Judge.
On second appeal the High Court of Patna held that the lease was not for agri cultural purposes and ordered eviction.
The present appeal is by way of special leave granted by this Court.
The main contention before this Court was that since the application for Jew made it clear that the land was for "garden 2 purpose" the appellant was raiyat within the meaning of section 6 of the Act.
Held, that the statement of the purpose had to considered alongwith the other facts mentioned in the document, viz. that the application was for a monthly tenancy, and that the applicant agreed to abide by the house building rules.
On such consideration, it was clear that the lease was not for horticultural or agricultural purposes.
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Civil Appeal No. 3909 of 1986.
From the Judgment and order dated 29.9.1986 of the Allahabad High Court in C.R. No. 83 of 1986.
Shanker Ghosh and P K. Jain for the Appellants.
Y.S. Chitale.
Madan Lokur, Prashant Bhushan, Beni Parshad, Rajinder Dhawan and Jitendra Sharma for the Respondents.
This appeal arises out of a judgment passed by the High Court of Allahabad in Civil Revision No. 83 of 1986 wherein the learned Judge of the High Court allowed the revision petition set aside the judgment and decree of the Trial Judge and decreed the plaintiff suit for ejectment of the appellant.
The disputed property was let out on June 25, 1976.
The accommodation was for the first time assessed for house tax by the Nagar Palika Ghaziabad with effect from October 1, 1976.
The suit was filed for eviction after termination of tenancy before the trial court and objection was raised that as the shop and the basement were separately let out the tenancy could not be terminated by a single notice that would be invalid.
The trial court therefore dismissed the suit.
The High Court set aside this conclusion of the trial court.
The main ground which was before the High Court was as to whether the provisions of U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 ( 'Act ' for short) will be applicable to these proceedings in view of the fact that although the premises were let out in June 1976 but as the assessment was made on October 1, 1976 the provisions of the Act referred to above will not apply for 10 years from October 1, 1976 and therefore the suit could be decreed as the protection available under this Act will not be available to the tenant.
High Court after discussing various decisions came to the conclusion that in view of the language of Section 2 sub clause 2 Explanation 1, it could not be doubted that period of 10 years will commence from 160 the date of assessment i.e. October 1, 1976 that it is in that view of the matter that the learned Judge of the High Court decreed the suit and hence the present appeal.
Learned counsel for the appellant contended that apart from the controversy about the date which should be the starting point for computing the period of 10 years in view of the language of Sections 39 and 40 of the Act, provisions of this Act will be applicable to the present case and therefore a decree for eviction could only be passed.
If it could be passed on anyone of the grounds mentioned in Section 20 clause 2 of this Act in support of this contention the learned counsel placed reliance on decisions in Om Prakash Gupta etc.
vs Dig Vijendrapal Gupta etc.
, 11982] 3 SCR 491 and Vineet Kumar vs Mangal Sain Wadhera, [ On the other hand learned counsel for the respondent contended that the rights of parties will be governed on the basis of the date on which the suit was filed and it was contended that if on the date on which the suit was filed by the respondent the provisions of this Act were not applicable then merely because the proceedings have been pending for all these years it could not be contended that as now 10 years elapsed the decree could not be passed.
Learned counsel placed reliance on a decision in Firms Amar Nath Basheshar Dass vs Tek Chand, 11972] 3 SCR 922 and contended that this is a decision of three Judges Bench which clearly hold that if the suit was filed within a period of exemption then the suit could be decreed and the provisions of the Act will not be applicable.
Learned counsel further contended that in the decision in Vineet Kumar 's case (supra) on which reliance has been placed by learned counsel for the appellant the Firms Amar Naath Basheshar Dass 's case (supra) has not been referred to and decision in Vineet Kumar 's case (supra) is a judgment by a Bench of two Judges.
It was also contended by learned counsel that as till the matter was pending in the High Court 10 years have not been completed and therefore the High Court passed the decree Now it could not be contended that as during the pendency of the proceedings in this Court 10 years have elapsed and therefore the appellant tenant will be entitled to protection of the provisions of Section 20 It was contended that it is well settled that if the right to file a suit accrues on the date of tiling of the suit then the rights will have to be determined on the basis of the law applicable on the date of the suit and not subsequently.
Learned counsel for the appellant contended that the decision in 161 Firms Amar Nath Basheshar Dass 's case (supra) will not be applicable to the present case as in that case this Court was considering the language of a notification issued under the East Punjab Act exempting buildings from the operation of the Act for five years and the view taken by this Court in that decision is based on the language of the notification issued whereas in view of the language of Sections 39 and 40 of the Act which is applicable to the present case that view is not possible and it is because of this that in Vineet Kumar 's case (supra) this Court took the view that if during the pendency of the proceedings 10 years have elapsed the tenant will be entitled to the benefit of the provisions of the Act.
It was contended that in this decision the Court was concerned with the provisions of Section 2 of the Act itself.
Before this Court also the only question that was raised on behalf of the parties was as to whether the provisions of the Act will be applicable or not and as to whether the protection granted to the tenants under this Act will be available to the present appellant Learned counsel for the appellant contended that as during the pendency of this matter in this Court 10 years have elapsed even if the date of completion is taken to be 1.
10.76 which is the date on which the first assessment of this property was made and during the pendency of this matter 1.
10.86 has been crossed now the period of exemption has come to an end and therefore the appellant is entitled to the benefits thereof.
In the alternative it was contended that even if it is held that the rights of parties have to be determined in respect of the date on which the suit was filed still because of the language of Sections 39 and 40 of this Act the appellant tenant will be entitled to protection under this Act Sub clause (2) Sec.
2 of the Act reads as under: "(2) Except as provided in sub section (5) of Section 12, sub section (1 A) of Section 21, sub section (2) of Section 84, Sections 24 A, 24 B, 24 C or sub section (3) of Section 29, nothing in this Act shall apply to a building during a period of ten years from the date on which its construction is completed: Provided that where any building is constructed substantially out of funds obtained by way of loan or advance from the State Government or the Life Insurance Corporation of India or a bank or a co operative society or the Uttar Pradesh Avas Evam Vikas Parishad, and the period of repayment of such loan or advance exceeds the aforesaid 162 period of ten years then the reference in this sub section to the period of ten years shall be deemed to be a reference to the period of fifteen years or the period ending with the date of actual repayment of such loan or advance (including interest), whichever is shorter: Explanation I For the purposes of this sub section, (a) the construction of a building shall be deemed to have been completed on the date on which the completion thereof is reported to or otherwise recorded by the local authority having jurisdiction, and in the case of a building subject to assessment, the date on which the first assessment thereof comes into effect, and where the said dates are different, the earliest of the said dates and in the absence of any such report, record or assessment, the date on which it is actually occupied (not including occupation merely for the purposes of supervising the construction or guarding the building under construction) for the first time: Provided that there may be different dates of completion of construction in respect of different parts of a building which are either designed as separate units or are occupied separately by the landlord and one or more tenants or by different tenants: (b)"construction" includes any new construction in place of an existing building which has been wholly or substantially demolished; (c) where such substantial addition is made to an existing building that the existing building becomes only a minor part thereof the whole of the building including the existing building shall be deemed to be constructed on the date of completion of the said addition.
" A perusal of this provision will clearly indicate that the new buildings constructed have been exempted from the operation of this Act for a period of 10 years.
This period of 10 years have to be computed in the manner from the date as indicated in Explanation 1 and it was contended by learned counsel for the respondents that it will be the date on which the first assessment was made and so far as this question is concerned, it is also concluded by a decision of this Court in Om 163 Prakash Gupta 's case (supra) where it has been clearly held while interpreting Sec.
2 Explanation I of this Act that if there is an assessment made then the date of completion of the building, the date from which 10 years are to be computed will be the date on which the first assessment was made.
In this view of the matter therefore it is clear that 10 years have to be computed from 1. 10.76, and it is because of this that even the learned counsel for the appellant did not seriously contend that the 10 years commence from 1.10.76.
It is true that the decision reported in Firms Amar Nath Basheshar Dass 's case (supra) is a decision on the Punjab Act where the question before this Court was about the language of the notification which was issued under the Act exempting the buildings from operation of the Act for a period of S years and it is true that the language of the notification was not identical with the language of Sec.
2 sub clause 2 quoted above.
But apart from it the contention advanced by the learned counsel for the appellant was that because of the language of Section 39 and 40 even if the matter is pending in this Court and 10 years have elapsed, appellant will be entitled to the benefit of the provisions of this Act because according to him the appeal will be a continuation of the suit and therefore the advantage will be available.
It is no doubt true that the appeal is the continuation of the suit and if within the language of Section 39 the appellant is entitled to the advantage of the Section even if the matter is pending in this Court the protection will be available to the appellant but looking to the language of Section 39 it appears that the contention of the learned counsel could not be accepted.
Pending suits for eviction relating to buildings brought under regulation for the first time In any suit for eviction of a tenant from any building to which the old Act did not apply, pending on the date of commencement of this Act, where the tenant within one month from such date of commencement or from the date of his knowledge of the pendency of the suit, whichever be later, deposits in the court before which the suit is pending, the entire amount of rent and damages for use and occupation (such damages for use and occupation being calculated at the same rate as rent) together with interest thereon at the rate of nine cent per annum and the landlord 's full cost of the suit, no decree for eviction shall be passed except on any of the grounds 164 mentioned in the proviso to sub section (1) or in clauses (b) A to (g) of sub section (2) of Section 20, and the parties shall be entitled to make necessary amendment in their pleadings and to adduce additional evidence where necessary: Provided that a tenant the rent payable by whom does not exceed twenty five rupees per month need not deposit any interest as aforesaid:" It is pertinent to note that this Section applies to those suits which were pending on the date of the commencement of this Act.
Admittedly this Act came into force on 15th July, 1972 and therefore if the suit was pending on that date it is only then that the provisions of Section 39 will come to the assistance of the tenant appellant.
Admittedly this suit was not pending on the date on which this Act came into force.
An attempt was made to contend that so far as the present property is concerned the Act will be deemed to have come into force on the expiry of 10 years i.e. 1.10.86 but this contention could not be accepted as it is very clear from the language of this Act that it applied I only to a suit pending on the date of the commencement of this Act and this is the view taken in the Om Prakash Gupta 's case wherein it was observed: "Further, in order to attract section 39 the suit must be pending on the date of commencement of the Act which is 15th of July, 1972 but the suit giving rise to the present appeal was filed on 23rd of March, 1974 long after the commencement of the Act.
There is yet another reason why section 39 will have no application to the present case.
It is therefore clear that so far as the present appeal is concerned, the provisions of Section 39 will be of no avail.
Section 40 of the Act reads as under: "40.
Pending appeals or revisions in suits for eviction relating to buildings brought under regulation for the first time Where an appeal or revision arising out of a suit for eviction of a tenant from any building to which the old Act did not apply is pending on the date of commencement of this Act, it shall be disposed of in accordance with the provisions of Section 39, which shall mutatis mutandis apply." 165 This Section talks of the pendency of a revision or an appeal arising out of a suit pending on the day on which this Act came into force.
It is clear that provisions of Section 40 will come to the rescue of the appellant tenant only if the suit from which revision or appeal arose was pending on the date of commencement of this Act i.e. 15.7.1972 and therefore it could not be contended that the present revision petition or the appeal either to the High Court or the appellate authority arose out of suit which was pending on the date on which this Act came into force.
Admittedly the suit itself was filed much after the coming into force of this Act.
In this view of the matter therefore, in our opinion, even this contention of learned counsel for the appellant could not be accepted.
It is well settled that the rights of the parties will be determined on the basis of the rights available to them on the date of the suit, but in Vineet Kumar 's case (supra) this Court took the view that if during the pendency of the proceedings 10 years have elapsed the tenant is entitled to the protection under the Act and in coming to this conclusion the Court also considered the language of Section 39 of the Act and it observed: "The appellant in the present case only seeks the protection of the new Rent Act which became applicable to the premises in question during the pendency c.f the litigation.
We see no reason why the benefit of the new Rent Act be not given to the appellant.
Section 20 of the new Rent Act provides a bar to a suit for eviction of a tenant except on the specified grounds as provided in the section.
Subsection (4) of section 20 stipulated that in any suit for eviction on the grounds mentioned in Cl.
(a) to sub section
(2) viz. the arrears of rent, if at the first hearing of the suit the tenant in default pays all arrears of rent to the landlord or deposits in court the entire amount of rent and damages for the use and occupation of the building due from him, such damages for use and occupation being calculated at the same rate as rent together with interest thereon at the rate of nine per cent per annum and the landlord 's cost of the suit in respect thereof after deducting therefrom any amount already deposited by the tenant under sub section (1) of section 30, the court may, in lieu of passing a decree for eviction on that ground, pass an order relieving the tenant against his liability for eviction on that ground.
Section 39 and 40 of the new Rent Act also indicate that the benefit of new Act will be given 166 to the tenant if the conditions contemplated in those sections are satisfied.
Section 39 also indicates that the parties are entitled to make necessary amendment in their pleadings and to adduce additional evidence where necessary. " But unfortunately attention of the Court was not drawn to the Om Prakash Gupta 's case (supra) which specifically considered this Act and the language of Section 39 in particular and is a decision of a Bench of three Judges which is binding on us.
The restriction on the right of a landlord to evict a tenant has been provided for in this Act under Section 20 and the language of Section 20 is also significant.
Bar of suit for eviction of tenant except on specified grounds (1) Save as provided in sub section (2) no suit shall be instituted for the eviction of a tenant from a building, notwithstanding the determination of his tenancy by efflux of time or on the expiration of a notice to quit or in any other manner: Provided that nothing in this sub section shall bar a suit for the eviction of a tenant on the determination of his tenancy by efflux of time where the tenancy for a fixed term was entered into by or in pursuance of a compromise or adjustment arrived at with reference to a suit, appeal, revision or execution proceedings, which is either recorded in court or otherwise reduced to writing and signed by the tenant.
" This is put in Chapter IV with the heading "Regulation and Eviction" and the section starts with title which is printed in bold "Bar of suit for eviction of tenant except on specified grounds" and again in the wording of the section itself it provides: "No suit shall be instituted for eviction.
" This clearly indicates that the restriction put under Section 20 is to the institution of the suit itself and therefore it is clear that if the provisions of this Act applies then no suit for eviction can be instituted except on the grounds specified in the sub sections of this Section.
Keeping in view the language of this Section if we examine the provisions contained in sub section (2) of Section 2 it will be clear that for a newly constructed building the provisions of this Act will not apply for 10 years and therefore so far as the restriction under Section 20 is concerned they will not apply and therefore it is clear that within 10 years as provided for in clause (2) of Section 2 restriction of the 167 institution of suit as provided for in Section 20 clause (1) quoted above will not be applicable and it is thus clear that during the pendency of the litigation even of 10 years expired the restriction will not be attracted as the suit has been instituted within 10 years and therefore restriction as provided for in Section 20 can not be attracted.
In the light of the discussions above therefore, in our opinion, the contention advanced by learned counsel for the appellant can not be accepted.
The appellant tenant could not be given the advantage of the provisions contained ' in this Act.
In this view of the matter therefore the appeal is without any substance and is dismissed.
It is true that we maintained the decree for eviction passed by the High Court but in view of the fact that as the appellant has been carrying out the business in the premises for a long time for it would be proper to permit the appellant time to make their arrangements for shifting.
We therefore direct that the decree for eviction shall not be executed upto 3 1st March, 1988 on the appellant filing a usual undertaking within four weeks.
In default the respondent shall be entitled to execute the decree forthwith.
In the circumstances of the case parties are directed to bear their own costs.
S.L. Appeal dismissed.
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The appellants are the tenants of the disputed property.
Respondent plaintiff 's suit for eviction of the appellants was dismissed by the trial court.
The High Court in revision set aside the judgment and order of the trial court and decreed the suit for ejectment of the tenants appellants.
The tenants appealed to this Court.
Dismissing the appeal, the Court, HELD: Under the provisions of sub section (2) of Section 2 of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, newly constructed buildings stand exempted from the operation of the Act for a period of ten years, which has to be computed from a date to be determined in the manner indicated in Explanation I to section 2(2), which in this case is the date on which first assessment of the premises in dispute was made for house tax by the Nagar Palika, i.e. October 1, 1976.
Provisions of Sections 39 and 40 are of no avail to the appellants as the suit for their eviction was not pending on July 15, 1972, when the Act came into force; the suit being filed much later after coming into force of the Act.
Provisions of the Act are not applicable to the appellants ' case and the protection thereunder granted to the tenants is not available to them.
[166G H; 164C, F] In view of the fact that the appellants had been carrying on business in the premises in question for a long time, the decree for eviction directed not to be executed till March 31, 1988, subject to the appellants ' filing usual undertaking (within four weeks).
[167C D] Om Prakash Gupta, etc.
vs Dig Vijendrapal Gupta, etc., [19821 3 S.C.R. 491 and Vineet Kumar vs Mangal Sain Wadhera, [1985] A.l.
R. S.C. 817, relied upon by the appellants.
159 Firm Amar Nath Basheshar Das vs Tek Chand, [19721 3 S.C.R. 922, relied upon by the respondent.
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Civil Appeal No. 3909 of 1986.
From the Judgment and order dated 29.9.1986 of the Allahabad High Court in C.R. No. 83 of 1986.
Shanker Ghosh and P K. Jain for the Appellants.
Y.S. Chitale.
Madan Lokur, Prashant Bhushan, Beni Parshad, Rajinder Dhawan and Jitendra Sharma for the Respondents.
This appeal arises out of a judgment passed by the High Court of Allahabad in Civil Revision No. 83 of 1986 wherein the learned Judge of the High Court allowed the revision petition set aside the judgment and decree of the Trial Judge and decreed the plaintiff suit for ejectment of the appellant.
The disputed property was let out on June 25, 1976.
The accommodation was for the first time assessed for house tax by the Nagar Palika Ghaziabad with effect from October 1, 1976.
The suit was filed for eviction after termination of tenancy before the trial court and objection was raised that as the shop and the basement were separately let out the tenancy could not be terminated by a single notice that would be invalid.
The trial court therefore dismissed the suit.
The High Court set aside this conclusion of the trial court.
The main ground which was before the High Court was as to whether the provisions of U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 ( 'Act ' for short) will be applicable to these proceedings in view of the fact that although the premises were let out in June 1976 but as the assessment was made on October 1, 1976 the provisions of the Act referred to above will not apply for 10 years from October 1, 1976 and therefore the suit could be decreed as the protection available under this Act will not be available to the tenant.
High Court after discussing various decisions came to the conclusion that in view of the language of Section 2 sub clause 2 Explanation 1, it could not be doubted that period of 10 years will commence from 160 the date of assessment i.e. October 1, 1976 that it is in that view of the matter that the learned Judge of the High Court decreed the suit and hence the present appeal.
Learned counsel for the appellant contended that apart from the controversy about the date which should be the starting point for computing the period of 10 years in view of the language of Sections 39 and 40 of the Act, provisions of this Act will be applicable to the present case and therefore a decree for eviction could only be passed.
If it could be passed on anyone of the grounds mentioned in Section 20 clause 2 of this Act in support of this contention the learned counsel placed reliance on decisions in Om Prakash Gupta etc.
vs Dig Vijendrapal Gupta etc.
, 11982] 3 SCR 491 and Vineet Kumar vs Mangal Sain Wadhera, [ On the other hand learned counsel for the respondent contended that the rights of parties will be governed on the basis of the date on which the suit was filed and it was contended that if on the date on which the suit was filed by the respondent the provisions of this Act were not applicable then merely because the proceedings have been pending for all these years it could not be contended that as now 10 years elapsed the decree could not be passed.
Learned counsel placed reliance on a decision in Firms Amar Nath Basheshar Dass vs Tek Chand, 11972] 3 SCR 922 and contended that this is a decision of three Judges Bench which clearly hold that if the suit was filed within a period of exemption then the suit could be decreed and the provisions of the Act will not be applicable.
Learned counsel further contended that in the decision in Vineet Kumar 's case (supra) on which reliance has been placed by learned counsel for the appellant the Firms Amar Naath Basheshar Dass 's case (supra) has not been referred to and decision in Vineet Kumar 's case (supra) is a judgment by a Bench of two Judges.
It was also contended by learned counsel that as till the matter was pending in the High Court 10 years have not been completed and therefore the High Court passed the decree Now it could not be contended that as during the pendency of the proceedings in this Court 10 years have elapsed and therefore the appellant tenant will be entitled to protection of the provisions of Section 20 It was contended that it is well settled that if the right to file a suit accrues on the date of tiling of the suit then the rights will have to be determined on the basis of the law applicable on the date of the suit and not subsequently.
Learned counsel for the appellant contended that the decision in 161 Firms Amar Nath Basheshar Dass 's case (supra) will not be applicable to the present case as in that case this Court was considering the language of a notification issued under the East Punjab Act exempting buildings from the operation of the Act for five years and the view taken by this Court in that decision is based on the language of the notification issued whereas in view of the language of Sections 39 and 40 of the Act which is applicable to the present case that view is not possible and it is because of this that in Vineet Kumar 's case (supra) this Court took the view that if during the pendency of the proceedings 10 years have elapsed the tenant will be entitled to the benefit of the provisions of the Act.
It was contended that in this decision the Court was concerned with the provisions of Section 2 of the Act itself.
Before this Court also the only question that was raised on behalf of the parties was as to whether the provisions of the Act will be applicable or not and as to whether the protection granted to the tenants under this Act will be available to the present appellant Learned counsel for the appellant contended that as during the pendency of this matter in this Court 10 years have elapsed even if the date of completion is taken to be 1.
10.76 which is the date on which the first assessment of this property was made and during the pendency of this matter 1.
10.86 has been crossed now the period of exemption has come to an end and therefore the appellant is entitled to the benefits thereof.
In the alternative it was contended that even if it is held that the rights of parties have to be determined in respect of the date on which the suit was filed still because of the language of Sections 39 and 40 of this Act the appellant tenant will be entitled to protection under this Act Sub clause (2) Sec.
2 of the Act reads as under: "(2) Except as provided in sub section (5) of Section 12, sub section (1 A) of Section 21, sub section (2) of Section 84, Sections 24 A, 24 B, 24 C or sub section (3) of Section 29, nothing in this Act shall apply to a building during a period of ten years from the date on which its construction is completed: Provided that where any building is constructed substantially out of funds obtained by way of loan or advance from the State Government or the Life Insurance Corporation of India or a bank or a co operative society or the Uttar Pradesh Avas Evam Vikas Parishad, and the period of repayment of such loan or advance exceeds the aforesaid 162 period of ten years then the reference in this sub section to the period of ten years shall be deemed to be a reference to the period of fifteen years or the period ending with the date of actual repayment of such loan or advance (including interest), whichever is shorter: Explanation I For the purposes of this sub section, (a) the construction of a building shall be deemed to have been completed on the date on which the completion thereof is reported to or otherwise recorded by the local authority having jurisdiction, and in the case of a building subject to assessment, the date on which the first assessment thereof comes into effect, and where the said dates are different, the earliest of the said dates and in the absence of any such report, record or assessment, the date on which it is actually occupied (not including occupation merely for the purposes of supervising the construction or guarding the building under construction) for the first time: Provided that there may be different dates of completion of construction in respect of different parts of a building which are either designed as separate units or are occupied separately by the landlord and one or more tenants or by different tenants: (b)"construction" includes any new construction in place of an existing building which has been wholly or substantially demolished; (c) where such substantial addition is made to an existing building that the existing building becomes only a minor part thereof the whole of the building including the existing building shall be deemed to be constructed on the date of completion of the said addition.
" A perusal of this provision will clearly indicate that the new buildings constructed have been exempted from the operation of this Act for a period of 10 years.
This period of 10 years have to be computed in the manner from the date as indicated in Explanation 1 and it was contended by learned counsel for the respondents that it will be the date on which the first assessment was made and so far as this question is concerned, it is also concluded by a decision of this Court in Om 163 Prakash Gupta 's case (supra) where it has been clearly held while interpreting Sec.
2 Explanation I of this Act that if there is an assessment made then the date of completion of the building, the date from which 10 years are to be computed will be the date on which the first assessment was made.
In this view of the matter therefore it is clear that 10 years have to be computed from 1. 10.76, and it is because of this that even the learned counsel for the appellant did not seriously contend that the 10 years commence from 1.10.76.
It is true that the decision reported in Firms Amar Nath Basheshar Dass 's case (supra) is a decision on the Punjab Act where the question before this Court was about the language of the notification which was issued under the Act exempting the buildings from operation of the Act for a period of S years and it is true that the language of the notification was not identical with the language of Sec.
2 sub clause 2 quoted above.
But apart from it the contention advanced by the learned counsel for the appellant was that because of the language of Section 39 and 40 even if the matter is pending in this Court and 10 years have elapsed, appellant will be entitled to the benefit of the provisions of this Act because according to him the appeal will be a continuation of the suit and therefore the advantage will be available.
It is no doubt true that the appeal is the continuation of the suit and if within the language of Section 39 the appellant is entitled to the advantage of the Section even if the matter is pending in this Court the protection will be available to the appellant but looking to the language of Section 39 it appears that the contention of the learned counsel could not be accepted.
Pending suits for eviction relating to buildings brought under regulation for the first time In any suit for eviction of a tenant from any building to which the old Act did not apply, pending on the date of commencement of this Act, where the tenant within one month from such date of commencement or from the date of his knowledge of the pendency of the suit, whichever be later, deposits in the court before which the suit is pending, the entire amount of rent and damages for use and occupation (such damages for use and occupation being calculated at the same rate as rent) together with interest thereon at the rate of nine cent per annum and the landlord 's full cost of the suit, no decree for eviction shall be passed except on any of the grounds 164 mentioned in the proviso to sub section (1) or in clauses (b) A to (g) of sub section (2) of Section 20, and the parties shall be entitled to make necessary amendment in their pleadings and to adduce additional evidence where necessary: Provided that a tenant the rent payable by whom does not exceed twenty five rupees per month need not deposit any interest as aforesaid:" It is pertinent to note that this Section applies to those suits which were pending on the date of the commencement of this Act.
Admittedly this Act came into force on 15th July, 1972 and therefore if the suit was pending on that date it is only then that the provisions of Section 39 will come to the assistance of the tenant appellant.
Admittedly this suit was not pending on the date on which this Act came into force.
An attempt was made to contend that so far as the present property is concerned the Act will be deemed to have come into force on the expiry of 10 years i.e. 1.10.86 but this contention could not be accepted as it is very clear from the language of this Act that it applied I only to a suit pending on the date of the commencement of this Act and this is the view taken in the Om Prakash Gupta 's case wherein it was observed: "Further, in order to attract section 39 the suit must be pending on the date of commencement of the Act which is 15th of July, 1972 but the suit giving rise to the present appeal was filed on 23rd of March, 1974 long after the commencement of the Act.
There is yet another reason why section 39 will have no application to the present case.
It is therefore clear that so far as the present appeal is concerned, the provisions of Section 39 will be of no avail.
Section 40 of the Act reads as under: "40.
Pending appeals or revisions in suits for eviction relating to buildings brought under regulation for the first time Where an appeal or revision arising out of a suit for eviction of a tenant from any building to which the old Act did not apply is pending on the date of commencement of this Act, it shall be disposed of in accordance with the provisions of Section 39, which shall mutatis mutandis apply." 165 This Section talks of the pendency of a revision or an appeal arising out of a suit pending on the day on which this Act came into force.
It is clear that provisions of Section 40 will come to the rescue of the appellant tenant only if the suit from which revision or appeal arose was pending on the date of commencement of this Act i.e. 15.7.1972 and therefore it could not be contended that the present revision petition or the appeal either to the High Court or the appellate authority arose out of suit which was pending on the date on which this Act came into force.
Admittedly the suit itself was filed much after the coming into force of this Act.
In this view of the matter therefore, in our opinion, even this contention of learned counsel for the appellant could not be accepted.
It is well settled that the rights of the parties will be determined on the basis of the rights available to them on the date of the suit, but in Vineet Kumar 's case (supra) this Court took the view that if during the pendency of the proceedings 10 years have elapsed the tenant is entitled to the protection under the Act and in coming to this conclusion the Court also considered the language of Section 39 of the Act and it observed: "The appellant in the present case only seeks the protection of the new Rent Act which became applicable to the premises in question during the pendency c.f the litigation.
We see no reason why the benefit of the new Rent Act be not given to the appellant.
Section 20 of the new Rent Act provides a bar to a suit for eviction of a tenant except on the specified grounds as provided in the section.
Subsection (4) of section 20 stipulated that in any suit for eviction on the grounds mentioned in Cl.
(a) to sub section
(2) viz. the arrears of rent, if at the first hearing of the suit the tenant in default pays all arrears of rent to the landlord or deposits in court the entire amount of rent and damages for the use and occupation of the building due from him, such damages for use and occupation being calculated at the same rate as rent together with interest thereon at the rate of nine per cent per annum and the landlord 's cost of the suit in respect thereof after deducting therefrom any amount already deposited by the tenant under sub section (1) of section 30, the court may, in lieu of passing a decree for eviction on that ground, pass an order relieving the tenant against his liability for eviction on that ground.
Section 39 and 40 of the new Rent Act also indicate that the benefit of new Act will be given 166 to the tenant if the conditions contemplated in those sections are satisfied.
Section 39 also indicates that the parties are entitled to make necessary amendment in their pleadings and to adduce additional evidence where necessary. " But unfortunately attention of the Court was not drawn to the Om Prakash Gupta 's case (supra) which specifically considered this Act and the language of Section 39 in particular and is a decision of a Bench of three Judges which is binding on us.
The restriction on the right of a landlord to evict a tenant has been provided for in this Act under Section 20 and the language of Section 20 is also significant.
Bar of suit for eviction of tenant except on specified grounds (1) Save as provided in sub section (2) no suit shall be instituted for the eviction of a tenant from a building, notwithstanding the determination of his tenancy by efflux of time or on the expiration of a notice to quit or in any other manner: Provided that nothing in this sub section shall bar a suit for the eviction of a tenant on the determination of his tenancy by efflux of time where the tenancy for a fixed term was entered into by or in pursuance of a compromise or adjustment arrived at with reference to a suit, appeal, revision or execution proceedings, which is either recorded in court or otherwise reduced to writing and signed by the tenant.
" This is put in Chapter IV with the heading "Regulation and Eviction" and the section starts with title which is printed in bold "Bar of suit for eviction of tenant except on specified grounds" and again in the wording of the section itself it provides: "No suit shall be instituted for eviction.
" This clearly indicates that the restriction put under Section 20 is to the institution of the suit itself and therefore it is clear that if the provisions of this Act applies then no suit for eviction can be instituted except on the grounds specified in the sub sections of this Section.
Keeping in view the language of this Section if we examine the provisions contained in sub section (2) of Section 2 it will be clear that for a newly constructed building the provisions of this Act will not apply for 10 years and therefore so far as the restriction under Section 20 is concerned they will not apply and therefore it is clear that within 10 years as provided for in clause (2) of Section 2 restriction of the 167 institution of suit as provided for in Section 20 clause (1) quoted above will not be applicable and it is thus clear that during the pendency of the litigation even of 10 years expired the restriction will not be attracted as the suit has been instituted within 10 years and therefore restriction as provided for in Section 20 can not be attracted.
In the light of the discussions above therefore, in our opinion, the contention advanced by learned counsel for the appellant can not be accepted.
The appellant tenant could not be given the advantage of the provisions contained ' in this Act.
In this view of the matter therefore the appeal is without any substance and is dismissed.
It is true that we maintained the decree for eviction passed by the High Court but in view of the fact that as the appellant has been carrying out the business in the premises for a long time for it would be proper to permit the appellant time to make their arrangements for shifting.
We therefore direct that the decree for eviction shall not be executed upto 3 1st March, 1988 on the appellant filing a usual undertaking within four weeks.
In default the respondent shall be entitled to execute the decree forthwith.
In the circumstances of the case parties are directed to bear their own costs.
S.L. Appeal dismissed.
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From the Judgment and order dated 29.9.1986 of the Allahabad High Court in C.R. No. Shanker Ghosh and P K. Jain for the Appellants. Madan Lokur, Prashant Bhushan, Beni Parshad, Rajinder Dhawan and Jitendra Sharma for the Respondents. This appeal arises out of a judgment passed by the High Court of Allahabad in Civil Revision No. 83 of 1986 wherein the learned Judge of the High Court allowed the revision petition set aside the judgment and decree of the Trial Judge and decreed the plaintiff suit for ejectment of the appellant. The disputed property was let out on June 25, 1976. The accommodation was for the first time assessed for house tax by the Nagar Palika Ghaziabad with effect from October 1, 1976. The suit was filed for eviction after termination of tenancy before the trial court and objection was raised that as the shop and the basement were separately let out the tenancy could not be terminated by a single notice that would be invalid. The trial court therefore dismissed the suit. The High Court set aside this conclusion of the trial court. The main ground which was before the High Court was as to whether the provisions of U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 ( 'Act ' for short) will be applicable to these proceedings in view of the fact that although the premises were let out in June 1976 but as the assessment was made on October 1, 1976 the provisions of the Act referred to above will not apply for 10 years from October 1, 1976 and therefore the suit could be decreed as the protection available under this Act will not be available to the tenant. High Court after discussing various decisions came to the conclusion that in view of the language of Section 2 sub clause 2 Explanation 1, it could not be doubted that period of 10 years will commence from 160 the date of assessment i.e. October 1, 1976 that it is in that view of the matter that the learned Judge of the High Court decreed the suit and hence the present appeal. Learned counsel for the appellant contended that apart from the controversy about the date which should be the starting point for computing the period of 10 years in view of the language of Sections 39 and 40 of the Act, provisions of this Act will be applicable to the present case and therefore a decree for eviction could only be passed. If it could be passed on anyone of the grounds mentioned in Section 20 clause 2 of this Act in support of this contention the learned counsel placed reliance on decisions in Om Prakash Gupta etc. , 11982] 3 SCR 491 and Vineet Kumar vs Mangal Sain Wadhera, [ On the other hand learned counsel for the respondent contended that the rights of parties will be governed on the basis of the date on which the suit was filed and it was contended that if on the date on which the suit was filed by the respondent the provisions of this Act were not applicable then merely because the proceedings have been pending for all these years it could not be contended that as now 10 years elapsed the decree could not be passed. Learned counsel placed reliance on a decision in Firms Amar Nath Basheshar Dass vs Tek Chand, 11972] 3 SCR 922 and contended that this is a decision of three Judges Bench which clearly hold that if the suit was filed within a period of exemption then the suit could be decreed and the provisions of the Act will not be applicable. It was contended that in this decision the Court was concerned with the provisions of Section 2 of the Act itself. 10.76 which is the date on which the first assessment of this property was made and during the pendency of this matter 1. 10.86 has been crossed now the period of exemption has come to an end and therefore the appellant is entitled to the benefits thereof. In the alternative it was contended that even if it is held that the rights of parties have to be determined in respect of the date on which the suit was filed still because of the language of Sections 39 and 40 of this Act the appellant tenant will be entitled to protection under this Act Sub clause (2) Sec. " A perusal of this provision will clearly indicate that the new buildings constructed have been exempted from the operation of this Act for a period of 10 years. 2 Explanation I of this Act that if there is an assessment made then the date of completion of the building, the date from which 10 years are to be computed will be the date on which the first assessment was made. In this view of the matter therefore it is clear that 10 years have to be computed from 1. 10.76, and it is because of this that even the learned counsel for the appellant did not seriously contend that the 10 years commence from 1.10.76. It is true that the decision reported in Firms Amar Nath Basheshar Dass 's case (supra) is a decision on the Punjab Act where the question before this Court was about the language of the notification which was issued under the Act exempting the buildings from operation of the Act for a period of S years and it is true that the language of the notification was not identical with the language of Sec. But apart from it the contention advanced by the learned counsel for the appellant was that because of the language of Section 39 and 40 even if the matter is pending in this Court and 10 years have elapsed, appellant will be entitled to the benefit of the provisions of this Act because according to him the appeal will be a continuation of the suit and therefore the advantage will be available. It is no doubt true that the appeal is the continuation of the suit and if within the language of Section 39 the appellant is entitled to the advantage of the Section even if the matter is pending in this Court the protection will be available to the appellant but looking to the language of Section 39 it appears that the contention of the learned counsel could not be accepted. Admittedly this Act came into force on 15th July, 1972 and therefore if the suit was pending on that date it is only then that the provisions of Section 39 will come to the assistance of the tenant appellant. Admittedly this suit was not pending on the date on which this Act came into force. There is yet another reason why section 39 will have no application to the present case. It is therefore clear that so far as the present appeal is concerned, the provisions of Section 39 will be of no avail. Section 40 of the Act reads as under: "40. Pending appeals or revisions in suits for eviction relating to buildings brought under regulation for the first time Where an appeal or revision arising out of a suit for eviction of a tenant from any building to which the old Act did not apply is pending on the date of commencement of this Act, it shall be disposed of in accordance with the provisions of Section 39, which shall mutatis mutandis apply." 165 This Section talks of the pendency of a revision or an appeal arising out of a suit pending on the day on which this Act came into force. It is clear that provisions of Section 40 will come to the rescue of the appellant tenant only if the suit from which revision or appeal arose was pending on the date of commencement of this Act i.e. 15.7.1972 and therefore it could not be contended that the present revision petition or the appeal either to the High Court or the appellate authority arose out of suit which was pending on the date on which this Act came into force. Admittedly the suit itself was filed much after the coming into force of this Act. In this view of the matter therefore, in our opinion, even this contention of learned counsel for the appellant could not be accepted. We see no reason why the benefit of the new Rent Act be not given to the appellant. Section 20 of the new Rent Act provides a bar to a suit for eviction of a tenant except on the specified grounds as provided in the section. Subsection (4) of section 20 stipulated that in any suit for eviction on the grounds mentioned in Cl. Section 39 and 40 of the new Rent Act also indicate that the benefit of new Act will be given 166 to the tenant if the conditions contemplated in those sections are satisfied. Section 39 also indicates that the parties are entitled to make necessary amendment in their pleadings and to adduce additional evidence where necessary. " The restriction on the right of a landlord to evict a tenant has been provided for in this Act under Section 20 and the language of Section 20 is also significant. " This is put in Chapter IV with the heading "Regulation and Eviction" and the section starts with title which is printed in bold "Bar of suit for eviction of tenant except on specified grounds" and again in the wording of the section itself it provides: "No suit shall be instituted for eviction. " This clearly indicates that the restriction put under Section 20 is to the institution of the suit itself and therefore it is clear that if the provisions of this Act applies then no suit for eviction can be instituted except on the grounds specified in the sub sections of this Section. In the light of the discussions above therefore, in our opinion, the contention advanced by learned counsel for the appellant can not be accepted. The appellant tenant could not be given the advantage of the provisions contained ' in this Act. In this view of the matter therefore the appeal is without any substance and is dismissed. It is true that we maintained the decree for eviction passed by the High Court but in view of the fact that as the appellant has been carrying out the business in the premises for a long time for it would be proper to permit the appellant time to make their arrangements for shifting. We therefore direct that the decree for eviction shall not be executed upto 3 1st March, 1988 on the appellant filing a usual undertaking within four weeks. In default the respondent shall be entitled to execute the decree forthwith. In the circumstances of the case parties are directed to bear their own costs.
|
The appellants are the tenants of the disputed property.
Respondent plaintiff 's suit for eviction of the appellants was dismissed by the trial court.
The High Court in revision set aside the judgment and order of the trial court and decreed the suit for ejectment of the tenants appellants.
The tenants appealed to this Court.
Dismissing the appeal, the Court, HELD: Under the provisions of sub section (2) of Section 2 of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, newly constructed buildings stand exempted from the operation of the Act for a period of ten years, which has to be computed from a date to be determined in the manner indicated in Explanation I to section 2(2), which in this case is the date on which first assessment of the premises in dispute was made for house tax by the Nagar Palika, i.e. October 1, 1976.
Provisions of Sections 39 and 40 are of no avail to the appellants as the suit for their eviction was not pending on July 15, 1972, when the Act came into force; the suit being filed much later after coming into force of the Act.
Provisions of the Act are not applicable to the appellants ' case and the protection thereunder granted to the tenants is not available to them.
[166G H; 164C, F] In view of the fact that the appellants had been carrying on business in the premises in question for a long time, the decree for eviction directed not to be executed till March 31, 1988, subject to the appellants ' filing usual undertaking (within four weeks).
[167C D] Om Prakash Gupta, etc.
vs Dig Vijendrapal Gupta, etc., [19821 3 S.C.R. 491 and Vineet Kumar vs Mangal Sain Wadhera, [1985] A.l.
R. S.C. 817, relied upon by the appellants.
159 Firm Amar Nath Basheshar Das vs Tek Chand, [19721 3 S.C.R. 922, relied upon by the respondent.
|
The appellants are the tenants of the disputed property.
Respondent plaintiff 's suit for eviction of the appellants was dismissed by the trial court.
The High Court in revision set aside the judgment and order of the trial court and decreed the suit for ejectment of the tenants appellants.
The tenants appealed to this Court.
Dismissing the appeal, the Court, HELD: Under the provisions of sub section (2) of Section 2 of the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, newly constructed buildings stand exempted from the operation of the Act for a period of ten years, which has to be computed from a date to be determined in the manner indicated in Explanation I to section 2(2), which in this case is the date on which first assessment of the premises in dispute was made for house tax by the Nagar Palika, i.e. October 1, 1976.
Provisions of Sections 39 and 40 are of no avail to the appellants as the suit for their eviction was not pending on July 15, 1972, when the Act came into force; the suit being filed much later after coming into force of the Act.
Provisions of the Act are not applicable to the appellants ' case and the protection thereunder granted to the tenants is not available to them.
[166G H; 164C, F] In view of the fact that the appellants had been carrying on business in the premises in question for a long time, the decree for eviction directed not to be executed till March 31, 1988, subject to the appellants ' filing usual undertaking (within four weeks).
[167C D] Om Prakash Gupta, etc.
vs Dig Vijendrapal Gupta, etc., [19821 3 S.C.R. 491 and Vineet Kumar vs Mangal Sain Wadhera, [1985] A.l.
R. S.C. 817, relied upon by the appellants.
159 Firm Amar Nath Basheshar Das vs Tek Chand, [19721 3 S.C.R. 922, relied upon by the respondent.
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Civil Appeal No. 2860 of 1987.
From the Judgment and order dated 8.7.1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 1311 of 1983 and Suppl.
A. No. 1798 of 1987 BI.
Soli J. Sorabjee, S.R. Grover and K.J. John for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is a statutory appeal from the decision and order of the Customs Excise and Gold (Control) Appellate Tribunal (briefly referred to as 'CEGAT ') under section 35L of the Central Excise and Salt Act, 1944 (hereinafter called 'the Act ').
It appears that the appellant is a manufacturer of Hospital and Pharmaceutical Appliances and Heavy Duty Industrial Canteen Equipment.
The following 14 items were classified by him under Tariff Item No. 68 of the said Act in his Classification List No. 106 dated 27:3.1979: "(1) Storage Tank, (2) Cooking Range (Electric opera 734 tion and gas operated), (3) Baking oven, (4) Deep Fat Fryer, (5) Bain Mafie, (6) Sterilizing Sink, (7) Expresso Coffee Machine, (8) Steam Jacketed Vessel (Steam operated), (9) Bread Toaster, (10) Bulk Cooker & Fryer, (11) Chappatty Plate/Chappatty Puffer and Chappatty Plate/Puffer, (12) Dish Washing Machine, (13) Potato Pooler and (14) Masala Grinder.
" The Assistant Collector held the view that products 2 to 14 were classifiable under Tariff Item No. 33C in view of the Explanation thereof.
After giving notice the Assistant Collector demanded differential duty amounting to Rs.1,91,622.20 for the period Ist of March, 1979 to 30th June, 1980.
The Assistant Collector confirmed the demand except in respect of Item No. 8, namely, Steam Jacketed Vessel.
Being aggrieved from these orders, the appellant filed appeals before the Collector.
The Collector accepted the appellant 's contentions and came to the conclusion that these were to be classified under Tariff Item No. 68 and not under Tariff Item No. 33C. Tariff Item 33C at the relevant time contained the Explanation I, which is as follows: "Explanation I 'Domestic electrical appliances ' means electrical appliances normally used in the household and similar appliances used in hotels, restaurants, hostels.
offices, educational institutions, hospitals, train kitchens.
aircraft or ship 's pantries, canteens, tailoring establish ments, laundary shops and hair dressing saloons".
The revenue went up in appeal before the CEGAT.
The Tribunal noted that the equipments in question were used in industrial canteens, Five Star Hotels, big hospitals etc.
The nature of the items such as deep fat fryer, Expresso coffee machine, bread toaster, chap patty plate, etc.
were all electrically operated machines.
The Tribunal further noted that Tariff Item 33C was in respect of "domestic electrical appliances not elsewhere specified".
According to the Tribunal the intention of the legislature in respect of "domestic electrical appliances" was clear from the Explanation.
It is apparent that the above named items are specially designed for use in big canteens attached to industrial units, big hotels, hospitals etc.
where food in bulk quantity for hundreds of people is required to be prepared and served.
These required electric power exceeding 230 volts in order to have considerable capacity for preparing and serving food.
Their prices ranged from 735 Rs.7,000 to Rs.1.5 lakhs.
It was submitted that these are important and relevant factors for distinguishing the said items as distinct and different from those appliances which are used normally in the household.
It was submitted that these heavy duty items fall outside the purview of Tariff Item No. 33C. The Tribunal was of the view that though considerable space is required for these items but space was not any criteria for determining this question.
According to the Tribunal that these items could not be classified under Tariff Item No. 68.
We are of the opinion that the Tribunal is right.
It is manifest that these equipments were electrical appliances.
There was no dispute on that.
It is also clear that these are normally used in household and similar appliances are used in hotels etc.
The expression "similar" is a significant expression.
It does not mean identical but it means corresponding to or resembling to in many respects; somewhat like; or having a general likeness.
The statute does not contemplate that goods classed under the words of 'similar description ' shall be in all respects the same.
If it did these words would be unnecessary.
These were intended to embrace goods but not identical with those goods.
If the items were similar appliances which are normally used in the household, these will be taxable under Tariff Item No. 33C.
It appears that the Gujarat High Court in the case of Viswa & Co. vs The State of Gujarat, (17 Sales Tax Cases 581) had occasion to consider whether electric fans are domestic electrical appliances for the purpose of Bombay Sales Tax Act, 1953.
Bhagwati, J. as the learned Chief Justice then was, speaking for the Gujarat High Court observed as follows: "A domestic electrical appliance, in our opinion, would be an electrical appliance of a kind generally used for domestic purposes.
It may also be used at places other than the home or the house, but that would not destroy the character of a domestic electrical appliance which attaches to it by reason of its being a kind of an electrical appliance generally used for the household.
There are several electrical appliances which are generally used in the household, such as electric irons, electrical sewing machines and electrical cooking ranges which are also used in other establishments.
But these electrical appliances do not therefore cease to be domestic electrical appliances.
It is of course not necessary that an electrical appliance, in order to 736 satisfy the description of a domestic electrical appliance, must be actually used in the home or the house.
What is necessary is that it must be of a kind which is generally used for household purposes and if that test is applied, there is no doubt that electric fans are domestic electrical appliances and the Tribunal was therefore right in holding that they fall within entry 52 of Schedule B." We agree that it is not necessary to be a domestic electrical appliance that it must be actually used in the home or the house.
It must be of a kind which is generally used for household purposes.
It appears to us that the types of items concerned in this appeal are generally used for household purposes and that is sufficiently good test for classification in the light of the explanation to Tariff Item No. 33C.
In view of the fact that the Tribunal recognised that the appellant had set out all the details in the classification list and the revenue had assessed him under Tariff Item 68, the Tribunal came to the conclusion that there was no intention to evade payment of duty.
Therefore, the Tribunal directed that the modification of the classification list could only be prospective and not retrospective.
The Tribunal was just and right in so doing.
The Tribunal was also right in holding that in the absence of any proof of suppression of fact, section 11 A of the said Act would not be applicable.
The show cause notice raising a demand of duty was issued on 8th of September, 1980 and the Tribunal sustained the demand for the period 9th March, 1980 to 30th June, 1980 in respect of items 3 to 7 and 9 to 14.
We are of the opinion that the Tribunal was right and the decision of the Tribunal therefore, does not call for interference.
In that view of the matter the appeal is rejected.
There will be no order as to costs N.P.V. Appeal dismissed.
|
% Words and Phrases: 'Similar description ' meaning of.
The appellant, manufacturer of Hospital and Pharmaceutical Appliances and Heavy Duty Industrial Canteen Equipment, classified certain items like cooking range, deep fat fryer, express coffee machine, bread toaster etc.
, numbering 14, under Tariff Item No. 68 of the Central Excise and Salt Act, 1944.
The Assistant Collector held that products 2 to 14 were classifiable under Tariff Item No. 33C, in view of the Explanation thereof, and demanded differential duty for the period of 1st March, 1979 to 30th June, 1980.
The Collector, on appeal, held that these items were to be classified under Tariff item No. 68 and not under Tariff item 33C .
On appeal by the Revenue, the Central Customs Excise and Gold (Control) Appellate Tribunal, while noting that the equipment in question, some of which were electrically operated machines, were used in industrial canteens, five star hotels, big hospitals, etc.
held that the intention of the Legislature was clear from the Explanation to Tariff Item No. 33C, and the items in question could not be classified under Tariff Item No. 68.
Dismissing the appeal by the manufacturer.
^ HELD: The statute does not contemplate that goods classed under the words of "similar description" shall be in all respects the same.
If it did, these words would be unnecessary.
These were intended to embrace goods but not identical with those goods.
If the items were 732 similar appliances which are normally used in household, these will be taxable under Tariff Item No. 33C. [73CD] It is not necessary, to be a domestic appliance, that it must be actually used in the home or the house.
It must be of a kind that they are generally used for household purposes.
[736B] The types of items concerned in the instant case are generally used for household purposes and that is sufficiently good test for classification in the light of explanation to tariff item No. 33C.
The Tribunal was.
therefore, right in holding that these items could not be classified under Item 68.
[736C] Since the appellant had set out all the details and the Revenue had assessed the appellant under Tariff Item No. 68, the Tribunal was right in holding that there was no intention to evade payment of duty and in directing that the modification of the classification list could only be prospective and not retrospective.
In the absence of any proof of suppression of fact, it was also right in holding that section l 1 A of the Act would not be applicable.
[736D E]
|
Civil Appeal No. 2860 of 1987.
From the Judgment and order dated 8.7.1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 1311 of 1983 and Suppl.
A. No. 1798 of 1987 BI.
Soli J. Sorabjee, S.R. Grover and K.J. John for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is a statutory appeal from the decision and order of the Customs Excise and Gold (Control) Appellate Tribunal (briefly referred to as 'CEGAT ') under section 35L of the Central Excise and Salt Act, 1944 (hereinafter called 'the Act ').
It appears that the appellant is a manufacturer of Hospital and Pharmaceutical Appliances and Heavy Duty Industrial Canteen Equipment.
The following 14 items were classified by him under Tariff Item No. 68 of the said Act in his Classification List No. 106 dated 27:3.1979: "(1) Storage Tank, (2) Cooking Range (Electric opera 734 tion and gas operated), (3) Baking oven, (4) Deep Fat Fryer, (5) Bain Mafie, (6) Sterilizing Sink, (7) Expresso Coffee Machine, (8) Steam Jacketed Vessel (Steam operated), (9) Bread Toaster, (10) Bulk Cooker & Fryer, (11) Chappatty Plate/Chappatty Puffer and Chappatty Plate/Puffer, (12) Dish Washing Machine, (13) Potato Pooler and (14) Masala Grinder.
" The Assistant Collector held the view that products 2 to 14 were classifiable under Tariff Item No. 33C in view of the Explanation thereof.
After giving notice the Assistant Collector demanded differential duty amounting to Rs.1,91,622.20 for the period Ist of March, 1979 to 30th June, 1980.
The Assistant Collector confirmed the demand except in respect of Item No. 8, namely, Steam Jacketed Vessel.
Being aggrieved from these orders, the appellant filed appeals before the Collector.
The Collector accepted the appellant 's contentions and came to the conclusion that these were to be classified under Tariff Item No. 68 and not under Tariff Item No. 33C. Tariff Item 33C at the relevant time contained the Explanation I, which is as follows: "Explanation I 'Domestic electrical appliances ' means electrical appliances normally used in the household and similar appliances used in hotels, restaurants, hostels.
offices, educational institutions, hospitals, train kitchens.
aircraft or ship 's pantries, canteens, tailoring establish ments, laundary shops and hair dressing saloons".
The revenue went up in appeal before the CEGAT.
The Tribunal noted that the equipments in question were used in industrial canteens, Five Star Hotels, big hospitals etc.
The nature of the items such as deep fat fryer, Expresso coffee machine, bread toaster, chap patty plate, etc.
were all electrically operated machines.
The Tribunal further noted that Tariff Item 33C was in respect of "domestic electrical appliances not elsewhere specified".
According to the Tribunal the intention of the legislature in respect of "domestic electrical appliances" was clear from the Explanation.
It is apparent that the above named items are specially designed for use in big canteens attached to industrial units, big hotels, hospitals etc.
where food in bulk quantity for hundreds of people is required to be prepared and served.
These required electric power exceeding 230 volts in order to have considerable capacity for preparing and serving food.
Their prices ranged from 735 Rs.7,000 to Rs.1.5 lakhs.
It was submitted that these are important and relevant factors for distinguishing the said items as distinct and different from those appliances which are used normally in the household.
It was submitted that these heavy duty items fall outside the purview of Tariff Item No. 33C. The Tribunal was of the view that though considerable space is required for these items but space was not any criteria for determining this question.
According to the Tribunal that these items could not be classified under Tariff Item No. 68.
We are of the opinion that the Tribunal is right.
It is manifest that these equipments were electrical appliances.
There was no dispute on that.
It is also clear that these are normally used in household and similar appliances are used in hotels etc.
The expression "similar" is a significant expression.
It does not mean identical but it means corresponding to or resembling to in many respects; somewhat like; or having a general likeness.
The statute does not contemplate that goods classed under the words of 'similar description ' shall be in all respects the same.
If it did these words would be unnecessary.
These were intended to embrace goods but not identical with those goods.
If the items were similar appliances which are normally used in the household, these will be taxable under Tariff Item No. 33C.
It appears that the Gujarat High Court in the case of Viswa & Co. vs The State of Gujarat, (17 Sales Tax Cases 581) had occasion to consider whether electric fans are domestic electrical appliances for the purpose of Bombay Sales Tax Act, 1953.
Bhagwati, J. as the learned Chief Justice then was, speaking for the Gujarat High Court observed as follows: "A domestic electrical appliance, in our opinion, would be an electrical appliance of a kind generally used for domestic purposes.
It may also be used at places other than the home or the house, but that would not destroy the character of a domestic electrical appliance which attaches to it by reason of its being a kind of an electrical appliance generally used for the household.
There are several electrical appliances which are generally used in the household, such as electric irons, electrical sewing machines and electrical cooking ranges which are also used in other establishments.
But these electrical appliances do not therefore cease to be domestic electrical appliances.
It is of course not necessary that an electrical appliance, in order to 736 satisfy the description of a domestic electrical appliance, must be actually used in the home or the house.
What is necessary is that it must be of a kind which is generally used for household purposes and if that test is applied, there is no doubt that electric fans are domestic electrical appliances and the Tribunal was therefore right in holding that they fall within entry 52 of Schedule B." We agree that it is not necessary to be a domestic electrical appliance that it must be actually used in the home or the house.
It must be of a kind which is generally used for household purposes.
It appears to us that the types of items concerned in this appeal are generally used for household purposes and that is sufficiently good test for classification in the light of the explanation to Tariff Item No. 33C.
In view of the fact that the Tribunal recognised that the appellant had set out all the details in the classification list and the revenue had assessed him under Tariff Item 68, the Tribunal came to the conclusion that there was no intention to evade payment of duty.
Therefore, the Tribunal directed that the modification of the classification list could only be prospective and not retrospective.
The Tribunal was just and right in so doing.
The Tribunal was also right in holding that in the absence of any proof of suppression of fact, section 11 A of the said Act would not be applicable.
The show cause notice raising a demand of duty was issued on 8th of September, 1980 and the Tribunal sustained the demand for the period 9th March, 1980 to 30th June, 1980 in respect of items 3 to 7 and 9 to 14.
We are of the opinion that the Tribunal was right and the decision of the Tribunal therefore, does not call for interference.
In that view of the matter the appeal is rejected.
There will be no order as to costs N.P.V. Appeal dismissed.
|
Civil Appeal No. 2860 of 1987.
From the Judgment and order dated 8.7.1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 1311 of 1983 and Suppl.
A. No. 1798 of 1987 BI.
Soli J. Sorabjee, S.R. Grover and K.J. John for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is a statutory appeal from the decision and order of the Customs Excise and Gold (Control) Appellate Tribunal (briefly referred to as 'CEGAT ') under section 35L of the Central Excise and Salt Act, 1944 (hereinafter called 'the Act ').
It appears that the appellant is a manufacturer of Hospital and Pharmaceutical Appliances and Heavy Duty Industrial Canteen Equipment.
The following 14 items were classified by him under Tariff Item No. 68 of the said Act in his Classification List No. 106 dated 27:3.1979: "(1) Storage Tank, (2) Cooking Range (Electric opera 734 tion and gas operated), (3) Baking oven, (4) Deep Fat Fryer, (5) Bain Mafie, (6) Sterilizing Sink, (7) Expresso Coffee Machine, (8) Steam Jacketed Vessel (Steam operated), (9) Bread Toaster, (10) Bulk Cooker & Fryer, (11) Chappatty Plate/Chappatty Puffer and Chappatty Plate/Puffer, (12) Dish Washing Machine, (13) Potato Pooler and (14) Masala Grinder.
" The Assistant Collector held the view that products 2 to 14 were classifiable under Tariff Item No. 33C in view of the Explanation thereof.
After giving notice the Assistant Collector demanded differential duty amounting to Rs.1,91,622.20 for the period Ist of March, 1979 to 30th June, 1980.
The Assistant Collector confirmed the demand except in respect of Item No. 8, namely, Steam Jacketed Vessel.
Being aggrieved from these orders, the appellant filed appeals before the Collector.
The Collector accepted the appellant 's contentions and came to the conclusion that these were to be classified under Tariff Item No. 68 and not under Tariff Item No. 33C. Tariff Item 33C at the relevant time contained the Explanation I, which is as follows: "Explanation I 'Domestic electrical appliances ' means electrical appliances normally used in the household and similar appliances used in hotels, restaurants, hostels.
offices, educational institutions, hospitals, train kitchens.
aircraft or ship 's pantries, canteens, tailoring establish ments, laundary shops and hair dressing saloons".
The revenue went up in appeal before the CEGAT.
The Tribunal noted that the equipments in question were used in industrial canteens, Five Star Hotels, big hospitals etc.
The nature of the items such as deep fat fryer, Expresso coffee machine, bread toaster, chap patty plate, etc.
were all electrically operated machines.
The Tribunal further noted that Tariff Item 33C was in respect of "domestic electrical appliances not elsewhere specified".
According to the Tribunal the intention of the legislature in respect of "domestic electrical appliances" was clear from the Explanation.
It is apparent that the above named items are specially designed for use in big canteens attached to industrial units, big hotels, hospitals etc.
where food in bulk quantity for hundreds of people is required to be prepared and served.
These required electric power exceeding 230 volts in order to have considerable capacity for preparing and serving food.
Their prices ranged from 735 Rs.7,000 to Rs.1.5 lakhs.
It was submitted that these are important and relevant factors for distinguishing the said items as distinct and different from those appliances which are used normally in the household.
It was submitted that these heavy duty items fall outside the purview of Tariff Item No. 33C. The Tribunal was of the view that though considerable space is required for these items but space was not any criteria for determining this question.
According to the Tribunal that these items could not be classified under Tariff Item No. 68.
We are of the opinion that the Tribunal is right.
It is manifest that these equipments were electrical appliances.
There was no dispute on that.
It is also clear that these are normally used in household and similar appliances are used in hotels etc.
The expression "similar" is a significant expression.
It does not mean identical but it means corresponding to or resembling to in many respects; somewhat like; or having a general likeness.
The statute does not contemplate that goods classed under the words of 'similar description ' shall be in all respects the same.
If it did these words would be unnecessary.
These were intended to embrace goods but not identical with those goods.
If the items were similar appliances which are normally used in the household, these will be taxable under Tariff Item No. 33C.
It appears that the Gujarat High Court in the case of Viswa & Co. vs The State of Gujarat, (17 Sales Tax Cases 581) had occasion to consider whether electric fans are domestic electrical appliances for the purpose of Bombay Sales Tax Act, 1953.
Bhagwati, J. as the learned Chief Justice then was, speaking for the Gujarat High Court observed as follows: "A domestic electrical appliance, in our opinion, would be an electrical appliance of a kind generally used for domestic purposes.
It may also be used at places other than the home or the house, but that would not destroy the character of a domestic electrical appliance which attaches to it by reason of its being a kind of an electrical appliance generally used for the household.
There are several electrical appliances which are generally used in the household, such as electric irons, electrical sewing machines and electrical cooking ranges which are also used in other establishments.
But these electrical appliances do not therefore cease to be domestic electrical appliances.
It is of course not necessary that an electrical appliance, in order to 736 satisfy the description of a domestic electrical appliance, must be actually used in the home or the house.
What is necessary is that it must be of a kind which is generally used for household purposes and if that test is applied, there is no doubt that electric fans are domestic electrical appliances and the Tribunal was therefore right in holding that they fall within entry 52 of Schedule B." We agree that it is not necessary to be a domestic electrical appliance that it must be actually used in the home or the house.
It must be of a kind which is generally used for household purposes.
It appears to us that the types of items concerned in this appeal are generally used for household purposes and that is sufficiently good test for classification in the light of the explanation to Tariff Item No. 33C.
In view of the fact that the Tribunal recognised that the appellant had set out all the details in the classification list and the revenue had assessed him under Tariff Item 68, the Tribunal came to the conclusion that there was no intention to evade payment of duty.
Therefore, the Tribunal directed that the modification of the classification list could only be prospective and not retrospective.
The Tribunal was just and right in so doing.
The Tribunal was also right in holding that in the absence of any proof of suppression of fact, section 11 A of the said Act would not be applicable.
The show cause notice raising a demand of duty was issued on 8th of September, 1980 and the Tribunal sustained the demand for the period 9th March, 1980 to 30th June, 1980 in respect of items 3 to 7 and 9 to 14.
We are of the opinion that the Tribunal was right and the decision of the Tribunal therefore, does not call for interference.
In that view of the matter the appeal is rejected.
There will be no order as to costs N.P.V. Appeal dismissed.
|
% Words and Phrases: 'Similar description ' meaning of.
The appellant, manufacturer of Hospital and Pharmaceutical Appliances and Heavy Duty Industrial Canteen Equipment, classified certain items like cooking range, deep fat fryer, express coffee machine, bread toaster etc.
, numbering 14, under Tariff Item No. 68 of the Central Excise and Salt Act, 1944.
The Assistant Collector held that products 2 to 14 were classifiable under Tariff Item No. 33C, in view of the Explanation thereof, and demanded differential duty for the period of 1st March, 1979 to 30th June, 1980.
The Collector, on appeal, held that these items were to be classified under Tariff item No. 68 and not under Tariff item 33C .
On appeal by the Revenue, the Central Customs Excise and Gold (Control) Appellate Tribunal, while noting that the equipment in question, some of which were electrically operated machines, were used in industrial canteens, five star hotels, big hospitals, etc.
held that the intention of the Legislature was clear from the Explanation to Tariff Item No. 33C, and the items in question could not be classified under Tariff Item No. 68.
Dismissing the appeal by the manufacturer.
^ HELD: The statute does not contemplate that goods classed under the words of "similar description" shall be in all respects the same.
If it did, these words would be unnecessary.
These were intended to embrace goods but not identical with those goods.
If the items were 732 similar appliances which are normally used in household, these will be taxable under Tariff Item No. 33C. [73CD] It is not necessary, to be a domestic appliance, that it must be actually used in the home or the house.
It must be of a kind that they are generally used for household purposes.
[736B] The types of items concerned in the instant case are generally used for household purposes and that is sufficiently good test for classification in the light of explanation to tariff item No. 33C.
The Tribunal was.
therefore, right in holding that these items could not be classified under Item 68.
[736C] Since the appellant had set out all the details and the Revenue had assessed the appellant under Tariff Item No. 68, the Tribunal was right in holding that there was no intention to evade payment of duty and in directing that the modification of the classification list could only be prospective and not retrospective.
In the absence of any proof of suppression of fact, it was also right in holding that section l 1 A of the Act would not be applicable.
[736D E]
|
% Words and Phrases: 'Similar description ' meaning of.
The appellant, manufacturer of Hospital and Pharmaceutical Appliances and Heavy Duty Industrial Canteen Equipment, classified certain items like cooking range, deep fat fryer, express coffee machine, bread toaster etc.
, numbering 14, under Tariff Item No. 68 of the Central Excise and Salt Act, 1944.
The Assistant Collector held that products 2 to 14 were classifiable under Tariff Item No. 33C, in view of the Explanation thereof, and demanded differential duty for the period of 1st March, 1979 to 30th June, 1980.
The Collector, on appeal, held that these items were to be classified under Tariff item No. 68 and not under Tariff item 33C .
On appeal by the Revenue, the Central Customs Excise and Gold (Control) Appellate Tribunal, while noting that the equipment in question, some of which were electrically operated machines, were used in industrial canteens, five star hotels, big hospitals, etc.
held that the intention of the Legislature was clear from the Explanation to Tariff Item No. 33C, and the items in question could not be classified under Tariff Item No. 68.
Dismissing the appeal by the manufacturer.
^ HELD: The statute does not contemplate that goods classed under the words of "similar description" shall be in all respects the same.
If it did, these words would be unnecessary.
These were intended to embrace goods but not identical with those goods.
If the items were 732 similar appliances which are normally used in household, these will be taxable under Tariff Item No. 33C. [73CD] It is not necessary, to be a domestic appliance, that it must be actually used in the home or the house.
It must be of a kind that they are generally used for household purposes.
[736B] The types of items concerned in the instant case are generally used for household purposes and that is sufficiently good test for classification in the light of explanation to tariff item No. 33C.
The Tribunal was.
therefore, right in holding that these items could not be classified under Item 68.
[736C] Since the appellant had set out all the details and the Revenue had assessed the appellant under Tariff Item No. 68, the Tribunal was right in holding that there was no intention to evade payment of duty and in directing that the modification of the classification list could only be prospective and not retrospective.
In the absence of any proof of suppression of fact, it was also right in holding that section l 1 A of the Act would not be applicable.
[736D E]
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AL APPELLATE JURISDICTION: Criminal Appeal No. 450 of 1987 From the Judgment and order dated 26.3.1987 of the Allahabad High Court in Habeas Corpus Petition No. 17849 of 1986.
D.K. Garg for the Appellant.
Dalveer Bhandari for the Respondents.
The Judgment of the Court was delivered by B.C. RAY, J.
Special leave granted.
Arguments heard.
This appeal by special leave is directed against the judgment and order of the High Court of Allahabad dated 26th March, 1987 in Habeas Corpus Petition No. 17849 of 1986 dismissing the writ petition and confirming the order of detention passed against the appellant by the District Magistrate, Allahabad.
The respondent No. 2, District Magistrate, Allahabad clamped upon the appellant an order of detention under section 3(2) of the and the appellant was detained at Central Jail, Naini on October 10, 1986.
On the same day the grounds of detention were served on the appellant.
Two grounds of detention mentioned in the grounds of detention are stated hereinbelow: (1) That the appellant on 2.10.1986 threatened the shopkeepers of Khalasi Line locality in order to extort money anc} was saying that appellant could not come for the last auction because the police were present on that occasion and that the shopkeepers bad not given the appellant the money received in the above auction.
Further that the shopkeepers should collect money and give it to the appellant or else the appellant would shoot all of them.
As a result of this the place was terror stricken and the shops and houses closed down.
A report of this incident was made by the picket employed at police station Kydganj, i.e. report No. 38 time 20.
10 dated 2. 10.86.
This was investigated by Dev Shankar, S.I. Of police station Kydganj and the details written in report No. 2 time 00.30 dated 3.
10.86 in the general diary as Case crime No. 248/86, Section 307 I.P.C. and case crime No.249/86, Section 4/5 Explosives Act, Police Station, Kydganj, Allahabad.
131 (2) On 3. 10.
1986, the appellant armed with illegal bombs went towards Uttam Talkies.
Kydganj, Allahabad with the intention of committing serious offence.
On information being received, the police went to arrest the appellant.
That the appellant with the intention to kill lobbed a bomb but the police party escaped it by a hair 's breadth and the bomb exploded.
As a result of this there was a stampede in the public, the doors and windows of the houses and shops closed down, the traffic stopped and the people were terror stricken.
The police arrested appellant on the spot and recovered 3 illegal bombs from the appellant.
The appellant has also been supplied with a copy of a confidential letter written by the Superintendent of Police, Allahabad to District Magistrate, Allahabad dated 9.10.1986.
The said letter was written by the Superintendent of Police on the recommendation of the Station officer, Kydganj, Allahabad on 5.
The appellant has also been supplied with the copy of the report No. 38 in which it is alleged that the appellant threatened the shopkeepers of Khalasi Line in an attempt to extort money.
He was also supplied with the copy of the report which was registered as case crime No. 248 of 1986 under section 307 I.P.C. and case crime No. 249 of 1986 under section 4/5 of the Explosives Act.
The appellant made representation against the grounds of detention before the authorities concerned but his representation was rejected and the order of detention was confirmed.
E The appellant challenged the order of detention by a writ of Habeas Corpus before the High Court of Allahabad on the ground inter alia that the grounds of detention are absolutely vague and there is complete non application of mind by the detaining authority in coming to the subjective satisfaction, that the order of detention passed on the appelant while he was in custody is wholly arbitrary and unwarranted and the two cases disclosed in the grounds of detention relate to law and order problem and not to the disturbance of public order.
The criminal proceedings pending in respect of the case should not have been by passed by taking recourse to the order of detention of the appellant who is already in custody and there was no likelihood nor any possibility of his indulging in activities prejudicial to the maintenance of public order as the appellant has not made any application for bail in the said case.
The detention order has, therefore, been assailed as illegal and bad and so the same is invalid in law.
The High Court after hearing the appellant, by its judgment and H 132 order dated 26th March, 1987 dismissed the writ petition No. 17849 of 1986 holding that the order of detention passed by the detaining authority while the appellant was in jail could not be held to be illegal in the facts and circumstances of the case.
Aggrieved by the said order the instant appeal by special leave was filed in this court.
An affidavit in counter verified by one O.P. Ojha, Station officer, Police Station, Kydganj, Allahabad has been filed.
It has been stated in paragraph 4(iii) of the counter affidavit that the appellant 's history starts from 1955 and he involved himself in a large number of criminal cases.
His name in the history sheet was included by the police.
It has been further stated that out of fear the shopkeepers of the village dare not disclose their names and the people of Khalasi Line dare not depose against the appellant since he is a goonda of the locality and people are afraid of him.
It has been further stated that this is the reason for non appearance of the shopkeepers and others as witnesses.
The first incident dated October 2, 1986 was registered in G.D. No. 38 of the said date and the second incident which occurred on October 3, 1986 was registered as case crime No. 368 of 1986 under section 302/307/120 B, I.P.C.
It has been further stated that these two incidents created terror to the shopkeepers and the people of the locality.
This resulted in a great problem of public order.
It has been stated further that after being convinced of the gravity of the situation created by the appellant and his accomplice, the District Magistrate after fully satisfying himself about the state of affairs, passed the order of detention of the appellant.
It has also been stated that the detention order was passed mainly on the basis of two criminal acts committed by the appellant on October 2 and 3, 1986.
Before passing the detention order the District Magistrate fully satisfied himself of all the conditions for passing a detention order under the .
It has also been stated that it is wrong that the allegations made in the reports dated October 2 and 3, 1986 are false.
The District Magistrate fully satisfied himself after perusing all the records before he passed the order of detention against the appellant.
The cases which have been reported on October 2 and 3, 1986 are pending trial before the Court.
It has also been stated that the order of detention was passed by the District Magistrate on the basis of the information gathered by him from the reports submitted by the police.
It has also been stated that the appellant has already applied for bail in crime case No. 248/86 under section 307 I.P.C. and crime case No. 249/86 under section 4/5 of Explosives Act.
Notices of bail applications in connection with these 133 two cases were served on the State Government prior to the passing of the detention order by the District Magistrate.
The District Magistrate passed the detention order dated October 10, 1986 when the appellant was already in jail on the apprehension that the appellant is likely to be released on bail in the near future and that if the appellant is bailed out, the public order problem will become worse.
The detention order was passed with the object of preventing the appellant from acting in a manner prejudicial to the maintenance of public order.
Hence the detention order is legal in all respects.
The history sheet of crime cases against the appellant has been annexed to the said affidavit.
Before proceeding to consider the case on merits it is relevant to quote the provisions of Section 3 sub section (2) of National security Act, 1980.
3(2):The Central Government or the State Government may, if satisfied with respect to any person that with a view to preventing him from acting in any manner prejudicial to the security of the State.
Or from acting in any manner prejudicial to the maintenance of public order or from acting in any manner prejudicial to the maintenance of supplies and services essential to the community it is necessary so to do, make an order directing that such person be detained.
On a plain reading of Section 3(2) of the said Act it becomes clear that the Central Government or the State Government or the District Magistrate authorised by the State Government in writing may pass an order of detention against a person on being satisfied that with a view to preventing him from acting in any manner prejudicial to the maintenance of public order, it is necessary to make an order directing that such person be detained.
In the instant case the order of detention has been made by respondent No. 2, District Magistrate, on the basis of two criminal cases in respect of two incidents which occurred on October 2 and 3, 1986.
So far as the case being G.D. No. 38 is concerned, allegation was that the appellant was threatening the traders of Khalasi Line who participated in the auction at the fort and he was saying that he could not collect money from them on the last occasion because the police were posted there but in case they did not collect money and give it to him he would shoot all of them.
Because of this terror the shopkeeprs closed the doors and windows of their shops and houses.
The report of 134 this incident was made by the picket employed at police station, Kydganj.
It appears from this report that there are no particulars about the shopkeepers who have been terrorised and threatened for payment of money nor the names of any of the witnesses in whose presence the threat or terror was given and money was demanded, are mentioned at all.
The report is absolutely vague and it is not possible for the detenu to give an effective representation against the aforesaid ground which is one of the constitutional requirement enjoined in Article 22(5) of the Constitution of India.
The second ground which leads to crime case No. 248/86 under section 307 I.P.C. and case crime No. 249 under section 4/5 of Explosives Act and which occurred on October 3, 1986 at about 10 A.M.
On the complaint of Sub Inspector Yatendra Singh through special court, Allahabad also does not disclose any particulars as to the shopkeepers in whose presence the alleged bombs were thrown by the appellant and his associate and who were terrified and panic stricken and put down their shutters, nor the names of any of the witnesses have been mentiond in respect of the said incident.
The meaning of the word 'public order ' has been determined by this Court in the case of Kanu Biswas vs State of West Bengal.
[1972] 3 SSC 83 1.
In this case it has been held that the question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order is a question of degree and the extent of the reach of the act upon the society.
Public order is what the French call "order publique" and is something more than ordinary maintenance of law and order.
In the case of Haradhan Saha vs The State of West Bengal and others, [19751 3 SCC 198 this Court has observed that the following principles emerge from the judicial decisions: First: merely because a detenu is liable to be tried in a criminal court for the commission of a criminal offence or to be proceeded against for preventing him from committing offences dealt with in Chapter VIII of the Code of Criminal Procedure would not by itself debar the Government from taking action for his detention under the Act.
Second: the fact that the Police arrests a person and later on enlarges him on bail and initiates steps to prosecute him under the Code of Criminal Procedure and even lodges a first information report may be no bar against the District Magistrate issuing an order under the preventive detention.
135 Third: where the concerned person is actually in jail custody at the time when an order of detention is passed against him and is not likely to be released for a fair length of time, it may be possible to contend that there could be no satisfaction on the part of the detaining authority as to the likelihood of such a person indulging in activities which would jeopardise the security of the State or the public order.
Fourth: the mere circumstance that a detention order is passed during the pendency of the prosecution will not violate the order.
Fifth: the order of detention is a precautionary measure.
It is based on a reasonable prognosis of the future behaviour of a person based on his part conduct in the light of the surrounding circumstances.
This has been followed in Kanchanlal Meneklal Chokshi vs State of Gujarat and others, [ ; wherein it has been observed that: "The ordinary criminal process is not to be circumvented or short circuited by ready resort to preventive detention.
But, the possibility of launching a criminal prosecution is not an absolute bar to an order of preventive detention.
Nor is it correct to say that if such possibility is not present to the mind of the detaining authority the order of detention is necessarily bad.
However, the failure of the detaining authority to consider the possibility of launching a criminal prosecution may, in the circumstances of a case, lead to the conclusion that the detaining authority had not applied its mind to the vital question whether it was necessary to make an order of preventive detention.
Where an express allegation is made that the order of detention was issued in a mechanical fashion without keeping present to its mind the question whether it was necessary to make such an order when an ordinary criminal prosecution could well serve the purpose, the detaining authority must satisfy the Court that question too was borne in mind before the order of detention was made.
If the detaining authority fails to satisfy the Court that the detaining authority so bore the question in mind the Court would be justified in drawing the inference that there was no application of the mind by the detaining authority to the vital question whether it was necessary to preventively detain the detenu.
" 136 In the case of Dr. Ram Manohar Lohia vs State of Bihar and others, [1966] l SCR 709 it has been observed by this Court that: "The contravention of law always affects order but before it can be said to affect public order, it must affect the community or the public at large.
There are three concepts according to the learned Judge (Hidayatullah, J) i.e. ' 'law and order ' ', "public order" and "security of the State ' .
It has been observed that to appreciate the scope and extent of each of them, one should imagine three concentric circles.
The largest of them represented law and order, next represented public order and the smallest represented the security of the State.
An act might affect law and order but not public order just as an act might affect public order but not the security of the State. ' ' As observed in the case of Arun Ghosh vs State of West Bengal, "Public order is the even tempo of the life of the community taking the country as a whole or even a specified locality.
Disturbance of public order is to be distinguished from acts directed against individuals which do not disturb the society to the extent of causing a general disturbance of public tranquility.
It is the degree of disturbance and its effect upon the life of the community in a locality which determines whether the disturbance amounts only to a breach of law and order.
Take for instance, a man stabs another.
People may be shocked and even disturbed, but the life of the community keeps moving at an even tempo, however much one may dislike the act.
Take another case of a town where there is communal tension.
A man stabs a member of the other community.
This is an act of a very different sort.
Its implications are deeper and it affects the even tempo of life and public order is jeopardized because the repercussions of the act embrace large sections of the community and incite them to make further breaches of the law and order and to subvert the public order.
An act by itself is not determinant of its own gravity.
In its quality it may not differ from another but in its potentiality it may be very different.
" This has been followed in the case of Nagendra Nath Mondal vs 137 State of West Bengal; , and Nand Lal Roy alias Nonda Dulal Roy vs State of West Bengal, [ Thus from these observations it is evident that an act whether amounts to a breach of law and order or a breach of public order solely depends on its extent and reach to the society.
If the act is restricted to particular individuals or a group of individuals it breaches the law and order problem but if the effect and reach and potentiality of the act is so deep as to affect the community at large and or the even tempo of the community that it becomes a breach of the public order.
In the case of S.K. Kedar vs State of West Bengal, this Court has observed that : "The question whether a person has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order is one of degree and the extent of the reach of the act upon the society.
An act by itself is not determinative of its own gravity.
In its quality it may not differ from another but in its potentiality it may be very different.
Similar acts in different contexts affect differently law and order on the one hand and public order on the other.
It is always a question of degree of the harm and its effect upon the community.
Public order is the even tempo of the life of the community taking the country as a whole or even a specified locality.
It is the degree of disturbance upon the life of the community which determines whether the disturbance amounts only to a breach of the law and order." This Court has further observed in the case of Ashok Kumar vs Delhi Administration, [ while dealing with the distinction between 'public order ' and 'law and order ' to which one of us is a party that: "The true distinction between the areas of 'public order and 'law and order ' lies not in the nature of quality of the act, but in the degree and extent of its reach upon society.
The distinction between the two concepts of 'law and order ' and 'public order ' is a fine one but this does not mean that there can be no overlapping.
Acts similar in nature but committed in different contexts and circumstances might cause different reactions.
In one case it might affect specific individuals only and therefore touch the problem of law and order.
The act by itself therefore is not determinant of its own gravity.
It is the potentiality of the 138 act to disturb the even tempo of the life of the community which makes it prejudicial to the maintenance of public order.
" On a conspectus of all these decisions it has been observed by this Court in the case of State of U.P. vs Hari Shankar Tewari, [ ; that conceptually there is difference between law and order and public order but what in a given situation may be a matter covered by law and order may really turn out to be one of public order.
One has to turn to the facts of each case to ascertain whether the matter relates to the larger circle or the smaller circle.
An act which may not at all be objected to in certain situations is capable of totally disturbing the public tranquility.
When communal tension is high, an indiscreet act of no significance is likely to disturb or dislocate the even tempo of the life of the community.
An order of detention made in such a situation has to take note of the potentiality of the act objected to.
Thus whether an act relates to law and order or to public order depends upon the impact of the act on the life of the community or in other words the reach and effect and potentiality of the act if so put as to disturb or dislocate the even tempo of the life of the community, it will be an act which will affect public order.
In the present case so far as the first incident which occurred on 2.
10.1986 is concerned, the ground is vague in as much as neither the names of the witnesses in whose presence the threat was given and the incident occurred, have been mentioned.
As regards the second incident which occurred on 3.
10.1986, case crime No. 248 86 under Section 307 I.P.C. and No. 249/86 under Section 4/5 Explosives Act respectively are pending trial.
It is also pertinent to remember in this connection that a case crime No. 200 of 1986 under section 323/504/506/426 I.P.C. read with section 2 3 of the U.P. Gangsters and Anti Social Activities Act No. 4 of 1986 by the police of the police station, Naini, a copy of which was annexed as annexure I to this appeal, was registered against the appellant.
The said case was challenged by an application under section 482 Cr.
P.C. in the High Court.
The said application was admitted on 2.6.1986 and it is pending as Criminal Misc.
Application No. 6638 of 1986.
The High Court while admitting the case had granted stay of arrest of the appellant.
Furthermore, the appellant was taken in custody and he was in jail as an under trial prisoner on October 10.
1986 when the impugned order of detention was clamped upon him by the detaining authority, the respondent No. 2.
The appellant has 139 stated in his appeal before this Court that till date he had not applied for bail in case crime No. 248 1986 under section 307 I.P.C. and case crime No. 249 1986 under section 4/5 of the Explosives Act as well as the case registered in report No. 38 dated October 2, 1986 at police station, Kydganj.
The question is whether there is possibility of the detaining authority to be satisfied that the appellant is likely to indulge in activities prejudicial to the maintenance of public order as there is no likelihood of his being released from jail custody immediately.
This specific question arose in the case of Masood Alam vs Union of India, AIR 1973 (SC) 897 wherein it has been observed that: "The order of detention served upon the detenu while he was in jail is not invalid rendering the petitioner 's detention as void.
There is no legal bar in serving an order of detention on a person who is in jail custody if he is likely to be released soon thereafter and there is relevant material on which the detaining authority is satisfied that if freed, the person concerned is likely to indulge in activities prejudicial to the security of the state or maintenance of public order.
" In the case of Rameshwar Shaw vs District Magistrate, Burdwan & Anr., [ 1 it has been observed that: "The first stage in the process is to examine the material adduced against a person to show either from his conduct or his antecedent history that he has been acting in a prejudicial manner.
If the said material appears satisfactory to the authority, then the authority has to consider whether it is likely that the said person would act in a prejudicial manner in future if he is not prevented from doing so by an order of detention.
If this question is answered against the petitioner, then the detention order can be properly made.
It is obvious that before an authority can legitimately come to the conclusion that the detention of the person is necessary to prevent him from acting in a prejudicial manner, the authority has to be satisfied that if the person is not detained, he would act in a prejudicial manner and that inevitably postulates freedom of action to the said person at the relevant time.
If a person is already in jail custody, how can it rationally be postulated that if he is not detained, h would act in a prejudicial manner? At the point of time when an order of detention is going to be 140 served on a person, it must be patent that the said person would act prejudicially if he is not detained and that is a consideration which would be absent when the authority is dealing with a person already in detention.
The satisfaction that it is necessary to detain a person for the purpose of preventing him from acting in a prejudicial manner is thus the basis of the order under section 3(1)(a), and this basis is clearly absent in the case of the petitioner.
" In the instant case there is nothing to show that in consideration of his previous conduct and acts there.
is a likelihood of the appellant indulging in activities prejudicial] to the maintenance of public order if he is set free and/or released from custody.
It has been observed in the case of Merugu Satyanarayana etc.
vs State of Andhra Pradesh and others, [ ; by this Court that before making an order of detention in respect of a person already confined to jail "it must be present to the mind of the detaining authority that keeping in view the fact the person is already indetention a preventive detention order is still necessary.
The subjective satisfaction of the detaining authority must comprehend the very fact that the person sought to be detained is already in jail or under detention and yet a preventive detention order is a compelling necessity.
If the subjective satisfaction is reached without the awareness of this very relevant fact the detention order is likely to be vitiated.
But as stated by this Court it will depend on the facts and circumstances of each case.
It has further been observed as follows: "We are completely at a loss to understand how a Sub Inspector of Police can arrogate to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act.
If the power of preventive detention is to be conferred on an officer of the level and standing of a Sub Inspector of Police, we would not be far from a Police State.
Parliament has conferred power primarily on the Central Government and the State Government and in some specific cases if the conditions set out in sub section (3) of section 3 are satisfied and the notification is issued by the State Government to that effect, this extra ordinary power of directing preventive detention can be exercised by such highly placed officers as 141 District Magistrate or Commissioner of Police.
In this case the District Magistrate, the detaining authority has not chosen to file his affidavit.
The affidavit in opposition is filed by a Sub Inspector of Police.
Would this imply that Sub Inspector of Police had access to the file of the District Magistrate or was the Sub Inspector the person who influenced the decision of the District Magistrate for making the detention order? From the very fact that the respondents sought to sustain the order by filing an affidavit of Sub Inspector of Police, we have serious apprehension as to whether the District Magistrate completely abdicated his functions in favour of the Sub Inspector of Police.
" In a recent case of Ramesh Yadav vs District Magistrate, Etah and others, AIR 1986 (SC) 3 15 it has been observed that: "It is clear that the order of detention was passed as the detaining authority was apprehensive that in case the detenu was released on bail he would again carry on his criminal activities in the area.
If the apprehension of the detaining authority was true, the bail application had to be opposed and in case bail was granted, challenge against that order in the higher forum had to be raised.
Merely on the ground that an accused in detention as an undertrial prisoner was likely to get bail an order of detention under the should not ordinarily be passed.
We are inclined to agree with counsel for the petitioner that the order of detention in the circumstances is not sustainable and is contrary to the well settled principles indicated by this Court in series of cases relating to preventive detention.
The impugned order, therefore, has to be quashed.
In the instant case the detaining authority, respondent No. 2 has not come forward to file an affidavit stating whether he has taken into consideration the fact that the appellant was already in judicial custody and on considering his past activities he was subjectively satisfied that if set free or released from jail custody on bail, there was likelihood of the appellant indulging in criminal activities endangering public order.
On the other hand, the Station officer of the Police Station, Kydganj, Shri O.P. Ojha has filed a counter stating that the District Magistrate passed the impugned detention order when the appellant was already in jail on the apprehension that the appellant is likely to be released on 142 bail in the near future and if the appellant is bailed out, the public order problem will become worse.
This clearly goes to show that the Sub Inspector has arrogated to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act.
The District Magistrate, the detaining authority in this case has not chosen to file his affidavit.
The affidavit in opposition filed by the Station officer of Police implies that he has access to the file of the District Magistrate or he influenced the decision of the District Magistrate for making the detention order.
This is also clear from the confidential report submitted by the Senior Superintendent of Police, Allahabad to the District Magistrate, Allahabad as well as from the report of the Sub Inspector of Police annexed with the said report wherein it has been specifically stated that it was apprehended that the appellant, Gulab Mehra who is at present in Naini jail and who has applied for bail, if enlarged on bail, public order will be disturbed.
There is nothing to show that there was awareness in the mind of the District Magistrate, the detaining authority of the fact that the appellant was in jail at the time of clamping of the order of detention, and the detaining authority was satisfied in considering his antecedents and previous criminal acts, that there is likelihood of his indulging in criminal activities jeopardizing public order if he is enlarged on bail and that there is every likelihood that the appellant will be released on bail within a short time.
On this ground alone, the order of detention is invalid.
It may also be stated in this connection that the respondents can very well oppose the bail application when it comes for hearing and if at all the appellant is released on bail the respondents are not without any remedy.
They can also file application in revision for cancellation of the bail application.
In such circumstances, we cannot but hold that the passing of the order of detention of the appellant who is already in custody is fully bad and as such the same is invalid in law.
We have already said hereinbefore that the respondents can very well proceed with the criminal case under section 307 of I.P.C., execute it against the appellant and can get him punished if the case is approved beyond doubt against the appellant.
It is pertinent to mention in this connection the case of Abdul Gaffer vs State of West Bengal, AIR 1975 (SC) 1496 wherein the order of detention was passed in respect of three cases registered against the petitioner.
These are as follows: (1) The petitioner along with his associates on 18.7.1971 being armed with deadly weapons like daggers etc.
committed thefts in respect of D.O. plates from the railway yard and on being challenged, pelted stones causing injury to the R.P.F. party.
The R.P.F. party had 143 to open fire but the petitioner and his associates fled away.
A (2) On 25.11.1971 the petitioner along with his associates being armed with deadly weapons committed theft in respect of batteries from empty rakes standing on the railway track.
Being challenged by the R.P.F. party the petitioner and his associates pelted stones.
The R.P.F. party fired two rounds whereby one of his associates was injured and arrested at the spot.
(3) On 20.2.
1972, at Howrah Goods Yard near Oriapara Quarters, the petitioner along with his associates being armed with deadly weapons viz. bombs, iron rods etc.
committed theft of wheat bags from a wagon and on being challenged by the R.P.F. party the petitioner and his associates pelted stones and hurled bombs.
As a result of this act train services on Howrah Burdwan line was suspended for a considerable period.
Three cases were registered in respect of these offences and order of detention was made by the District Magistrate.
The detaining authority, however, did not file an affidavit but his successor in office in response to Rule Nisi issued by the High Court filed the counter.
It has been observed firstly that the detaining authority has not filed the counter affidavit and the return filed in his place by his successor in office does not satisfactorily explain why the prosecution of the petitioner for the substantive offence in respect of which he was arrested and named in the F.I.R. was not proceeded with.
According to the counsel the so called explanation given in the counter that the witnesses being afraid were not coming forward to give evidence was too ridiculous to be believed by any reasonable person.
The Sub Inspector of Police who made the panchnama could certainly not be afraid of giving evidence.
The other material witnesses who could give evidence were the members of the R.P.F. party.
It is a para police organisation.
The bald but sweeping allegation in the counter that these witnesses were also afraid of giving evidence in court against the petitioner is a version which is too incredulous to be swallowed even by an ultra credulous person without straining his credulity to the utmost.
The order of detention was therefore held invalid.
In the instant case the police officers who withnessed the hurling of bombs and the Sub Inspector of Police who recorded the F.I.R. can come forward to give the evidence.
Therefore, in such circumstances, the open statement made in the affidavit of the Sub Inspector of Police that the witnesses are afraid of disclosing their names and coming H 144 forward to give evidence is wholly incredulous and it cannot be accepted.
The prosecution of the appellant for the substantive offences can be properly proceeded with in this case In the case of Sudhir Kumar Saha vs Commissioner of Police, Calcutta & Anr., ; the petitioner along with his associates committed various acts of crime on three occasions.
On the first occasion he attacked the people of a locality with a knife and by hurling bottles at them.
On the other two occasions he attacked the people of another locality, by hurling bomes at them.
It was held that the incidents were not interlinked and could not have prejudiced the maintenance of public order.
On considering these decisions, we are constrained to hold that the clamping of the order of detention is not in accordance with the provision of the Act.
Furthermore, the history sheet does not at all link to the proximity of the two incidents on the basis of which the o order of detention was made.
It has been vehemently urged before us by the learned counsel appearing for the appellant that in none of the cases mentioned in the history sheet the appellant has been convicted and moreover these cases related to a period much earlier than the period in which the two cases have occurred.
It has also been submitted in this connection by the learned counsel for the appellant that the appellant had not been convicted in any of the cases and the submission of the Sub Inspector of Police that the witnesses are afraid of disclosing their names and coming forward to give evidence is wholly incorrect and false in as much as witnesses in fact gave the evidence in a criminal case which ended in acquittal.
It has also been submitted by the learned counsel that the shopkeepers of the locality where the alleged hurling of bombs took place have made an application in this case that no such incident occurred on the said dates.
In the premises, aforesaid, we hold that the impugned order of detention is illegal and invalid and we allow the appeal setting aside the judgment and order of the High Court without any order as to costs.
S.L. Appeal allowed.
|
HELD: The order of detention was passed by the respondent No. 2.
District Magistrate, on the basis of two Criminal Cases in respect of two incidents which had occurred on October 2 and 3, 1986.
So far as the case being G.D. No. 38 was concerned, the report of this incident was made by the picket employed at police station, Kydganj.
It appeared from this report that there were no particulars about the shopkeepers who had been terrorised and threatened for payment of money, as alleged in the grounds of detention, nor were mentioned at all the names of any of the witnesses in whose presence the threat or terror was used and money was demanded.
The report was absolutely vague and it was not possible for the detenu to give an effective representation 127 against the ground, which is one of the Constitutional requirements enjoined in Article 22(5) of the Constitution of India.
The second ground, which led to crime case No. 248/86 under section 307, I.P.C., and crime case No. 249/86 under section 4/5 of the Explosives Act and which occurred on October 3, 1986, registered on the complaint of Sub/Inspector Yatendra Singh through special court, Allahabad, also did not disclose any particulars as to the shop keepers in whose presence the bombs alleged were thrown by the appellant, and who were terrified and panic stricken, etc., nor were mentioned the names of any witnesses in respect of the said incident.
[133F, 134A D] The question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order, is a question of degree and the extent of the reach of the act upon the Society, as held by this Court in Kanu Biswos vs State of West Bengal, ; , while determining the meaning of 'public order '.
Public order is what the French Call "order Publique" and is something more than ordinary maintenance of law and order.
From the observations of this Court made in many cases, it is evident that whether an act amounts to a breach of law and order or a breach of public order, solely depends upon its extent and reach to the society.
If the act is restricted to particular individuals or a group of individuals, it breaches the law and order problem, but if the effect and reach and potentiality of the act are so deep as to affect the community at large and/or the even tempo of the community, then, it becomes a breach of the public order.
An act, which may not at all be objected to in certain situations is capable of totally disturbing the public tranquillity.
When communal tension is high, an indiscreet act of no significance is likely to disturb or dislocate the even tempo of the life of the community.
An order of detention made in such a situation has to take note of the potentiality of the act objected to.
Thus, whether an act relates to law and order or the public order depends upon the impact of the act on the life of the community, or, in other words, the reach and effect and potentiality of the act, if so put as to disturb or dislocate the even tempo of the life of the community, it will be an act which will affect the public order .
[134D E,137A B. 138B D] In this case, so far as the first incident which occurred on 2.10.1986 was concerned, the ground was vague inasmuch as the names of the witnesses in whose presence the threat was given and the incident occurred, had not been mentioned.
As regards the second incident which occurred on 3.
10.1986, the Crime Case No. 248/86 under section 307, I.P.C. and the Crime Case No. 249/86 under section 4/5 of the Explosive Act, were pending trial.
[138E F] 128 A case crime No. 200 of 1985 under sections 323/504/506/426, l.
P.C., read with section 2/3 of the U.P. Gangsters and Anti Social Activities Act No. 4 of 1986 was registered against the appellant by the police.
That case was challenged by an application under section 482 Cr.
P.C. in the High Court.
The said application was admitted on 2.6.1986 and had been pending.
The High Court had, while admitting the case, granted stay of arrest of the appellant.
The appellant had been taken into custody and was in jail as an undertrial prisoner on October 10, 1986, when the impugned order of detention was clamped upon him.
The appellant stated in this Appeal that till date he had not applied for bail in case crime No. 248/86 and case crime No. 249/86 as well as the case registered in report No. 38 dated October 2, 1986 at the police station Kydganj.
The question was whether there was a possibility of the detaining authority to be satisfied that the appellant was likely to indulge in activities prejudicial to the maintenance of public order as there was no likelihood of his being released from the jail custody immediately.
There was nothing in the case to show that in consideration of his previous conduct and acts, there was a likelihood of the appellant 's indulging in activities prejudicial to the maintenance of public order if he was set free and/or released from custody.
[138F H, 139A B, 140B C] The detaining authority District Magistrate respondent No. 2, had not filed an affidavit stating whether he had taken into consideration the fact that the appellant had already been in the judicial custody and on considering his past activities he had been subjectively satisfied that if set free or released from jail custody on bail, there was a likelihood of his indulging in criminal activities endangering public order.
On the other hand, the Station officer of Kydganj police station, had filed a counter stating that the District Magistrate had passed the impugned detention order when the appellant was already in jail, on the p apprehension that the appellant was likely to be released on bail in the near future and if he was bailed out, the public order would become worse.
This clearly showed that the police officer had arrogated to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act.
The affidavit filed by the station officer of police implied that he had access to the file of the District Magistrate or he influenced the decision of the District Magistrate for making the detention order.
There was nothing to show that there was awareness in the mind of the District Magistrate, the detaining authority, of the fact that the appellant was in jail at the time of the clamping of the order of detention, and the detaining authority was satisfied, in considering his antecedents, that there was a likelihood of his indulging in criminal activities, jeopardising public order if he 129 was released on bail and that there was every likelihood of his being A enlarged on bail within a short time.
On this ground alone, the detention order was invalid.
It might be said in this connection that the respondents could very well oppose the bail application when it came up for hearing, and if at all the appellant was released on bail, the respondents were not without a remedy.
They could file an application for cancellation of the bail.
In the circumstances, it could not but be held that the passing of the order of detention of the appellant who was already in custody was fully bad and invalid in law.
The respondents could very well proceed with the criminal case under section 307, I.P.C., and get the appellant punished if the case was proved beyond doubt against him.
The police officers, who witnessed the hurling of the bombs and the Sub Inspector of police who recorded the F.I.R., could come forward to give evidence.
In the circumstances, the open statement in the affidavit of the Sub Inspector that the witnesses were afraid of disclosing their names and giving evidence, was wholly incredulous and could not be accepted.
[141G H, 142A G, 143G 144A] The clamping of the order of detention was not in accordance with the provisions of the Act.
The history sheet did not at all link to the proximity of the two incidents on the basis of which the detention order had been passed.
[144C D] The impugned order of detention was illegal and invalid.
[144G] E Kanu Biswas vs State of West Bengal, [1972] 3 S.C.C. 831; Haradhan Saha vs The State of West Bengal and Anr. ; ; Kanchanlal Maneklal Chokshi vs State of Gujarat & ors.
; , ; Dr. Ram Manohar Lohia vs State of Bihar & ors.; , ; Arun Ghosh vs State of West Bengal, ; Nagendra Nath Mondal vs State of West Bengal, 11972] 1 S.C.C. 498; Nand Lal Roy alias Nonda Dulal Roy vs State of West Bengal, ; S.K. Kedar vs State of West Bengal, ; Ashok Kumar vs Delhi Administration, ; State of U.P. vs Hari Shankar Tewari, ; ; Masood Alam vs Union of India, A.I.R. 1973 S.C. 897; Rameshwar Shaw vs District Magistrate Burdwan State of Andhra Pradesh & ors.
; , ; Ramesh Yadav vs District Magistrate, Etah and others, A.I.R. 1986 S.C. 315; Abdul Gaffer vs State of West Bengal, A.I.R. 1975 S.C. 1496 and Sudhir Kumar Saha vs Commissioner of Police, Calcutta, ;
|
AL APPELLATE JURISDICTION: Criminal Appeal No. 450 of 1987 From the Judgment and order dated 26.3.1987 of the Allahabad High Court in Habeas Corpus Petition No. 17849 of 1986.
D.K. Garg for the Appellant.
Dalveer Bhandari for the Respondents.
The Judgment of the Court was delivered by B.C. RAY, J.
Special leave granted.
Arguments heard.
This appeal by special leave is directed against the judgment and order of the High Court of Allahabad dated 26th March, 1987 in Habeas Corpus Petition No. 17849 of 1986 dismissing the writ petition and confirming the order of detention passed against the appellant by the District Magistrate, Allahabad.
The respondent No. 2, District Magistrate, Allahabad clamped upon the appellant an order of detention under section 3(2) of the and the appellant was detained at Central Jail, Naini on October 10, 1986.
On the same day the grounds of detention were served on the appellant.
Two grounds of detention mentioned in the grounds of detention are stated hereinbelow: (1) That the appellant on 2.10.1986 threatened the shopkeepers of Khalasi Line locality in order to extort money anc} was saying that appellant could not come for the last auction because the police were present on that occasion and that the shopkeepers bad not given the appellant the money received in the above auction.
Further that the shopkeepers should collect money and give it to the appellant or else the appellant would shoot all of them.
As a result of this the place was terror stricken and the shops and houses closed down.
A report of this incident was made by the picket employed at police station Kydganj, i.e. report No. 38 time 20.
10 dated 2. 10.86.
This was investigated by Dev Shankar, S.I. Of police station Kydganj and the details written in report No. 2 time 00.30 dated 3.
10.86 in the general diary as Case crime No. 248/86, Section 307 I.P.C. and case crime No.249/86, Section 4/5 Explosives Act, Police Station, Kydganj, Allahabad.
131 (2) On 3. 10.
1986, the appellant armed with illegal bombs went towards Uttam Talkies.
Kydganj, Allahabad with the intention of committing serious offence.
On information being received, the police went to arrest the appellant.
That the appellant with the intention to kill lobbed a bomb but the police party escaped it by a hair 's breadth and the bomb exploded.
As a result of this there was a stampede in the public, the doors and windows of the houses and shops closed down, the traffic stopped and the people were terror stricken.
The police arrested appellant on the spot and recovered 3 illegal bombs from the appellant.
The appellant has also been supplied with a copy of a confidential letter written by the Superintendent of Police, Allahabad to District Magistrate, Allahabad dated 9.10.1986.
The said letter was written by the Superintendent of Police on the recommendation of the Station officer, Kydganj, Allahabad on 5.
The appellant has also been supplied with the copy of the report No. 38 in which it is alleged that the appellant threatened the shopkeepers of Khalasi Line in an attempt to extort money.
He was also supplied with the copy of the report which was registered as case crime No. 248 of 1986 under section 307 I.P.C. and case crime No. 249 of 1986 under section 4/5 of the Explosives Act.
The appellant made representation against the grounds of detention before the authorities concerned but his representation was rejected and the order of detention was confirmed.
E The appellant challenged the order of detention by a writ of Habeas Corpus before the High Court of Allahabad on the ground inter alia that the grounds of detention are absolutely vague and there is complete non application of mind by the detaining authority in coming to the subjective satisfaction, that the order of detention passed on the appelant while he was in custody is wholly arbitrary and unwarranted and the two cases disclosed in the grounds of detention relate to law and order problem and not to the disturbance of public order.
The criminal proceedings pending in respect of the case should not have been by passed by taking recourse to the order of detention of the appellant who is already in custody and there was no likelihood nor any possibility of his indulging in activities prejudicial to the maintenance of public order as the appellant has not made any application for bail in the said case.
The detention order has, therefore, been assailed as illegal and bad and so the same is invalid in law.
The High Court after hearing the appellant, by its judgment and H 132 order dated 26th March, 1987 dismissed the writ petition No. 17849 of 1986 holding that the order of detention passed by the detaining authority while the appellant was in jail could not be held to be illegal in the facts and circumstances of the case.
Aggrieved by the said order the instant appeal by special leave was filed in this court.
An affidavit in counter verified by one O.P. Ojha, Station officer, Police Station, Kydganj, Allahabad has been filed.
It has been stated in paragraph 4(iii) of the counter affidavit that the appellant 's history starts from 1955 and he involved himself in a large number of criminal cases.
His name in the history sheet was included by the police.
It has been further stated that out of fear the shopkeepers of the village dare not disclose their names and the people of Khalasi Line dare not depose against the appellant since he is a goonda of the locality and people are afraid of him.
It has been further stated that this is the reason for non appearance of the shopkeepers and others as witnesses.
The first incident dated October 2, 1986 was registered in G.D. No. 38 of the said date and the second incident which occurred on October 3, 1986 was registered as case crime No. 368 of 1986 under section 302/307/120 B, I.P.C.
It has been further stated that these two incidents created terror to the shopkeepers and the people of the locality.
This resulted in a great problem of public order.
It has been stated further that after being convinced of the gravity of the situation created by the appellant and his accomplice, the District Magistrate after fully satisfying himself about the state of affairs, passed the order of detention of the appellant.
It has also been stated that the detention order was passed mainly on the basis of two criminal acts committed by the appellant on October 2 and 3, 1986.
Before passing the detention order the District Magistrate fully satisfied himself of all the conditions for passing a detention order under the .
It has also been stated that it is wrong that the allegations made in the reports dated October 2 and 3, 1986 are false.
The District Magistrate fully satisfied himself after perusing all the records before he passed the order of detention against the appellant.
The cases which have been reported on October 2 and 3, 1986 are pending trial before the Court.
It has also been stated that the order of detention was passed by the District Magistrate on the basis of the information gathered by him from the reports submitted by the police.
It has also been stated that the appellant has already applied for bail in crime case No. 248/86 under section 307 I.P.C. and crime case No. 249/86 under section 4/5 of Explosives Act.
Notices of bail applications in connection with these 133 two cases were served on the State Government prior to the passing of the detention order by the District Magistrate.
The District Magistrate passed the detention order dated October 10, 1986 when the appellant was already in jail on the apprehension that the appellant is likely to be released on bail in the near future and that if the appellant is bailed out, the public order problem will become worse.
The detention order was passed with the object of preventing the appellant from acting in a manner prejudicial to the maintenance of public order.
Hence the detention order is legal in all respects.
The history sheet of crime cases against the appellant has been annexed to the said affidavit.
Before proceeding to consider the case on merits it is relevant to quote the provisions of Section 3 sub section (2) of National security Act, 1980.
3(2):The Central Government or the State Government may, if satisfied with respect to any person that with a view to preventing him from acting in any manner prejudicial to the security of the State.
Or from acting in any manner prejudicial to the maintenance of public order or from acting in any manner prejudicial to the maintenance of supplies and services essential to the community it is necessary so to do, make an order directing that such person be detained.
On a plain reading of Section 3(2) of the said Act it becomes clear that the Central Government or the State Government or the District Magistrate authorised by the State Government in writing may pass an order of detention against a person on being satisfied that with a view to preventing him from acting in any manner prejudicial to the maintenance of public order, it is necessary to make an order directing that such person be detained.
In the instant case the order of detention has been made by respondent No. 2, District Magistrate, on the basis of two criminal cases in respect of two incidents which occurred on October 2 and 3, 1986.
So far as the case being G.D. No. 38 is concerned, allegation was that the appellant was threatening the traders of Khalasi Line who participated in the auction at the fort and he was saying that he could not collect money from them on the last occasion because the police were posted there but in case they did not collect money and give it to him he would shoot all of them.
Because of this terror the shopkeeprs closed the doors and windows of their shops and houses.
The report of 134 this incident was made by the picket employed at police station, Kydganj.
It appears from this report that there are no particulars about the shopkeepers who have been terrorised and threatened for payment of money nor the names of any of the witnesses in whose presence the threat or terror was given and money was demanded, are mentioned at all.
The report is absolutely vague and it is not possible for the detenu to give an effective representation against the aforesaid ground which is one of the constitutional requirement enjoined in Article 22(5) of the Constitution of India.
The second ground which leads to crime case No. 248/86 under section 307 I.P.C. and case crime No. 249 under section 4/5 of Explosives Act and which occurred on October 3, 1986 at about 10 A.M.
On the complaint of Sub Inspector Yatendra Singh through special court, Allahabad also does not disclose any particulars as to the shopkeepers in whose presence the alleged bombs were thrown by the appellant and his associate and who were terrified and panic stricken and put down their shutters, nor the names of any of the witnesses have been mentiond in respect of the said incident.
The meaning of the word 'public order ' has been determined by this Court in the case of Kanu Biswas vs State of West Bengal.
[1972] 3 SSC 83 1.
In this case it has been held that the question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order is a question of degree and the extent of the reach of the act upon the society.
Public order is what the French call "order publique" and is something more than ordinary maintenance of law and order.
In the case of Haradhan Saha vs The State of West Bengal and others, [19751 3 SCC 198 this Court has observed that the following principles emerge from the judicial decisions: First: merely because a detenu is liable to be tried in a criminal court for the commission of a criminal offence or to be proceeded against for preventing him from committing offences dealt with in Chapter VIII of the Code of Criminal Procedure would not by itself debar the Government from taking action for his detention under the Act.
Second: the fact that the Police arrests a person and later on enlarges him on bail and initiates steps to prosecute him under the Code of Criminal Procedure and even lodges a first information report may be no bar against the District Magistrate issuing an order under the preventive detention.
135 Third: where the concerned person is actually in jail custody at the time when an order of detention is passed against him and is not likely to be released for a fair length of time, it may be possible to contend that there could be no satisfaction on the part of the detaining authority as to the likelihood of such a person indulging in activities which would jeopardise the security of the State or the public order.
Fourth: the mere circumstance that a detention order is passed during the pendency of the prosecution will not violate the order.
Fifth: the order of detention is a precautionary measure.
It is based on a reasonable prognosis of the future behaviour of a person based on his part conduct in the light of the surrounding circumstances.
This has been followed in Kanchanlal Meneklal Chokshi vs State of Gujarat and others, [ ; wherein it has been observed that: "The ordinary criminal process is not to be circumvented or short circuited by ready resort to preventive detention.
But, the possibility of launching a criminal prosecution is not an absolute bar to an order of preventive detention.
Nor is it correct to say that if such possibility is not present to the mind of the detaining authority the order of detention is necessarily bad.
However, the failure of the detaining authority to consider the possibility of launching a criminal prosecution may, in the circumstances of a case, lead to the conclusion that the detaining authority had not applied its mind to the vital question whether it was necessary to make an order of preventive detention.
Where an express allegation is made that the order of detention was issued in a mechanical fashion without keeping present to its mind the question whether it was necessary to make such an order when an ordinary criminal prosecution could well serve the purpose, the detaining authority must satisfy the Court that question too was borne in mind before the order of detention was made.
If the detaining authority fails to satisfy the Court that the detaining authority so bore the question in mind the Court would be justified in drawing the inference that there was no application of the mind by the detaining authority to the vital question whether it was necessary to preventively detain the detenu.
" 136 In the case of Dr. Ram Manohar Lohia vs State of Bihar and others, [1966] l SCR 709 it has been observed by this Court that: "The contravention of law always affects order but before it can be said to affect public order, it must affect the community or the public at large.
There are three concepts according to the learned Judge (Hidayatullah, J) i.e. ' 'law and order ' ', "public order" and "security of the State ' .
It has been observed that to appreciate the scope and extent of each of them, one should imagine three concentric circles.
The largest of them represented law and order, next represented public order and the smallest represented the security of the State.
An act might affect law and order but not public order just as an act might affect public order but not the security of the State. ' ' As observed in the case of Arun Ghosh vs State of West Bengal, "Public order is the even tempo of the life of the community taking the country as a whole or even a specified locality.
Disturbance of public order is to be distinguished from acts directed against individuals which do not disturb the society to the extent of causing a general disturbance of public tranquility.
It is the degree of disturbance and its effect upon the life of the community in a locality which determines whether the disturbance amounts only to a breach of law and order.
Take for instance, a man stabs another.
People may be shocked and even disturbed, but the life of the community keeps moving at an even tempo, however much one may dislike the act.
Take another case of a town where there is communal tension.
A man stabs a member of the other community.
This is an act of a very different sort.
Its implications are deeper and it affects the even tempo of life and public order is jeopardized because the repercussions of the act embrace large sections of the community and incite them to make further breaches of the law and order and to subvert the public order.
An act by itself is not determinant of its own gravity.
In its quality it may not differ from another but in its potentiality it may be very different.
" This has been followed in the case of Nagendra Nath Mondal vs 137 State of West Bengal; , and Nand Lal Roy alias Nonda Dulal Roy vs State of West Bengal, [ Thus from these observations it is evident that an act whether amounts to a breach of law and order or a breach of public order solely depends on its extent and reach to the society.
If the act is restricted to particular individuals or a group of individuals it breaches the law and order problem but if the effect and reach and potentiality of the act is so deep as to affect the community at large and or the even tempo of the community that it becomes a breach of the public order.
In the case of S.K. Kedar vs State of West Bengal, this Court has observed that : "The question whether a person has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order is one of degree and the extent of the reach of the act upon the society.
An act by itself is not determinative of its own gravity.
In its quality it may not differ from another but in its potentiality it may be very different.
Similar acts in different contexts affect differently law and order on the one hand and public order on the other.
It is always a question of degree of the harm and its effect upon the community.
Public order is the even tempo of the life of the community taking the country as a whole or even a specified locality.
It is the degree of disturbance upon the life of the community which determines whether the disturbance amounts only to a breach of the law and order." This Court has further observed in the case of Ashok Kumar vs Delhi Administration, [ while dealing with the distinction between 'public order ' and 'law and order ' to which one of us is a party that: "The true distinction between the areas of 'public order and 'law and order ' lies not in the nature of quality of the act, but in the degree and extent of its reach upon society.
The distinction between the two concepts of 'law and order ' and 'public order ' is a fine one but this does not mean that there can be no overlapping.
Acts similar in nature but committed in different contexts and circumstances might cause different reactions.
In one case it might affect specific individuals only and therefore touch the problem of law and order.
The act by itself therefore is not determinant of its own gravity.
It is the potentiality of the 138 act to disturb the even tempo of the life of the community which makes it prejudicial to the maintenance of public order.
" On a conspectus of all these decisions it has been observed by this Court in the case of State of U.P. vs Hari Shankar Tewari, [ ; that conceptually there is difference between law and order and public order but what in a given situation may be a matter covered by law and order may really turn out to be one of public order.
One has to turn to the facts of each case to ascertain whether the matter relates to the larger circle or the smaller circle.
An act which may not at all be objected to in certain situations is capable of totally disturbing the public tranquility.
When communal tension is high, an indiscreet act of no significance is likely to disturb or dislocate the even tempo of the life of the community.
An order of detention made in such a situation has to take note of the potentiality of the act objected to.
Thus whether an act relates to law and order or to public order depends upon the impact of the act on the life of the community or in other words the reach and effect and potentiality of the act if so put as to disturb or dislocate the even tempo of the life of the community, it will be an act which will affect public order.
In the present case so far as the first incident which occurred on 2.
10.1986 is concerned, the ground is vague in as much as neither the names of the witnesses in whose presence the threat was given and the incident occurred, have been mentioned.
As regards the second incident which occurred on 3.
10.1986, case crime No. 248 86 under Section 307 I.P.C. and No. 249/86 under Section 4/5 Explosives Act respectively are pending trial.
It is also pertinent to remember in this connection that a case crime No. 200 of 1986 under section 323/504/506/426 I.P.C. read with section 2 3 of the U.P. Gangsters and Anti Social Activities Act No. 4 of 1986 by the police of the police station, Naini, a copy of which was annexed as annexure I to this appeal, was registered against the appellant.
The said case was challenged by an application under section 482 Cr.
P.C. in the High Court.
The said application was admitted on 2.6.1986 and it is pending as Criminal Misc.
Application No. 6638 of 1986.
The High Court while admitting the case had granted stay of arrest of the appellant.
Furthermore, the appellant was taken in custody and he was in jail as an under trial prisoner on October 10.
1986 when the impugned order of detention was clamped upon him by the detaining authority, the respondent No. 2.
The appellant has 139 stated in his appeal before this Court that till date he had not applied for bail in case crime No. 248 1986 under section 307 I.P.C. and case crime No. 249 1986 under section 4/5 of the Explosives Act as well as the case registered in report No. 38 dated October 2, 1986 at police station, Kydganj.
The question is whether there is possibility of the detaining authority to be satisfied that the appellant is likely to indulge in activities prejudicial to the maintenance of public order as there is no likelihood of his being released from jail custody immediately.
This specific question arose in the case of Masood Alam vs Union of India, AIR 1973 (SC) 897 wherein it has been observed that: "The order of detention served upon the detenu while he was in jail is not invalid rendering the petitioner 's detention as void.
There is no legal bar in serving an order of detention on a person who is in jail custody if he is likely to be released soon thereafter and there is relevant material on which the detaining authority is satisfied that if freed, the person concerned is likely to indulge in activities prejudicial to the security of the state or maintenance of public order.
" In the case of Rameshwar Shaw vs District Magistrate, Burdwan & Anr., [ 1 it has been observed that: "The first stage in the process is to examine the material adduced against a person to show either from his conduct or his antecedent history that he has been acting in a prejudicial manner.
If the said material appears satisfactory to the authority, then the authority has to consider whether it is likely that the said person would act in a prejudicial manner in future if he is not prevented from doing so by an order of detention.
If this question is answered against the petitioner, then the detention order can be properly made.
It is obvious that before an authority can legitimately come to the conclusion that the detention of the person is necessary to prevent him from acting in a prejudicial manner, the authority has to be satisfied that if the person is not detained, he would act in a prejudicial manner and that inevitably postulates freedom of action to the said person at the relevant time.
If a person is already in jail custody, how can it rationally be postulated that if he is not detained, h would act in a prejudicial manner? At the point of time when an order of detention is going to be 140 served on a person, it must be patent that the said person would act prejudicially if he is not detained and that is a consideration which would be absent when the authority is dealing with a person already in detention.
The satisfaction that it is necessary to detain a person for the purpose of preventing him from acting in a prejudicial manner is thus the basis of the order under section 3(1)(a), and this basis is clearly absent in the case of the petitioner.
" In the instant case there is nothing to show that in consideration of his previous conduct and acts there.
is a likelihood of the appellant indulging in activities prejudicial] to the maintenance of public order if he is set free and/or released from custody.
It has been observed in the case of Merugu Satyanarayana etc.
vs State of Andhra Pradesh and others, [ ; by this Court that before making an order of detention in respect of a person already confined to jail "it must be present to the mind of the detaining authority that keeping in view the fact the person is already indetention a preventive detention order is still necessary.
The subjective satisfaction of the detaining authority must comprehend the very fact that the person sought to be detained is already in jail or under detention and yet a preventive detention order is a compelling necessity.
If the subjective satisfaction is reached without the awareness of this very relevant fact the detention order is likely to be vitiated.
But as stated by this Court it will depend on the facts and circumstances of each case.
It has further been observed as follows: "We are completely at a loss to understand how a Sub Inspector of Police can arrogate to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act.
If the power of preventive detention is to be conferred on an officer of the level and standing of a Sub Inspector of Police, we would not be far from a Police State.
Parliament has conferred power primarily on the Central Government and the State Government and in some specific cases if the conditions set out in sub section (3) of section 3 are satisfied and the notification is issued by the State Government to that effect, this extra ordinary power of directing preventive detention can be exercised by such highly placed officers as 141 District Magistrate or Commissioner of Police.
In this case the District Magistrate, the detaining authority has not chosen to file his affidavit.
The affidavit in opposition is filed by a Sub Inspector of Police.
Would this imply that Sub Inspector of Police had access to the file of the District Magistrate or was the Sub Inspector the person who influenced the decision of the District Magistrate for making the detention order? From the very fact that the respondents sought to sustain the order by filing an affidavit of Sub Inspector of Police, we have serious apprehension as to whether the District Magistrate completely abdicated his functions in favour of the Sub Inspector of Police.
" In a recent case of Ramesh Yadav vs District Magistrate, Etah and others, AIR 1986 (SC) 3 15 it has been observed that: "It is clear that the order of detention was passed as the detaining authority was apprehensive that in case the detenu was released on bail he would again carry on his criminal activities in the area.
If the apprehension of the detaining authority was true, the bail application had to be opposed and in case bail was granted, challenge against that order in the higher forum had to be raised.
Merely on the ground that an accused in detention as an undertrial prisoner was likely to get bail an order of detention under the should not ordinarily be passed.
We are inclined to agree with counsel for the petitioner that the order of detention in the circumstances is not sustainable and is contrary to the well settled principles indicated by this Court in series of cases relating to preventive detention.
The impugned order, therefore, has to be quashed.
In the instant case the detaining authority, respondent No. 2 has not come forward to file an affidavit stating whether he has taken into consideration the fact that the appellant was already in judicial custody and on considering his past activities he was subjectively satisfied that if set free or released from jail custody on bail, there was likelihood of the appellant indulging in criminal activities endangering public order.
On the other hand, the Station officer of the Police Station, Kydganj, Shri O.P. Ojha has filed a counter stating that the District Magistrate passed the impugned detention order when the appellant was already in jail on the apprehension that the appellant is likely to be released on 142 bail in the near future and if the appellant is bailed out, the public order problem will become worse.
This clearly goes to show that the Sub Inspector has arrogated to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act.
The District Magistrate, the detaining authority in this case has not chosen to file his affidavit.
The affidavit in opposition filed by the Station officer of Police implies that he has access to the file of the District Magistrate or he influenced the decision of the District Magistrate for making the detention order.
This is also clear from the confidential report submitted by the Senior Superintendent of Police, Allahabad to the District Magistrate, Allahabad as well as from the report of the Sub Inspector of Police annexed with the said report wherein it has been specifically stated that it was apprehended that the appellant, Gulab Mehra who is at present in Naini jail and who has applied for bail, if enlarged on bail, public order will be disturbed.
There is nothing to show that there was awareness in the mind of the District Magistrate, the detaining authority of the fact that the appellant was in jail at the time of clamping of the order of detention, and the detaining authority was satisfied in considering his antecedents and previous criminal acts, that there is likelihood of his indulging in criminal activities jeopardizing public order if he is enlarged on bail and that there is every likelihood that the appellant will be released on bail within a short time.
On this ground alone, the order of detention is invalid.
It may also be stated in this connection that the respondents can very well oppose the bail application when it comes for hearing and if at all the appellant is released on bail the respondents are not without any remedy.
They can also file application in revision for cancellation of the bail application.
In such circumstances, we cannot but hold that the passing of the order of detention of the appellant who is already in custody is fully bad and as such the same is invalid in law.
We have already said hereinbefore that the respondents can very well proceed with the criminal case under section 307 of I.P.C., execute it against the appellant and can get him punished if the case is approved beyond doubt against the appellant.
It is pertinent to mention in this connection the case of Abdul Gaffer vs State of West Bengal, AIR 1975 (SC) 1496 wherein the order of detention was passed in respect of three cases registered against the petitioner.
These are as follows: (1) The petitioner along with his associates on 18.7.1971 being armed with deadly weapons like daggers etc.
committed thefts in respect of D.O. plates from the railway yard and on being challenged, pelted stones causing injury to the R.P.F. party.
The R.P.F. party had 143 to open fire but the petitioner and his associates fled away.
A (2) On 25.11.1971 the petitioner along with his associates being armed with deadly weapons committed theft in respect of batteries from empty rakes standing on the railway track.
Being challenged by the R.P.F. party the petitioner and his associates pelted stones.
The R.P.F. party fired two rounds whereby one of his associates was injured and arrested at the spot.
(3) On 20.2.
1972, at Howrah Goods Yard near Oriapara Quarters, the petitioner along with his associates being armed with deadly weapons viz. bombs, iron rods etc.
committed theft of wheat bags from a wagon and on being challenged by the R.P.F. party the petitioner and his associates pelted stones and hurled bombs.
As a result of this act train services on Howrah Burdwan line was suspended for a considerable period.
Three cases were registered in respect of these offences and order of detention was made by the District Magistrate.
The detaining authority, however, did not file an affidavit but his successor in office in response to Rule Nisi issued by the High Court filed the counter.
It has been observed firstly that the detaining authority has not filed the counter affidavit and the return filed in his place by his successor in office does not satisfactorily explain why the prosecution of the petitioner for the substantive offence in respect of which he was arrested and named in the F.I.R. was not proceeded with.
According to the counsel the so called explanation given in the counter that the witnesses being afraid were not coming forward to give evidence was too ridiculous to be believed by any reasonable person.
The Sub Inspector of Police who made the panchnama could certainly not be afraid of giving evidence.
The other material witnesses who could give evidence were the members of the R.P.F. party.
It is a para police organisation.
The bald but sweeping allegation in the counter that these witnesses were also afraid of giving evidence in court against the petitioner is a version which is too incredulous to be swallowed even by an ultra credulous person without straining his credulity to the utmost.
The order of detention was therefore held invalid.
In the instant case the police officers who withnessed the hurling of bombs and the Sub Inspector of Police who recorded the F.I.R. can come forward to give the evidence.
Therefore, in such circumstances, the open statement made in the affidavit of the Sub Inspector of Police that the witnesses are afraid of disclosing their names and coming H 144 forward to give evidence is wholly incredulous and it cannot be accepted.
The prosecution of the appellant for the substantive offences can be properly proceeded with in this case In the case of Sudhir Kumar Saha vs Commissioner of Police, Calcutta & Anr., ; the petitioner along with his associates committed various acts of crime on three occasions.
On the first occasion he attacked the people of a locality with a knife and by hurling bottles at them.
On the other two occasions he attacked the people of another locality, by hurling bomes at them.
It was held that the incidents were not interlinked and could not have prejudiced the maintenance of public order.
On considering these decisions, we are constrained to hold that the clamping of the order of detention is not in accordance with the provision of the Act.
Furthermore, the history sheet does not at all link to the proximity of the two incidents on the basis of which the o order of detention was made.
It has been vehemently urged before us by the learned counsel appearing for the appellant that in none of the cases mentioned in the history sheet the appellant has been convicted and moreover these cases related to a period much earlier than the period in which the two cases have occurred.
It has also been submitted in this connection by the learned counsel for the appellant that the appellant had not been convicted in any of the cases and the submission of the Sub Inspector of Police that the witnesses are afraid of disclosing their names and coming forward to give evidence is wholly incorrect and false in as much as witnesses in fact gave the evidence in a criminal case which ended in acquittal.
It has also been submitted by the learned counsel that the shopkeepers of the locality where the alleged hurling of bombs took place have made an application in this case that no such incident occurred on the said dates.
In the premises, aforesaid, we hold that the impugned order of detention is illegal and invalid and we allow the appeal setting aside the judgment and order of the High Court without any order as to costs.
S.L. Appeal allowed.
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AL APPELLATE JURISDICTION: Criminal Appeal No. 450 of 1987 From the Judgment and order dated 26.3.1987 of the Allahabad High Court in Habeas Corpus Petition No. The Judgment of the Court was delivered by B.C. RAY, J.
Special leave granted. On the same day the grounds of detention were served on the appellant. As a result of this the place was terror stricken and the shops and houses closed down. 10.86 in the general diary as Case crime No. 1986, the appellant armed with illegal bombs went towards Uttam Talkies. Kydganj, Allahabad with the intention of committing serious offence. On information being received, the police went to arrest the appellant. As a result of this there was a stampede in the public, the doors and windows of the houses and shops closed down, the traffic stopped and the people were terror stricken. The police arrested appellant on the spot and recovered 3 illegal bombs from the appellant. The appellant has also been supplied with a copy of a confidential letter written by the Superintendent of Police, Allahabad to District Magistrate, Allahabad dated 9.10.1986. 38 in which it is alleged that the appellant threatened the shopkeepers of Khalasi Line in an attempt to extort money. He was also supplied with the copy of the report which was registered as case crime No. 249 of 1986 under section 4/5 of the Explosives Act. The appellant made representation against the grounds of detention before the authorities concerned but his representation was rejected and the order of detention was confirmed. The detention order has, therefore, been assailed as illegal and bad and so the same is invalid in law. The High Court after hearing the appellant, by its judgment and H 132 order dated 26th March, 1987 dismissed the writ petition No. 17849 of 1986 holding that the order of detention passed by the detaining authority while the appellant was in jail could not be held to be illegal in the facts and circumstances of the case. His name in the history sheet was included by the police. It has been further stated that this is the reason for non appearance of the shopkeepers and others as witnesses. The first incident dated October 2, 1986 was registered in G.D. No. 38 of the said date and the second incident which occurred on October 3, 1986 was registered as case crime No. This resulted in a great problem of public order. It has been stated further that after being convinced of the gravity of the situation created by the appellant and his accomplice, the District Magistrate after fully satisfying himself about the state of affairs, passed the order of detention of the appellant. It has also been stated that the detention order was passed mainly on the basis of two criminal acts committed by the appellant on October 2 and 3, 1986. It has also been stated that it is wrong that the allegations made in the reports dated October 2 and 3, 1986 are false. The cases which have been reported on October 2 and 3, 1986 are pending trial before the Court. It has also been stated that the order of detention was passed by the District Magistrate on the basis of the information gathered by him from the reports submitted by the police. It has also been stated that the appellant has already applied for bail in crime case No. 249/86 under section 4/5 of Explosives Act. Hence the detention order is legal in all respects. Before proceeding to consider the case on merits it is relevant to quote the provisions of Section 3 sub section (2) of National security Act, 1980. In the instant case the order of detention has been made by respondent No. 2, District Magistrate, on the basis of two criminal cases in respect of two incidents which occurred on October 2 and 3, 1986. The report of 134 this incident was made by the picket employed at police station, Kydganj. The second ground which leads to crime case No. 248/86 under section 307 I.P.C. and case crime No. 249 under section 4/5 of Explosives Act and which occurred on October 3, 1986 at about 10 A.M.
On the complaint of Sub Inspector Yatendra Singh through special court, Allahabad also does not disclose any particulars as to the shopkeepers in whose presence the alleged bombs were thrown by the appellant and his associate and who were terrified and panic stricken and put down their shutters, nor the names of any of the witnesses have been mentiond in respect of the said incident. Public order is what the French call "order publique" and is something more than ordinary maintenance of law and order. 135 Third: where the concerned person is actually in jail custody at the time when an order of detention is passed against him and is not likely to be released for a fair length of time, it may be possible to contend that there could be no satisfaction on the part of the detaining authority as to the likelihood of such a person indulging in activities which would jeopardise the security of the State or the public order. Fifth: the order of detention is a precautionary measure. But, the possibility of launching a criminal prosecution is not an absolute bar to an order of preventive detention. There are three concepts according to the learned Judge (Hidayatullah, J) i.e. ' 'law and order ' ', "public order" and "security of the State ' . It has been observed that to appreciate the scope and extent of each of them, one should imagine three concentric circles. The largest of them represented law and order, next represented public order and the smallest represented the security of the State. An act might affect law and order but not public order just as an act might affect public order but not the security of the State. ' ' It is the degree of disturbance and its effect upon the life of the community in a locality which determines whether the disturbance amounts only to a breach of law and order. Take another case of a town where there is communal tension. A man stabs a member of the other community. Its implications are deeper and it affects the even tempo of life and public order is jeopardized because the repercussions of the act embrace large sections of the community and incite them to make further breaches of the law and order and to subvert the public order. An act by itself is not determinant of its own gravity. In its quality it may not differ from another but in its potentiality it may be very different. " This has been followed in the case of Nagendra Nath Mondal vs 137 State of West Bengal; , and Nand Lal Roy alias Nonda Dulal Roy vs State of West Bengal, [ Thus from these observations it is evident that an act whether amounts to a breach of law and order or a breach of public order solely depends on its extent and reach to the society. If the act is restricted to particular individuals or a group of individuals it breaches the law and order problem but if the effect and reach and potentiality of the act is so deep as to affect the community at large and or the even tempo of the community that it becomes a breach of the public order. Similar acts in different contexts affect differently law and order on the one hand and public order on the other. It is always a question of degree of the harm and its effect upon the community. Public order is the even tempo of the life of the community taking the country as a whole or even a specified locality. The distinction between the two concepts of 'law and order ' and 'public order ' is a fine one but this does not mean that there can be no overlapping. Acts similar in nature but committed in different contexts and circumstances might cause different reactions. In one case it might affect specific individuals only and therefore touch the problem of law and order. An act which may not at all be objected to in certain situations is capable of totally disturbing the public tranquility. When communal tension is high, an indiscreet act of no significance is likely to disturb or dislocate the even tempo of the life of the community. In the present case so far as the first incident which occurred on 2. As regards the second incident which occurred on 3. 249/86 under Section 4/5 Explosives Act respectively are pending trial. It is also pertinent to remember in this connection that a case crime No. The said application was admitted on 2.6.1986 and it is pending as Criminal Misc. The High Court while admitting the case had granted stay of arrest of the appellant. Furthermore, the appellant was taken in custody and he was in jail as an under trial prisoner on October 10. 38 dated October 2, 1986 at police station, Kydganj. If the said material appears satisfactory to the authority, then the authority has to consider whether it is likely that the said person would act in a prejudicial manner in future if he is not prevented from doing so by an order of detention. If this question is answered against the petitioner, then the detention order can be properly made. At the point of time when an order of detention is going to be 140 served on a person, it must be patent that the said person would act prejudicially if he is not detained and that is a consideration which would be absent when the authority is dealing with a person already in detention. " In the instant case there is nothing to show that in consideration of his previous conduct and acts there. It has been observed in the case of Merugu Satyanarayana etc. But as stated by this Court it will depend on the facts and circumstances of each case. It has further been observed as follows: "We are completely at a loss to understand how a Sub Inspector of Police can arrogate to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act. In this case the District Magistrate, the detaining authority has not chosen to file his affidavit. The affidavit in opposition is filed by a Sub Inspector of Police. " In a recent case of Ramesh Yadav vs District Magistrate, Etah and others, AIR 1986 (SC) 3 15 it has been observed that: "It is clear that the order of detention was passed as the detaining authority was apprehensive that in case the detenu was released on bail he would again carry on his criminal activities in the area. If the apprehension of the detaining authority was true, the bail application had to be opposed and in case bail was granted, challenge against that order in the higher forum had to be raised. Merely on the ground that an accused in detention as an undertrial prisoner was likely to get bail an order of detention under the should not ordinarily be passed. We are inclined to agree with counsel for the petitioner that the order of detention in the circumstances is not sustainable and is contrary to the well settled principles indicated by this Court in series of cases relating to preventive detention. The impugned order, therefore, has to be quashed. In the instant case the detaining authority, respondent No. 2 has not come forward to file an affidavit stating whether he has taken into consideration the fact that the appellant was already in judicial custody and on considering his past activities he was subjectively satisfied that if set free or released from jail custody on bail, there was likelihood of the appellant indulging in criminal activities endangering public order. On the other hand, the Station officer of the Police Station, Kydganj, Shri O.P. Ojha has filed a counter stating that the District Magistrate passed the impugned detention order when the appellant was already in jail on the apprehension that the appellant is likely to be released on 142 bail in the near future and if the appellant is bailed out, the public order problem will become worse. On this ground alone, the order of detention is invalid. They can also file application in revision for cancellation of the bail application. It is pertinent to mention in this connection the case of Abdul Gaffer vs State of West Bengal, AIR 1975 (SC) 1496 wherein the order of detention was passed in respect of three cases registered against the petitioner. These are as follows: (1) The petitioner along with his associates on 18.7.1971 being armed with deadly weapons like daggers etc. A (2) On 25.11.1971 the petitioner along with his associates being armed with deadly weapons committed theft in respect of batteries from empty rakes standing on the railway track. The R.P.F. party fired two rounds whereby one of his associates was injured and arrested at the spot. committed theft of wheat bags from a wagon and on being challenged by the R.P.F. party the petitioner and his associates pelted stones and hurled bombs. As a result of this act train services on Howrah Burdwan line was suspended for a considerable period. Three cases were registered in respect of these offences and order of detention was made by the District Magistrate. According to the counsel the so called explanation given in the counter that the witnesses being afraid were not coming forward to give evidence was too ridiculous to be believed by any reasonable person. The Sub Inspector of Police who made the panchnama could certainly not be afraid of giving evidence. The bald but sweeping allegation in the counter that these witnesses were also afraid of giving evidence in court against the petitioner is a version which is too incredulous to be swallowed even by an ultra credulous person without straining his credulity to the utmost. The order of detention was therefore held invalid. the petitioner along with his associates committed various acts of crime on three occasions. On the first occasion he attacked the people of a locality with a knife and by hurling bottles at them. On the other two occasions he attacked the people of another locality, by hurling bomes at them. It was held that the incidents were not interlinked and could not have prejudiced the maintenance of public order. Furthermore, the history sheet does not at all link to the proximity of the two incidents on the basis of which the o order of detention was made. It has also been submitted in this connection by the learned counsel for the appellant that the appellant had not been convicted in any of the cases and the submission of the Sub Inspector of Police that the witnesses are afraid of disclosing their names and coming forward to give evidence is wholly incorrect and false in as much as witnesses in fact gave the evidence in a criminal case which ended in acquittal. It has also been submitted by the learned counsel that the shopkeepers of the locality where the alleged hurling of bombs took place have made an application in this case that no such incident occurred on the said dates.
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HELD: The order of detention was passed by the respondent No. 2.
District Magistrate, on the basis of two Criminal Cases in respect of two incidents which had occurred on October 2 and 3, 1986.
So far as the case being G.D. No. 38 was concerned, the report of this incident was made by the picket employed at police station, Kydganj.
It appeared from this report that there were no particulars about the shopkeepers who had been terrorised and threatened for payment of money, as alleged in the grounds of detention, nor were mentioned at all the names of any of the witnesses in whose presence the threat or terror was used and money was demanded.
The report was absolutely vague and it was not possible for the detenu to give an effective representation 127 against the ground, which is one of the Constitutional requirements enjoined in Article 22(5) of the Constitution of India.
The second ground, which led to crime case No. 248/86 under section 307, I.P.C., and crime case No. 249/86 under section 4/5 of the Explosives Act and which occurred on October 3, 1986, registered on the complaint of Sub/Inspector Yatendra Singh through special court, Allahabad, also did not disclose any particulars as to the shop keepers in whose presence the bombs alleged were thrown by the appellant, and who were terrified and panic stricken, etc., nor were mentioned the names of any witnesses in respect of the said incident.
[133F, 134A D] The question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order, is a question of degree and the extent of the reach of the act upon the Society, as held by this Court in Kanu Biswos vs State of West Bengal, ; , while determining the meaning of 'public order '.
Public order is what the French Call "order Publique" and is something more than ordinary maintenance of law and order.
From the observations of this Court made in many cases, it is evident that whether an act amounts to a breach of law and order or a breach of public order, solely depends upon its extent and reach to the society.
If the act is restricted to particular individuals or a group of individuals, it breaches the law and order problem, but if the effect and reach and potentiality of the act are so deep as to affect the community at large and/or the even tempo of the community, then, it becomes a breach of the public order.
An act, which may not at all be objected to in certain situations is capable of totally disturbing the public tranquillity.
When communal tension is high, an indiscreet act of no significance is likely to disturb or dislocate the even tempo of the life of the community.
An order of detention made in such a situation has to take note of the potentiality of the act objected to.
Thus, whether an act relates to law and order or the public order depends upon the impact of the act on the life of the community, or, in other words, the reach and effect and potentiality of the act, if so put as to disturb or dislocate the even tempo of the life of the community, it will be an act which will affect the public order .
[134D E,137A B. 138B D] In this case, so far as the first incident which occurred on 2.10.1986 was concerned, the ground was vague inasmuch as the names of the witnesses in whose presence the threat was given and the incident occurred, had not been mentioned.
As regards the second incident which occurred on 3.
10.1986, the Crime Case No. 248/86 under section 307, I.P.C. and the Crime Case No. 249/86 under section 4/5 of the Explosive Act, were pending trial.
[138E F] 128 A case crime No. 200 of 1985 under sections 323/504/506/426, l.
P.C., read with section 2/3 of the U.P. Gangsters and Anti Social Activities Act No. 4 of 1986 was registered against the appellant by the police.
That case was challenged by an application under section 482 Cr.
P.C. in the High Court.
The said application was admitted on 2.6.1986 and had been pending.
The High Court had, while admitting the case, granted stay of arrest of the appellant.
The appellant had been taken into custody and was in jail as an undertrial prisoner on October 10, 1986, when the impugned order of detention was clamped upon him.
The appellant stated in this Appeal that till date he had not applied for bail in case crime No. 248/86 and case crime No. 249/86 as well as the case registered in report No. 38 dated October 2, 1986 at the police station Kydganj.
The question was whether there was a possibility of the detaining authority to be satisfied that the appellant was likely to indulge in activities prejudicial to the maintenance of public order as there was no likelihood of his being released from the jail custody immediately.
There was nothing in the case to show that in consideration of his previous conduct and acts, there was a likelihood of the appellant 's indulging in activities prejudicial to the maintenance of public order if he was set free and/or released from custody.
[138F H, 139A B, 140B C] The detaining authority District Magistrate respondent No. 2, had not filed an affidavit stating whether he had taken into consideration the fact that the appellant had already been in the judicial custody and on considering his past activities he had been subjectively satisfied that if set free or released from jail custody on bail, there was a likelihood of his indulging in criminal activities endangering public order.
On the other hand, the Station officer of Kydganj police station, had filed a counter stating that the District Magistrate had passed the impugned detention order when the appellant was already in jail, on the p apprehension that the appellant was likely to be released on bail in the near future and if he was bailed out, the public order would become worse.
This clearly showed that the police officer had arrogated to himself the knowledge about the subjective satisfaction of the District Magistrate on whom the power is conferred by the Act.
The affidavit filed by the station officer of police implied that he had access to the file of the District Magistrate or he influenced the decision of the District Magistrate for making the detention order.
There was nothing to show that there was awareness in the mind of the District Magistrate, the detaining authority, of the fact that the appellant was in jail at the time of the clamping of the order of detention, and the detaining authority was satisfied, in considering his antecedents, that there was a likelihood of his indulging in criminal activities, jeopardising public order if he 129 was released on bail and that there was every likelihood of his being A enlarged on bail within a short time.
On this ground alone, the detention order was invalid.
It might be said in this connection that the respondents could very well oppose the bail application when it came up for hearing, and if at all the appellant was released on bail, the respondents were not without a remedy.
They could file an application for cancellation of the bail.
In the circumstances, it could not but be held that the passing of the order of detention of the appellant who was already in custody was fully bad and invalid in law.
The respondents could very well proceed with the criminal case under section 307, I.P.C., and get the appellant punished if the case was proved beyond doubt against him.
The police officers, who witnessed the hurling of the bombs and the Sub Inspector of police who recorded the F.I.R., could come forward to give evidence.
In the circumstances, the open statement in the affidavit of the Sub Inspector that the witnesses were afraid of disclosing their names and giving evidence, was wholly incredulous and could not be accepted.
[141G H, 142A G, 143G 144A] The clamping of the order of detention was not in accordance with the provisions of the Act.
The history sheet did not at all link to the proximity of the two incidents on the basis of which the detention order had been passed.
[144C D] The impugned order of detention was illegal and invalid.
[144G] E Kanu Biswas vs State of West Bengal, [1972] 3 S.C.C. 831; Haradhan Saha vs The State of West Bengal and Anr. ; ; Kanchanlal Maneklal Chokshi vs State of Gujarat & ors.
; , ; Dr. Ram Manohar Lohia vs State of Bihar & ors.; , ; Arun Ghosh vs State of West Bengal, ; Nagendra Nath Mondal vs State of West Bengal, 11972] 1 S.C.C. 498; Nand Lal Roy alias Nonda Dulal Roy vs State of West Bengal, ; S.K. Kedar vs State of West Bengal, ; Ashok Kumar vs Delhi Administration, ; State of U.P. vs Hari Shankar Tewari, ; ; Masood Alam vs Union of India, A.I.R. 1973 S.C. 897; Rameshwar Shaw vs District Magistrate Burdwan State of Andhra Pradesh & ors.
; , ; Ramesh Yadav vs District Magistrate, Etah and others, A.I.R. 1986 S.C. 315; Abdul Gaffer vs State of West Bengal, A.I.R. 1975 S.C. 1496 and Sudhir Kumar Saha vs Commissioner of Police, Calcutta, ;
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HELD: The order of detention was passed by the respondent No. District Magistrate, on the basis of two Criminal Cases in respect of two incidents which had occurred on October 2 and 3, 1986. The second ground, which led to crime case No. 248/86 under section 307, I.P.C., and crime case No. [133F, 134A D] The question whether a man has only committed a breach of law and order or has acted in a manner likely to cause a disturbance of the public order, is a question of degree and the extent of the reach of the act upon the Society, as held by this Court in Kanu Biswos vs State of West Bengal, ; , while determining the meaning of 'public order '. Public order is what the French Call "order Publique" and is something more than ordinary maintenance of law and order. As regards the second incident which occurred on 3. 200 of 1985 under sections 323/504/506/426, l.
P.C., read with section 2/3 of the U.P. Gangsters and Anti Social Activities Act No. 4 of 1986 was registered against the appellant by the police. That case was challenged by an application under section 482 Cr. The said application was admitted on 2.6.1986 and had been pending. 249/86 as well as the case registered in report No. 38 dated October 2, 1986 at the police station Kydganj. The question was whether there was a possibility of the detaining authority to be satisfied that the appellant was likely to indulge in activities prejudicial to the maintenance of public order as there was no likelihood of his being released from the jail custody immediately. [138F H, 139A B, 140B C] The detaining authority District Magistrate respondent No. On the other hand, the Station officer of Kydganj police station, had filed a counter stating that the District Magistrate had passed the impugned detention order when the appellant was already in jail, on the p apprehension that the appellant was likely to be released on bail in the near future and if he was bailed out, the public order would become worse. On this ground alone, the detention order was invalid. They could file an application for cancellation of the bail. The respondents could very well proceed with the criminal case under section 307, I.P.C., and get the appellant punished if the case was proved beyond doubt against him. The police officers, who witnessed the hurling of the bombs and the Sub Inspector of police who recorded the F.I.R., could come forward to give evidence. Kanchanlal Maneklal Chokshi vs State of Gujarat & ors. ; , ; Dr. Ram Manohar Lohia vs State of Bihar & ors.; , ; ; , ; Ramesh Yadav vs District Magistrate, Etah and others, A.I.R. 1986 S.C. 315; Abdul Gaffer vs State of West Bengal, A.I.R. 1975 S.C. 1496 and Sudhir Kumar Saha vs Commissioner of Police, Calcutta, ;
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N: Criminal Appeal No . 579 of 1986 From the Judgment and order dated 15.4.1986 of the Bombay High Court in Crl.
R. Appln.
No. 160 of 1985.
Rakesh Upadhyay, M.M. Kashyap and N.A. Siddiqui for the Appellants.
V.N. Ganpule, S.K. Agnihotri and A.S. Bhasme for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
The appellant No. 1 Bakulabai filed an application under section 125 of the Code of Criminal Procedure, 1973 (hereinafter referred to as the Code) before the Judicial Magistrate, Degloor, alleging that she was lawfully married to the respondent No. 1 Ganga Ram and that the appellant No. 2 Maroti was born out of this wedlock.
She claimed maintenance both for herself and for her son.
Ganga Ram denied the marriage as well as the paternity of the appellant No. 2.
He also averred that he was already married twice before the wedding 790 pleaded by Bakulabai and that both his wives were living.
The Judicial Magistrate accepted Bakulabai 's case and granted maintenance at the rate of Rs. 100 per month in her favour and additional Rs.50 per month for the minor boy.
Ganga Ram moved the Sessions Judge in revision.
Bakulabai also filed a revision application for enhancement of the rate of maintenance.
The two applications were registered respectively as Criminal Revision No. 83 of 1984 and Criminal Revision No. 110 of 1984, and were heard together.
The Sessions Judge accepted the defence case, reversed the findings of the Judicial Magistrate and dismissed the application for maintenance.
Revision case No. 83 of 1984 was thus allowed and the wife 's application was dismissed.
Bakulabai challenged the order before the Bombay High Court by a revision application.
By the impugned Judgment the High Court rejected the same holding that since it was the second revision application by the wife it was not maintainable, being barred by the provisions of section 397(3) of the Code.
The Court further proceeded to examine the merits of the case and concurred with the view of the Sessions Judge.
The appellants have now come to this Court by special leave.
On the maintainability of the revision application before it, the High Court took an erroneous view.
The provisions of sub section (3) of section 397 relied upon, are in the following terms: "(3) If an application under this section has been made by any person either to the High Court or to the Sessions Judge, no further application by the same person shall be entertained by the other of them.
" The main judgment of the Judicial Magistrate upholding the appellants ' claim for maintenance was in her favour and there was no question of her challenging the same.
Her challenge before the Sessions Judge was confined to the part of the order assessing the amount of maintenance, and this issue could not have been raised again by her.
Subject to this limitation she was, certainly entitled to invoke the revisional jurisdiction of the High Court.
The decision on the merits of her claim went against her for the first time before the Sessions Judge, and this was the subject matter of her revision before the High Court.
She could not, therefore, be said to be making a second attempt when she challenged this order before the High Court.
The fact that she had moved before the Sessions Judge against the quantum of maintenance 791 could not be used against her in respect of her right of revision against the Sessions Judge 's order.
Accordingly, the decision of the High Court on this question is set aside and it is held that the revision petition of the appellant before the High Court, except the prayer for enhancing the amount was maintainable.
Now, coming to the other aspect, the Judicial Magistrate on a consideration of the evidence led on behalf of the parties accepted the appellants ' case.
He held that Bakulabai and Ganga Ram had lived together in the same house as husband and wife for a considerable period, and the boy Maroti was born of this union.
On the question as to whether Ganga Ram was already married and his wife or wives were living on the date the marriage with the appellant Bakulabai is alleged, the Magistrate did not record a categorical finding.
According to the case of Ganga Ram, he was first married with Rajabai, and again with Kusumbai in 1969.
It was, therefore, argued on his behalf that as he had two living spouses in 1972, he could not have lawfully married a third time in view of the provisions of the .
The Judicial Magistrate rejected the plea by saying that the second marriage of the respondent with Kusumbai was on his own showing null and void as his first wife was then alive.
Dealing with the effect of the first marriage he held that it was not as fact proved.
Thus he got rid of the effect of both the marriages by adopting a queer logic.
If the story of the first marriage was to be rejected, the second marriage could not have been held to be void on that ground.
The finding of the Judicial Magistrate on the validity of the marriage of the appellant was, therefore, illegal.
We have by our judgment in Criminal Appeal No. 475 of 1983 (Smt.
Yamunabai vs Anantrao Shivram Adhav and another) delivered today held that the marriage of a Hindu woman with a Hindu male with a living spouse performed after the coming in force of the , is null and void and the woman is not entitled to maintenance under section 125 of the Code.
Coming to the facts of the present case, it appears that the respondent has satisfactorily proved his case about his earlier marriage with Kusumbai by production of good evidence including a certificate issued by the Arya Samaj in this regard.
It is not suggested that Rajabai was living when Kusumbai was married and was dead by the time the appellant 's marriage took place.
The position which emerges, therefore, is that either the respondent 's first marriage with Rajabai was subsisting so as to nullify his second marriage with Kusumbai, in which case the appellant 's marriage also was rendered null and void on that very ground; or if, on the other 792 hand, the respondent 's case of his marriage with Rajabai is disbelieved A the marriage of Kusumbai will have to be held to be legal and effective so as to lead to the same conclusion of the appellant 's marriage being void on either hypothesis the appellant 's claim is not covered by section 125 of the Code.
She cannot, therefore, be granted any relief in the present preceedings.
The decision to that effect of the High Court is, R therefore, confirmed.
The other findings of the Magistrate on the disputed question of fact were recorded after a full consideration of the evidence an should have been left undisturbed in revision.
No error of law appears to have been discovered in his judgment and so the revisional courts were not justified in making a reassessment of the evidence and substitute their own views for those of the Magistrate.
(See Pathumma and another vs Mahammad; , Besides holding that the respondent had married the appellant, the Magistrate categorically said that the appellant and the respondent lived together as husband and wife for a number of years and the appellant No. 2 Maroti was their child.
If, as a matter of fact, a marriage although ineffective in the eye of law, took place between the appellant No. 1 and the respondent No. 1, the status of the boy must be held to be of a legitimate son on account of section 16(1) of the , which reads as follows: "16(1).
Notwithstanding that a marriage is null and void under Section 11, any child of such marriage who would have been legitimate if the marriage had been valid, shall be legitimate, whether such child is born before or after the commencement of the Marriage Laws (Amendment) Act, 1976 (68 of 1976), and whether or not a decree of nullity is granted in respect of that marriage under this Act and whether or not the marriage is held to be void otherwise than on a petition under this Act.
" Even if the factum of marriage of his mother is ignored he must be treated as an illegitimate child of the respondent on the basis of the findings of the Judicial Magistrate and is entitled to relief by reason of Clauses (b) and (c) of section 125(1) of the Code specifically referring to an illegitimate child.
We, therefore, hold that the order of the Judicial Magistrate allowing the maintenance to the appellant No. 2 was correctly passed.
The amount of Rs.50 per month was allowed as the mainte 793 nance of the child in 1984.
The revision application filed before the Sessions Judge was rejected.
A second application before the High Court was, therefore, not maintainable.
We will, therefore, assume that the decision assessing the amount of maintenance as Rs.50 per month in 1984 became final.
However, on account of change of circumstances, this amount can be revised after efflux of time.
During the last four years the value of money has gone down due to inflation.
The child has also grown in age.
In the circumstances, we direct the respondent Ganga Ram to pay the appellant No. 1 the maintenance amount for appellant No. 2 at the rate of Rs.150 per month with effect from February, 1988.
The arrears up to January, 1988, if not paid, should also be paid promptly.
The appeal is allowed in the terms mentioned above.
G.N. Appeal allowed.
G.N. Appeal allowed.
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% The appellant filed an application under Section 125 Cr.
P.C. before the Judicial Magistrate, claiming maintenance for herself and her son, alleging lawful marriage with the respondent, and that the son was born out of the wedlock.
Respondent, however, denied the marriage and paternity of her son.
He claimed that he was already married twice and both his wives were alive.
The Judicial Magistrate accepted the appellant 's case and granted maintenance at the rate of 100 per month in her favour and Rs.50 per month for her minor son.
The Judicial Magistrate held that appellant No. t and respondent lived together in the same house as husband and wife for a considerable period, and appellant No. 2 was born out of this union.
He did not record a categorical finding as to whether the respondent was already married and his wife or wives were alive on the date of his marriage with appellant No. t. A revision application was filed by the appellant for enhancement of the rate of maintenance.
The respondent also moved the Sessions Judge in revision.
The Sessions Judge reversed the findings of the judicial Magistrate.
The appellant challenged the order by way of a revision application before the Bombay High Court which rejected the same holding that since it was the second revision application, it was not maintainable, being barred by the provisions of section 397(3) Cr.
The High Court also examined the merits of the case and concurred with the view of the Sessions Judge.
This appeal is by Special Leave.
788 Allowing the appeal, this Court, ^ HELD: t.
The plea that respondent could not have lawfully married a third time in view of the provisions of the was rejected by the Judicial Magistrate by saying that even according to the respondent, his second marriage was null and void as his first wife was then alive.
As regards the first marriage he held that it was not as a fact proved.
He got rid of the effect of both the marriages by adopting a queer logic.
If the story of the first marriage was to be rejected, the second marriage could not have been held to be void on that ground.
It appears that the respondent has satisfactorily provide his case about his earlier marriage by production of good evidence.
Either the respondent 's first marriage was subsisting so as to nullify his second marriage, in which case the appellant 's marriage also was rendered null and void on that ground; or if the respondent 's case of his first marriage is disbelieved the second marriage will have to be held to be legal and effective so as to lead to the same conclusion of the appellant 's marriage being void.
On either hypothesis the appellant 's claim is not covered by Section 125 Cr.
The appellant cannot, therefore, be granted any relief in the present proceedings.
[791D H; 792A B] Smt.
Yamunabhai v Anantrao Shivram Adhav and another; , followed.
Besides holding that the respondent had married the appellant, the Magistrate categorically said that the appellant and the respondent lived together as husband and wife for a number of years and that appellant No. 2 was their child.
If, as a matter of fact, a marriage, although ineffective in the eye of law, took place between the appellant and the respondent, the status of the boy must be held to be that of a legitimate son on account of Section 16(1) of the .
Even if the factum of marriage of his mother is ignored, he must be treated as an illegitimate child of the respondent on the basis of the findings of the Judicial Magistrate and is entitled to relief by reason of clauses (b) and (c) of Section 125(t) Cr.
P.C. specifically referring to an illegitimate child.
The order of the Judicial Magistrate allowing the maintenance to appellant No. 2 was correctly passed.
But the amount of Rs.50 per month was allowed as the maintenance of the child four years back.
In view of the fact that money value has gone down due to inflation and the child has grown in age, the rate of maintenance is increased to Rs.150.[791B C: 793B] 3.
Since the claim for maintenance was granted in favour of the 789 appellant, by the Judicial Magistrate, there was no question of her challenging the same.
Her challenge before the Sessions Judge was confined to that part of the order assessing the amount of maintenance.
and this issue could not have been raised again by her.
Subject to this limitation, she was certainly entitled to invoke the revisional jurisdiction of the High Court.
The decision on the merits of her claim went against her for the first time before the Sessions Judge, and this was the subject matter of her revision before the High Court.
She could not, therefore, be said to be making a second attempt when she challenged the order before the High Court.
The fact that she had moved the Sessions Court against the quantum of maintenance could not be used against her in respect of her right of revision against the Sessions Judge 's order.
[790F H;791A] 4.
No error of law appears to have been discovered in the judgment of the Magistrate and so the revisional courts were not justified in making a reassessment of the evidence and substitute their own views for those of the Magistrate.
[792C] Pathumma vs Mohammad, ; , followed.
|
N: Criminal Appeal No . 579 of 1986 From the Judgment and order dated 15.4.1986 of the Bombay High Court in Crl.
R. Appln.
No. 160 of 1985.
Rakesh Upadhyay, M.M. Kashyap and N.A. Siddiqui for the Appellants.
V.N. Ganpule, S.K. Agnihotri and A.S. Bhasme for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
The appellant No. 1 Bakulabai filed an application under section 125 of the Code of Criminal Procedure, 1973 (hereinafter referred to as the Code) before the Judicial Magistrate, Degloor, alleging that she was lawfully married to the respondent No. 1 Ganga Ram and that the appellant No. 2 Maroti was born out of this wedlock.
She claimed maintenance both for herself and for her son.
Ganga Ram denied the marriage as well as the paternity of the appellant No. 2.
He also averred that he was already married twice before the wedding 790 pleaded by Bakulabai and that both his wives were living.
The Judicial Magistrate accepted Bakulabai 's case and granted maintenance at the rate of Rs. 100 per month in her favour and additional Rs.50 per month for the minor boy.
Ganga Ram moved the Sessions Judge in revision.
Bakulabai also filed a revision application for enhancement of the rate of maintenance.
The two applications were registered respectively as Criminal Revision No. 83 of 1984 and Criminal Revision No. 110 of 1984, and were heard together.
The Sessions Judge accepted the defence case, reversed the findings of the Judicial Magistrate and dismissed the application for maintenance.
Revision case No. 83 of 1984 was thus allowed and the wife 's application was dismissed.
Bakulabai challenged the order before the Bombay High Court by a revision application.
By the impugned Judgment the High Court rejected the same holding that since it was the second revision application by the wife it was not maintainable, being barred by the provisions of section 397(3) of the Code.
The Court further proceeded to examine the merits of the case and concurred with the view of the Sessions Judge.
The appellants have now come to this Court by special leave.
On the maintainability of the revision application before it, the High Court took an erroneous view.
The provisions of sub section (3) of section 397 relied upon, are in the following terms: "(3) If an application under this section has been made by any person either to the High Court or to the Sessions Judge, no further application by the same person shall be entertained by the other of them.
" The main judgment of the Judicial Magistrate upholding the appellants ' claim for maintenance was in her favour and there was no question of her challenging the same.
Her challenge before the Sessions Judge was confined to the part of the order assessing the amount of maintenance, and this issue could not have been raised again by her.
Subject to this limitation she was, certainly entitled to invoke the revisional jurisdiction of the High Court.
The decision on the merits of her claim went against her for the first time before the Sessions Judge, and this was the subject matter of her revision before the High Court.
She could not, therefore, be said to be making a second attempt when she challenged this order before the High Court.
The fact that she had moved before the Sessions Judge against the quantum of maintenance 791 could not be used against her in respect of her right of revision against the Sessions Judge 's order.
Accordingly, the decision of the High Court on this question is set aside and it is held that the revision petition of the appellant before the High Court, except the prayer for enhancing the amount was maintainable.
Now, coming to the other aspect, the Judicial Magistrate on a consideration of the evidence led on behalf of the parties accepted the appellants ' case.
He held that Bakulabai and Ganga Ram had lived together in the same house as husband and wife for a considerable period, and the boy Maroti was born of this union.
On the question as to whether Ganga Ram was already married and his wife or wives were living on the date the marriage with the appellant Bakulabai is alleged, the Magistrate did not record a categorical finding.
According to the case of Ganga Ram, he was first married with Rajabai, and again with Kusumbai in 1969.
It was, therefore, argued on his behalf that as he had two living spouses in 1972, he could not have lawfully married a third time in view of the provisions of the .
The Judicial Magistrate rejected the plea by saying that the second marriage of the respondent with Kusumbai was on his own showing null and void as his first wife was then alive.
Dealing with the effect of the first marriage he held that it was not as fact proved.
Thus he got rid of the effect of both the marriages by adopting a queer logic.
If the story of the first marriage was to be rejected, the second marriage could not have been held to be void on that ground.
The finding of the Judicial Magistrate on the validity of the marriage of the appellant was, therefore, illegal.
We have by our judgment in Criminal Appeal No. 475 of 1983 (Smt.
Yamunabai vs Anantrao Shivram Adhav and another) delivered today held that the marriage of a Hindu woman with a Hindu male with a living spouse performed after the coming in force of the , is null and void and the woman is not entitled to maintenance under section 125 of the Code.
Coming to the facts of the present case, it appears that the respondent has satisfactorily proved his case about his earlier marriage with Kusumbai by production of good evidence including a certificate issued by the Arya Samaj in this regard.
It is not suggested that Rajabai was living when Kusumbai was married and was dead by the time the appellant 's marriage took place.
The position which emerges, therefore, is that either the respondent 's first marriage with Rajabai was subsisting so as to nullify his second marriage with Kusumbai, in which case the appellant 's marriage also was rendered null and void on that very ground; or if, on the other 792 hand, the respondent 's case of his marriage with Rajabai is disbelieved A the marriage of Kusumbai will have to be held to be legal and effective so as to lead to the same conclusion of the appellant 's marriage being void on either hypothesis the appellant 's claim is not covered by section 125 of the Code.
She cannot, therefore, be granted any relief in the present preceedings.
The decision to that effect of the High Court is, R therefore, confirmed.
The other findings of the Magistrate on the disputed question of fact were recorded after a full consideration of the evidence an should have been left undisturbed in revision.
No error of law appears to have been discovered in his judgment and so the revisional courts were not justified in making a reassessment of the evidence and substitute their own views for those of the Magistrate.
(See Pathumma and another vs Mahammad; , Besides holding that the respondent had married the appellant, the Magistrate categorically said that the appellant and the respondent lived together as husband and wife for a number of years and the appellant No. 2 Maroti was their child.
If, as a matter of fact, a marriage although ineffective in the eye of law, took place between the appellant No. 1 and the respondent No. 1, the status of the boy must be held to be of a legitimate son on account of section 16(1) of the , which reads as follows: "16(1).
Notwithstanding that a marriage is null and void under Section 11, any child of such marriage who would have been legitimate if the marriage had been valid, shall be legitimate, whether such child is born before or after the commencement of the Marriage Laws (Amendment) Act, 1976 (68 of 1976), and whether or not a decree of nullity is granted in respect of that marriage under this Act and whether or not the marriage is held to be void otherwise than on a petition under this Act.
" Even if the factum of marriage of his mother is ignored he must be treated as an illegitimate child of the respondent on the basis of the findings of the Judicial Magistrate and is entitled to relief by reason of Clauses (b) and (c) of section 125(1) of the Code specifically referring to an illegitimate child.
We, therefore, hold that the order of the Judicial Magistrate allowing the maintenance to the appellant No. 2 was correctly passed.
The amount of Rs.50 per month was allowed as the mainte 793 nance of the child in 1984.
The revision application filed before the Sessions Judge was rejected.
A second application before the High Court was, therefore, not maintainable.
We will, therefore, assume that the decision assessing the amount of maintenance as Rs.50 per month in 1984 became final.
However, on account of change of circumstances, this amount can be revised after efflux of time.
During the last four years the value of money has gone down due to inflation.
The child has also grown in age.
In the circumstances, we direct the respondent Ganga Ram to pay the appellant No. 1 the maintenance amount for appellant No. 2 at the rate of Rs.150 per month with effect from February, 1988.
The arrears up to January, 1988, if not paid, should also be paid promptly.
The appeal is allowed in the terms mentioned above.
G.N. Appeal allowed.
G.N. Appeal allowed.
|
N: Criminal Appeal No . 579 of 1986 From the Judgment and order dated 15.4.1986 of the Bombay High Court in Crl.
R. Appln.
No. 160 of 1985.
Rakesh Upadhyay, M.M. Kashyap and N.A. Siddiqui for the Appellants.
V.N. Ganpule, S.K. Agnihotri and A.S. Bhasme for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
The appellant No. 1 Bakulabai filed an application under section 125 of the Code of Criminal Procedure, 1973 (hereinafter referred to as the Code) before the Judicial Magistrate, Degloor, alleging that she was lawfully married to the respondent No. 1 Ganga Ram and that the appellant No. 2 Maroti was born out of this wedlock.
She claimed maintenance both for herself and for her son.
Ganga Ram denied the marriage as well as the paternity of the appellant No. 2.
He also averred that he was already married twice before the wedding 790 pleaded by Bakulabai and that both his wives were living.
The Judicial Magistrate accepted Bakulabai 's case and granted maintenance at the rate of Rs. 100 per month in her favour and additional Rs.50 per month for the minor boy.
Ganga Ram moved the Sessions Judge in revision.
Bakulabai also filed a revision application for enhancement of the rate of maintenance.
The two applications were registered respectively as Criminal Revision No. 83 of 1984 and Criminal Revision No. 110 of 1984, and were heard together.
The Sessions Judge accepted the defence case, reversed the findings of the Judicial Magistrate and dismissed the application for maintenance.
Revision case No. 83 of 1984 was thus allowed and the wife 's application was dismissed.
Bakulabai challenged the order before the Bombay High Court by a revision application.
By the impugned Judgment the High Court rejected the same holding that since it was the second revision application by the wife it was not maintainable, being barred by the provisions of section 397(3) of the Code.
The Court further proceeded to examine the merits of the case and concurred with the view of the Sessions Judge.
The appellants have now come to this Court by special leave.
On the maintainability of the revision application before it, the High Court took an erroneous view.
The provisions of sub section (3) of section 397 relied upon, are in the following terms: "(3) If an application under this section has been made by any person either to the High Court or to the Sessions Judge, no further application by the same person shall be entertained by the other of them.
" The main judgment of the Judicial Magistrate upholding the appellants ' claim for maintenance was in her favour and there was no question of her challenging the same.
Her challenge before the Sessions Judge was confined to the part of the order assessing the amount of maintenance, and this issue could not have been raised again by her.
Subject to this limitation she was, certainly entitled to invoke the revisional jurisdiction of the High Court.
The decision on the merits of her claim went against her for the first time before the Sessions Judge, and this was the subject matter of her revision before the High Court.
She could not, therefore, be said to be making a second attempt when she challenged this order before the High Court.
The fact that she had moved before the Sessions Judge against the quantum of maintenance 791 could not be used against her in respect of her right of revision against the Sessions Judge 's order.
Accordingly, the decision of the High Court on this question is set aside and it is held that the revision petition of the appellant before the High Court, except the prayer for enhancing the amount was maintainable.
Now, coming to the other aspect, the Judicial Magistrate on a consideration of the evidence led on behalf of the parties accepted the appellants ' case.
He held that Bakulabai and Ganga Ram had lived together in the same house as husband and wife for a considerable period, and the boy Maroti was born of this union.
On the question as to whether Ganga Ram was already married and his wife or wives were living on the date the marriage with the appellant Bakulabai is alleged, the Magistrate did not record a categorical finding.
According to the case of Ganga Ram, he was first married with Rajabai, and again with Kusumbai in 1969.
It was, therefore, argued on his behalf that as he had two living spouses in 1972, he could not have lawfully married a third time in view of the provisions of the .
The Judicial Magistrate rejected the plea by saying that the second marriage of the respondent with Kusumbai was on his own showing null and void as his first wife was then alive.
Dealing with the effect of the first marriage he held that it was not as fact proved.
Thus he got rid of the effect of both the marriages by adopting a queer logic.
If the story of the first marriage was to be rejected, the second marriage could not have been held to be void on that ground.
The finding of the Judicial Magistrate on the validity of the marriage of the appellant was, therefore, illegal.
We have by our judgment in Criminal Appeal No. 475 of 1983 (Smt.
Yamunabai vs Anantrao Shivram Adhav and another) delivered today held that the marriage of a Hindu woman with a Hindu male with a living spouse performed after the coming in force of the , is null and void and the woman is not entitled to maintenance under section 125 of the Code.
Coming to the facts of the present case, it appears that the respondent has satisfactorily proved his case about his earlier marriage with Kusumbai by production of good evidence including a certificate issued by the Arya Samaj in this regard.
It is not suggested that Rajabai was living when Kusumbai was married and was dead by the time the appellant 's marriage took place.
The position which emerges, therefore, is that either the respondent 's first marriage with Rajabai was subsisting so as to nullify his second marriage with Kusumbai, in which case the appellant 's marriage also was rendered null and void on that very ground; or if, on the other 792 hand, the respondent 's case of his marriage with Rajabai is disbelieved A the marriage of Kusumbai will have to be held to be legal and effective so as to lead to the same conclusion of the appellant 's marriage being void on either hypothesis the appellant 's claim is not covered by section 125 of the Code.
She cannot, therefore, be granted any relief in the present preceedings.
The decision to that effect of the High Court is, R therefore, confirmed.
The other findings of the Magistrate on the disputed question of fact were recorded after a full consideration of the evidence an should have been left undisturbed in revision.
No error of law appears to have been discovered in his judgment and so the revisional courts were not justified in making a reassessment of the evidence and substitute their own views for those of the Magistrate.
(See Pathumma and another vs Mahammad; , Besides holding that the respondent had married the appellant, the Magistrate categorically said that the appellant and the respondent lived together as husband and wife for a number of years and the appellant No. 2 Maroti was their child.
If, as a matter of fact, a marriage although ineffective in the eye of law, took place between the appellant No. 1 and the respondent No. 1, the status of the boy must be held to be of a legitimate son on account of section 16(1) of the , which reads as follows: "16(1).
Notwithstanding that a marriage is null and void under Section 11, any child of such marriage who would have been legitimate if the marriage had been valid, shall be legitimate, whether such child is born before or after the commencement of the Marriage Laws (Amendment) Act, 1976 (68 of 1976), and whether or not a decree of nullity is granted in respect of that marriage under this Act and whether or not the marriage is held to be void otherwise than on a petition under this Act.
" Even if the factum of marriage of his mother is ignored he must be treated as an illegitimate child of the respondent on the basis of the findings of the Judicial Magistrate and is entitled to relief by reason of Clauses (b) and (c) of section 125(1) of the Code specifically referring to an illegitimate child.
We, therefore, hold that the order of the Judicial Magistrate allowing the maintenance to the appellant No. 2 was correctly passed.
The amount of Rs.50 per month was allowed as the mainte 793 nance of the child in 1984.
The revision application filed before the Sessions Judge was rejected.
A second application before the High Court was, therefore, not maintainable.
We will, therefore, assume that the decision assessing the amount of maintenance as Rs.50 per month in 1984 became final.
However, on account of change of circumstances, this amount can be revised after efflux of time.
During the last four years the value of money has gone down due to inflation.
The child has also grown in age.
In the circumstances, we direct the respondent Ganga Ram to pay the appellant No. 1 the maintenance amount for appellant No. 2 at the rate of Rs.150 per month with effect from February, 1988.
The arrears up to January, 1988, if not paid, should also be paid promptly.
The appeal is allowed in the terms mentioned above.
G.N. Appeal allowed.
G.N. Appeal allowed.
|
% The appellant filed an application under Section 125 Cr.
P.C. before the Judicial Magistrate, claiming maintenance for herself and her son, alleging lawful marriage with the respondent, and that the son was born out of the wedlock.
Respondent, however, denied the marriage and paternity of her son.
He claimed that he was already married twice and both his wives were alive.
The Judicial Magistrate accepted the appellant 's case and granted maintenance at the rate of 100 per month in her favour and Rs.50 per month for her minor son.
The Judicial Magistrate held that appellant No. t and respondent lived together in the same house as husband and wife for a considerable period, and appellant No. 2 was born out of this union.
He did not record a categorical finding as to whether the respondent was already married and his wife or wives were alive on the date of his marriage with appellant No. t. A revision application was filed by the appellant for enhancement of the rate of maintenance.
The respondent also moved the Sessions Judge in revision.
The Sessions Judge reversed the findings of the judicial Magistrate.
The appellant challenged the order by way of a revision application before the Bombay High Court which rejected the same holding that since it was the second revision application, it was not maintainable, being barred by the provisions of section 397(3) Cr.
The High Court also examined the merits of the case and concurred with the view of the Sessions Judge.
This appeal is by Special Leave.
788 Allowing the appeal, this Court, ^ HELD: t.
The plea that respondent could not have lawfully married a third time in view of the provisions of the was rejected by the Judicial Magistrate by saying that even according to the respondent, his second marriage was null and void as his first wife was then alive.
As regards the first marriage he held that it was not as a fact proved.
He got rid of the effect of both the marriages by adopting a queer logic.
If the story of the first marriage was to be rejected, the second marriage could not have been held to be void on that ground.
It appears that the respondent has satisfactorily provide his case about his earlier marriage by production of good evidence.
Either the respondent 's first marriage was subsisting so as to nullify his second marriage, in which case the appellant 's marriage also was rendered null and void on that ground; or if the respondent 's case of his first marriage is disbelieved the second marriage will have to be held to be legal and effective so as to lead to the same conclusion of the appellant 's marriage being void.
On either hypothesis the appellant 's claim is not covered by Section 125 Cr.
The appellant cannot, therefore, be granted any relief in the present proceedings.
[791D H; 792A B] Smt.
Yamunabhai v Anantrao Shivram Adhav and another; , followed.
Besides holding that the respondent had married the appellant, the Magistrate categorically said that the appellant and the respondent lived together as husband and wife for a number of years and that appellant No. 2 was their child.
If, as a matter of fact, a marriage, although ineffective in the eye of law, took place between the appellant and the respondent, the status of the boy must be held to be that of a legitimate son on account of Section 16(1) of the .
Even if the factum of marriage of his mother is ignored, he must be treated as an illegitimate child of the respondent on the basis of the findings of the Judicial Magistrate and is entitled to relief by reason of clauses (b) and (c) of Section 125(t) Cr.
P.C. specifically referring to an illegitimate child.
The order of the Judicial Magistrate allowing the maintenance to appellant No. 2 was correctly passed.
But the amount of Rs.50 per month was allowed as the maintenance of the child four years back.
In view of the fact that money value has gone down due to inflation and the child has grown in age, the rate of maintenance is increased to Rs.150.[791B C: 793B] 3.
Since the claim for maintenance was granted in favour of the 789 appellant, by the Judicial Magistrate, there was no question of her challenging the same.
Her challenge before the Sessions Judge was confined to that part of the order assessing the amount of maintenance.
and this issue could not have been raised again by her.
Subject to this limitation, she was certainly entitled to invoke the revisional jurisdiction of the High Court.
The decision on the merits of her claim went against her for the first time before the Sessions Judge, and this was the subject matter of her revision before the High Court.
She could not, therefore, be said to be making a second attempt when she challenged the order before the High Court.
The fact that she had moved the Sessions Court against the quantum of maintenance could not be used against her in respect of her right of revision against the Sessions Judge 's order.
[790F H;791A] 4.
No error of law appears to have been discovered in the judgment of the Magistrate and so the revisional courts were not justified in making a reassessment of the evidence and substitute their own views for those of the Magistrate.
[792C] Pathumma vs Mohammad, ; , followed.
|
% The appellant filed an application under Section 125 Cr. P.C. before the Judicial Magistrate, claiming maintenance for herself and her son, alleging lawful marriage with the respondent, and that the son was born out of the wedlock. Respondent, however, denied the marriage and paternity of her son. He claimed that he was already married twice and both his wives were alive. The Judicial Magistrate accepted the appellant 's case and granted maintenance at the rate of 100 per month in her favour and Rs.50 per month for her minor son. The Judicial Magistrate held that appellant No. t and respondent lived together in the same house as husband and wife for a considerable period, and appellant No. t. A revision application was filed by the appellant for enhancement of the rate of maintenance. The respondent also moved the Sessions Judge in revision. The Sessions Judge reversed the findings of the judicial Magistrate. The appellant challenged the order by way of a revision application before the Bombay High Court which rejected the same holding that since it was the second revision application, it was not maintainable, being barred by the provisions of section 397(3) Cr. 788 Allowing the appeal, this Court, ^ HELD: t.
The plea that respondent could not have lawfully married a third time in view of the provisions of the was rejected by the Judicial Magistrate by saying that even according to the respondent, his second marriage was null and void as his first wife was then alive. As regards the first marriage he held that it was not as a fact proved. He got rid of the effect of both the marriages by adopting a queer logic. If the story of the first marriage was to be rejected, the second marriage could not have been held to be void on that ground. It appears that the respondent has satisfactorily provide his case about his earlier marriage by production of good evidence. The appellant cannot, therefore, be granted any relief in the present proceedings. Yamunabhai v Anantrao Shivram Adhav and another; , followed. Besides holding that the respondent had married the appellant, the Magistrate categorically said that the appellant and the respondent lived together as husband and wife for a number of years and that appellant No. Even if the factum of marriage of his mother is ignored, he must be treated as an illegitimate child of the respondent on the basis of the findings of the Judicial Magistrate and is entitled to relief by reason of clauses (b) and (c) of Section 125(t) Cr. P.C. specifically referring to an illegitimate child. The order of the Judicial Magistrate allowing the maintenance to appellant No. In view of the fact that money value has gone down due to inflation and the child has grown in age, the rate of maintenance is increased to Rs.150.[791B C: 793B] 3. Her challenge before the Sessions Judge was confined to that part of the order assessing the amount of maintenance. and this issue could not have been raised again by her. Subject to this limitation, she was certainly entitled to invoke the revisional jurisdiction of the High Court. The decision on the merits of her claim went against her for the first time before the Sessions Judge, and this was the subject matter of her revision before the High Court. She could not, therefore, be said to be making a second attempt when she challenged the order before the High Court. The fact that she had moved the Sessions Court against the quantum of maintenance could not be used against her in respect of her right of revision against the Sessions Judge 's order. [792C] Pathumma vs Mohammad, ; , followed.
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: Criminal Appeal No. 98 of 1987.
From the Judgment and Order dated 9.10.1986 of the Punjab and Haryana High Court in Crl.
A. No. 437 of 1986.
A.N. Mulla and S.K. Sabharwal for the Appellants.
M.R. Sharma, R.S. Suri, H.S. Phoolta, Meera Agarwal and R.C. Mishra for the Respondent.
846 The Judgment of the Court was delivered by OZA, J.
This is an appeal on grant of special leave against the judgment of the High Court of Punjab and Haryana in Criminal Appeal No. 437/86 and Reference No. 4/86 wherein the learned Judgess of the High Court maintained the conviction and sentence passed against the appellants by the learned Additional Sessions Judge, Faridkot.
The conviction and sentences passed against the appellants are: CHARGES & SENTENCES: Darshan Singh u/s 302 IPC (for Sentenced to death and to the murder of pay a fine of Rs.200/ or Mukand Singh in default R.I. for three months.
Pala Singh, u/ss 302/34 IPC Sentenced to undergo Buggar Singh (for the murder) imprisonment for life and alias Bagga (of Mukand Singh) to pay a fine of Rs.200/ Singh and or in default R.I. for Roop Singh three months each.
Darshan Singh u/s 302 IPC Sentenced to death and to (for the murder) pay a fine of Rs.200/ or of Harbans Kaur) in default to undergo R.I. for three months.
Pala Singh, u/ss 302/34 IPC Sentenced to undergo Buggar Singh (for the murder) imprisonment for life alias Bagga of Harbans Kaur) and to pay a fine of Singh and Rs.200/ or in default Roop Singh R.I. for three months each Buggar Singh u/s 302 IPC Sentenced to death and to Bagga Singh (for the murder) pay a fine of Rs.200/ or of Pritam Kaur) in default to undergo for R.I. three months.
Darshan Singh, u/ss 302/34 IPC Sentenced to undergo Pala Singh and (for the murder) imprisonment for life and Roop Singh of Pritam Kaur) to pay a fine of Rs.200/ or in default to undergo R.I. for three months each.
847 Accused Pala Singh and Roop Singh are also convicted as mentioned above but they have not come up before this Court.
This appeal has been filed by Darshan Singh and Buggar Singh @ Bagga Singh, therefore we are concerned with their cases only.
The prosecution case at the trial was that on 24th June, 1985 at about 7.30 p.m. Dalip Singh, brother of Pritam Kaur, and his son Sarbjit Singh were present outside the house of Mukand Singh alongwith Gurnam Singh son of Babu Singh.
Mukand Singh was returning to his house.
At that time, Darshan Singh and Roop Singh accused armed with a Gandasa each, Pala Singh and Buggar Singh accused armed with Kapa each came on a tractor from the village side.
They stopped the tractor near Mukand Singh.
All the four accused got down from the tractor.
Pala Singh and Roop Singh accused caught hold of Mukand Singh deceased and threw him on the ground.
A blow on the neck of Mukand Singh was inflicted by Darshan Singh as a result of which the neck was chopped off except that it remained suspended with the body by skin.
Then Harbans Kaur, the daughter of Mukand Singh came out of the house and she was given three gandasa blows on her head by Darshan Singh.
It is thereafter that Pritam Kaur, the wife of Mukand Singh came out of the house and Bugger Singh gave kapa blows on her person.
As a result, all the three victims died on the spot.
Dalip Singh, Sarbjit Singh and Gurnam Singh who had witnessed the incident raised an alarm and also threw brick bats towards the assailants.
Thereupon all the appellants made good their escape.
It is significant that Mukand Singh had only one daughter Harbans Kaur and had no male issue.
The appellant Darshan Singh is the son of Pala Singh whereas Bugger Singh is said to be an agricultural labourer working with Pala Singh and Roop Singh also belonging to the group of appellant.
It is alleged by the prosecution that the two brothers had inherited some land from their father and there were disputes about it.
Apparently, Pala Singh and Darshan Singh by eradicating the family of his brother Mukand Singh removed one of the successors claiming half share in the property.
It was also alleged that as Mukand Singh had no male issue and Harbans Kaur was of marriageable age, it appears from evidence that negotiations for marriage were in the offing, Pala Singh apprehended the entrance of some stranger in the family as son in law of Mukand Singh to succeed to the property falling in the share of Mukand Singh.
848 Dalip Singh accompained with Gurnam Singh son of Babu Singh went immediately to the Police Station, Baghapurana and lodged the First Information Report exhibit PH which was recorded by Inspector Darshan Singh.
This report was recorded at 8.30 p.m. and it was alleged that the incident had taken place sometimes in the evening about 7.30 p.m.
Inspector Darshan Singh went on the spot, prepared the visual plan.
He also held inquest of the three dead bodies of Mukand Singh, Harbans Kaur and Pritam Kaur respectively and sent the dead bodies for autopsy.
He also took blood stained earth from the place where the bodies were found and recovered 20 brick bats from the spot.
The accused persons were searched and it is alleged that they were not traceable.
They, however, were arrested subsequently on 27th June, 1985 and 1st July, 1985.
After arrest, the Investigation officer interrogated Darshan Singh accused in the presence of Gurnam Singh son of Kartar Singh and Kalkiat Singh PW and he disclosed in his statement giving information where the gandasa is and on his information from the specified place, the gandasa was recovered.
After investigaton, a charge sheet was filed and on trial the appellants have been convicted and sentenced as mentioned above.
As it involved a sentence of death to the two appellants, apart from the appeal preferred by the appellants there was also a reference to the High Court and by the impugned judgment the High Court dismissed the appeal filed by the appellants and confirmed the sentence of death awarded by the learned trial court and it is against this judgment that the present appeal by Darshan Singh and Bugger Singh is before us.
Learned counsel appearing for the appellants mainly contended that the motive alleged that the appellants did not like the idea of a stranger inheriting the property and coming into the family after the marriage of Harbans Kaur appears to be not a very plaussible reason.
It was also contended that there is a will executed by Mukand Singh in favour of Sarbjit Singh son of Dalip Singh and therefore if the motive was to eliminate all possible successors to the half share of Mukand Singh the accused appellants would not have spared Sarbjit Singh.
So far as this contention of the learned counsel is concerned when he referred to the relevant evidence it is discovered that this will was filed by Sarbjit Singh after this incident in some civil proceedings when he claimed to be brought on record in place of Mukand Singh on the basis of the will.
This apparently could not indicate that this will in favour of Sarbjit Singh was in the knowledge of the appellants on the date of incident.
Learned counsel could not point out to any other material to 849 suggest that this will was known to the appellants on the date of incident and therefore this contention raised by the learned counsel for the appellant is without any substance.
Learned counsel also attempted to contend that Dalip Singh who is the brother of Pritam Kaur the wife of Mukand Singh has given an explanation for having come to the house of Mukand Singh but it does not appear to be justified.
As according to the witness, he is the maternal uncle of Harbans Kaur and there was some negotiations about her marriage and for that purpose he alongwith his son had come to the house of Mukand Singh.
It is apparent that a maternal uncle of the daughter (bride) is generally consulted when negotiations for marriage of the daughter are in progress and apart from it both the courts below had accepted the testimony of this witness which also is fully corroborated by the First Information Report lodged immediately after the incident.
In fact, in this case as the report is lodged immediately the contention advanced by the learned counsel for the appellants is not that there is delay but it was seriously contended that if the incident has taken place at 7.30 p.m. as mentioned in the First Information Report the report could not have been lodged at 8.30 p.m. within one hour as in the First Information Report itself the distance of the police station from the scene of occurrence is recorded as 121/2 kilometres and on this basis an argument was raised by learned counsel for the appellants that the report appears to have been prepared later on and a false time has been mentioned in the report.
Instances of this filed that no relevant evidence was brought on record and not a single question was put to any witness or to Dalip Singh who made the First Information Report that he had noted the time of incident after seeing the watch and this was recorded in the first information report as 7.30 p.m.
It is also clear that there is nothing in his evidence to indicate that he and Gurnam Singh who went to the police station walked on foot and covered a distance of 121/2 kilometres because it is not in their testimony as to whether they went through the normal route or they went across the fields by short cut nor there is anything in the evidence that they did not take a lift in any vehicles.
Learned counsel when confronted with this situation contended that the burden lay on the prosecution but it could not be disputed that if this was the contention of the defence that the report could not have been recorded at 8.30 p.m. if the incident was at 7.30 p.m. question to establish this should have been put in corss examination.
It is apparent that there is no material to indicate that the time of incident when noted was 7.30 p.m. it is precise time nor it is there in 850 evidence as to whether the persons who lodged the first information report walked through 12 1/2 kilometres.
In abssence of any material the only thing that appears is that immediately after the incident the report is recorded and this report contains a clear description of the incident corroborating the testimony of the eye witnesses.
The courts below therefore on consideration of the testimony of the eye witnesses accepted their version and convicted the appellants as mentioned above.
Learned counsel could not from the evidence of the eye witnesses refer to any part of their evidence to indicate that the evidence is such on which reliance could not be placed except for the fact, according to the learned counsel, that there were disputes between the two parties i.e. the groups of the two brothers and all the prosecution witnesses apparently were belonging to the group of the deceased.
It was also contended that in the locality independent witnesses could be available but they have not been examined.
The Courts below have considered this aspect of the matter.
It appears from the evidence that the nearby area was not so inhabitated and by that time in the evening no one else was available.
Those who were present have been examined and in this view of the matter the contention that independent witnesses were not examined is of no consequence.
It is also significant that the testimony of the eye witnesses has been fully corroborated by the medical evidence and the injuries on the particular parts of the body of the three deceased persons.
In this view of the matter therefore learned counsel for the appellants mainly emphasised on the aspect of motive and the first information report.
It was also contended that appellant Bugger Singh had submitted an application somtimes before this incident in which he had made allegations against the police officers of the police station and in view of that the police officers must have been prejudiced against him.
The application for contempt against the police moved by Bugger Singh was also relied upon in support of the contention.
We do not find any substance in this contention too.
In the complaint made, it is apparent that none of the police officers in charge of the investigations of the present case has been referred to therein.
It was however, contended that the brotherhood of the uniform created a prejudice against the appellant Buggar Singh, and it is why he has been falsely implicated.
This appears to be too tall a proposition.
There is no material to indicate that there was any prejudice in the mind of the investigating officer.
The report of the incident was lodged immediately and in the 851 report the part played by the accused has been clearly stated.
Under these circumstances, therefore, merely because Buggar Singh chose to make some application and also mentioned the names of some police officers in it, it could not be held that all police officers will be interested in falsely implicating this appellant in a murder case.
There is no other material on the basis of which it could be contended that there was any prejudice against him.
The evidence of the eye witnesses have been considered by both the courts in detail and especially the Sessions Court before whom the witnesses were examined accepted their testimony and we have no reason to discard their testimony.
The names of the eye witnesses have been mentioned in the first information report, which was lodged immediately after the incident and the statements of eye witnesses have been fully corroborated by medical evidence.
No doubt could therefore be raised about the reliability of such evidence.
Learned counsel realising the situation ultimately contended that so far as Darshan Singh is concerned he could not make submissions about the sentence as he has done away with first Mukand Singh his uncle and then Harbans Kaur, Mukand Singh ' daughter i.e. her own cousin.
But he contended that so far as Buggar Singh is concerned he is a stranger and he is not in any way connected with the family and so there could be no motive attributed to him.
Pala Singh and Darshan Singh may have the interest of getting the property falling into the share of Mukand Singh but Buggar Singh has no such motive and therefore the sentence of death awarded to him does not appear to be justified.
The learned counsel appearing for the respondent State contended that the courts below have considered the question of sentence in a reasonable manner and those who are personally responsible for killing in such a brutal manner three persons one after another, have been sentenced to death and those who have been convicted with the aid of Section 34 have been treated leniently and sentence of life imprisonment alone is awarded.
In the light of the discussions above therefore so far as merits are concerned, there is no substance in the contention advanced by learned counsel for the appellants.
The conviction of the appellants could not be assailed on any ground.
The only question that remains to be considered is the question of sentence.
Learned counsel referred to the decision of this Court in Dalbir Singh & Ors.
vs State of Punjab, 852 ; wherein the plausible reasons which may weigh with a court while awarding a sentence of death have been enunciated.
So far as the present case is concerned we must consider the facts of the case.
It is clear and not disputed also that father of Mukand Singh and Pala Singh left behind some agricultural land.
It is not in dispute that the two brothers Pala Singh and Mukand Singh were the only heirs entitled to the share in the property of their father.
It is also not disputed that so far as Mukand Singh is concerned he had only one daughter Harbans Kaur and had no male issue.
It is also disputed that the property disputes have been going on.
There have been cases and complaints against each other.
It appears that Pala Singh and his son Darshan Singh were keen to grab that property and it is in pursuit of this motive that they attacked Mukand Singh and his family and killed all the members of the family, Mukand Singh, his wife Pritam Kaur and his only daughter Harbans Kaur and thereby eliminated everyone who could claim any share in the property.
The attack was brutal.
The medical evidence indicates that Mukand Singh 's neck was chopped off, repeated blows by Gandasa were inflicted on the body of Harbans Kaur.
Therefore it is clear that Darshan Singh first chopped off the neck of Mukand Singh and even after doing this he inflicted number of blows on Harbans Kaur a young girl, his own Uncle 's daughter and the repeated blows go to show that he inflicted injuries with determination that she may not escape.
In this view of the matter and the manner in which brutally these two were done to death, we see no reason to alter the sentence awarded to Darshan Singh.
So far as Buggar Singh is concerned it is no doubt true that he inflicted three blows on Pritam Kaur by Kapa which he was carrying.
So far as infliction of injuries are concerned it could be described as nothing but cruel but it is true that he had no motive.
He appears to have been dragged into the killing.
In our opinion, so far as he is concerned both the courts below were not right in awarding sentence of death.
Consequently the appeal is partly allowed.
The conviction of all the appellants is maintained.
The sentences of all the appellants except Buggar Singh are maintained and so far as Buggar Singh is concerned, sentence of death awarded to him is altered to a sentence of imprisonment for life.
G.N. Appeal allowed.
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% Appellants Nos. 1 and 2 along with two other accused were convicted for the murder of the first Appellant 's paternal uncle, his wife and daughter.
First the brother, and then his daughter and wife were done to death with gandassa and kapa blows just outside their house.
The motive alleged was that the first appellant 's father and his deceased brother had inherited some land from their father and there were disputes about it, and by eliminating the family, one of the successors entitled to half share in the property had been removed.
It was also alleged that the deceased man had no male issue and had only one daughter for whom negotiations for marriage were in the offing and appellant No. 1 and his father apprehended the entry of a stranger in the family as the son in law to succeed to the property falling to the share of the deceased man.
The Trial Court convicted the appellants and sentenced them to death, while the other two accused were sentenced to life imprisonment.
Against the conviction and sentence, an appeal was filed.
There was also a reference to the High Court, as death sentence was involved in respect of the two appellants.
The High Court dismissed the appeal and confirmed the death sentence.
The appeal before this Court is filed by the two appellants who have been sentenced to death.
The motive alleged has been disputed on behalf of the appellants, as a will had been executed by the deceased man in favour of the son of his wife 's brother, and that if at all there was a motive he should have also been eliminated.
844 It was also contended that in the locality independent witnesses could be available and they have not been examined.
Another submission was that one of the witnesses had complained against the Police Officer and so the Police Officers were prejudiced against him.
The time at which the FIR had been registered has also been questioned.
In the absence of motive on the part of the second appellant, it was contended, that the death sentence awarded to him is not justified.
Allowing the appeal partly, this Court, ^ HELD: 1.
The will was filed after the murders, in some civil proceedings when the legatee claimed to be brought on record in place of the deceased man.
This apparently could not indicate that this will was in the knowledge of the appellants on the date of incident.
Therefore the motive cannot be doubted.
[848G H] 2.
One of the witnesses is the maternal uncle of the deceased girl and there were some negotiations for her marriage and for that purpose he along with his son had come to the house of the deceased.
It is apparent that a maternal uncle is generally consulted when negotiations for marriage of a girl are in progress and apart from it both the courts below had accepted the testimony of this witness which is fully corroborated by the First Information Report lodged immediately after the incident.
It appears from the evidence that the nearby area was not so inhabitated and by that time in the evening no one else was available.
Those who were present have been examined and in this view of the matter the contention that independent witnesses were not examined is of no consequence.
The names of the eye witnesses have been mentioned in the First Information Report, which was lodged immediately after the incident and the statements of eye witnesses have been fully corroborated by medical evidence.
No doubt could therefore be raised about the reliability of such evidence.
[849B C; 851C] 3.
No relevant evidence was brought on record and not a single question was put to any witness or to the person who made the First Information Report as to whether he had noted the correct time of the incident.
There is no material on record to show as to whether the persons who lodged the First Information Report, walked through 12 1/2 kilometres or took a lift in any vehicle.
In the absence of any material, the only thing that appears is that immediately after the incident the report was recorded and this report contains a clear description of the incident corroborating the testimony of the eye witnesses.
[849F; 850A B] 845 4.
Merely because the second appellant chose to make some application and also mentioned the names of some police officers in it, it could not be said that all police officers would be interested in falsely implicating him in a murder case.
In the complaint made by appellant No. 2, none of the police officers in charge of the investigation of the present case has been referred to therein.
It was, however, contended that the brotherhood of the uniform created a prejudice against the second appellant and that is why he has been falsely implicated.
This appears to be too tall a proposition.
There is no material to indicate that there was any prejudice in the mind of the investigating officer.
The report of the incident was lodged immediately and in the report the part played by the accused has been clearly stated.
[851A B; 850G H] 5.1 It appears that first appellant and his father were keen to grab the property and it is in pursuit of this motive that they committed the triple murder.
The attack was brutal.
The medical evidence indicates that the deceased man 's neck was chopped off and repeated blows by Gandasa were inflicted on the body of his daughter.
Therefore, it is clear that the first appellant first chopped off the neck of his uncle and even after doing this he inflicted number of blows on the young girl, who was his own uncle 's daughter, and the repeated blows go to show that he inflicted the injuries with determination that she may not escape.
In this view of the matter and the brutal manner in which these two were done to death, there is no reason to alter the sentence awarded to the first appellant.
[852C E] 5.2 So far as the second appellant is concerned he is a stranger and he is not in any way connected with the family and so there could be no motive attributed to him.
He appears to have been dragged into the killing.
Therefore, the sentence of death awarded to the second appellant is altered to a sentence of imprisonment for life.
[852E F]
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: Criminal Appeal No. 98 of 1987.
From the Judgment and Order dated 9.10.1986 of the Punjab and Haryana High Court in Crl.
A. No. 437 of 1986.
A.N. Mulla and S.K. Sabharwal for the Appellants.
M.R. Sharma, R.S. Suri, H.S. Phoolta, Meera Agarwal and R.C. Mishra for the Respondent.
846 The Judgment of the Court was delivered by OZA, J.
This is an appeal on grant of special leave against the judgment of the High Court of Punjab and Haryana in Criminal Appeal No. 437/86 and Reference No. 4/86 wherein the learned Judgess of the High Court maintained the conviction and sentence passed against the appellants by the learned Additional Sessions Judge, Faridkot.
The conviction and sentences passed against the appellants are: CHARGES & SENTENCES: Darshan Singh u/s 302 IPC (for Sentenced to death and to the murder of pay a fine of Rs.200/ or Mukand Singh in default R.I. for three months.
Pala Singh, u/ss 302/34 IPC Sentenced to undergo Buggar Singh (for the murder) imprisonment for life and alias Bagga (of Mukand Singh) to pay a fine of Rs.200/ Singh and or in default R.I. for Roop Singh three months each.
Darshan Singh u/s 302 IPC Sentenced to death and to (for the murder) pay a fine of Rs.200/ or of Harbans Kaur) in default to undergo R.I. for three months.
Pala Singh, u/ss 302/34 IPC Sentenced to undergo Buggar Singh (for the murder) imprisonment for life alias Bagga of Harbans Kaur) and to pay a fine of Singh and Rs.200/ or in default Roop Singh R.I. for three months each Buggar Singh u/s 302 IPC Sentenced to death and to Bagga Singh (for the murder) pay a fine of Rs.200/ or of Pritam Kaur) in default to undergo for R.I. three months.
Darshan Singh, u/ss 302/34 IPC Sentenced to undergo Pala Singh and (for the murder) imprisonment for life and Roop Singh of Pritam Kaur) to pay a fine of Rs.200/ or in default to undergo R.I. for three months each.
847 Accused Pala Singh and Roop Singh are also convicted as mentioned above but they have not come up before this Court.
This appeal has been filed by Darshan Singh and Buggar Singh @ Bagga Singh, therefore we are concerned with their cases only.
The prosecution case at the trial was that on 24th June, 1985 at about 7.30 p.m. Dalip Singh, brother of Pritam Kaur, and his son Sarbjit Singh were present outside the house of Mukand Singh alongwith Gurnam Singh son of Babu Singh.
Mukand Singh was returning to his house.
At that time, Darshan Singh and Roop Singh accused armed with a Gandasa each, Pala Singh and Buggar Singh accused armed with Kapa each came on a tractor from the village side.
They stopped the tractor near Mukand Singh.
All the four accused got down from the tractor.
Pala Singh and Roop Singh accused caught hold of Mukand Singh deceased and threw him on the ground.
A blow on the neck of Mukand Singh was inflicted by Darshan Singh as a result of which the neck was chopped off except that it remained suspended with the body by skin.
Then Harbans Kaur, the daughter of Mukand Singh came out of the house and she was given three gandasa blows on her head by Darshan Singh.
It is thereafter that Pritam Kaur, the wife of Mukand Singh came out of the house and Bugger Singh gave kapa blows on her person.
As a result, all the three victims died on the spot.
Dalip Singh, Sarbjit Singh and Gurnam Singh who had witnessed the incident raised an alarm and also threw brick bats towards the assailants.
Thereupon all the appellants made good their escape.
It is significant that Mukand Singh had only one daughter Harbans Kaur and had no male issue.
The appellant Darshan Singh is the son of Pala Singh whereas Bugger Singh is said to be an agricultural labourer working with Pala Singh and Roop Singh also belonging to the group of appellant.
It is alleged by the prosecution that the two brothers had inherited some land from their father and there were disputes about it.
Apparently, Pala Singh and Darshan Singh by eradicating the family of his brother Mukand Singh removed one of the successors claiming half share in the property.
It was also alleged that as Mukand Singh had no male issue and Harbans Kaur was of marriageable age, it appears from evidence that negotiations for marriage were in the offing, Pala Singh apprehended the entrance of some stranger in the family as son in law of Mukand Singh to succeed to the property falling in the share of Mukand Singh.
848 Dalip Singh accompained with Gurnam Singh son of Babu Singh went immediately to the Police Station, Baghapurana and lodged the First Information Report exhibit PH which was recorded by Inspector Darshan Singh.
This report was recorded at 8.30 p.m. and it was alleged that the incident had taken place sometimes in the evening about 7.30 p.m.
Inspector Darshan Singh went on the spot, prepared the visual plan.
He also held inquest of the three dead bodies of Mukand Singh, Harbans Kaur and Pritam Kaur respectively and sent the dead bodies for autopsy.
He also took blood stained earth from the place where the bodies were found and recovered 20 brick bats from the spot.
The accused persons were searched and it is alleged that they were not traceable.
They, however, were arrested subsequently on 27th June, 1985 and 1st July, 1985.
After arrest, the Investigation officer interrogated Darshan Singh accused in the presence of Gurnam Singh son of Kartar Singh and Kalkiat Singh PW and he disclosed in his statement giving information where the gandasa is and on his information from the specified place, the gandasa was recovered.
After investigaton, a charge sheet was filed and on trial the appellants have been convicted and sentenced as mentioned above.
As it involved a sentence of death to the two appellants, apart from the appeal preferred by the appellants there was also a reference to the High Court and by the impugned judgment the High Court dismissed the appeal filed by the appellants and confirmed the sentence of death awarded by the learned trial court and it is against this judgment that the present appeal by Darshan Singh and Bugger Singh is before us.
Learned counsel appearing for the appellants mainly contended that the motive alleged that the appellants did not like the idea of a stranger inheriting the property and coming into the family after the marriage of Harbans Kaur appears to be not a very plaussible reason.
It was also contended that there is a will executed by Mukand Singh in favour of Sarbjit Singh son of Dalip Singh and therefore if the motive was to eliminate all possible successors to the half share of Mukand Singh the accused appellants would not have spared Sarbjit Singh.
So far as this contention of the learned counsel is concerned when he referred to the relevant evidence it is discovered that this will was filed by Sarbjit Singh after this incident in some civil proceedings when he claimed to be brought on record in place of Mukand Singh on the basis of the will.
This apparently could not indicate that this will in favour of Sarbjit Singh was in the knowledge of the appellants on the date of incident.
Learned counsel could not point out to any other material to 849 suggest that this will was known to the appellants on the date of incident and therefore this contention raised by the learned counsel for the appellant is without any substance.
Learned counsel also attempted to contend that Dalip Singh who is the brother of Pritam Kaur the wife of Mukand Singh has given an explanation for having come to the house of Mukand Singh but it does not appear to be justified.
As according to the witness, he is the maternal uncle of Harbans Kaur and there was some negotiations about her marriage and for that purpose he alongwith his son had come to the house of Mukand Singh.
It is apparent that a maternal uncle of the daughter (bride) is generally consulted when negotiations for marriage of the daughter are in progress and apart from it both the courts below had accepted the testimony of this witness which also is fully corroborated by the First Information Report lodged immediately after the incident.
In fact, in this case as the report is lodged immediately the contention advanced by the learned counsel for the appellants is not that there is delay but it was seriously contended that if the incident has taken place at 7.30 p.m. as mentioned in the First Information Report the report could not have been lodged at 8.30 p.m. within one hour as in the First Information Report itself the distance of the police station from the scene of occurrence is recorded as 121/2 kilometres and on this basis an argument was raised by learned counsel for the appellants that the report appears to have been prepared later on and a false time has been mentioned in the report.
Instances of this filed that no relevant evidence was brought on record and not a single question was put to any witness or to Dalip Singh who made the First Information Report that he had noted the time of incident after seeing the watch and this was recorded in the first information report as 7.30 p.m.
It is also clear that there is nothing in his evidence to indicate that he and Gurnam Singh who went to the police station walked on foot and covered a distance of 121/2 kilometres because it is not in their testimony as to whether they went through the normal route or they went across the fields by short cut nor there is anything in the evidence that they did not take a lift in any vehicles.
Learned counsel when confronted with this situation contended that the burden lay on the prosecution but it could not be disputed that if this was the contention of the defence that the report could not have been recorded at 8.30 p.m. if the incident was at 7.30 p.m. question to establish this should have been put in corss examination.
It is apparent that there is no material to indicate that the time of incident when noted was 7.30 p.m. it is precise time nor it is there in 850 evidence as to whether the persons who lodged the first information report walked through 12 1/2 kilometres.
In abssence of any material the only thing that appears is that immediately after the incident the report is recorded and this report contains a clear description of the incident corroborating the testimony of the eye witnesses.
The courts below therefore on consideration of the testimony of the eye witnesses accepted their version and convicted the appellants as mentioned above.
Learned counsel could not from the evidence of the eye witnesses refer to any part of their evidence to indicate that the evidence is such on which reliance could not be placed except for the fact, according to the learned counsel, that there were disputes between the two parties i.e. the groups of the two brothers and all the prosecution witnesses apparently were belonging to the group of the deceased.
It was also contended that in the locality independent witnesses could be available but they have not been examined.
The Courts below have considered this aspect of the matter.
It appears from the evidence that the nearby area was not so inhabitated and by that time in the evening no one else was available.
Those who were present have been examined and in this view of the matter the contention that independent witnesses were not examined is of no consequence.
It is also significant that the testimony of the eye witnesses has been fully corroborated by the medical evidence and the injuries on the particular parts of the body of the three deceased persons.
In this view of the matter therefore learned counsel for the appellants mainly emphasised on the aspect of motive and the first information report.
It was also contended that appellant Bugger Singh had submitted an application somtimes before this incident in which he had made allegations against the police officers of the police station and in view of that the police officers must have been prejudiced against him.
The application for contempt against the police moved by Bugger Singh was also relied upon in support of the contention.
We do not find any substance in this contention too.
In the complaint made, it is apparent that none of the police officers in charge of the investigations of the present case has been referred to therein.
It was however, contended that the brotherhood of the uniform created a prejudice against the appellant Buggar Singh, and it is why he has been falsely implicated.
This appears to be too tall a proposition.
There is no material to indicate that there was any prejudice in the mind of the investigating officer.
The report of the incident was lodged immediately and in the 851 report the part played by the accused has been clearly stated.
Under these circumstances, therefore, merely because Buggar Singh chose to make some application and also mentioned the names of some police officers in it, it could not be held that all police officers will be interested in falsely implicating this appellant in a murder case.
There is no other material on the basis of which it could be contended that there was any prejudice against him.
The evidence of the eye witnesses have been considered by both the courts in detail and especially the Sessions Court before whom the witnesses were examined accepted their testimony and we have no reason to discard their testimony.
The names of the eye witnesses have been mentioned in the first information report, which was lodged immediately after the incident and the statements of eye witnesses have been fully corroborated by medical evidence.
No doubt could therefore be raised about the reliability of such evidence.
Learned counsel realising the situation ultimately contended that so far as Darshan Singh is concerned he could not make submissions about the sentence as he has done away with first Mukand Singh his uncle and then Harbans Kaur, Mukand Singh ' daughter i.e. her own cousin.
But he contended that so far as Buggar Singh is concerned he is a stranger and he is not in any way connected with the family and so there could be no motive attributed to him.
Pala Singh and Darshan Singh may have the interest of getting the property falling into the share of Mukand Singh but Buggar Singh has no such motive and therefore the sentence of death awarded to him does not appear to be justified.
The learned counsel appearing for the respondent State contended that the courts below have considered the question of sentence in a reasonable manner and those who are personally responsible for killing in such a brutal manner three persons one after another, have been sentenced to death and those who have been convicted with the aid of Section 34 have been treated leniently and sentence of life imprisonment alone is awarded.
In the light of the discussions above therefore so far as merits are concerned, there is no substance in the contention advanced by learned counsel for the appellants.
The conviction of the appellants could not be assailed on any ground.
The only question that remains to be considered is the question of sentence.
Learned counsel referred to the decision of this Court in Dalbir Singh & Ors.
vs State of Punjab, 852 ; wherein the plausible reasons which may weigh with a court while awarding a sentence of death have been enunciated.
So far as the present case is concerned we must consider the facts of the case.
It is clear and not disputed also that father of Mukand Singh and Pala Singh left behind some agricultural land.
It is not in dispute that the two brothers Pala Singh and Mukand Singh were the only heirs entitled to the share in the property of their father.
It is also not disputed that so far as Mukand Singh is concerned he had only one daughter Harbans Kaur and had no male issue.
It is also disputed that the property disputes have been going on.
There have been cases and complaints against each other.
It appears that Pala Singh and his son Darshan Singh were keen to grab that property and it is in pursuit of this motive that they attacked Mukand Singh and his family and killed all the members of the family, Mukand Singh, his wife Pritam Kaur and his only daughter Harbans Kaur and thereby eliminated everyone who could claim any share in the property.
The attack was brutal.
The medical evidence indicates that Mukand Singh 's neck was chopped off, repeated blows by Gandasa were inflicted on the body of Harbans Kaur.
Therefore it is clear that Darshan Singh first chopped off the neck of Mukand Singh and even after doing this he inflicted number of blows on Harbans Kaur a young girl, his own Uncle 's daughter and the repeated blows go to show that he inflicted injuries with determination that she may not escape.
In this view of the matter and the manner in which brutally these two were done to death, we see no reason to alter the sentence awarded to Darshan Singh.
So far as Buggar Singh is concerned it is no doubt true that he inflicted three blows on Pritam Kaur by Kapa which he was carrying.
So far as infliction of injuries are concerned it could be described as nothing but cruel but it is true that he had no motive.
He appears to have been dragged into the killing.
In our opinion, so far as he is concerned both the courts below were not right in awarding sentence of death.
Consequently the appeal is partly allowed.
The conviction of all the appellants is maintained.
The sentences of all the appellants except Buggar Singh are maintained and so far as Buggar Singh is concerned, sentence of death awarded to him is altered to a sentence of imprisonment for life.
G.N. Appeal allowed.
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: Criminal Appeal No. 98 of 1987.
From the Judgment and Order dated 9.10.1986 of the Punjab and Haryana High Court in Crl.
A. No. 437 of 1986.
A.N. Mulla and S.K. Sabharwal for the Appellants.
M.R. Sharma, R.S. Suri, H.S. Phoolta, Meera Agarwal and R.C. Mishra for the Respondent.
846 The Judgment of the Court was delivered by OZA, J.
This is an appeal on grant of special leave against the judgment of the High Court of Punjab and Haryana in Criminal Appeal No. 437/86 and Reference No. 4/86 wherein the learned Judgess of the High Court maintained the conviction and sentence passed against the appellants by the learned Additional Sessions Judge, Faridkot.
The conviction and sentences passed against the appellants are: CHARGES & SENTENCES: Darshan Singh u/s 302 IPC (for Sentenced to death and to the murder of pay a fine of Rs.200/ or Mukand Singh in default R.I. for three months.
Pala Singh, u/ss 302/34 IPC Sentenced to undergo Buggar Singh (for the murder) imprisonment for life and alias Bagga (of Mukand Singh) to pay a fine of Rs.200/ Singh and or in default R.I. for Roop Singh three months each.
Darshan Singh u/s 302 IPC Sentenced to death and to (for the murder) pay a fine of Rs.200/ or of Harbans Kaur) in default to undergo R.I. for three months.
Pala Singh, u/ss 302/34 IPC Sentenced to undergo Buggar Singh (for the murder) imprisonment for life alias Bagga of Harbans Kaur) and to pay a fine of Singh and Rs.200/ or in default Roop Singh R.I. for three months each Buggar Singh u/s 302 IPC Sentenced to death and to Bagga Singh (for the murder) pay a fine of Rs.200/ or of Pritam Kaur) in default to undergo for R.I. three months.
Darshan Singh, u/ss 302/34 IPC Sentenced to undergo Pala Singh and (for the murder) imprisonment for life and Roop Singh of Pritam Kaur) to pay a fine of Rs.200/ or in default to undergo R.I. for three months each.
847 Accused Pala Singh and Roop Singh are also convicted as mentioned above but they have not come up before this Court.
This appeal has been filed by Darshan Singh and Buggar Singh @ Bagga Singh, therefore we are concerned with their cases only.
The prosecution case at the trial was that on 24th June, 1985 at about 7.30 p.m. Dalip Singh, brother of Pritam Kaur, and his son Sarbjit Singh were present outside the house of Mukand Singh alongwith Gurnam Singh son of Babu Singh.
Mukand Singh was returning to his house.
At that time, Darshan Singh and Roop Singh accused armed with a Gandasa each, Pala Singh and Buggar Singh accused armed with Kapa each came on a tractor from the village side.
They stopped the tractor near Mukand Singh.
All the four accused got down from the tractor.
Pala Singh and Roop Singh accused caught hold of Mukand Singh deceased and threw him on the ground.
A blow on the neck of Mukand Singh was inflicted by Darshan Singh as a result of which the neck was chopped off except that it remained suspended with the body by skin.
Then Harbans Kaur, the daughter of Mukand Singh came out of the house and she was given three gandasa blows on her head by Darshan Singh.
It is thereafter that Pritam Kaur, the wife of Mukand Singh came out of the house and Bugger Singh gave kapa blows on her person.
As a result, all the three victims died on the spot.
Dalip Singh, Sarbjit Singh and Gurnam Singh who had witnessed the incident raised an alarm and also threw brick bats towards the assailants.
Thereupon all the appellants made good their escape.
It is significant that Mukand Singh had only one daughter Harbans Kaur and had no male issue.
The appellant Darshan Singh is the son of Pala Singh whereas Bugger Singh is said to be an agricultural labourer working with Pala Singh and Roop Singh also belonging to the group of appellant.
It is alleged by the prosecution that the two brothers had inherited some land from their father and there were disputes about it.
Apparently, Pala Singh and Darshan Singh by eradicating the family of his brother Mukand Singh removed one of the successors claiming half share in the property.
It was also alleged that as Mukand Singh had no male issue and Harbans Kaur was of marriageable age, it appears from evidence that negotiations for marriage were in the offing, Pala Singh apprehended the entrance of some stranger in the family as son in law of Mukand Singh to succeed to the property falling in the share of Mukand Singh.
848 Dalip Singh accompained with Gurnam Singh son of Babu Singh went immediately to the Police Station, Baghapurana and lodged the First Information Report exhibit PH which was recorded by Inspector Darshan Singh.
This report was recorded at 8.30 p.m. and it was alleged that the incident had taken place sometimes in the evening about 7.30 p.m.
Inspector Darshan Singh went on the spot, prepared the visual plan.
He also held inquest of the three dead bodies of Mukand Singh, Harbans Kaur and Pritam Kaur respectively and sent the dead bodies for autopsy.
He also took blood stained earth from the place where the bodies were found and recovered 20 brick bats from the spot.
The accused persons were searched and it is alleged that they were not traceable.
They, however, were arrested subsequently on 27th June, 1985 and 1st July, 1985.
After arrest, the Investigation officer interrogated Darshan Singh accused in the presence of Gurnam Singh son of Kartar Singh and Kalkiat Singh PW and he disclosed in his statement giving information where the gandasa is and on his information from the specified place, the gandasa was recovered.
After investigaton, a charge sheet was filed and on trial the appellants have been convicted and sentenced as mentioned above.
As it involved a sentence of death to the two appellants, apart from the appeal preferred by the appellants there was also a reference to the High Court and by the impugned judgment the High Court dismissed the appeal filed by the appellants and confirmed the sentence of death awarded by the learned trial court and it is against this judgment that the present appeal by Darshan Singh and Bugger Singh is before us.
Learned counsel appearing for the appellants mainly contended that the motive alleged that the appellants did not like the idea of a stranger inheriting the property and coming into the family after the marriage of Harbans Kaur appears to be not a very plaussible reason.
It was also contended that there is a will executed by Mukand Singh in favour of Sarbjit Singh son of Dalip Singh and therefore if the motive was to eliminate all possible successors to the half share of Mukand Singh the accused appellants would not have spared Sarbjit Singh.
So far as this contention of the learned counsel is concerned when he referred to the relevant evidence it is discovered that this will was filed by Sarbjit Singh after this incident in some civil proceedings when he claimed to be brought on record in place of Mukand Singh on the basis of the will.
This apparently could not indicate that this will in favour of Sarbjit Singh was in the knowledge of the appellants on the date of incident.
Learned counsel could not point out to any other material to 849 suggest that this will was known to the appellants on the date of incident and therefore this contention raised by the learned counsel for the appellant is without any substance.
Learned counsel also attempted to contend that Dalip Singh who is the brother of Pritam Kaur the wife of Mukand Singh has given an explanation for having come to the house of Mukand Singh but it does not appear to be justified.
As according to the witness, he is the maternal uncle of Harbans Kaur and there was some negotiations about her marriage and for that purpose he alongwith his son had come to the house of Mukand Singh.
It is apparent that a maternal uncle of the daughter (bride) is generally consulted when negotiations for marriage of the daughter are in progress and apart from it both the courts below had accepted the testimony of this witness which also is fully corroborated by the First Information Report lodged immediately after the incident.
In fact, in this case as the report is lodged immediately the contention advanced by the learned counsel for the appellants is not that there is delay but it was seriously contended that if the incident has taken place at 7.30 p.m. as mentioned in the First Information Report the report could not have been lodged at 8.30 p.m. within one hour as in the First Information Report itself the distance of the police station from the scene of occurrence is recorded as 121/2 kilometres and on this basis an argument was raised by learned counsel for the appellants that the report appears to have been prepared later on and a false time has been mentioned in the report.
Instances of this filed that no relevant evidence was brought on record and not a single question was put to any witness or to Dalip Singh who made the First Information Report that he had noted the time of incident after seeing the watch and this was recorded in the first information report as 7.30 p.m.
It is also clear that there is nothing in his evidence to indicate that he and Gurnam Singh who went to the police station walked on foot and covered a distance of 121/2 kilometres because it is not in their testimony as to whether they went through the normal route or they went across the fields by short cut nor there is anything in the evidence that they did not take a lift in any vehicles.
Learned counsel when confronted with this situation contended that the burden lay on the prosecution but it could not be disputed that if this was the contention of the defence that the report could not have been recorded at 8.30 p.m. if the incident was at 7.30 p.m. question to establish this should have been put in corss examination.
It is apparent that there is no material to indicate that the time of incident when noted was 7.30 p.m. it is precise time nor it is there in 850 evidence as to whether the persons who lodged the first information report walked through 12 1/2 kilometres.
In abssence of any material the only thing that appears is that immediately after the incident the report is recorded and this report contains a clear description of the incident corroborating the testimony of the eye witnesses.
The courts below therefore on consideration of the testimony of the eye witnesses accepted their version and convicted the appellants as mentioned above.
Learned counsel could not from the evidence of the eye witnesses refer to any part of their evidence to indicate that the evidence is such on which reliance could not be placed except for the fact, according to the learned counsel, that there were disputes between the two parties i.e. the groups of the two brothers and all the prosecution witnesses apparently were belonging to the group of the deceased.
It was also contended that in the locality independent witnesses could be available but they have not been examined.
The Courts below have considered this aspect of the matter.
It appears from the evidence that the nearby area was not so inhabitated and by that time in the evening no one else was available.
Those who were present have been examined and in this view of the matter the contention that independent witnesses were not examined is of no consequence.
It is also significant that the testimony of the eye witnesses has been fully corroborated by the medical evidence and the injuries on the particular parts of the body of the three deceased persons.
In this view of the matter therefore learned counsel for the appellants mainly emphasised on the aspect of motive and the first information report.
It was also contended that appellant Bugger Singh had submitted an application somtimes before this incident in which he had made allegations against the police officers of the police station and in view of that the police officers must have been prejudiced against him.
The application for contempt against the police moved by Bugger Singh was also relied upon in support of the contention.
We do not find any substance in this contention too.
In the complaint made, it is apparent that none of the police officers in charge of the investigations of the present case has been referred to therein.
It was however, contended that the brotherhood of the uniform created a prejudice against the appellant Buggar Singh, and it is why he has been falsely implicated.
This appears to be too tall a proposition.
There is no material to indicate that there was any prejudice in the mind of the investigating officer.
The report of the incident was lodged immediately and in the 851 report the part played by the accused has been clearly stated.
Under these circumstances, therefore, merely because Buggar Singh chose to make some application and also mentioned the names of some police officers in it, it could not be held that all police officers will be interested in falsely implicating this appellant in a murder case.
There is no other material on the basis of which it could be contended that there was any prejudice against him.
The evidence of the eye witnesses have been considered by both the courts in detail and especially the Sessions Court before whom the witnesses were examined accepted their testimony and we have no reason to discard their testimony.
The names of the eye witnesses have been mentioned in the first information report, which was lodged immediately after the incident and the statements of eye witnesses have been fully corroborated by medical evidence.
No doubt could therefore be raised about the reliability of such evidence.
Learned counsel realising the situation ultimately contended that so far as Darshan Singh is concerned he could not make submissions about the sentence as he has done away with first Mukand Singh his uncle and then Harbans Kaur, Mukand Singh ' daughter i.e. her own cousin.
But he contended that so far as Buggar Singh is concerned he is a stranger and he is not in any way connected with the family and so there could be no motive attributed to him.
Pala Singh and Darshan Singh may have the interest of getting the property falling into the share of Mukand Singh but Buggar Singh has no such motive and therefore the sentence of death awarded to him does not appear to be justified.
The learned counsel appearing for the respondent State contended that the courts below have considered the question of sentence in a reasonable manner and those who are personally responsible for killing in such a brutal manner three persons one after another, have been sentenced to death and those who have been convicted with the aid of Section 34 have been treated leniently and sentence of life imprisonment alone is awarded.
In the light of the discussions above therefore so far as merits are concerned, there is no substance in the contention advanced by learned counsel for the appellants.
The conviction of the appellants could not be assailed on any ground.
The only question that remains to be considered is the question of sentence.
Learned counsel referred to the decision of this Court in Dalbir Singh & Ors.
vs State of Punjab, 852 ; wherein the plausible reasons which may weigh with a court while awarding a sentence of death have been enunciated.
So far as the present case is concerned we must consider the facts of the case.
It is clear and not disputed also that father of Mukand Singh and Pala Singh left behind some agricultural land.
It is not in dispute that the two brothers Pala Singh and Mukand Singh were the only heirs entitled to the share in the property of their father.
It is also not disputed that so far as Mukand Singh is concerned he had only one daughter Harbans Kaur and had no male issue.
It is also disputed that the property disputes have been going on.
There have been cases and complaints against each other.
It appears that Pala Singh and his son Darshan Singh were keen to grab that property and it is in pursuit of this motive that they attacked Mukand Singh and his family and killed all the members of the family, Mukand Singh, his wife Pritam Kaur and his only daughter Harbans Kaur and thereby eliminated everyone who could claim any share in the property.
The attack was brutal.
The medical evidence indicates that Mukand Singh 's neck was chopped off, repeated blows by Gandasa were inflicted on the body of Harbans Kaur.
Therefore it is clear that Darshan Singh first chopped off the neck of Mukand Singh and even after doing this he inflicted number of blows on Harbans Kaur a young girl, his own Uncle 's daughter and the repeated blows go to show that he inflicted injuries with determination that she may not escape.
In this view of the matter and the manner in which brutally these two were done to death, we see no reason to alter the sentence awarded to Darshan Singh.
So far as Buggar Singh is concerned it is no doubt true that he inflicted three blows on Pritam Kaur by Kapa which he was carrying.
So far as infliction of injuries are concerned it could be described as nothing but cruel but it is true that he had no motive.
He appears to have been dragged into the killing.
In our opinion, so far as he is concerned both the courts below were not right in awarding sentence of death.
Consequently the appeal is partly allowed.
The conviction of all the appellants is maintained.
The sentences of all the appellants except Buggar Singh are maintained and so far as Buggar Singh is concerned, sentence of death awarded to him is altered to a sentence of imprisonment for life.
G.N. Appeal allowed.
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% Appellants Nos. 1 and 2 along with two other accused were convicted for the murder of the first Appellant 's paternal uncle, his wife and daughter.
First the brother, and then his daughter and wife were done to death with gandassa and kapa blows just outside their house.
The motive alleged was that the first appellant 's father and his deceased brother had inherited some land from their father and there were disputes about it, and by eliminating the family, one of the successors entitled to half share in the property had been removed.
It was also alleged that the deceased man had no male issue and had only one daughter for whom negotiations for marriage were in the offing and appellant No. 1 and his father apprehended the entry of a stranger in the family as the son in law to succeed to the property falling to the share of the deceased man.
The Trial Court convicted the appellants and sentenced them to death, while the other two accused were sentenced to life imprisonment.
Against the conviction and sentence, an appeal was filed.
There was also a reference to the High Court, as death sentence was involved in respect of the two appellants.
The High Court dismissed the appeal and confirmed the death sentence.
The appeal before this Court is filed by the two appellants who have been sentenced to death.
The motive alleged has been disputed on behalf of the appellants, as a will had been executed by the deceased man in favour of the son of his wife 's brother, and that if at all there was a motive he should have also been eliminated.
844 It was also contended that in the locality independent witnesses could be available and they have not been examined.
Another submission was that one of the witnesses had complained against the Police Officer and so the Police Officers were prejudiced against him.
The time at which the FIR had been registered has also been questioned.
In the absence of motive on the part of the second appellant, it was contended, that the death sentence awarded to him is not justified.
Allowing the appeal partly, this Court, ^ HELD: 1.
The will was filed after the murders, in some civil proceedings when the legatee claimed to be brought on record in place of the deceased man.
This apparently could not indicate that this will was in the knowledge of the appellants on the date of incident.
Therefore the motive cannot be doubted.
[848G H] 2.
One of the witnesses is the maternal uncle of the deceased girl and there were some negotiations for her marriage and for that purpose he along with his son had come to the house of the deceased.
It is apparent that a maternal uncle is generally consulted when negotiations for marriage of a girl are in progress and apart from it both the courts below had accepted the testimony of this witness which is fully corroborated by the First Information Report lodged immediately after the incident.
It appears from the evidence that the nearby area was not so inhabitated and by that time in the evening no one else was available.
Those who were present have been examined and in this view of the matter the contention that independent witnesses were not examined is of no consequence.
The names of the eye witnesses have been mentioned in the First Information Report, which was lodged immediately after the incident and the statements of eye witnesses have been fully corroborated by medical evidence.
No doubt could therefore be raised about the reliability of such evidence.
[849B C; 851C] 3.
No relevant evidence was brought on record and not a single question was put to any witness or to the person who made the First Information Report as to whether he had noted the correct time of the incident.
There is no material on record to show as to whether the persons who lodged the First Information Report, walked through 12 1/2 kilometres or took a lift in any vehicle.
In the absence of any material, the only thing that appears is that immediately after the incident the report was recorded and this report contains a clear description of the incident corroborating the testimony of the eye witnesses.
[849F; 850A B] 845 4.
Merely because the second appellant chose to make some application and also mentioned the names of some police officers in it, it could not be said that all police officers would be interested in falsely implicating him in a murder case.
In the complaint made by appellant No. 2, none of the police officers in charge of the investigation of the present case has been referred to therein.
It was, however, contended that the brotherhood of the uniform created a prejudice against the second appellant and that is why he has been falsely implicated.
This appears to be too tall a proposition.
There is no material to indicate that there was any prejudice in the mind of the investigating officer.
The report of the incident was lodged immediately and in the report the part played by the accused has been clearly stated.
[851A B; 850G H] 5.1 It appears that first appellant and his father were keen to grab the property and it is in pursuit of this motive that they committed the triple murder.
The attack was brutal.
The medical evidence indicates that the deceased man 's neck was chopped off and repeated blows by Gandasa were inflicted on the body of his daughter.
Therefore, it is clear that the first appellant first chopped off the neck of his uncle and even after doing this he inflicted number of blows on the young girl, who was his own uncle 's daughter, and the repeated blows go to show that he inflicted the injuries with determination that she may not escape.
In this view of the matter and the brutal manner in which these two were done to death, there is no reason to alter the sentence awarded to the first appellant.
[852C E] 5.2 So far as the second appellant is concerned he is a stranger and he is not in any way connected with the family and so there could be no motive attributed to him.
He appears to have been dragged into the killing.
Therefore, the sentence of death awarded to the second appellant is altered to a sentence of imprisonment for life.
[852E F]
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1 and 2 along with two other accused were convicted for the murder of the first Appellant 's paternal uncle, his wife and daughter. First the brother, and then his daughter and wife were done to death with gandassa and kapa blows just outside their house. It was also alleged that the deceased man had no male issue and had only one daughter for whom negotiations for marriage were in the offing and appellant No. The Trial Court convicted the appellants and sentenced them to death, while the other two accused were sentenced to life imprisonment. Against the conviction and sentence, an appeal was filed. There was also a reference to the High Court, as death sentence was involved in respect of the two appellants. The High Court dismissed the appeal and confirmed the death sentence. The appeal before this Court is filed by the two appellants who have been sentenced to death. The motive alleged has been disputed on behalf of the appellants, as a will had been executed by the deceased man in favour of the son of his wife 's brother, and that if at all there was a motive he should have also been eliminated. 844 It was also contended that in the locality independent witnesses could be available and they have not been examined. Another submission was that one of the witnesses had complained against the Police Officer and so the Police Officers were prejudiced against him. The time at which the FIR had been registered has also been questioned. In the absence of motive on the part of the second appellant, it was contended, that the death sentence awarded to him is not justified. Allowing the appeal partly, this Court, ^ HELD: 1. The will was filed after the murders, in some civil proceedings when the legatee claimed to be brought on record in place of the deceased man. One of the witnesses is the maternal uncle of the deceased girl and there were some negotiations for her marriage and for that purpose he along with his son had come to the house of the deceased. It appears from the evidence that the nearby area was not so inhabitated and by that time in the evening no one else was available. Those who were present have been examined and in this view of the matter the contention that independent witnesses were not examined is of no consequence. No doubt could therefore be raised about the reliability of such evidence. No relevant evidence was brought on record and not a single question was put to any witness or to the person who made the First Information Report as to whether he had noted the correct time of the incident. In the absence of any material, the only thing that appears is that immediately after the incident the report was recorded and this report contains a clear description of the incident corroborating the testimony of the eye witnesses. It was, however, contended that the brotherhood of the uniform created a prejudice against the second appellant and that is why he has been falsely implicated. This appears to be too tall a proposition. There is no material to indicate that there was any prejudice in the mind of the investigating officer. The report of the incident was lodged immediately and in the report the part played by the accused has been clearly stated. The medical evidence indicates that the deceased man 's neck was chopped off and repeated blows by Gandasa were inflicted on the body of his daughter. [852C E] 5.2 So far as the second appellant is concerned he is a stranger and he is not in any way connected with the family and so there could be no motive attributed to him. He appears to have been dragged into the killing.
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Civil Appeal No. 2537 of 1985 etc.
From the Judgment and Order dated 27.4.1984 of the Bombay High Court in O.S.W.P. No. 704 of 1984.
G.G. Kalsekar, K.M.M. Khan, N. Nettar and S.N. Bhat for the Appellants.
S.K. Dholakia, Ashok H. Desai, A.M. Khanwilkar, A.S.Bhasme, D.N. Mishra, section Sukumaran, G.E. Vahanvati, V.B. Agarwala, B.B. Agarwala, R.B. Hathi Khanawala for the Respondents.
Vinod A. Bobde, Mrs. J. Wad and Mrs. Aruna Mathur for the Intervener.
922 The Judgment of the Court was delivered by DUTT, J.
The subject matter of this appeal by special leave is the permission for development of the land granted in favour of respondent No. 5 who proposed to construct a five star hotel on a tract of land measuring 44,820.49 square yards at Bandra, Bombay, bearing R.S. Nos. 416 (Part) and 417.
The land in question had been purchased by the respondent No. 5, Enjay Estates Pvt. Ltd., from its erstwhile owner, Byramji Jeejeebhoy Pvt. Ltd. In the 1966 sanctioned Development Plan of Greater Bombay, the said land was shown in the residential zone and a contiguous parcel of land measuring 18,000 sq.
was shown as a green belt.
With a view to developing the disputed land, the respondent No. 5 submitted a plan to the Municipal Corporation of Greater Bombay for the construction of a five star hotel.
The Commissioner of the Municipal Corporation, however, rejected the plan on the sole ground that it was proposed to earmark the said land under reference as a recreational ground with suitable internal network of roads during the revision of the development plan which was in the offing.
Being aggrieved by the said rejection of the plan, the respondent No. 5 pref erred an appeal to the Government of Maharashtra under section 47 of the Maharashtra Regional and Town Planning Act, 1966, hereinafter referred to as 'the Act '.
The appellants, who are rate payers of the Municipal Corporation of Greater Bombay and claim to be members of various ecological action groups, appeared in the appeal and opposed the same contending, inter alia, that the whole of the said land should be kept reserved for a green belt or recreational ground in the interest of the general public.
The appeal was heard by the Minister of State for Urban Development, the respondent No. 2 herein.
The respondent No. 2 set aside the order of the Commissioner of the Municipal Corporation rejecting the plan submitted by the respondent No. 5 after hearing the petitioners as also the Municipal Commissioner and directed sanctioning of the plan on certain conditions which will be referred to later in this judgment.
The Municipal Corporation accepted the appellate order and did not challenge the order of the respondent No. 2.
But the appellants filed a writ petition challenging the legality of the order of the respon 923 dent No. 2 granting sanction of the plan submitted by the respondent No. 5 for the construction of a hotel on the said land.
The writ petition was, however, dismissed by the Division Bench of the High Court by the judgment under appeal.
At this stage, we may refer to some of the provisions of the Act.
It is an Act to make provision for planning the development and use of land in Regions established for that purpose and for the constitution of Regional Planning Boards therefor; to make better provisions for the preparation of Development Plans with a view to ensuring that town planning schemes are made in a proper manner and their execution is made effective; to provide for the creation of new towns by means of Development Authorities; to make provisions for the compulsory acquisition of land required for public purposes in respect of the plans; and for purposes connected with the matters aforesaid.
Section 2(9) defines "Development Plan" to mean a plan for the development or re development of the area within the jurisdiction of a Planning Authority and includes revision of a development plan and proposals of a Special Planning Authority for development of land within its jurisdiction.
Under section 2(19), "Planning Authority" means a local authority; and includes a Special Planning Authority constituted or appointed under section 40.
Chapter III of the Act contains provisions for the Development plan.
Section 23 provides for the declaration of intention by the Planning Authority to prepare a Development plan.
Section 26 provides for the preparation and the publication of notice of draft Development plan.
Under section 30, the Planning Authority has to submit the draft Development Plan to the State Government for sanction.
Section 31 provides for the sanction to the draft Development plan by the State Government.
Section 43 provides, inter Ala, that after the date on which the declaration of intention to prepare a Development plan for any area is published in the Official Gazette, no person shall carry out any development of land without the permission in writing of the Planning Authority.
Section 45 deals with grant or refusal of sanction for development by the Planning Authority.
Section 45 enjoins that the Planning Authority in considering an application for permission shall have due regard to the provisions of any draft or final plan or proposals published by means of notice submitted or sanctioned under the Act.
Section 47 provides for an appeal to the State Government or to an officer appointed by the State Government by any applicant aggrieved by an order granting permission on conditions or refusing permission under section 45.
In allowing the appeal of the respondent No. 5 and directing 924 sanction of the development plan, the respondent No. 2 observed that in view of the clear provisions of sections 46 and 31(6) of the Act and having regard to the position that in the sanctioned plan of 1966, the said land was included in the residential zone and no proposal to exclude it therefrom in the draft revised development plan had been published, the Municipal Commissioner was not justified in rejecting the application for approval of the plan submitted by the respondent No. 5 on the ground that the Bombay Municipal Corporation had decided to revise the 1966 Development Plan.
We have already referred to section 46 of the Act which provides that the Planning Authority in considering the application for permission shall have due regard to the provisions of any draft or final plan or proposals published by means of notice submitted or sanctioned under the Act.
It seems that the respondent No. 2 was of the view that the Planning Authority could only take into its consideration any draft or final plan or proposal which had been published by means of notice or sanctioned under the Act as provided in section 46.
There is, in our opinion, some force in the contention made by Mr. Kalsekar, learned Counsel appearing on behalf of the appellants, that the respondent No. 2 has misunderstood the provisions of section 46.
It is submitted by the learned Counsel that the Municipal Corporation was entitled to take into consideration other relevant facts including the contemplated revision of the plan, apart from those mentioned in section 46.
In support of his contention, the learned Counsel has placed reliance on an unreported decision of a learned Single Judge of the Bombay High Court in Life Insurance Corporation of India and Another vs Municipal Corporation of Greater Bombay and Others, Writ Petition No. 2944 of 1932 disposed of on 6.3.1984.
In that case, a development application was rejected by the Municipal Corporation on the ground that the property was proposed to be reserved for public purposes or for recreational ground in the draft revised development plan, and the High Court repelled the challenge to the decision taking the view that even the proposed revision could be taken into account as one of the relevant factors.
There can be no doubt that if there be any other material or relevant fact, section 46 does not stand in the way of such material or fact being considered by the Municipal Corporation for the grant or refusal to grant sanction of any development plan.
In the unreported decision of the High Court, the relevant fact that was taken into consideration was the draft revised development plan, even though the plan was not published.
In the instant case, however, at the time the Municipal Commissioner rejected the plan submitted by the respondent No. 5, there was no draft revised development plan in existence.
925 It was in contemplation.
If there had been such a plan, the Municipal Commissioner would be entitled to rely upon the same in rejecting the plan submitted by the respondent No. 5.
But, as there was no such draft revised plan as has been stated before this Court even by the Counsel for the Municipal Corporation, the Municipal Commissioner was not justified in merely relying upon a proposal for the preparation of a draft revised plan.
An order rejecting a development plan submitted by the owner of the land should be supported by some concrete material.
In the absence of any such material, it will be improper to reject the plan on the ground that there is a proposal for revision of the draft plan or that such a revision is under contemplation.
We are, therefore, of the view that the ground for rejecting the plan submitted by the respondent No. 5 was not tenable and the appellate authority was justified in allowing the appeal.
It is urged by Mr. Kalsekar that in any event no appeal lay under section 47 when the Municipal Corporation had decided to revise the development plan.
We are afraid, we are unable to accept the contention.
The same contention was advanced before the respondent No. 2 and it was rightly rejected.
Section 47 of the Act does not warrant the contention urged by the learned Counsel.
In our opinion, to hold that after the Municipal Corporation had decided to revise the development plan, no appeal would be competent to the State Government under section 47, would amount to legislating and rewriting the provision.
Such a contention is without any substance and is rejected.
The respondent No. 2 directed sanction of the plan out of 44,820.49 sq. yds.
belonging to the respondent No. 5, on the following conditions: (i) 15% Recreation space to be left in Block 'A ' shall be kept on the southern side of the plot abutting the green space left from Block 'B ' after merging the Road area in the Green space.
(ii) The Development shall be allowed IOD and C.C. shall be issued as per the Development Control Rules.
(iii)The F.S.I. of the road area would be admissible on plot 'A ' as per Development Control Rule 10(2).
(iv) The Municipal Commissioner, Municipal Corporation of Greater Bombay, Bombay, shall take over the possession of 926 the land proposed to be kept as Green on southern side, abutting the sea after getting the plots properly demarcated.
The Municipal Commissioner, M.C., G.E., Bombay, may consider the proposal of allowing the development and maintenance of the park and garden space by the applicant party at their own cost after obtaining the possession of the lands now proposed to be kept green.
The permission for development of plots as per plans submitted by appellants be granted by the M.C.B. M.C. subject to the conditions mentioned above.
We are told that after the above conditions are worked out, the area that will be available to the respondent No. 5 for the construction of the hotel is only 19,951.10 sq.
It is, therefore, apparent that in granting sanction to the plan, the respondent No. 2 was quite alive to public interest.
At this stage, we may notice a very significant development that has taken place during the pendency of this appeal, namely, that the Municipal Corporation has, subsequent to the judgment of the High Court, prepared and published on April 30, 1984 a draft revised development plan.
The plan of the respondent No. 5 is not inconsistent with the draft revised development plan.
This fact demolishes all the contentions of the appellants against the plan submitted by the respondent No. 5.
Realising this difficulty, Mr. Kalsekar assailed the draft revised plan on the ground that it was prepared in accordance with the direction of the respondent No. 2.
This contention of the learned Counsel has no foundation whatsoever.
There is no material on record to show that the Municipal Corporation which is the Planning Authority, had prepared the draft revised plan in accordance with the direction of the respondent No. 2.
The respondent No. 2, in our opinion, has acted in public interest by imposing the conditions mentioned above.
The conditions would show that considerable area out of the disputed land has been reserved for recreational ground or green belt.
The plan, as sanctioned by the respondent No. 2 with the conditions imposed, has been shown in the draft revised plan.
It was open to the Municipal Corporation to accept the verdict of the appellate authority and it has done so by not challenging it in the High Court or before this Court.
In the circumstances, there is no merit in this appeal challenging the order of the respondent No. 2 sanctioning the development plan of the respondent No. 5. 927 Now we may take up the two Special Leave Petitions being Special Leave Petition (Civil) No. 173776 of 1985 and Special Leave Petition (Civil) No. 17377 of 1985.
A few facts may be stated.
The Municipal Corporation passed a resolution on 3.12.1973, inter Ala, extending the park reservation by including the remaining area of the land comprised in R.S. No. 416 and R.S. No. 417 (part) at Bandra.
By another resolution dated 14.3.1974, the first resolution was modified limiting the reservation for the park to 7,000 sq.
out of the disputed land.
The petitioners, who are the appellants in the above appeal, filed two Misc.
Petitions, namely, Misc.
Petition No. 463 of 1974 challenging the legality and validity of the resolution dated 14.3.1974 and Misc.
Petition No. 1406 of 1978 challenging the order of the Government of Maharashtra dated 25.7.1978 exempting the disputed land under section 20 of the Urban Land (Ceiling and Regulation) Act, 1976, hereinafter referred to as the 'Urban Land Ceiling Act '.
Both the Misc.
Petitions were dismissed by a learned Single Judge of the Bombay High Court.
Two appeals were preferred by the petitioners against the judgment of the learned Single Judge to the Division Bench.
On July 30, 1984 when the appeals were taken up for hearing, a prayer was made by the learned Counsel for the petitioners for an adjournment for two weeks on the ground that Shri Bhore, the Advocate on Record, had met with an accident and the learned Counsel was unable to proceed with the appeals without the Advocate on Record.
The learned Judges of the Division Bench did not accede to the prayer of the learned Counsel for an adjournment for two weeks on the ground that the appeals were old appeals of 1979, and that the learned Counsel who prayed for adjournment himself appeared throughout the proceedings as an Advocate.
The learned Judges, however, adjourned the appeals to the next day, that is, July 31, 1984 to enable the learned Counsel to be ready with the matter.
On the next day, the learned Counsel did not appear and the learned Judges of the Division Bench disposed of the appeals ex parte by a judgment dealing with the contentions of the petitioners.
The result was that both the appeals were dismissed.
We do not think that we are called upon to consider whether the learned Judges should have granted an adjournment for two weeks as was prayed for by the learned Counsel.
Suffice it to say that if an adjournment had been granted, multiplicity of proceedings could have been avoided.
Be that as it may, the petitioners filed two applications for review.
Both the said applications for review were dismissed by the 928 Division Bench after considering all the points including certain additional grounds to the effect that certain contentions had not been dealt with earlier by the judgment dated October 9/10, 1985.
The petitioners have not challenged the judgment of the High Court passed on the review applications.
They have, however, filed before this Court the above two Special Leave Petitions.
Special Leave Petition (Civil) No. 17376 of 1985 arises out of Misc.
Petition No. 463 of 1974 whereby the petitioners challenged the legality and validity of the said resolution dated 14.3.1974.
We are of the view that the contention of the petitioners against the validity of the resolution is no longer tenable, regard being had to the fact that the draft revised development plan has since been published and the plan submitted by the respondent No. 5 and conditioned by the respondent No. 2 is not inconsistent with the draft revised plan.
In that view of the matter, Mr. Kalsekar also has not seriously pressed the validity of the said resolution.
Accordingly, Special Leave Petition (Civil) No. 17376 of 1985 is liable to be dismissed.
So far as Special Leave Petition (Civil) No.17377 of 1985 is concerned, it has been strenuously urged by Mr. Kalsekar that in granting exemption to the respondent No. 5, the authority concerned has violated the relevant guidelines and also the provision of section 20 of the Urban Land Ceiling Act.
Learned Counsel points out that one of the grounds for exemption is that 75,000 sq.
of vacant land is available for the development of gardens.
As a matter of fact, Counsel submits, it is not a vacant land, but contains 350 houses.
It is submitted that granting exemption on the ground of availability of 75,000 sq.
of open site for the purpose of gardens is a fraud on the Urban Land Ceiling Act.
It is, accordingly, urged by the learned Counsel that the order granting exemption should be quashed.
The above grounds of challenge to the order of exemption granted to the respondent No. 5 have all been considered by the High Court in its judgment disposing of the review applications.
The petitioners have not challenged the judgment on review applications.
The petitioners are only interested in seeing that sufficient area is kept reserved for a park or recreation ground for the benefit of the members of the public.
They are not, in our opinion, concerned with the question as to the legality or otherwise of the exemption granted by the Government to the respondent No. 5 under the Urban Land Ceiling Act.
A copy of the draft revised development plan has been produced before us by Mr. Desai, learned Counsel appearing on behalf of 929 the respondent No. 5.
We are satisfied that the question whether or not sufficient quantity of land has been kept reserved for park and recreation ground has been adequately considered and taken into account by the High Court.
In the circumstances, we do not think that we are called upon to decide the legality or otherwise of the order granting exemption to the respondent No. 5 under the Urban Land Ceiling Act.
There is, therefore no substance also in Special Leave Petition (Civil) No. 17377 of 1985.
In the result, the appeal and both the special leave petitions are dismissed.
There will, however, be no order as to costs.
G.N. Appeal and Petitions dismissed.
|
% A piece of land had been purchased for the construction of a five star hotel.
In the sanctioned development plan the said land was shown in the residential zone and a contiguous parcel of land was shown as green belt.
When the plan was submitted to the Municipal Corporation for the construction of a five star hotel, the Commissioner rejected the plan on the ground that it was proposed to earmark the said land as a recreational ground with suitable internal network of roads during the revision of the development plan which was in the offing.
Aggrieved by the rejection, an appeal was preferred to the State Government under sec.
47 of the Maharashtra Regional and Town Planning Act, 1966.
The appeal was heard by the Minister of State for Urban Development.
The appellants herein, members of various ecological groups and rate payers of the Municipal Corporation, appeared and opposed saying that the land should be kept reserved for a green belt or recreational ground in the interest of the general public.
However, the Minister set aside the order of the Municipal Commissioner and directed the sanctioning of the plan on certain conditions.
The Municipal Corporation accepted the appellate order and did not challenge it.
But the appellants filed a Writ Petition challenging the legality of the order.
The writ petition was dismissed by the High Court.
The present appeal by special leave is against this dismissal.
Meanwhile the Municipal Corporation passed a resolution extending the park reservation by including the remaining area of the land in question.
By another resolution the first resolution was modified limiting the reservation for the park to 7,000 sq.
yards out of the dis 920 puted land.
Thereafter the State Government exempted the disputed land under section 20 of the Urban Land (Ceiling and Regulation) Act, 1976.
The resolutions and the order were challenged in the High Court.
The petitions were dismissed by a Single Judge of the High Court and later by the Division Bench on appeal.
The Review Petitions also met the same fate.
The petitioners have not challenged the judgment of the High Court passed on the review applications, but filed before this Court the two special leave petitions challenging the legality and validity of the two resolutions and the order of Government giving exemption under section 20 of the Urban Land (Ceiling and Regulation) Act.
Dismissing the appeal, and the special leave petitions, this Court, ^ HELD: 1.1 In allowing the appeal and directing sanction of the development plan, the Minister observed that in view of the clear provisions of sections 46 and 31(6) of the Act and having regard to the position that in the sanctioned plan of 1966, the said land was included in the residential zone and no proposal to exclude it therefrom in the draft revised development plan had been published, the Municipal Commissioner was not justified in rejecting the application for approval of the plan on the ground that the Bombay Municipal Corporation had decided to revise the 1966 Development Plan.
The Minister was of the view that the Planning Authority could only take into consideration any draft or final plan or proposal which had been published by means of notice, or sanctioned under the Act.
When Municipal Commissioner rejected the plan, there was no draft revised development plan in existence.
It was in contemplation.
If there had been such a plan, the Municipal Commissioner would be entitled to rely upon the same in rejecting the plan.
The Commissioner was not justified in merely relying upon a proposal for the preparation of a draft revised plan.
An order rejecting a development plan submitted by the owner of the land should be supported by some concrete material.
In the absence of any such material, it will be improper to reject the plan on the ground that there is a proposal for revision of the draft plan or that such a revision is under contemplation.
Therefore, the ground for rejecting the plan was not tenable and the appellate authority was justified in allowing the appeal.
[923H; 924A B, H; 925A C] 1.2 The Municipal Corporation has, subsequent to the judgment of the High Court, prepared and published a draft revised development plan.
The plan is not inconsistent with the draft revised development plan.
There is no material on record to show that the Municipal Corporation which is the Planning Authority, had prepared the draft revised 921 plan in accordance with the direction of the Minister.
The Minister has acted in public interest by imposing the conditions.
The conditions would show that considerable area out of the disputed land has been reserved for recreational ground or green belt.
The plan, as sanctioned with the conditions imposed, has been shown in the draft revised plan.
It was open to the Municipal Corporation to accept the verdict of the appellate authority and it has done so by not challenging it in the High Court or before this Court.
[926E H] 2.
The contention of the petitioners against the validity of the resolution is no longer tenable, regard being had to the fact that the draft revised development plan has since been published and the plan submitted and conditioned by the Minister is not inconsistent with the draft revised plan.
The petitioners have also not seriously pressed the validity of the said resolution.
[928C D] 3.
This Court is not called upon to decide the legality or otherwise of the order granting exemption.
These have been considered by the High Court in its judgment disposing of the review applications.
The petitioners have not challenged the judgment on review applications.
The petitioners are only interested in seeing that sufficient area is kept reserved for a park or recreation ground for the benefit of the members of the public, and are not concerned with the question as to the legality or otherwise of the exemption granted by the Government.
The question whether or not sufficient quantity of land has been kept reserved for park and recreation ground has been adequately considered and taken into account by the High Court.
[928G H; 929A]
|
Civil Appeal No. 2537 of 1985 etc.
From the Judgment and Order dated 27.4.1984 of the Bombay High Court in O.S.W.P. No. 704 of 1984.
G.G. Kalsekar, K.M.M. Khan, N. Nettar and S.N. Bhat for the Appellants.
S.K. Dholakia, Ashok H. Desai, A.M. Khanwilkar, A.S.Bhasme, D.N. Mishra, section Sukumaran, G.E. Vahanvati, V.B. Agarwala, B.B. Agarwala, R.B. Hathi Khanawala for the Respondents.
Vinod A. Bobde, Mrs. J. Wad and Mrs. Aruna Mathur for the Intervener.
922 The Judgment of the Court was delivered by DUTT, J.
The subject matter of this appeal by special leave is the permission for development of the land granted in favour of respondent No. 5 who proposed to construct a five star hotel on a tract of land measuring 44,820.49 square yards at Bandra, Bombay, bearing R.S. Nos. 416 (Part) and 417.
The land in question had been purchased by the respondent No. 5, Enjay Estates Pvt. Ltd., from its erstwhile owner, Byramji Jeejeebhoy Pvt. Ltd. In the 1966 sanctioned Development Plan of Greater Bombay, the said land was shown in the residential zone and a contiguous parcel of land measuring 18,000 sq.
was shown as a green belt.
With a view to developing the disputed land, the respondent No. 5 submitted a plan to the Municipal Corporation of Greater Bombay for the construction of a five star hotel.
The Commissioner of the Municipal Corporation, however, rejected the plan on the sole ground that it was proposed to earmark the said land under reference as a recreational ground with suitable internal network of roads during the revision of the development plan which was in the offing.
Being aggrieved by the said rejection of the plan, the respondent No. 5 pref erred an appeal to the Government of Maharashtra under section 47 of the Maharashtra Regional and Town Planning Act, 1966, hereinafter referred to as 'the Act '.
The appellants, who are rate payers of the Municipal Corporation of Greater Bombay and claim to be members of various ecological action groups, appeared in the appeal and opposed the same contending, inter alia, that the whole of the said land should be kept reserved for a green belt or recreational ground in the interest of the general public.
The appeal was heard by the Minister of State for Urban Development, the respondent No. 2 herein.
The respondent No. 2 set aside the order of the Commissioner of the Municipal Corporation rejecting the plan submitted by the respondent No. 5 after hearing the petitioners as also the Municipal Commissioner and directed sanctioning of the plan on certain conditions which will be referred to later in this judgment.
The Municipal Corporation accepted the appellate order and did not challenge the order of the respondent No. 2.
But the appellants filed a writ petition challenging the legality of the order of the respon 923 dent No. 2 granting sanction of the plan submitted by the respondent No. 5 for the construction of a hotel on the said land.
The writ petition was, however, dismissed by the Division Bench of the High Court by the judgment under appeal.
At this stage, we may refer to some of the provisions of the Act.
It is an Act to make provision for planning the development and use of land in Regions established for that purpose and for the constitution of Regional Planning Boards therefor; to make better provisions for the preparation of Development Plans with a view to ensuring that town planning schemes are made in a proper manner and their execution is made effective; to provide for the creation of new towns by means of Development Authorities; to make provisions for the compulsory acquisition of land required for public purposes in respect of the plans; and for purposes connected with the matters aforesaid.
Section 2(9) defines "Development Plan" to mean a plan for the development or re development of the area within the jurisdiction of a Planning Authority and includes revision of a development plan and proposals of a Special Planning Authority for development of land within its jurisdiction.
Under section 2(19), "Planning Authority" means a local authority; and includes a Special Planning Authority constituted or appointed under section 40.
Chapter III of the Act contains provisions for the Development plan.
Section 23 provides for the declaration of intention by the Planning Authority to prepare a Development plan.
Section 26 provides for the preparation and the publication of notice of draft Development plan.
Under section 30, the Planning Authority has to submit the draft Development Plan to the State Government for sanction.
Section 31 provides for the sanction to the draft Development plan by the State Government.
Section 43 provides, inter Ala, that after the date on which the declaration of intention to prepare a Development plan for any area is published in the Official Gazette, no person shall carry out any development of land without the permission in writing of the Planning Authority.
Section 45 deals with grant or refusal of sanction for development by the Planning Authority.
Section 45 enjoins that the Planning Authority in considering an application for permission shall have due regard to the provisions of any draft or final plan or proposals published by means of notice submitted or sanctioned under the Act.
Section 47 provides for an appeal to the State Government or to an officer appointed by the State Government by any applicant aggrieved by an order granting permission on conditions or refusing permission under section 45.
In allowing the appeal of the respondent No. 5 and directing 924 sanction of the development plan, the respondent No. 2 observed that in view of the clear provisions of sections 46 and 31(6) of the Act and having regard to the position that in the sanctioned plan of 1966, the said land was included in the residential zone and no proposal to exclude it therefrom in the draft revised development plan had been published, the Municipal Commissioner was not justified in rejecting the application for approval of the plan submitted by the respondent No. 5 on the ground that the Bombay Municipal Corporation had decided to revise the 1966 Development Plan.
We have already referred to section 46 of the Act which provides that the Planning Authority in considering the application for permission shall have due regard to the provisions of any draft or final plan or proposals published by means of notice submitted or sanctioned under the Act.
It seems that the respondent No. 2 was of the view that the Planning Authority could only take into its consideration any draft or final plan or proposal which had been published by means of notice or sanctioned under the Act as provided in section 46.
There is, in our opinion, some force in the contention made by Mr. Kalsekar, learned Counsel appearing on behalf of the appellants, that the respondent No. 2 has misunderstood the provisions of section 46.
It is submitted by the learned Counsel that the Municipal Corporation was entitled to take into consideration other relevant facts including the contemplated revision of the plan, apart from those mentioned in section 46.
In support of his contention, the learned Counsel has placed reliance on an unreported decision of a learned Single Judge of the Bombay High Court in Life Insurance Corporation of India and Another vs Municipal Corporation of Greater Bombay and Others, Writ Petition No. 2944 of 1932 disposed of on 6.3.1984.
In that case, a development application was rejected by the Municipal Corporation on the ground that the property was proposed to be reserved for public purposes or for recreational ground in the draft revised development plan, and the High Court repelled the challenge to the decision taking the view that even the proposed revision could be taken into account as one of the relevant factors.
There can be no doubt that if there be any other material or relevant fact, section 46 does not stand in the way of such material or fact being considered by the Municipal Corporation for the grant or refusal to grant sanction of any development plan.
In the unreported decision of the High Court, the relevant fact that was taken into consideration was the draft revised development plan, even though the plan was not published.
In the instant case, however, at the time the Municipal Commissioner rejected the plan submitted by the respondent No. 5, there was no draft revised development plan in existence.
925 It was in contemplation.
If there had been such a plan, the Municipal Commissioner would be entitled to rely upon the same in rejecting the plan submitted by the respondent No. 5.
But, as there was no such draft revised plan as has been stated before this Court even by the Counsel for the Municipal Corporation, the Municipal Commissioner was not justified in merely relying upon a proposal for the preparation of a draft revised plan.
An order rejecting a development plan submitted by the owner of the land should be supported by some concrete material.
In the absence of any such material, it will be improper to reject the plan on the ground that there is a proposal for revision of the draft plan or that such a revision is under contemplation.
We are, therefore, of the view that the ground for rejecting the plan submitted by the respondent No. 5 was not tenable and the appellate authority was justified in allowing the appeal.
It is urged by Mr. Kalsekar that in any event no appeal lay under section 47 when the Municipal Corporation had decided to revise the development plan.
We are afraid, we are unable to accept the contention.
The same contention was advanced before the respondent No. 2 and it was rightly rejected.
Section 47 of the Act does not warrant the contention urged by the learned Counsel.
In our opinion, to hold that after the Municipal Corporation had decided to revise the development plan, no appeal would be competent to the State Government under section 47, would amount to legislating and rewriting the provision.
Such a contention is without any substance and is rejected.
The respondent No. 2 directed sanction of the plan out of 44,820.49 sq. yds.
belonging to the respondent No. 5, on the following conditions: (i) 15% Recreation space to be left in Block 'A ' shall be kept on the southern side of the plot abutting the green space left from Block 'B ' after merging the Road area in the Green space.
(ii) The Development shall be allowed IOD and C.C. shall be issued as per the Development Control Rules.
(iii)The F.S.I. of the road area would be admissible on plot 'A ' as per Development Control Rule 10(2).
(iv) The Municipal Commissioner, Municipal Corporation of Greater Bombay, Bombay, shall take over the possession of 926 the land proposed to be kept as Green on southern side, abutting the sea after getting the plots properly demarcated.
The Municipal Commissioner, M.C., G.E., Bombay, may consider the proposal of allowing the development and maintenance of the park and garden space by the applicant party at their own cost after obtaining the possession of the lands now proposed to be kept green.
The permission for development of plots as per plans submitted by appellants be granted by the M.C.B. M.C. subject to the conditions mentioned above.
We are told that after the above conditions are worked out, the area that will be available to the respondent No. 5 for the construction of the hotel is only 19,951.10 sq.
It is, therefore, apparent that in granting sanction to the plan, the respondent No. 2 was quite alive to public interest.
At this stage, we may notice a very significant development that has taken place during the pendency of this appeal, namely, that the Municipal Corporation has, subsequent to the judgment of the High Court, prepared and published on April 30, 1984 a draft revised development plan.
The plan of the respondent No. 5 is not inconsistent with the draft revised development plan.
This fact demolishes all the contentions of the appellants against the plan submitted by the respondent No. 5.
Realising this difficulty, Mr. Kalsekar assailed the draft revised plan on the ground that it was prepared in accordance with the direction of the respondent No. 2.
This contention of the learned Counsel has no foundation whatsoever.
There is no material on record to show that the Municipal Corporation which is the Planning Authority, had prepared the draft revised plan in accordance with the direction of the respondent No. 2.
The respondent No. 2, in our opinion, has acted in public interest by imposing the conditions mentioned above.
The conditions would show that considerable area out of the disputed land has been reserved for recreational ground or green belt.
The plan, as sanctioned by the respondent No. 2 with the conditions imposed, has been shown in the draft revised plan.
It was open to the Municipal Corporation to accept the verdict of the appellate authority and it has done so by not challenging it in the High Court or before this Court.
In the circumstances, there is no merit in this appeal challenging the order of the respondent No. 2 sanctioning the development plan of the respondent No. 5. 927 Now we may take up the two Special Leave Petitions being Special Leave Petition (Civil) No. 173776 of 1985 and Special Leave Petition (Civil) No. 17377 of 1985.
A few facts may be stated.
The Municipal Corporation passed a resolution on 3.12.1973, inter Ala, extending the park reservation by including the remaining area of the land comprised in R.S. No. 416 and R.S. No. 417 (part) at Bandra.
By another resolution dated 14.3.1974, the first resolution was modified limiting the reservation for the park to 7,000 sq.
out of the disputed land.
The petitioners, who are the appellants in the above appeal, filed two Misc.
Petitions, namely, Misc.
Petition No. 463 of 1974 challenging the legality and validity of the resolution dated 14.3.1974 and Misc.
Petition No. 1406 of 1978 challenging the order of the Government of Maharashtra dated 25.7.1978 exempting the disputed land under section 20 of the Urban Land (Ceiling and Regulation) Act, 1976, hereinafter referred to as the 'Urban Land Ceiling Act '.
Both the Misc.
Petitions were dismissed by a learned Single Judge of the Bombay High Court.
Two appeals were preferred by the petitioners against the judgment of the learned Single Judge to the Division Bench.
On July 30, 1984 when the appeals were taken up for hearing, a prayer was made by the learned Counsel for the petitioners for an adjournment for two weeks on the ground that Shri Bhore, the Advocate on Record, had met with an accident and the learned Counsel was unable to proceed with the appeals without the Advocate on Record.
The learned Judges of the Division Bench did not accede to the prayer of the learned Counsel for an adjournment for two weeks on the ground that the appeals were old appeals of 1979, and that the learned Counsel who prayed for adjournment himself appeared throughout the proceedings as an Advocate.
The learned Judges, however, adjourned the appeals to the next day, that is, July 31, 1984 to enable the learned Counsel to be ready with the matter.
On the next day, the learned Counsel did not appear and the learned Judges of the Division Bench disposed of the appeals ex parte by a judgment dealing with the contentions of the petitioners.
The result was that both the appeals were dismissed.
We do not think that we are called upon to consider whether the learned Judges should have granted an adjournment for two weeks as was prayed for by the learned Counsel.
Suffice it to say that if an adjournment had been granted, multiplicity of proceedings could have been avoided.
Be that as it may, the petitioners filed two applications for review.
Both the said applications for review were dismissed by the 928 Division Bench after considering all the points including certain additional grounds to the effect that certain contentions had not been dealt with earlier by the judgment dated October 9/10, 1985.
The petitioners have not challenged the judgment of the High Court passed on the review applications.
They have, however, filed before this Court the above two Special Leave Petitions.
Special Leave Petition (Civil) No. 17376 of 1985 arises out of Misc.
Petition No. 463 of 1974 whereby the petitioners challenged the legality and validity of the said resolution dated 14.3.1974.
We are of the view that the contention of the petitioners against the validity of the resolution is no longer tenable, regard being had to the fact that the draft revised development plan has since been published and the plan submitted by the respondent No. 5 and conditioned by the respondent No. 2 is not inconsistent with the draft revised plan.
In that view of the matter, Mr. Kalsekar also has not seriously pressed the validity of the said resolution.
Accordingly, Special Leave Petition (Civil) No. 17376 of 1985 is liable to be dismissed.
So far as Special Leave Petition (Civil) No.17377 of 1985 is concerned, it has been strenuously urged by Mr. Kalsekar that in granting exemption to the respondent No. 5, the authority concerned has violated the relevant guidelines and also the provision of section 20 of the Urban Land Ceiling Act.
Learned Counsel points out that one of the grounds for exemption is that 75,000 sq.
of vacant land is available for the development of gardens.
As a matter of fact, Counsel submits, it is not a vacant land, but contains 350 houses.
It is submitted that granting exemption on the ground of availability of 75,000 sq.
of open site for the purpose of gardens is a fraud on the Urban Land Ceiling Act.
It is, accordingly, urged by the learned Counsel that the order granting exemption should be quashed.
The above grounds of challenge to the order of exemption granted to the respondent No. 5 have all been considered by the High Court in its judgment disposing of the review applications.
The petitioners have not challenged the judgment on review applications.
The petitioners are only interested in seeing that sufficient area is kept reserved for a park or recreation ground for the benefit of the members of the public.
They are not, in our opinion, concerned with the question as to the legality or otherwise of the exemption granted by the Government to the respondent No. 5 under the Urban Land Ceiling Act.
A copy of the draft revised development plan has been produced before us by Mr. Desai, learned Counsel appearing on behalf of 929 the respondent No. 5.
We are satisfied that the question whether or not sufficient quantity of land has been kept reserved for park and recreation ground has been adequately considered and taken into account by the High Court.
In the circumstances, we do not think that we are called upon to decide the legality or otherwise of the order granting exemption to the respondent No. 5 under the Urban Land Ceiling Act.
There is, therefore no substance also in Special Leave Petition (Civil) No. 17377 of 1985.
In the result, the appeal and both the special leave petitions are dismissed.
There will, however, be no order as to costs.
G.N. Appeal and Petitions dismissed.
|
From the Judgment and Order dated 27.4.1984 of the Bombay High Court in O.S.W.P. No. G.G. Kalsekar, K.M.M. Khan, N. Nettar and S.N. Bhat for the Appellants. S.K. Dholakia, Ashok H. Desai, A.M. Khanwilkar, A.S.Bhasme, D.N. Mishra, section Sukumaran, G.E. Vahanvati, V.B. Agarwala, B.B. Agarwala, R.B. Hathi Khanawala for the Respondents. Vinod A. Bobde, Mrs. J. Wad and Mrs. Aruna Mathur for the Intervener. 922 The Judgment of the Court was delivered by DUTT, J.
The subject matter of this appeal by special leave is the permission for development of the land granted in favour of respondent No. 5 who proposed to construct a five star hotel on a tract of land measuring 44,820.49 square yards at Bandra, Bombay, bearing R.S. Nos. The land in question had been purchased by the respondent No. Ltd., from its erstwhile owner, Byramji Jeejeebhoy Pvt. Ltd. In the 1966 sanctioned Development Plan of Greater Bombay, the said land was shown in the residential zone and a contiguous parcel of land measuring 18,000 sq. With a view to developing the disputed land, the respondent No. 5 submitted a plan to the Municipal Corporation of Greater Bombay for the construction of a five star hotel. Being aggrieved by the said rejection of the plan, the respondent No. 5 pref erred an appeal to the Government of Maharashtra under section 47 of the Maharashtra Regional and Town Planning Act, 1966, hereinafter referred to as 'the Act '. The appellants, who are rate payers of the Municipal Corporation of Greater Bombay and claim to be members of various ecological action groups, appeared in the appeal and opposed the same contending, inter alia, that the whole of the said land should be kept reserved for a green belt or recreational ground in the interest of the general public. The appeal was heard by the Minister of State for Urban Development, the respondent No. 2 set aside the order of the Commissioner of the Municipal Corporation rejecting the plan submitted by the respondent No. 5 after hearing the petitioners as also the Municipal Commissioner and directed sanctioning of the plan on certain conditions which will be referred to later in this judgment. The Municipal Corporation accepted the appellate order and did not challenge the order of the respondent No. But the appellants filed a writ petition challenging the legality of the order of the respon 923 dent No. 2 granting sanction of the plan submitted by the respondent No. 5 for the construction of a hotel on the said land. The writ petition was, however, dismissed by the Division Bench of the High Court by the judgment under appeal. At this stage, we may refer to some of the provisions of the Act. Section 2(9) defines "Development Plan" to mean a plan for the development or re development of the area within the jurisdiction of a Planning Authority and includes revision of a development plan and proposals of a Special Planning Authority for development of land within its jurisdiction. Under section 2(19), "Planning Authority" means a local authority; and includes a Special Planning Authority constituted or appointed under section 40. Chapter III of the Act contains provisions for the Development plan. Section 23 provides for the declaration of intention by the Planning Authority to prepare a Development plan. Section 26 provides for the preparation and the publication of notice of draft Development plan. Under section 30, the Planning Authority has to submit the draft Development Plan to the State Government for sanction. Section 31 provides for the sanction to the draft Development plan by the State Government. Section 43 provides, inter Ala, that after the date on which the declaration of intention to prepare a Development plan for any area is published in the Official Gazette, no person shall carry out any development of land without the permission in writing of the Planning Authority. Section 45 deals with grant or refusal of sanction for development by the Planning Authority. Section 47 provides for an appeal to the State Government or to an officer appointed by the State Government by any applicant aggrieved by an order granting permission on conditions or refusing permission under section 45. In allowing the appeal of the respondent No. 5 and directing 924 sanction of the development plan, the respondent No. 2 observed that in view of the clear provisions of sections 46 and 31(6) of the Act and having regard to the position that in the sanctioned plan of 1966, the said land was included in the residential zone and no proposal to exclude it therefrom in the draft revised development plan had been published, the Municipal Commissioner was not justified in rejecting the application for approval of the plan submitted by the respondent No. 5 on the ground that the Bombay Municipal Corporation had decided to revise the 1966 Development Plan. We have already referred to section 46 of the Act which provides that the Planning Authority in considering the application for permission shall have due regard to the provisions of any draft or final plan or proposals published by means of notice submitted or sanctioned under the Act. There is, in our opinion, some force in the contention made by Mr. Kalsekar, learned Counsel appearing on behalf of the appellants, that the respondent No. 2 has misunderstood the provisions of section 46. It is submitted by the learned Counsel that the Municipal Corporation was entitled to take into consideration other relevant facts including the contemplated revision of the plan, apart from those mentioned in section 46. In support of his contention, the learned Counsel has placed reliance on an unreported decision of a learned Single Judge of the Bombay High Court in Life Insurance Corporation of India and Another vs Municipal Corporation of Greater Bombay and Others, Writ Petition No. There can be no doubt that if there be any other material or relevant fact, section 46 does not stand in the way of such material or fact being considered by the Municipal Corporation for the grant or refusal to grant sanction of any development plan. In the unreported decision of the High Court, the relevant fact that was taken into consideration was the draft revised development plan, even though the plan was not published. In the instant case, however, at the time the Municipal Commissioner rejected the plan submitted by the respondent No. 5, there was no draft revised development plan in existence. If there had been such a plan, the Municipal Commissioner would be entitled to rely upon the same in rejecting the plan submitted by the respondent No. But, as there was no such draft revised plan as has been stated before this Court even by the Counsel for the Municipal Corporation, the Municipal Commissioner was not justified in merely relying upon a proposal for the preparation of a draft revised plan. An order rejecting a development plan submitted by the owner of the land should be supported by some concrete material. In the absence of any such material, it will be improper to reject the plan on the ground that there is a proposal for revision of the draft plan or that such a revision is under contemplation. We are, therefore, of the view that the ground for rejecting the plan submitted by the respondent No. 5 was not tenable and the appellate authority was justified in allowing the appeal. It is urged by Mr. Kalsekar that in any event no appeal lay under section 47 when the Municipal Corporation had decided to revise the development plan. We are afraid, we are unable to accept the contention. The same contention was advanced before the respondent No. Section 47 of the Act does not warrant the contention urged by the learned Counsel. Such a contention is without any substance and is rejected. 2 directed sanction of the plan out of 44,820.49 sq. 5, on the following conditions: (i) 15% Recreation space to be left in Block 'A ' shall be kept on the southern side of the plot abutting the green space left from Block 'B ' after merging the Road area in the Green space. (ii) The Development shall be allowed IOD and C.C. shall be issued as per the Development Control Rules. (iii)The F.S.I. of the road area would be admissible on plot 'A ' as per Development Control Rule 10(2). (iv) The Municipal Commissioner, Municipal Corporation of Greater Bombay, Bombay, shall take over the possession of 926 the land proposed to be kept as Green on southern side, abutting the sea after getting the plots properly demarcated. The Municipal Commissioner, M.C., G.E., Bombay, may consider the proposal of allowing the development and maintenance of the park and garden space by the applicant party at their own cost after obtaining the possession of the lands now proposed to be kept green. The permission for development of plots as per plans submitted by appellants be granted by the M.C.B. M.C. subject to the conditions mentioned above. We are told that after the above conditions are worked out, the area that will be available to the respondent No. 5 for the construction of the hotel is only 19,951.10 sq. It is, therefore, apparent that in granting sanction to the plan, the respondent No. At this stage, we may notice a very significant development that has taken place during the pendency of this appeal, namely, that the Municipal Corporation has, subsequent to the judgment of the High Court, prepared and published on April 30, 1984 a draft revised development plan. 5 is not inconsistent with the draft revised development plan. This fact demolishes all the contentions of the appellants against the plan submitted by the respondent No. Realising this difficulty, Mr. Kalsekar assailed the draft revised plan on the ground that it was prepared in accordance with the direction of the respondent No. This contention of the learned Counsel has no foundation whatsoever. There is no material on record to show that the Municipal Corporation which is the Planning Authority, had prepared the draft revised plan in accordance with the direction of the respondent No. 2, in our opinion, has acted in public interest by imposing the conditions mentioned above. The conditions would show that considerable area out of the disputed land has been reserved for recreational ground or green belt. The plan, as sanctioned by the respondent No. 2 with the conditions imposed, has been shown in the draft revised plan. It was open to the Municipal Corporation to accept the verdict of the appellate authority and it has done so by not challenging it in the High Court or before this Court. In the circumstances, there is no merit in this appeal challenging the order of the respondent No. 927 Now we may take up the two Special Leave Petitions being Special Leave Petition (Civil) No. 173776 of 1985 and Special Leave Petition (Civil) No. The Municipal Corporation passed a resolution on 3.12.1973, inter Ala, extending the park reservation by including the remaining area of the land comprised in R.S. No. By another resolution dated 14.3.1974, the first resolution was modified limiting the reservation for the park to 7,000 sq. The petitioners, who are the appellants in the above appeal, filed two Misc. 463 of 1974 challenging the legality and validity of the resolution dated 14.3.1974 and Misc. 1406 of 1978 challenging the order of the Government of Maharashtra dated 25.7.1978 exempting the disputed land under section 20 of the Urban Land (Ceiling and Regulation) Act, 1976, hereinafter referred to as the 'Urban Land Ceiling Act '. Petitions were dismissed by a learned Single Judge of the Bombay High Court. Two appeals were preferred by the petitioners against the judgment of the learned Single Judge to the Division Bench. On July 30, 1984 when the appeals were taken up for hearing, a prayer was made by the learned Counsel for the petitioners for an adjournment for two weeks on the ground that Shri Bhore, the Advocate on Record, had met with an accident and the learned Counsel was unable to proceed with the appeals without the Advocate on Record. The learned Judges, however, adjourned the appeals to the next day, that is, July 31, 1984 to enable the learned Counsel to be ready with the matter. On the next day, the learned Counsel did not appear and the learned Judges of the Division Bench disposed of the appeals ex parte by a judgment dealing with the contentions of the petitioners. The result was that both the appeals were dismissed. We do not think that we are called upon to consider whether the learned Judges should have granted an adjournment for two weeks as was prayed for by the learned Counsel. Suffice it to say that if an adjournment had been granted, multiplicity of proceedings could have been avoided. Be that as it may, the petitioners filed two applications for review. Both the said applications for review were dismissed by the 928 Division Bench after considering all the points including certain additional grounds to the effect that certain contentions had not been dealt with earlier by the judgment dated October 9/10, 1985. The petitioners have not challenged the judgment of the High Court passed on the review applications. They have, however, filed before this Court the above two Special Leave Petitions. 463 of 1974 whereby the petitioners challenged the legality and validity of the said resolution dated 14.3.1974. We are of the view that the contention of the petitioners against the validity of the resolution is no longer tenable, regard being had to the fact that the draft revised development plan has since been published and the plan submitted by the respondent No. 2 is not inconsistent with the draft revised plan. In that view of the matter, Mr. Kalsekar also has not seriously pressed the validity of the said resolution. Accordingly, Special Leave Petition (Civil) No. So far as Special Leave Petition (Civil) No.17377 of 1985 is concerned, it has been strenuously urged by Mr. Kalsekar that in granting exemption to the respondent No. 5, the authority concerned has violated the relevant guidelines and also the provision of section 20 of the Urban Land Ceiling Act. Learned Counsel points out that one of the grounds for exemption is that 75,000 sq. of vacant land is available for the development of gardens. As a matter of fact, Counsel submits, it is not a vacant land, but contains 350 houses. It is submitted that granting exemption on the ground of availability of 75,000 sq. of open site for the purpose of gardens is a fraud on the Urban Land Ceiling Act. It is, accordingly, urged by the learned Counsel that the order granting exemption should be quashed. The above grounds of challenge to the order of exemption granted to the respondent No. 5 have all been considered by the High Court in its judgment disposing of the review applications. The petitioners have not challenged the judgment on review applications. The petitioners are only interested in seeing that sufficient area is kept reserved for a park or recreation ground for the benefit of the members of the public. They are not, in our opinion, concerned with the question as to the legality or otherwise of the exemption granted by the Government to the respondent No. A copy of the draft revised development plan has been produced before us by Mr. Desai, learned Counsel appearing on behalf of 929 the respondent No. We are satisfied that the question whether or not sufficient quantity of land has been kept reserved for park and recreation ground has been adequately considered and taken into account by the High Court. In the circumstances, we do not think that we are called upon to decide the legality or otherwise of the order granting exemption to the respondent No. There is, therefore no substance also in Special Leave Petition (Civil) No. In the result, the appeal and both the special leave petitions are dismissed. There will, however, be no order as to costs.
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% A piece of land had been purchased for the construction of a five star hotel.
In the sanctioned development plan the said land was shown in the residential zone and a contiguous parcel of land was shown as green belt.
When the plan was submitted to the Municipal Corporation for the construction of a five star hotel, the Commissioner rejected the plan on the ground that it was proposed to earmark the said land as a recreational ground with suitable internal network of roads during the revision of the development plan which was in the offing.
Aggrieved by the rejection, an appeal was preferred to the State Government under sec.
47 of the Maharashtra Regional and Town Planning Act, 1966.
The appeal was heard by the Minister of State for Urban Development.
The appellants herein, members of various ecological groups and rate payers of the Municipal Corporation, appeared and opposed saying that the land should be kept reserved for a green belt or recreational ground in the interest of the general public.
However, the Minister set aside the order of the Municipal Commissioner and directed the sanctioning of the plan on certain conditions.
The Municipal Corporation accepted the appellate order and did not challenge it.
But the appellants filed a Writ Petition challenging the legality of the order.
The writ petition was dismissed by the High Court.
The present appeal by special leave is against this dismissal.
Meanwhile the Municipal Corporation passed a resolution extending the park reservation by including the remaining area of the land in question.
By another resolution the first resolution was modified limiting the reservation for the park to 7,000 sq.
yards out of the dis 920 puted land.
Thereafter the State Government exempted the disputed land under section 20 of the Urban Land (Ceiling and Regulation) Act, 1976.
The resolutions and the order were challenged in the High Court.
The petitions were dismissed by a Single Judge of the High Court and later by the Division Bench on appeal.
The Review Petitions also met the same fate.
The petitioners have not challenged the judgment of the High Court passed on the review applications, but filed before this Court the two special leave petitions challenging the legality and validity of the two resolutions and the order of Government giving exemption under section 20 of the Urban Land (Ceiling and Regulation) Act.
Dismissing the appeal, and the special leave petitions, this Court, ^ HELD: 1.1 In allowing the appeal and directing sanction of the development plan, the Minister observed that in view of the clear provisions of sections 46 and 31(6) of the Act and having regard to the position that in the sanctioned plan of 1966, the said land was included in the residential zone and no proposal to exclude it therefrom in the draft revised development plan had been published, the Municipal Commissioner was not justified in rejecting the application for approval of the plan on the ground that the Bombay Municipal Corporation had decided to revise the 1966 Development Plan.
The Minister was of the view that the Planning Authority could only take into consideration any draft or final plan or proposal which had been published by means of notice, or sanctioned under the Act.
When Municipal Commissioner rejected the plan, there was no draft revised development plan in existence.
It was in contemplation.
If there had been such a plan, the Municipal Commissioner would be entitled to rely upon the same in rejecting the plan.
The Commissioner was not justified in merely relying upon a proposal for the preparation of a draft revised plan.
An order rejecting a development plan submitted by the owner of the land should be supported by some concrete material.
In the absence of any such material, it will be improper to reject the plan on the ground that there is a proposal for revision of the draft plan or that such a revision is under contemplation.
Therefore, the ground for rejecting the plan was not tenable and the appellate authority was justified in allowing the appeal.
[923H; 924A B, H; 925A C] 1.2 The Municipal Corporation has, subsequent to the judgment of the High Court, prepared and published a draft revised development plan.
The plan is not inconsistent with the draft revised development plan.
There is no material on record to show that the Municipal Corporation which is the Planning Authority, had prepared the draft revised 921 plan in accordance with the direction of the Minister.
The Minister has acted in public interest by imposing the conditions.
The conditions would show that considerable area out of the disputed land has been reserved for recreational ground or green belt.
The plan, as sanctioned with the conditions imposed, has been shown in the draft revised plan.
It was open to the Municipal Corporation to accept the verdict of the appellate authority and it has done so by not challenging it in the High Court or before this Court.
[926E H] 2.
The contention of the petitioners against the validity of the resolution is no longer tenable, regard being had to the fact that the draft revised development plan has since been published and the plan submitted and conditioned by the Minister is not inconsistent with the draft revised plan.
The petitioners have also not seriously pressed the validity of the said resolution.
[928C D] 3.
This Court is not called upon to decide the legality or otherwise of the order granting exemption.
These have been considered by the High Court in its judgment disposing of the review applications.
The petitioners have not challenged the judgment on review applications.
The petitioners are only interested in seeing that sufficient area is kept reserved for a park or recreation ground for the benefit of the members of the public, and are not concerned with the question as to the legality or otherwise of the exemption granted by the Government.
The question whether or not sufficient quantity of land has been kept reserved for park and recreation ground has been adequately considered and taken into account by the High Court.
[928G H; 929A]
|
% A piece of land had been purchased for the construction of a five star hotel. In the sanctioned development plan the said land was shown in the residential zone and a contiguous parcel of land was shown as green belt. When the plan was submitted to the Municipal Corporation for the construction of a five star hotel, the Commissioner rejected the plan on the ground that it was proposed to earmark the said land as a recreational ground with suitable internal network of roads during the revision of the development plan which was in the offing. Aggrieved by the rejection, an appeal was preferred to the State Government under sec. 47 of the Maharashtra Regional and Town Planning Act, 1966. The appeal was heard by the Minister of State for Urban Development. The Municipal Corporation accepted the appellate order and did not challenge it. But the appellants filed a Writ Petition challenging the legality of the order. The writ petition was dismissed by the High Court. The present appeal by special leave is against this dismissal. Meanwhile the Municipal Corporation passed a resolution extending the park reservation by including the remaining area of the land in question. By another resolution the first resolution was modified limiting the reservation for the park to 7,000 sq. The resolutions and the order were challenged in the High Court. The petitions were dismissed by a Single Judge of the High Court and later by the Division Bench on appeal. The Review Petitions also met the same fate. When Municipal Commissioner rejected the plan, there was no draft revised development plan in existence. If there had been such a plan, the Municipal Commissioner would be entitled to rely upon the same in rejecting the plan. The Commissioner was not justified in merely relying upon a proposal for the preparation of a draft revised plan. An order rejecting a development plan submitted by the owner of the land should be supported by some concrete material. [923H; 924A B, H; 925A C] 1.2 The Municipal Corporation has, subsequent to the judgment of the High Court, prepared and published a draft revised development plan. The plan is not inconsistent with the draft revised development plan. There is no material on record to show that the Municipal Corporation which is the Planning Authority, had prepared the draft revised 921 plan in accordance with the direction of the Minister. The Minister has acted in public interest by imposing the conditions. The conditions would show that considerable area out of the disputed land has been reserved for recreational ground or green belt. It was open to the Municipal Corporation to accept the verdict of the appellate authority and it has done so by not challenging it in the High Court or before this Court. The contention of the petitioners against the validity of the resolution is no longer tenable, regard being had to the fact that the draft revised development plan has since been published and the plan submitted and conditioned by the Minister is not inconsistent with the draft revised plan. The petitioners have also not seriously pressed the validity of the said resolution. This Court is not called upon to decide the legality or otherwise of the order granting exemption. The petitioners have not challenged the judgment on review applications. The question whether or not sufficient quantity of land has been kept reserved for park and recreation ground has been adequately considered and taken into account by the High Court.
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| 0.906791
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| 0.72648
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N: Criminal Appeal No. 580 of 1976.
From the Judgment and Order dated 10.10.1975 of the High Court of Punjab and Haryana in Criminal Miscellaneous No. 772 M of 1974.
R.S. Sodhi for the Appellant.
Gopal Subramaniam, Amicus Curiae for the Respondent.
The Judgment of the Court was delivered by NATARAJAN, J.
This appeal by certificate granted under Article 134(1)(c) of the Constitution is directed against the judgment of a Full Bench of the High Court of Punjab and Haryana in Raj Kumar, A.S.I. vs The State of Punjab, [1976] IV C.L.R. (Pb. & Har.) page 39 allowing a petition under Section 561(A) of the Code of Criminal Procedure 1898 filed by the respondent.
The objective in filing the appeal, it was conceded by Mr. R.S. Sodhi, learned counsel for the State is the determination of a larger issue transcending the narrow confines of the quashing of the criminal proceedings against the respondent viz. the construction of Rule 16.38 of the Punjab Police Rules and its applicability to criminal prosecutions launched against the members of the Punjab Police Service for offences under the Indian Penal Code and other Acts.
The controversy regarding the ambit of Rule 16.38 of the Punjab Police Rules has arisen in the following circumstances.
One Jamuna Devi Mukhtiar Kaur gave a report against the respondent, who was an Assistant Sub Inspector in the Punjab Police Service, to the Deputy Superintendent of Police, Patiala alleging command of illegal gratification of Rs.200 by him for releasing her husband and brother on bail bonds in a case pertaining to a land dispute.
A first information report was registered and a trap was laid for the respondent and he was apprehended as soon as the marked currency notes treated with phenolophthalene were handed over to him and the marked currency 939 notes were recovered from him.
After completion of investigation, the respondent was chargesheeted before the Special Judge, Sangrur.
The respondent appeared before the Special Judge and raised an objection to the framing of charges against him on the ground the investigation of the case was in contravention of Rule 16.38.
The Special Judge over ruled the objection and framed charges and posted the case for trial.
The respondent filed a petition before the High Court under Section 561(A) of the Criminal Procedure Code 1898, for quashing the proceedings against him before the Special Judge.
As there were conflicting decisions of the High Court in the interpretation of Rule 16.38, a learned Single Judge referred the matter to a Division Bench and in turn the Division Bench referred the matter to a Full Bench.
A Full Bench of the High Court reviewed the earlier decisions and held that Rule 16.38 is mandatory and not directory in character and secondly the mandate would govern criminal prosecutions as well as departmental enquiries in equal measure and as such any prosecution launched or departmental enquiry held in violation of the terms of the Rule would vitiate the proceedings concerned.
Having interpreted Rule 16.38 thus, the Full Bench noticed that the investigation against the respondent had not been done in accordance with Rule 16.38 and therefore the bench allowed the petition and quashed the charges framed against the respondent.
The High Court, however, granted a certificate under Article 134(1)(c) to the State to file an appeal to this Court and that is how the appeal is before us.
What, therefore, calls for consideration is whether the procedure prescribed in Rule 16.38 calls for observance in the case of departmental enquiries alone or whether it would govern criminal prosecutions also for offences under the Indian Penal Code and other Acts, and secondly whether the Rule is mandatory in character or only directory.
Our task has been considerably lightened by a pronouncement on the first question, with which we are primarily concerned, by another Bench of this Court in the State of Punjab vs Charan Singh, ; declaring that Rule 16.38 cannot govern criminal prosecutions against the members of the Police Force as it cannot over ride the provisions of the Criminal Procedure Code.
In spite of the said pronouncement, with which we are in respectful agreement, we feel it necessary to deal with the matter at some length because of certain misconceptions contained in the judgment of the High Court under appeal.
940 Before we advert to the decisions pertaining to Rule 16.38, we may refer to certain provisions of the and the Punjab Police Rules framed thereunder.
Section 3 of the , confers the right of superintendence of the Police Force throughout the general police district on the State Government and vests in such Government the right to exercise such powers in that behalf.
Section 7 deals with the appointment, dismissal, etc.
of inferior officers.
The Section lays down that the "Subject to the provisions of Article 311 of the Constitution, and to such Rules as the State Government may from time to time make under this Act, the Inspector General, Deputy Inspector General, Asstt.
Inspector General and District Superintendents of Police may at any time dismiss, suspend or reduce any police officer of the subordinate ranks whom they shall think remiss or negligent in the discharge of his duty or unfit for the same" or to award any of the lesser punishments prescribed under clauses (a) (b) (c) (d) for discharge of duty in a careless or negligent manner etc.
Besides the power conferred on the State Government to make Rules under Section 7, there is also provision under Section 12 for the Inspector General of Police, subject to the approval of the State Government, to frame such orders and rules as he shall deem expedient relative to the organisation, classification and distribution of police force, the places at which the members of the police force shall reside, the services to be performed by them etc.
for ensuring the efficiency of the police force in the discharge of its duties.
It is in exercise of the powers conferred by Sections 7 and 12 of the that the Punjab Police Rules 1934 have been framed.
The Rules have been categorised under 28 Chapters for dealing with various matters such as organisational setup, uniforms, arms and ammunition, leave, pension, promotions, rewards, punishments, training, supervision, investigation, prosecution etc.
The matters covered by the Rules make it clear that the Rules have been framed for regulating the set up and the service conditions of the police force as well as for awarding them rewards and departmental punishments and other matters of internal administration for keeping efficient and disciplined one.
It is in that perspective Rule 38 of Chapter 16 has to be viewed.
The very first Rule in Chapter 16 sets out the scope and purpose of the Rule comprised in that chapter.
Rules 16.1 reads as follows: "(1) No police officer shall be departmentally punished otherwise than as provided in these rules; (2) The departmental punishments mentioned in the second 941 column of the subjoined table may be inflicted on officers of the various ranks shown in the heading Nos.
3 to 9, by the officers named below each heading in each case, or by any officer of higher ranks".
(Emphasis supplied) Rule 16.38 with which we are concerned, contains 7 sub clauses.
For our purpose it is enough if we extract sub clauses.
1 to 4 and refer in general terms to the contents of Clauses 5 to 7.
"16.38(1) Immediate information shall be given to the District Magistrate or any complaint received by the Superintendent of Police, which indicates the commission by a police officer of a criminal offence in connection with his official relations with the public.
The District Magistrate will decide whether the investigation of the complaint shall be conducted by a police officer, or made over to a selected magistrate having 1st class powers.
(2) When investigation of such a complaint establishes a prima facie case, a judicial prosecution shall normally follow; the matter shall be disposed of departmentally only if the District Magistrate so orders for reasons to be recorded.
When it is decided to proceed departmentally the procedure prescribed in rule 16.38 shall be followed.
An officer found guilty on a charge of the nature referred to in this rule shall ordinarily be dismissed.
(3) Ordinarily a magistrate before whom a complaint against a police officer if laid proceeds at once to judicial enquiry.
He is, however, required to report details of the case to the District Magistrate, who will forward a copy of this report to the Superintendent of Police.
The District Magistrate himself will similarly send a report to the Superintendent of Police in cases of which he himself takes cognizance.
(4) The Local Government has prescribed the following supplimentary procedure to be adopted in the case of complaints against police officers in those districts where abuses of the law with the object of victimising such officers or hampering investigation is rife.
The District Magistrate will order that all petitions against police officers shall be 942 presented to him personally.
If he considers that these petitions are of a frivolous or factious nature, it is within his discretion to take no action on them.
When he considers an enquiry to be necessary he will use his discretion whether to send the papers to the Superintendent of Police or to a magistrate for judicial enquiry.
In the case of formal criminal complaints, the District Magistrate will arrange for all cases to be transferred from other courts to his own.
Clauses 5 to 7 relate to strictures passed by the High Court and other courts against police officers and the manner of communication of the strictures to the District Magistrate and the Government.
Different interpretations were given by different Benches of the High Court of Punjab and Haryana regarding the scope and force of rule 16.38.
In Criminal Revision No. 1100 of 1972 (Amarjit Singh vs State of Punjab) H.R. Sharma, J. held that Rule 16.38 debarred criminal proceedings if the same had been instituted without a prior sanction of the District Magistrate.
In Ram Prakash, Asstt.
Sub Inspector vs The State, [1974] Chandigarh Law Reporter 205 Gurnam Singh, J. took a diametrically opposite view.
In Hoshiar Singh vs The State, a Division Bench of the High Court held that Rule 16.38 was attrected in the case of departmental enquiries only and the departmental enquiry would be vitiated if the papers had not been produced before the District Magistrate for getting his sanction at the initial stage.
In Nand Singh vs The Superintendent of Police and another, Current Law Journal(Pb)146 it was held that the Rule was mandatory.
The said view was affirmed by a Full Bench in Nand Mandan Sarup vs The District Magistrate and others, [1966] Current Law Journal (Pb) 608.
It was in that backdrop of conflicting decisions, the petition filed by the respondent herein under Section 561(A) for quashing of the proceedings against him before the Special Judge came to be referred to a Full Bench.
The reasoning of the Full Bench for allowing the respondent 's petition can be summarised thus: "The vests the right of superintendence of the police force in a State on the State Government.
Section 7 of the empowers the State Government to frame rules regarding disciplinary matters and Section 12 em 943 powers the Inspector General of Police, subject to the approval of the State Government, to frame orders and rules relating to the organisation, classification and distribution of the police force, the services to be performed by them etc.
" Hence the rules framed in exercise of powers conferred under section 7 and 12 have the force of law and they constitute a special legislation which takes precedence over the provisions of the Criminal Procedure Code.
Section 4 of the inter alia lays down that the administration of the police, within the jurisdiction of a District Magistrate, shall under his general control and direction, be vested in a District Superintendent and Assistant District Superintendents as the Government may appoint.
Consequently, the District Magistrate has statutory authority to exercise control over the administration of the police force in his District including the launching of criminal prosecutions or holding of Departmental enquiries against a member of the police force.
Rule 16.38 contains a mandatory provision regarding the procedure to be followed when any complaint is received by the Superintendent of Police against a member of the police force regarding the commission of an offence by him in connection with his official relations with the public.
The said rule will apply with equal force to investigations relating to criminal offences for which a prosecution is to be launched as it would to enquiries for taking departmental action through disciplinary proceedings.
On the basis of such reasoning, the Full Bench over ruled the decision in Hoshiar Singh vs State of Punjab (supra).
We will now refer to the decision in Hoshiar Singh (supra), since it has been approved by this Court in State of Punjab vs Charan Singh (supra), and then advert to some decisions of this Court relevant for consideration.
In that case a Sub Inspector of Police was challaned under Section 5(2) of the Prevention of Corruption Act and Section 161, Indian Penal Code and was suspended from service and chargesheeted and thereafter a departmental enquiry followed.
When a show cause notice was served on him on the conclusion of the enquiry intimating him the proposed punishment, he objected to the legality of the enquiry on the ground that no permission of the District Magistrate in accordance with Rule 16.38 of the Punjab Police Rules had been obtained.
The objection was sustained and the departmental enquiry was quashed.
Thereafter, the challan was put into Court and 944 once again an objection was raised that in the absence of a reference to the District Magistrate and his orders thereon directing prosecution, the Special Judge could not take cognizance of the case.
The Special Judge over ruled the objection holding that his powers under the Criminal Law (Amendment) Act were not trammelled by the Punjab Police Rules.
A criminal revision was filed before the High Court against the order of the Special Judge and the High Court dismissed the criminal revision holding thus: "I do not think Rule 16.38 was intended or could have the effect of imposing as a condition precedent to the trial of a police officer in a Court of Law, a sanction or an order by the District Magistrate, as contemplated therein.
The language appears to me to be confined only to departmental enquiries.
The investigation for establishing a prima facie case is merely meant to guide the District Magistrate, uncontrolled by the opinion of the Superintendent of Police, whether or not a departmental proceeding should be initiated against the guilty party, and it is the procedure and the punishment controlling the departmental proceedings alone, which appear to have been prescribed by this rule.
" In Delhi Administration vs Chanan Shah, [1969] 3 S.C.R. 653 an Asstt.
Sub Inspector was censured, after summary enquiry for having received illegal gratification in a case he was investigating.
The Deputy Inspector General of Police revoked the order of censure and directed departmental action being taken.
The departmental enquiry culminated in an order of dismissal against Chanan Shah.
An appeal and revision to the higher authorities having failed, Chanan Shah filed a writ petition which was dismissed by a Single Judge but allowed in writ appeal by a Division Bench and the order of dismissal was quashed.
The Delhi Administration came in appeal to this Court and this Court held that irrespective of whether Rule 16.38 is mandatory or directory, the authorities had failed to substantially comply with the provisions of the Rule and, therefore, the laches vitiated the departmental enquiry.
The same view was taken in a later case Union of India vs Ram Kishan, ; which related to the dismissal of a constable from service pursuant to a disciplinary enquiry being set aside in a civil suit filed by the dismissed constable.
The decree of the Trial Court was affirmed by the Appellate Court and the High Court and in further appeal to this Court, it was held that as no immediate information was given to the District Magistrate in respect of the complaint received 945 against the plaintiff (constable) and secondly since the District Magistrate has also not decided whether the investigating agency should be a police officer or a magistrate, as prescribed by Rule 16.38, the departmental enquiry was vitiated and, therefore, the plaintiff 's suit had been rightly decreed.
In State of Uttar Pradesh vs Babu Ram Upadhya, ; the view taken by the majority of the Bench was that paragraph 486 Rule 1 of U.P. Police Rules was mandatory in character and hence the departmental action taken against the respondent police officer in disregard of the rule was invalid.
It may be noticed that the three decisions of this Court which have been referred to above related to departmental enquiries and not criminal prosecutions for offences committed by the delinquent police officers.
The pronouncements in these cases will therefore govern only cases where departmental enquiries are held in contravention of the procedure prescribed by the Police Rules.
The reason for a special procedure being prescribed in the Rules for investigations before departmental enquiries are held against delinquent police officers is not far off to see.
In the very nature of their duties, the members of the police force would often stand exposed to criticism and complaints by not only the members of the public but also by the members of the force themselves and consequently they stand placed more vulnerable than members of other Government services, of being implicated in false or exaggerated charges.
In order to protect them from false implications and resultant proceedings, the Government had thought it necessary to have an initial screening of the complaints received against members of the police force by the District Magistrate.
Such screening would however extend only to matters which fall within the zone of departmental action and it could never extend to cases where the offences alleged to have been committed would attract investigation under the Criminal Procedure Code in the same manner the investigation would be attracted if the offences complained of had been committed by any member of the public.
That the procedure prescribed in Rule 16.38 has only a limited field of operation i.e. applicable only to departmental enquiries and punishments could be seen from the fact that clause 3 of the Rule enjoins every Magistrate to whom a complaint against a police officer is referred by the District Magistrate for judicial enquiry to report the details of the case to the District Magistrate in order to enable the District Magistrate to forward the report to the Superintendent of Police.
The clause further says that if the District Magistrate himself takes congnizance of a case, he should of his own accord send a report to the Superintendent of Police.
Clause IV of Rule 16.38 also throws light on the matter and brings out the 946 objective in greater clarity.
This clause sets out that in order to protect the interests of police officers serving in districts where petition mongering activities are notorious, the District Magistrate can direct that all petitions complaining about police officers shall be presented to him personally so that he can scrutinize them to find out whether the petitions are of a frivolous nature or they have been engineered by factious groups in the districts etc.
In fact, the words used in the clause are of a tell tale nature viz. "complaints against police officers in those districts were abuses of law with the object of victimising such officers or hampering investigation is rife.
" All these features make it clear that the purpose underlying the rule is to enable the District Magistrate and the District Superintendent of Police to exercise personal control and supervision over the complaints received against members of the police force in the performance of their duties and enable the District Magistrate to ensure that the complaint is not a baseless or mala fide one and secondly to determine whether the complaint requires investigation by a police officer or by a selected magistrate.
The procedure envisaged by the Rule is for effective check being exercised against victimisation of efficient and honest police officers on the one hand and favouritism being shown to the delinquent police officers on the other.
These rules were not intended to replace and certainly cannot over ride the provisions of the Criminal Procedure Code.
The Full Bench was therefore in error in taking the view that the Rules lay down a special procedure for investigation of all offences committed by the members of the police force and, that they have over riding effect over the provisions of the Criminal Procedure Code in terms of Sections 4 and 5 of the Code.
We may now refer to some other decisions where it has been laid down that the provisions of the cannot prevail over the provisions of the Indian Penal Code.
In Maulud Ahmad vs State of U.P., [1963] (Supp) 2 S.C.R. 38, the appellant who was a head constable contended that the prosecution launched against him was barred by limitation under Section 42 of the because the prosecution had been launched beyond the period of three months prescribed by Section 42.
The contention was rejected and it was pointed out that the period of three months prescribed under Section 42 for commencing a prosecution would govern only prosecutions of a police officer for something done or intended to be done by him under the provisions of the or under general police powers given by the Act and Section 42 would not apply to prosecutions against a police officer for anything done under the provisions of any other Act or under 947 Police powers conferred under any other Act.
It was also brought to focus that Section 36 of the explicitely provides that nothing contained in the said Act shall be construed to prevent any person from being prosecuted under any Regulation or Act for any offence made punishable by the Act or for being liable under any other Regulation or Act or any other or higher penalty or punishment that is provided for such offence by the .
The above ratio was followed in Ajaid Singh vs Joginder Singh, ; In yet another case viz. S.N. Sharma vs Bipen Kumar Tiwari & Ors., it was held that the power of the police to investigate a cognizable offence is uncontrolled by the Magistrate and it is only in cases where the police decided not to investigate the case that the Magistrate can intervene and either direct an investigation, or in the alternative himself proceed or depute a Magistrate subordinate to him to proceed to enquire into the case and that the powers of the police to investigate have been made independent of any control by the Magistrate.
Lastly, we come to the decision in the State of Punjab vs Charan Singh (supra) where the identical question under consideration had come up for determination by this Court.
The respondent therein was convicted by the Special Judge, Ludhiana of an offence under Section 5(1)(d) read with Section 5(2) of the Prevention of Corruption Act and sentence to suffer rigorous imprisonment for a period of one year and to pay a fine of Rs. 100.
On appeal, a Single Judge of the High Court acquitted the respondent on the ground the prosecution was vitiated by reason of non compliance with the provisions of Rule 16.38 of the Punjab Police Rules, 1934.
In the appeal preferred by the State, this Court allowed the appeal and held as follows: "A perusal of Chapter XVI of the Punjab Police Rules shows that the provisions of the Chapter deal with departmental punishments and the procedure to be followed in imposing such punishments.
Guidance is given as to how police officers guilty of misconduct and criminal offences may be dealt with . . .It is clear that Rule 16.38 is not designed to be a condition precedent to the launching of a prosecution in a criminal court; it is in the nature of instructions of the department and is not meant to be of the nature of a sanction or permission for a prosecution nor can it over ride the provisions of the Cr.
P.C. and the Prevention of Corruption Act.
We agree with the observations of Dua and Mahajan, JJ in Hoshiar Singh vs State (supra).
" 948 Though the decision of the Full Bench of the Punjab High Court which is now under consideration had not been brought to the notice of the Learned Judges when they rendered judgment in State of Punjab vs Charan Singh, we are in full agreement with the pronouncement of the Bench as the conclusion therein accords with our own conclusion and the reasons therefore.
We therefore hold that the Full Bench was in error in taking the view that the Punjab Police Rules read in conjunction with the prescribe a different procedure for the investigation and prosecution of offences committed by Police officers under the I.P.C. or other Acts in connection with their relations with the public and that the rules constitute a special statute and take precedence over the provisions of the Cr.
The Full Bench has failed to note that Rule 16.38 only mandates the investigation of cases pertaining to departmental enquiries and the holding of departmental enquiries in accordance with the procedure prescribed thereunder.
We therefore hold that the decision of the Full Bench under appeal in Raj Kumar, A.S.I. vs The State of Punjab (supra) is not in accordance with law and has to be set aside.
However, as mentioned at the outset, the State is not interested in reviving the charges against the respondent and pursuing the trial because of the long lapse of time.
Therefore, while allowing the appeal and setting aside the judgment of the High Court, we leave undisturbed the quashing of the charges framed against the respondent.
Since the respondent did not enter appearance or engage a counsel to contest the appeal in spite of the notice served on him, we requested Mr. Gopal Subramaniam, Advocate, to act as amicus curiae and render assistance to the Court on behalf of the respondent.
Mr. Gopal Subramaniam readily complied with our request and placed all the authorities for our consideration and we thank him for his assistance and place on record our appreciation of the services rendered by him.
H.S.K. Appeal allowed.
|
% The respondent was apprehended while taking bribe.
Investigation was held and the respondent was chargesheeted before the Special Judge.
The respondent raised an objection to the framing of charges against him on the ground that the investigation of the case was in contravention of rule 16.38 of the Punjab Police Rules.
The Special Judge overruled the objection and framed charges and posted the case for trial.
The respondent filed a petition before the High Court under section 561(A) of the Code of Criminal Procedure, 1898, for quashing the proceedings against him before the Special Judge.
A full bench of the High Court held that rule 16.38 is mandatory and not directory in character and that the mandate would govern criminal prosecution as well as departmental inquiries in equal measure.
The full bench having noticed that the investigation against the respondent had not been done in accordance with rule 16.38 allowed the petition and quashed the charges framed against the respondent.
Hence this appeal filed by certificate issued by the High Court.
Allowing the appeal and setting aside the High Court 's judgment this Court, ^ HELD: The procedure prescribed in rule 16.38 has only a limited field of operation that is applicable only to departmental inquiries and punishments.
This could be seen from the fact that clause 3 of the rule enjoins every Magistrate to whom a complaint against a police officer is referred by the District Magistrate for judicial enquiry to report the details of the case to the District Magistrate in order to enable the District Magistrate to forward the report to the Superintendent of Police.
The clause further says that if the District Magistrate himself takes cognizance of a case he should of his own accord send a report to 937 the Superintendent of Police.
Clause IV of rule 16.38 also throws light on the matter and brings out the objective in greater clarity.
This clause sets out that in order to protect the interest of police officers serving in districts where petition mongering activities are notorious, the District Magistrate can direct that all petitions complaining about police officers shall be presented to him personally so that he can scrutinize them to find out whether the petitions are of a frivolous nature or they have been engineered by factious groups in the districts etc.
In fact, the words used in the clause are of a tell tale nature viz. "complaints against police officers in those districts where abuses of law with the object of victimising such officers or hampering investigation is rife.
" [945F H; 946A B] The purpose underlying the rule is to enable the District Magistrate and the District Superintendent of Police to exercise personal control and supervision over the complaints received against members of the police force in the performance of their duties and enable the District Magistrate to ensure that the complaint is not a baseless or mala fide one and secondly to determine whether the complaint requires investigation by a police officer or by a selected Magistrate.
The procedure envisaged by the rule is for effective check being exercised against victimisation of efficient and honest police officers on the one hand and favouritism being shown to the delinquent police officers on the other.
These rules were not intended to replace and certainly cannot over ride the provisions of the Criminal Procedure Code.
[946C E] In the instant case the Full Bench was in error in taking the view that the Punjab Police Rules read in conjunction with the Police Act prescribe a different procedure for the investigation and prosecution of offences committed by Police Officer under the I.P.C. or other Acts in connection with their relations with the public and that the rules constitute a special statute and take precedence over the provisions of the Cr.
The Full Bench has failed to note that Rule 16.38 only mandates the investigation of cases pertaining to departmental enquiries and the holding of departmental enquiries in accordance with the procedure prescribed thereunder.[948B C] Raj Kumar, A. section I. vs The State of Punjab, [1976] IV CLR (Pb. & Har.) page 39, overruled.
State of Punjab vs Charan Singh, ; , referred to/agreed to.
Delhi Administration vs Chanan Shah, [1969] 3 S.C.R. 653; 938 Union of India vs Ram Kishan, ; ; State of Uttar Pradesh vs Babu Ram Upadhya, ; ; Maulud Ahmad vs State of U.P., [1963] (Supp.) 2 S.C.R. 38; Ajaib Singh vs Joginder Singh, ; and S.N. Sharma vs Bipan Kumar Tiwari & Ors.
,[1970] 1 S.C.C. 653, referred to.
|
N: Criminal Appeal No. 580 of 1976.
From the Judgment and Order dated 10.10.1975 of the High Court of Punjab and Haryana in Criminal Miscellaneous No. 772 M of 1974.
R.S. Sodhi for the Appellant.
Gopal Subramaniam, Amicus Curiae for the Respondent.
The Judgment of the Court was delivered by NATARAJAN, J.
This appeal by certificate granted under Article 134(1)(c) of the Constitution is directed against the judgment of a Full Bench of the High Court of Punjab and Haryana in Raj Kumar, A.S.I. vs The State of Punjab, [1976] IV C.L.R. (Pb. & Har.) page 39 allowing a petition under Section 561(A) of the Code of Criminal Procedure 1898 filed by the respondent.
The objective in filing the appeal, it was conceded by Mr. R.S. Sodhi, learned counsel for the State is the determination of a larger issue transcending the narrow confines of the quashing of the criminal proceedings against the respondent viz. the construction of Rule 16.38 of the Punjab Police Rules and its applicability to criminal prosecutions launched against the members of the Punjab Police Service for offences under the Indian Penal Code and other Acts.
The controversy regarding the ambit of Rule 16.38 of the Punjab Police Rules has arisen in the following circumstances.
One Jamuna Devi Mukhtiar Kaur gave a report against the respondent, who was an Assistant Sub Inspector in the Punjab Police Service, to the Deputy Superintendent of Police, Patiala alleging command of illegal gratification of Rs.200 by him for releasing her husband and brother on bail bonds in a case pertaining to a land dispute.
A first information report was registered and a trap was laid for the respondent and he was apprehended as soon as the marked currency notes treated with phenolophthalene were handed over to him and the marked currency 939 notes were recovered from him.
After completion of investigation, the respondent was chargesheeted before the Special Judge, Sangrur.
The respondent appeared before the Special Judge and raised an objection to the framing of charges against him on the ground the investigation of the case was in contravention of Rule 16.38.
The Special Judge over ruled the objection and framed charges and posted the case for trial.
The respondent filed a petition before the High Court under Section 561(A) of the Criminal Procedure Code 1898, for quashing the proceedings against him before the Special Judge.
As there were conflicting decisions of the High Court in the interpretation of Rule 16.38, a learned Single Judge referred the matter to a Division Bench and in turn the Division Bench referred the matter to a Full Bench.
A Full Bench of the High Court reviewed the earlier decisions and held that Rule 16.38 is mandatory and not directory in character and secondly the mandate would govern criminal prosecutions as well as departmental enquiries in equal measure and as such any prosecution launched or departmental enquiry held in violation of the terms of the Rule would vitiate the proceedings concerned.
Having interpreted Rule 16.38 thus, the Full Bench noticed that the investigation against the respondent had not been done in accordance with Rule 16.38 and therefore the bench allowed the petition and quashed the charges framed against the respondent.
The High Court, however, granted a certificate under Article 134(1)(c) to the State to file an appeal to this Court and that is how the appeal is before us.
What, therefore, calls for consideration is whether the procedure prescribed in Rule 16.38 calls for observance in the case of departmental enquiries alone or whether it would govern criminal prosecutions also for offences under the Indian Penal Code and other Acts, and secondly whether the Rule is mandatory in character or only directory.
Our task has been considerably lightened by a pronouncement on the first question, with which we are primarily concerned, by another Bench of this Court in the State of Punjab vs Charan Singh, ; declaring that Rule 16.38 cannot govern criminal prosecutions against the members of the Police Force as it cannot over ride the provisions of the Criminal Procedure Code.
In spite of the said pronouncement, with which we are in respectful agreement, we feel it necessary to deal with the matter at some length because of certain misconceptions contained in the judgment of the High Court under appeal.
940 Before we advert to the decisions pertaining to Rule 16.38, we may refer to certain provisions of the and the Punjab Police Rules framed thereunder.
Section 3 of the , confers the right of superintendence of the Police Force throughout the general police district on the State Government and vests in such Government the right to exercise such powers in that behalf.
Section 7 deals with the appointment, dismissal, etc.
of inferior officers.
The Section lays down that the "Subject to the provisions of Article 311 of the Constitution, and to such Rules as the State Government may from time to time make under this Act, the Inspector General, Deputy Inspector General, Asstt.
Inspector General and District Superintendents of Police may at any time dismiss, suspend or reduce any police officer of the subordinate ranks whom they shall think remiss or negligent in the discharge of his duty or unfit for the same" or to award any of the lesser punishments prescribed under clauses (a) (b) (c) (d) for discharge of duty in a careless or negligent manner etc.
Besides the power conferred on the State Government to make Rules under Section 7, there is also provision under Section 12 for the Inspector General of Police, subject to the approval of the State Government, to frame such orders and rules as he shall deem expedient relative to the organisation, classification and distribution of police force, the places at which the members of the police force shall reside, the services to be performed by them etc.
for ensuring the efficiency of the police force in the discharge of its duties.
It is in exercise of the powers conferred by Sections 7 and 12 of the that the Punjab Police Rules 1934 have been framed.
The Rules have been categorised under 28 Chapters for dealing with various matters such as organisational setup, uniforms, arms and ammunition, leave, pension, promotions, rewards, punishments, training, supervision, investigation, prosecution etc.
The matters covered by the Rules make it clear that the Rules have been framed for regulating the set up and the service conditions of the police force as well as for awarding them rewards and departmental punishments and other matters of internal administration for keeping efficient and disciplined one.
It is in that perspective Rule 38 of Chapter 16 has to be viewed.
The very first Rule in Chapter 16 sets out the scope and purpose of the Rule comprised in that chapter.
Rules 16.1 reads as follows: "(1) No police officer shall be departmentally punished otherwise than as provided in these rules; (2) The departmental punishments mentioned in the second 941 column of the subjoined table may be inflicted on officers of the various ranks shown in the heading Nos.
3 to 9, by the officers named below each heading in each case, or by any officer of higher ranks".
(Emphasis supplied) Rule 16.38 with which we are concerned, contains 7 sub clauses.
For our purpose it is enough if we extract sub clauses.
1 to 4 and refer in general terms to the contents of Clauses 5 to 7.
"16.38(1) Immediate information shall be given to the District Magistrate or any complaint received by the Superintendent of Police, which indicates the commission by a police officer of a criminal offence in connection with his official relations with the public.
The District Magistrate will decide whether the investigation of the complaint shall be conducted by a police officer, or made over to a selected magistrate having 1st class powers.
(2) When investigation of such a complaint establishes a prima facie case, a judicial prosecution shall normally follow; the matter shall be disposed of departmentally only if the District Magistrate so orders for reasons to be recorded.
When it is decided to proceed departmentally the procedure prescribed in rule 16.38 shall be followed.
An officer found guilty on a charge of the nature referred to in this rule shall ordinarily be dismissed.
(3) Ordinarily a magistrate before whom a complaint against a police officer if laid proceeds at once to judicial enquiry.
He is, however, required to report details of the case to the District Magistrate, who will forward a copy of this report to the Superintendent of Police.
The District Magistrate himself will similarly send a report to the Superintendent of Police in cases of which he himself takes cognizance.
(4) The Local Government has prescribed the following supplimentary procedure to be adopted in the case of complaints against police officers in those districts where abuses of the law with the object of victimising such officers or hampering investigation is rife.
The District Magistrate will order that all petitions against police officers shall be 942 presented to him personally.
If he considers that these petitions are of a frivolous or factious nature, it is within his discretion to take no action on them.
When he considers an enquiry to be necessary he will use his discretion whether to send the papers to the Superintendent of Police or to a magistrate for judicial enquiry.
In the case of formal criminal complaints, the District Magistrate will arrange for all cases to be transferred from other courts to his own.
Clauses 5 to 7 relate to strictures passed by the High Court and other courts against police officers and the manner of communication of the strictures to the District Magistrate and the Government.
Different interpretations were given by different Benches of the High Court of Punjab and Haryana regarding the scope and force of rule 16.38.
In Criminal Revision No. 1100 of 1972 (Amarjit Singh vs State of Punjab) H.R. Sharma, J. held that Rule 16.38 debarred criminal proceedings if the same had been instituted without a prior sanction of the District Magistrate.
In Ram Prakash, Asstt.
Sub Inspector vs The State, [1974] Chandigarh Law Reporter 205 Gurnam Singh, J. took a diametrically opposite view.
In Hoshiar Singh vs The State, a Division Bench of the High Court held that Rule 16.38 was attrected in the case of departmental enquiries only and the departmental enquiry would be vitiated if the papers had not been produced before the District Magistrate for getting his sanction at the initial stage.
In Nand Singh vs The Superintendent of Police and another, Current Law Journal(Pb)146 it was held that the Rule was mandatory.
The said view was affirmed by a Full Bench in Nand Mandan Sarup vs The District Magistrate and others, [1966] Current Law Journal (Pb) 608.
It was in that backdrop of conflicting decisions, the petition filed by the respondent herein under Section 561(A) for quashing of the proceedings against him before the Special Judge came to be referred to a Full Bench.
The reasoning of the Full Bench for allowing the respondent 's petition can be summarised thus: "The vests the right of superintendence of the police force in a State on the State Government.
Section 7 of the empowers the State Government to frame rules regarding disciplinary matters and Section 12 em 943 powers the Inspector General of Police, subject to the approval of the State Government, to frame orders and rules relating to the organisation, classification and distribution of the police force, the services to be performed by them etc.
" Hence the rules framed in exercise of powers conferred under section 7 and 12 have the force of law and they constitute a special legislation which takes precedence over the provisions of the Criminal Procedure Code.
Section 4 of the inter alia lays down that the administration of the police, within the jurisdiction of a District Magistrate, shall under his general control and direction, be vested in a District Superintendent and Assistant District Superintendents as the Government may appoint.
Consequently, the District Magistrate has statutory authority to exercise control over the administration of the police force in his District including the launching of criminal prosecutions or holding of Departmental enquiries against a member of the police force.
Rule 16.38 contains a mandatory provision regarding the procedure to be followed when any complaint is received by the Superintendent of Police against a member of the police force regarding the commission of an offence by him in connection with his official relations with the public.
The said rule will apply with equal force to investigations relating to criminal offences for which a prosecution is to be launched as it would to enquiries for taking departmental action through disciplinary proceedings.
On the basis of such reasoning, the Full Bench over ruled the decision in Hoshiar Singh vs State of Punjab (supra).
We will now refer to the decision in Hoshiar Singh (supra), since it has been approved by this Court in State of Punjab vs Charan Singh (supra), and then advert to some decisions of this Court relevant for consideration.
In that case a Sub Inspector of Police was challaned under Section 5(2) of the Prevention of Corruption Act and Section 161, Indian Penal Code and was suspended from service and chargesheeted and thereafter a departmental enquiry followed.
When a show cause notice was served on him on the conclusion of the enquiry intimating him the proposed punishment, he objected to the legality of the enquiry on the ground that no permission of the District Magistrate in accordance with Rule 16.38 of the Punjab Police Rules had been obtained.
The objection was sustained and the departmental enquiry was quashed.
Thereafter, the challan was put into Court and 944 once again an objection was raised that in the absence of a reference to the District Magistrate and his orders thereon directing prosecution, the Special Judge could not take cognizance of the case.
The Special Judge over ruled the objection holding that his powers under the Criminal Law (Amendment) Act were not trammelled by the Punjab Police Rules.
A criminal revision was filed before the High Court against the order of the Special Judge and the High Court dismissed the criminal revision holding thus: "I do not think Rule 16.38 was intended or could have the effect of imposing as a condition precedent to the trial of a police officer in a Court of Law, a sanction or an order by the District Magistrate, as contemplated therein.
The language appears to me to be confined only to departmental enquiries.
The investigation for establishing a prima facie case is merely meant to guide the District Magistrate, uncontrolled by the opinion of the Superintendent of Police, whether or not a departmental proceeding should be initiated against the guilty party, and it is the procedure and the punishment controlling the departmental proceedings alone, which appear to have been prescribed by this rule.
" In Delhi Administration vs Chanan Shah, [1969] 3 S.C.R. 653 an Asstt.
Sub Inspector was censured, after summary enquiry for having received illegal gratification in a case he was investigating.
The Deputy Inspector General of Police revoked the order of censure and directed departmental action being taken.
The departmental enquiry culminated in an order of dismissal against Chanan Shah.
An appeal and revision to the higher authorities having failed, Chanan Shah filed a writ petition which was dismissed by a Single Judge but allowed in writ appeal by a Division Bench and the order of dismissal was quashed.
The Delhi Administration came in appeal to this Court and this Court held that irrespective of whether Rule 16.38 is mandatory or directory, the authorities had failed to substantially comply with the provisions of the Rule and, therefore, the laches vitiated the departmental enquiry.
The same view was taken in a later case Union of India vs Ram Kishan, ; which related to the dismissal of a constable from service pursuant to a disciplinary enquiry being set aside in a civil suit filed by the dismissed constable.
The decree of the Trial Court was affirmed by the Appellate Court and the High Court and in further appeal to this Court, it was held that as no immediate information was given to the District Magistrate in respect of the complaint received 945 against the plaintiff (constable) and secondly since the District Magistrate has also not decided whether the investigating agency should be a police officer or a magistrate, as prescribed by Rule 16.38, the departmental enquiry was vitiated and, therefore, the plaintiff 's suit had been rightly decreed.
In State of Uttar Pradesh vs Babu Ram Upadhya, ; the view taken by the majority of the Bench was that paragraph 486 Rule 1 of U.P. Police Rules was mandatory in character and hence the departmental action taken against the respondent police officer in disregard of the rule was invalid.
It may be noticed that the three decisions of this Court which have been referred to above related to departmental enquiries and not criminal prosecutions for offences committed by the delinquent police officers.
The pronouncements in these cases will therefore govern only cases where departmental enquiries are held in contravention of the procedure prescribed by the Police Rules.
The reason for a special procedure being prescribed in the Rules for investigations before departmental enquiries are held against delinquent police officers is not far off to see.
In the very nature of their duties, the members of the police force would often stand exposed to criticism and complaints by not only the members of the public but also by the members of the force themselves and consequently they stand placed more vulnerable than members of other Government services, of being implicated in false or exaggerated charges.
In order to protect them from false implications and resultant proceedings, the Government had thought it necessary to have an initial screening of the complaints received against members of the police force by the District Magistrate.
Such screening would however extend only to matters which fall within the zone of departmental action and it could never extend to cases where the offences alleged to have been committed would attract investigation under the Criminal Procedure Code in the same manner the investigation would be attracted if the offences complained of had been committed by any member of the public.
That the procedure prescribed in Rule 16.38 has only a limited field of operation i.e. applicable only to departmental enquiries and punishments could be seen from the fact that clause 3 of the Rule enjoins every Magistrate to whom a complaint against a police officer is referred by the District Magistrate for judicial enquiry to report the details of the case to the District Magistrate in order to enable the District Magistrate to forward the report to the Superintendent of Police.
The clause further says that if the District Magistrate himself takes congnizance of a case, he should of his own accord send a report to the Superintendent of Police.
Clause IV of Rule 16.38 also throws light on the matter and brings out the 946 objective in greater clarity.
This clause sets out that in order to protect the interests of police officers serving in districts where petition mongering activities are notorious, the District Magistrate can direct that all petitions complaining about police officers shall be presented to him personally so that he can scrutinize them to find out whether the petitions are of a frivolous nature or they have been engineered by factious groups in the districts etc.
In fact, the words used in the clause are of a tell tale nature viz. "complaints against police officers in those districts were abuses of law with the object of victimising such officers or hampering investigation is rife.
" All these features make it clear that the purpose underlying the rule is to enable the District Magistrate and the District Superintendent of Police to exercise personal control and supervision over the complaints received against members of the police force in the performance of their duties and enable the District Magistrate to ensure that the complaint is not a baseless or mala fide one and secondly to determine whether the complaint requires investigation by a police officer or by a selected magistrate.
The procedure envisaged by the Rule is for effective check being exercised against victimisation of efficient and honest police officers on the one hand and favouritism being shown to the delinquent police officers on the other.
These rules were not intended to replace and certainly cannot over ride the provisions of the Criminal Procedure Code.
The Full Bench was therefore in error in taking the view that the Rules lay down a special procedure for investigation of all offences committed by the members of the police force and, that they have over riding effect over the provisions of the Criminal Procedure Code in terms of Sections 4 and 5 of the Code.
We may now refer to some other decisions where it has been laid down that the provisions of the cannot prevail over the provisions of the Indian Penal Code.
In Maulud Ahmad vs State of U.P., [1963] (Supp) 2 S.C.R. 38, the appellant who was a head constable contended that the prosecution launched against him was barred by limitation under Section 42 of the because the prosecution had been launched beyond the period of three months prescribed by Section 42.
The contention was rejected and it was pointed out that the period of three months prescribed under Section 42 for commencing a prosecution would govern only prosecutions of a police officer for something done or intended to be done by him under the provisions of the or under general police powers given by the Act and Section 42 would not apply to prosecutions against a police officer for anything done under the provisions of any other Act or under 947 Police powers conferred under any other Act.
It was also brought to focus that Section 36 of the explicitely provides that nothing contained in the said Act shall be construed to prevent any person from being prosecuted under any Regulation or Act for any offence made punishable by the Act or for being liable under any other Regulation or Act or any other or higher penalty or punishment that is provided for such offence by the .
The above ratio was followed in Ajaid Singh vs Joginder Singh, ; In yet another case viz. S.N. Sharma vs Bipen Kumar Tiwari & Ors., it was held that the power of the police to investigate a cognizable offence is uncontrolled by the Magistrate and it is only in cases where the police decided not to investigate the case that the Magistrate can intervene and either direct an investigation, or in the alternative himself proceed or depute a Magistrate subordinate to him to proceed to enquire into the case and that the powers of the police to investigate have been made independent of any control by the Magistrate.
Lastly, we come to the decision in the State of Punjab vs Charan Singh (supra) where the identical question under consideration had come up for determination by this Court.
The respondent therein was convicted by the Special Judge, Ludhiana of an offence under Section 5(1)(d) read with Section 5(2) of the Prevention of Corruption Act and sentence to suffer rigorous imprisonment for a period of one year and to pay a fine of Rs. 100.
On appeal, a Single Judge of the High Court acquitted the respondent on the ground the prosecution was vitiated by reason of non compliance with the provisions of Rule 16.38 of the Punjab Police Rules, 1934.
In the appeal preferred by the State, this Court allowed the appeal and held as follows: "A perusal of Chapter XVI of the Punjab Police Rules shows that the provisions of the Chapter deal with departmental punishments and the procedure to be followed in imposing such punishments.
Guidance is given as to how police officers guilty of misconduct and criminal offences may be dealt with . . .It is clear that Rule 16.38 is not designed to be a condition precedent to the launching of a prosecution in a criminal court; it is in the nature of instructions of the department and is not meant to be of the nature of a sanction or permission for a prosecution nor can it over ride the provisions of the Cr.
P.C. and the Prevention of Corruption Act.
We agree with the observations of Dua and Mahajan, JJ in Hoshiar Singh vs State (supra).
" 948 Though the decision of the Full Bench of the Punjab High Court which is now under consideration had not been brought to the notice of the Learned Judges when they rendered judgment in State of Punjab vs Charan Singh, we are in full agreement with the pronouncement of the Bench as the conclusion therein accords with our own conclusion and the reasons therefore.
We therefore hold that the Full Bench was in error in taking the view that the Punjab Police Rules read in conjunction with the prescribe a different procedure for the investigation and prosecution of offences committed by Police officers under the I.P.C. or other Acts in connection with their relations with the public and that the rules constitute a special statute and take precedence over the provisions of the Cr.
The Full Bench has failed to note that Rule 16.38 only mandates the investigation of cases pertaining to departmental enquiries and the holding of departmental enquiries in accordance with the procedure prescribed thereunder.
We therefore hold that the decision of the Full Bench under appeal in Raj Kumar, A.S.I. vs The State of Punjab (supra) is not in accordance with law and has to be set aside.
However, as mentioned at the outset, the State is not interested in reviving the charges against the respondent and pursuing the trial because of the long lapse of time.
Therefore, while allowing the appeal and setting aside the judgment of the High Court, we leave undisturbed the quashing of the charges framed against the respondent.
Since the respondent did not enter appearance or engage a counsel to contest the appeal in spite of the notice served on him, we requested Mr. Gopal Subramaniam, Advocate, to act as amicus curiae and render assistance to the Court on behalf of the respondent.
Mr. Gopal Subramaniam readily complied with our request and placed all the authorities for our consideration and we thank him for his assistance and place on record our appreciation of the services rendered by him.
H.S.K. Appeal allowed.
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From the Judgment and Order dated 10.10.1975 of the High Court of Punjab and Haryana in Criminal Miscellaneous No. Gopal Subramaniam, Amicus Curiae for the Respondent. The Judgment of the Court was delivered by NATARAJAN, J.
This appeal by certificate granted under Article 134(1)(c) of the Constitution is directed against the judgment of a Full Bench of the High Court of Punjab and Haryana in Raj Kumar, A.S.I. vs The State of Punjab, [1976] IV C.L.R. (Pb. & page 39 allowing a petition under Section 561(A) of the Code of Criminal Procedure 1898 filed by the respondent. the construction of Rule 16.38 of the Punjab Police Rules and its applicability to criminal prosecutions launched against the members of the Punjab Police Service for offences under the Indian Penal Code and other Acts. The controversy regarding the ambit of Rule 16.38 of the Punjab Police Rules has arisen in the following circumstances. One Jamuna Devi Mukhtiar Kaur gave a report against the respondent, who was an Assistant Sub Inspector in the Punjab Police Service, to the Deputy Superintendent of Police, Patiala alleging command of illegal gratification of Rs.200 by him for releasing her husband and brother on bail bonds in a case pertaining to a land dispute. A first information report was registered and a trap was laid for the respondent and he was apprehended as soon as the marked currency notes treated with phenolophthalene were handed over to him and the marked currency 939 notes were recovered from him. After completion of investigation, the respondent was chargesheeted before the Special Judge, Sangrur. The respondent appeared before the Special Judge and raised an objection to the framing of charges against him on the ground the investigation of the case was in contravention of Rule 16.38. The Special Judge over ruled the objection and framed charges and posted the case for trial. The respondent filed a petition before the High Court under Section 561(A) of the Criminal Procedure Code 1898, for quashing the proceedings against him before the Special Judge. Having interpreted Rule 16.38 thus, the Full Bench noticed that the investigation against the respondent had not been done in accordance with Rule 16.38 and therefore the bench allowed the petition and quashed the charges framed against the respondent. The High Court, however, granted a certificate under Article 134(1)(c) to the State to file an appeal to this Court and that is how the appeal is before us. Our task has been considerably lightened by a pronouncement on the first question, with which we are primarily concerned, by another Bench of this Court in the State of Punjab vs Charan Singh, ; declaring that Rule 16.38 cannot govern criminal prosecutions against the members of the Police Force as it cannot over ride the provisions of the Criminal Procedure Code. In spite of the said pronouncement, with which we are in respectful agreement, we feel it necessary to deal with the matter at some length because of certain misconceptions contained in the judgment of the High Court under appeal. Section 3 of the , confers the right of superintendence of the Police Force throughout the general police district on the State Government and vests in such Government the right to exercise such powers in that behalf. Section 7 deals with the appointment, dismissal, etc. Inspector General and District Superintendents of Police may at any time dismiss, suspend or reduce any police officer of the subordinate ranks whom they shall think remiss or negligent in the discharge of his duty or unfit for the same" or to award any of the lesser punishments prescribed under clauses (a) (b) (c) (d) for discharge of duty in a careless or negligent manner etc. Besides the power conferred on the State Government to make Rules under Section 7, there is also provision under Section 12 for the Inspector General of Police, subject to the approval of the State Government, to frame such orders and rules as he shall deem expedient relative to the organisation, classification and distribution of police force, the places at which the members of the police force shall reside, the services to be performed by them etc. for ensuring the efficiency of the police force in the discharge of its duties. It is in exercise of the powers conferred by Sections 7 and 12 of the that the Punjab Police Rules 1934 have been framed. The Rules have been categorised under 28 Chapters for dealing with various matters such as organisational setup, uniforms, arms and ammunition, leave, pension, promotions, rewards, punishments, training, supervision, investigation, prosecution etc. The matters covered by the Rules make it clear that the Rules have been framed for regulating the set up and the service conditions of the police force as well as for awarding them rewards and departmental punishments and other matters of internal administration for keeping efficient and disciplined one. It is in that perspective Rule 38 of Chapter 16 has to be viewed. The very first Rule in Chapter 16 sets out the scope and purpose of the Rule comprised in that chapter. Rules 16.1 reads as follows: "(1) No police officer shall be departmentally punished otherwise than as provided in these rules; (2) The departmental punishments mentioned in the second 941 column of the subjoined table may be inflicted on officers of the various ranks shown in the heading Nos. 3 to 9, by the officers named below each heading in each case, or by any officer of higher ranks". (Emphasis supplied) Rule 16.38 with which we are concerned, contains 7 sub clauses. For our purpose it is enough if we extract sub clauses. 1 to 4 and refer in general terms to the contents of Clauses 5 to 7. The District Magistrate will decide whether the investigation of the complaint shall be conducted by a police officer, or made over to a selected magistrate having 1st class powers. When it is decided to proceed departmentally the procedure prescribed in rule 16.38 shall be followed. An officer found guilty on a charge of the nature referred to in this rule shall ordinarily be dismissed. (3) Ordinarily a magistrate before whom a complaint against a police officer if laid proceeds at once to judicial enquiry. He is, however, required to report details of the case to the District Magistrate, who will forward a copy of this report to the Superintendent of Police. The District Magistrate himself will similarly send a report to the Superintendent of Police in cases of which he himself takes cognizance. The District Magistrate will order that all petitions against police officers shall be 942 presented to him personally. If he considers that these petitions are of a frivolous or factious nature, it is within his discretion to take no action on them. When he considers an enquiry to be necessary he will use his discretion whether to send the papers to the Superintendent of Police or to a magistrate for judicial enquiry. In the case of formal criminal complaints, the District Magistrate will arrange for all cases to be transferred from other courts to his own. Different interpretations were given by different Benches of the High Court of Punjab and Haryana regarding the scope and force of rule 16.38. Sub Inspector vs The State, [1974] Chandigarh Law Reporter 205 Gurnam Singh, J. took a diametrically opposite view. In Hoshiar Singh vs The State, a Division Bench of the High Court held that Rule 16.38 was attrected in the case of departmental enquiries only and the departmental enquiry would be vitiated if the papers had not been produced before the District Magistrate for getting his sanction at the initial stage. In Nand Singh vs The Superintendent of Police and another, Current Law Journal(Pb)146 it was held that the Rule was mandatory. The said view was affirmed by a Full Bench in Nand Mandan Sarup vs The District Magistrate and others, [1966] Current Law Journal (Pb) 608. " Hence the rules framed in exercise of powers conferred under section 7 and 12 have the force of law and they constitute a special legislation which takes precedence over the provisions of the Criminal Procedure Code. Section 4 of the inter alia lays down that the administration of the police, within the jurisdiction of a District Magistrate, shall under his general control and direction, be vested in a District Superintendent and Assistant District Superintendents as the Government may appoint. Consequently, the District Magistrate has statutory authority to exercise control over the administration of the police force in his District including the launching of criminal prosecutions or holding of Departmental enquiries against a member of the police force. Rule 16.38 contains a mandatory provision regarding the procedure to be followed when any complaint is received by the Superintendent of Police against a member of the police force regarding the commission of an offence by him in connection with his official relations with the public. The said rule will apply with equal force to investigations relating to criminal offences for which a prosecution is to be launched as it would to enquiries for taking departmental action through disciplinary proceedings. In that case a Sub Inspector of Police was challaned under Section 5(2) of the Prevention of Corruption Act and Section 161, Indian Penal Code and was suspended from service and chargesheeted and thereafter a departmental enquiry followed. The objection was sustained and the departmental enquiry was quashed. Thereafter, the challan was put into Court and 944 once again an objection was raised that in the absence of a reference to the District Magistrate and his orders thereon directing prosecution, the Special Judge could not take cognizance of the case. The language appears to me to be confined only to departmental enquiries. The investigation for establishing a prima facie case is merely meant to guide the District Magistrate, uncontrolled by the opinion of the Superintendent of Police, whether or not a departmental proceeding should be initiated against the guilty party, and it is the procedure and the punishment controlling the departmental proceedings alone, which appear to have been prescribed by this rule. " In Delhi Administration vs Chanan Shah, [1969] 3 S.C.R. 653 an Asstt. Sub Inspector was censured, after summary enquiry for having received illegal gratification in a case he was investigating. The Deputy Inspector General of Police revoked the order of censure and directed departmental action being taken. The departmental enquiry culminated in an order of dismissal against Chanan Shah. An appeal and revision to the higher authorities having failed, Chanan Shah filed a writ petition which was dismissed by a Single Judge but allowed in writ appeal by a Division Bench and the order of dismissal was quashed. The Delhi Administration came in appeal to this Court and this Court held that irrespective of whether Rule 16.38 is mandatory or directory, the authorities had failed to substantially comply with the provisions of the Rule and, therefore, the laches vitiated the departmental enquiry. The same view was taken in a later case Union of India vs Ram Kishan, ; which related to the dismissal of a constable from service pursuant to a disciplinary enquiry being set aside in a civil suit filed by the dismissed constable. In State of Uttar Pradesh vs Babu Ram Upadhya, ; the view taken by the majority of the Bench was that paragraph 486 Rule 1 of U.P. Police Rules was mandatory in character and hence the departmental action taken against the respondent police officer in disregard of the rule was invalid. The reason for a special procedure being prescribed in the Rules for investigations before departmental enquiries are held against delinquent police officers is not far off to see. In the very nature of their duties, the members of the police force would often stand exposed to criticism and complaints by not only the members of the public but also by the members of the force themselves and consequently they stand placed more vulnerable than members of other Government services, of being implicated in false or exaggerated charges. In order to protect them from false implications and resultant proceedings, the Government had thought it necessary to have an initial screening of the complaints received against members of the police force by the District Magistrate. Such screening would however extend only to matters which fall within the zone of departmental action and it could never extend to cases where the offences alleged to have been committed would attract investigation under the Criminal Procedure Code in the same manner the investigation would be attracted if the offences complained of had been committed by any member of the public. That the procedure prescribed in Rule 16.38 has only a limited field of operation i.e. applicable only to departmental enquiries and punishments could be seen from the fact that clause 3 of the Rule enjoins every Magistrate to whom a complaint against a police officer is referred by the District Magistrate for judicial enquiry to report the details of the case to the District Magistrate in order to enable the District Magistrate to forward the report to the Superintendent of Police. The clause further says that if the District Magistrate himself takes congnizance of a case, he should of his own accord send a report to the Superintendent of Police. Clause IV of Rule 16.38 also throws light on the matter and brings out the 946 objective in greater clarity. This clause sets out that in order to protect the interests of police officers serving in districts where petition mongering activities are notorious, the District Magistrate can direct that all petitions complaining about police officers shall be presented to him personally so that he can scrutinize them to find out whether the petitions are of a frivolous nature or they have been engineered by factious groups in the districts etc. In fact, the words used in the clause are of a tell tale nature viz. " complaints against police officers in those districts were abuses of law with the object of victimising such officers or hampering investigation is rife. " All these features make it clear that the purpose underlying the rule is to enable the District Magistrate and the District Superintendent of Police to exercise personal control and supervision over the complaints received against members of the police force in the performance of their duties and enable the District Magistrate to ensure that the complaint is not a baseless or mala fide one and secondly to determine whether the complaint requires investigation by a police officer or by a selected magistrate. The procedure envisaged by the Rule is for effective check being exercised against victimisation of efficient and honest police officers on the one hand and favouritism being shown to the delinquent police officers on the other. These rules were not intended to replace and certainly cannot over ride the provisions of the Criminal Procedure Code. We may now refer to some other decisions where it has been laid down that the provisions of the cannot prevail over the provisions of the Indian Penal Code. The contention was rejected and it was pointed out that the period of three months prescribed under Section 42 for commencing a prosecution would govern only prosecutions of a police officer for something done or intended to be done by him under the provisions of the or under general police powers given by the Act and Section 42 would not apply to prosecutions against a police officer for anything done under the provisions of any other Act or under 947 Police powers conferred under any other Act. It was also brought to focus that Section 36 of the explicitely provides that nothing contained in the said Act shall be construed to prevent any person from being prosecuted under any Regulation or Act for any offence made punishable by the Act or for being liable under any other Regulation or Act or any other or higher penalty or punishment that is provided for such offence by the . The above ratio was followed in Ajaid Singh vs Joginder Singh, ; In yet another case viz. S.N. Sharma vs Bipen Kumar Tiwari & Ors., Lastly, we come to the decision in the State of Punjab vs Charan Singh (supra) where the identical question under consideration had come up for determination by this Court. Guidance is given as to how police officers guilty of misconduct and criminal offences may be dealt with . . P.C. and the Prevention of Corruption Act. We agree with the observations of Dua and Mahajan, JJ in Hoshiar Singh vs State (supra). The Full Bench has failed to note that Rule 16.38 only mandates the investigation of cases pertaining to departmental enquiries and the holding of departmental enquiries in accordance with the procedure prescribed thereunder. However, as mentioned at the outset, the State is not interested in reviving the charges against the respondent and pursuing the trial because of the long lapse of time. Therefore, while allowing the appeal and setting aside the judgment of the High Court, we leave undisturbed the quashing of the charges framed against the respondent. Mr. Gopal Subramaniam readily complied with our request and placed all the authorities for our consideration and we thank him for his assistance and place on record our appreciation of the services rendered by him.
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% The respondent was apprehended while taking bribe.
Investigation was held and the respondent was chargesheeted before the Special Judge.
The respondent raised an objection to the framing of charges against him on the ground that the investigation of the case was in contravention of rule 16.38 of the Punjab Police Rules.
The Special Judge overruled the objection and framed charges and posted the case for trial.
The respondent filed a petition before the High Court under section 561(A) of the Code of Criminal Procedure, 1898, for quashing the proceedings against him before the Special Judge.
A full bench of the High Court held that rule 16.38 is mandatory and not directory in character and that the mandate would govern criminal prosecution as well as departmental inquiries in equal measure.
The full bench having noticed that the investigation against the respondent had not been done in accordance with rule 16.38 allowed the petition and quashed the charges framed against the respondent.
Hence this appeal filed by certificate issued by the High Court.
Allowing the appeal and setting aside the High Court 's judgment this Court, ^ HELD: The procedure prescribed in rule 16.38 has only a limited field of operation that is applicable only to departmental inquiries and punishments.
This could be seen from the fact that clause 3 of the rule enjoins every Magistrate to whom a complaint against a police officer is referred by the District Magistrate for judicial enquiry to report the details of the case to the District Magistrate in order to enable the District Magistrate to forward the report to the Superintendent of Police.
The clause further says that if the District Magistrate himself takes cognizance of a case he should of his own accord send a report to 937 the Superintendent of Police.
Clause IV of rule 16.38 also throws light on the matter and brings out the objective in greater clarity.
This clause sets out that in order to protect the interest of police officers serving in districts where petition mongering activities are notorious, the District Magistrate can direct that all petitions complaining about police officers shall be presented to him personally so that he can scrutinize them to find out whether the petitions are of a frivolous nature or they have been engineered by factious groups in the districts etc.
In fact, the words used in the clause are of a tell tale nature viz. "complaints against police officers in those districts where abuses of law with the object of victimising such officers or hampering investigation is rife.
" [945F H; 946A B] The purpose underlying the rule is to enable the District Magistrate and the District Superintendent of Police to exercise personal control and supervision over the complaints received against members of the police force in the performance of their duties and enable the District Magistrate to ensure that the complaint is not a baseless or mala fide one and secondly to determine whether the complaint requires investigation by a police officer or by a selected Magistrate.
The procedure envisaged by the rule is for effective check being exercised against victimisation of efficient and honest police officers on the one hand and favouritism being shown to the delinquent police officers on the other.
These rules were not intended to replace and certainly cannot over ride the provisions of the Criminal Procedure Code.
[946C E] In the instant case the Full Bench was in error in taking the view that the Punjab Police Rules read in conjunction with the Police Act prescribe a different procedure for the investigation and prosecution of offences committed by Police Officer under the I.P.C. or other Acts in connection with their relations with the public and that the rules constitute a special statute and take precedence over the provisions of the Cr.
The Full Bench has failed to note that Rule 16.38 only mandates the investigation of cases pertaining to departmental enquiries and the holding of departmental enquiries in accordance with the procedure prescribed thereunder.[948B C] Raj Kumar, A. section I. vs The State of Punjab, [1976] IV CLR (Pb. & Har.) page 39, overruled.
State of Punjab vs Charan Singh, ; , referred to/agreed to.
Delhi Administration vs Chanan Shah, [1969] 3 S.C.R. 653; 938 Union of India vs Ram Kishan, ; ; State of Uttar Pradesh vs Babu Ram Upadhya, ; ; Maulud Ahmad vs State of U.P., [1963] (Supp.) 2 S.C.R. 38; Ajaib Singh vs Joginder Singh, ; and S.N. Sharma vs Bipan Kumar Tiwari & Ors.
,[1970] 1 S.C.C. 653, referred to.
|
% The respondent was apprehended while taking bribe.
Investigation was held and the respondent was chargesheeted before the Special Judge.
The respondent raised an objection to the framing of charges against him on the ground that the investigation of the case was in contravention of rule 16.38 of the Punjab Police Rules.
The Special Judge overruled the objection and framed charges and posted the case for trial.
The respondent filed a petition before the High Court under section 561(A) of the Code of Criminal Procedure, 1898, for quashing the proceedings against him before the Special Judge.
A full bench of the High Court held that rule 16.38 is mandatory and not directory in character and that the mandate would govern criminal prosecution as well as departmental inquiries in equal measure.
The full bench having noticed that the investigation against the respondent had not been done in accordance with rule 16.38 allowed the petition and quashed the charges framed against the respondent.
Hence this appeal filed by certificate issued by the High Court.
Allowing the appeal and setting aside the High Court 's judgment this Court, ^ HELD: The procedure prescribed in rule 16.38 has only a limited field of operation that is applicable only to departmental inquiries and punishments.
This could be seen from the fact that clause 3 of the rule enjoins every Magistrate to whom a complaint against a police officer is referred by the District Magistrate for judicial enquiry to report the details of the case to the District Magistrate in order to enable the District Magistrate to forward the report to the Superintendent of Police.
The clause further says that if the District Magistrate himself takes cognizance of a case he should of his own accord send a report to 937 the Superintendent of Police.
Clause IV of rule 16.38 also throws light on the matter and brings out the objective in greater clarity.
This clause sets out that in order to protect the interest of police officers serving in districts where petition mongering activities are notorious, the District Magistrate can direct that all petitions complaining about police officers shall be presented to him personally so that he can scrutinize them to find out whether the petitions are of a frivolous nature or they have been engineered by factious groups in the districts etc.
In fact, the words used in the clause are of a tell tale nature viz. "complaints against police officers in those districts where abuses of law with the object of victimising such officers or hampering investigation is rife.
" [945F H; 946A B] The purpose underlying the rule is to enable the District Magistrate and the District Superintendent of Police to exercise personal control and supervision over the complaints received against members of the police force in the performance of their duties and enable the District Magistrate to ensure that the complaint is not a baseless or mala fide one and secondly to determine whether the complaint requires investigation by a police officer or by a selected Magistrate.
The procedure envisaged by the rule is for effective check being exercised against victimisation of efficient and honest police officers on the one hand and favouritism being shown to the delinquent police officers on the other.
These rules were not intended to replace and certainly cannot over ride the provisions of the Criminal Procedure Code.
[946C E] In the instant case the Full Bench was in error in taking the view that the Punjab Police Rules read in conjunction with the Police Act prescribe a different procedure for the investigation and prosecution of offences committed by Police Officer under the I.P.C. or other Acts in connection with their relations with the public and that the rules constitute a special statute and take precedence over the provisions of the Cr.
The Full Bench has failed to note that Rule 16.38 only mandates the investigation of cases pertaining to departmental enquiries and the holding of departmental enquiries in accordance with the procedure prescribed thereunder.[948B C] Raj Kumar, A. section I. vs The State of Punjab, [1976] IV CLR (Pb. & Har.) page 39, overruled.
State of Punjab vs Charan Singh, ; , referred to/agreed to.
Delhi Administration vs Chanan Shah, [1969] 3 S.C.R. 653; 938 Union of India vs Ram Kishan, ; ; State of Uttar Pradesh vs Babu Ram Upadhya, ; ; Maulud Ahmad vs State of U.P., [1963] (Supp.) 2 S.C.R. 38; Ajaib Singh vs Joginder Singh, ; and S.N. Sharma vs Bipan Kumar Tiwari & Ors.
,[1970] 1 S.C.C. 653, referred to.
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iminal Appeal No. 213 of 1960.
Appeal by special leave from the judgment and order dated March 24, 1960, of the Punjab High Court (Circuit Bench)Delhi in Criminal Appeal Case No. 41 D of 1958.
H. L. Anand, and K. Baldev Mehta, for the appellant.
V. D. Mahajan and P. D. Menon, for the respondent.
November 29.
The Judgment of the Court was delivered by 587 SUBBA RAO J.
This appeal by Special leave raises the question as to the true meaning of the expression "fraudulently ' in section 464 of the Indian Penal Code.
The facts either admitted or found by the courts below may be briefly stated.
The appellant is the wife of Siri Chand Kaviraj.
On january 20, 1953, she purchased an Austin 10 Horse Power Car with the registration No. DLA.
4796 from Dewan Ram Swarup in the name of her minor daughter Nalini aged about six months at that time.
The price for the car was paid by Dr. Vimla.
The transfer of the car was notified in the name of Nalini to the Motor Registration Authority.
The car at that time was insured against a policy issued by the Bharat Fire & General Insurance Co., Ltd., and the policy was due to expire sometime in April, 1953.
On a request made by Dewan Ram Swarup, the said policy was transferred in the name of Nalini.
In that connection, Dr. Vimla visited the Insurance Company 's Office and signed the proposal form as Nalini.
Subsequently, she also filed two claims on the ground that the car met with accidents.
In connection with these claims, she signed the claim forms as Nalini and also the receipts acknowledging the payments of the compensation money as Nalini.
On a complaint made by the company alleging fraud on the part of Dr. Vimla and her husband, the police made investigation and prosecuted Dr. Vimla and her husband Siri Chand Kaviraj in the Court of Magistrate 1st Class Delhi.
The 'Magistrate committed Dr. Vimla and her husband to Sessions to take their trial under sections 120 B, 419, 467 and 468 of the Indian Penal Code.
The learned Sessions judge held that no case had been made out against the accused under any one of those sections and on that finding, acquitted both of them.
The State preferred an appeal to the High Court of Punjab and the appeal was disposed of by a Division Bench of that court comprising Falshaw 588 and Chopra,JJ.
The learned judges confirmed the acquittal of Siri Chand; but in regard to Dr.
Vimla, they confirmed her acquittal under section 419 of the Indian Penal Code, but set aside her acquittal under sections 467 and 468 of the Code and instead, convicted her under the said sections and sentenced her to imprisonment till the rising of the court and to the payment of a fine of Rs. 100/ or in default to under , go simple imprisonment for two weeks.
Dr. Vimla has preferred the present appeal by special leave against her conviction and sentence.
The facts found may be briefly summarised thus : Dr. Vimla purchased a motor car with her own money in the name of her minor daughter, had the insurance policy transferred in the name of her minor daughter by signing her name and she also received compensation for the claims made by her in regard to the two accidents to the car.
The claims were true claims and she received the moneys by signing in ,he claim forms and also in the receipts as Nalini.
That is to say, Dr. Vim] a in fact and in substance put through her transactions in connection with the said motor car in the name of her minor daughter.
Nalini was in fact either a benamidar for Dr. Vimla or her name was used for luck or other sentimental considerations.
On the facts found, neither Dr. Vimla got any advantage either pecuniary or otherwise by signing the name of Nalini in any of the said documents nor the Insurance Company incurred any loss, pecuniary or otherwise, by dealing with Dr. Vimla in the name of Nalini.
The Insurance Company would not have acted differently even if the, car stood in the name of Dr. Vimla and she made the claims and received the amounts from the insurance company in her name.
On the said facts, the question that arises in this case is whether Dr. vimla was guilty of offences under sections 463 and 464 of the Indian Penal Code.
589 Learned Counsel for the appellant contends that on the facts found, the appellant would not be guilty of forgery as she did not "fraudulently" sign the requisite forms and the receipts in the name of Nalini, as.
by so signing, she did not intend to cause injury to the insurance company.
In other words, the contention was that a person does not act fraudulently within the meaning of section 464 unless he is not only guilty of deceit but also he intends to cause injury to the person or persons deceived, and as in the present case the appellant had never had the intention to cause injury to the insurance company and as on the facts found no injury had been caused at all to the company, the appellant could not be found guilty under the said sections.
Before we consider the decisions cited at the Bar it would be convenient to look at the relevant provisions of the Indian Penal Code.
Section 463 : Whoever makes any false document or part of a document with intent to cause damage or injury, to the public or to any person, or to support any claim or title, or to cause any person to part with property or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery.
Section 464 : A person is said to make a false document First Which dishonestly or fraudulently makes, signs, seals or executes a document or part of a document, or makes any mark denoting the execution of a document, with the intention of causing it to be believed that such document/or part of a document was made, signed, sealed or executed by or by the authority of a person by whom or by whose authority he knows that it was not made, signed, sealed or executed, or at a time 590 at which he knows that it was not made, signed, scaled or executed; or The definition of "false document" is a part of the definition of "forgery".
Both must be read together.
If so read, the ingredients of the offence of forgery relevant to the present enquiry are as follows , (1) fraudulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another or under his authority ; (2) making of such a document with an intention to commit fraud or that fraud may be committed.
In the two definitions, both mens rea described in s.464 i. e., "fradulently" and the intention to commit fraud in section 463 have the same meaning.
This redundancy has perhaps become necessary as the element of fraud is not the ingredient of other in tentions mentioned in section 463.
The idea of deceit is a necessary ingredient of fraud, but it does not exhaust it; an additional element is implicit in the expression.
The scope of that something more is the subject of may decisions.
We shall consider that question at a later stage in the light of the decisions bearing on the subject.
The second thing to be noticed is that in section 464 two adverbs, "dishonestly" and "fraudulently" are used alternatively indicating thereby that one excludes the other.
That means they are not tautological and must be given different meanings.
Section 24 of the Penal Code defines "dishonestly" thus : "Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing dishonestly".
"Fraudulently" is defined in section 25 thus: " A perosn is said to do a thing fraudulently if he does that thing with intent to 591 defrand but not otherwise".
The word "defraud" includes an element of deceit.
Deceit is not an ingredient of the definition of the word "dishonestly" while it is an important ingredient of the definition of the word "fraudulently".
The former involves a pecuniary or economic gain or loss while the latter by construction excludes that element.
Further) the juxtaposition of the two expressions " 'dishonestly" and "fraudulently" used in the various sections of the Code indicates their close affinity and therefore the definition of one may give colour to the other.
To illustrate, in the definition of "dishonestly", wrongful gain or wrongful loss is the necessary enough.
So too, if the expresssion "fraudulently ' were to be held to involve the element of injury to the person or persons deceived, it would be reasonable to assume that the injury should be something other than pecuniary or economic loss.
Though almost always an advantage to one causes loss to another and vice versa, it need not necessarily be so.
Should we hold that the concept of fraud" would include not only deceit but also some injury to the person deceived, it would be appropriate to hold by analogy drawn from the definition of "dishonestly" that to satisfy the definition of " 'fraudulently" it would be enough if there was a non economic advantage to the deceiver or a non economic loss to the deceived.
Both need not co exist.
Let us now consider some of the leading text book writers and, decisions to ascertain the meaning of the word "fraudulently".
The classic definition of the word "fraudulently" is found in Steplien 's History of the Criminal law of England, Vol. 2, at p. 121 and it reads "I shall not attempt to construct a definition which will meet every case which might 592 be suggested, but there is little danger in saving that whenever the words "fraud" or intent to defraud" or "fraudulently" occur in the definition of a crime two elements at least are essential to the commission of the crime : namely, first, deceit or an intention to deceive or in some cases mere secrecy ; and secondly, either actual injury or possible injury or to a risk of possible 'injury by means of that deceit or secrecy. . .
This intent is very seldom the only, or the principal, intention entertained by the fraudulent person, whose principal object in nearly every case is his own advantage. . . .
A practically conclusive test of the fraudulent character of a deception for criminal purposes is this : Did the author of the deceit derive any advantage from it which could not have been had if the truth had been known ? If so it is hardly possible that the advantage should not have had an equivalent in loss or risk of loss to someone else, and if so, there was fraud.
" It would be seen from this passage that " 'fraud" is made up of two ingredients, deceit and injury.
The learned author also realizes that the principal object of every fraudulent person in nearly every case is to derive some advantage though such advantage has a corresponding loss or risk of loss to another.
Though the author has not visualized the extremely rare situation of an advantage secured by one without a corresponding loss to another, this idea is persued in later decisions.
As regards the nature of this injury, in Kenny 's Outline of Criminal Law, 15th Edn., at p. 333, it is stated that pecuniary detriment is unnecessary.
In Haycraft vs Creasy (1) LeBlanc, observed (1) ; 593 "by fraud is meant an intention to deceive; whether it be from any expectation of advantage to the party himself or from the ill will towards the other is immaterial.
" This passage for the first time brings out the distinction between an advantage derived by the person who deceives in contrast to the loss incurred by the person deceived.
Buckley.
J., in Re London & Clobe Finance Corporation Ltd. (1) brings out the ingredients of fraud thus : "To deceive is, I apprehend, to induce a man to believe that a thing is true which is false, and which the person practising the deceit knows or believes to be false.
defraud is to deprive by deceit: it is by deceit to induce a man to act to his injury ' More tersely it may be put, that to deceive is by falsehood to induce a state of mind; to defraud is by deceit to induce a course of action." The English decisions have been elaborately considered by the Court of Criminal Appeal in R. vs Welhant (2).
In that case, hire purchase finance companies advanced money on a hire purchase form and agreement and on credit sale agreements witnessed by the accused.
The form and agreements were forgeries The accused was charged with offences of Uttering forged documents with intent to defraud.
It was not proved that he had intended to cause any loss of once to the finance companies.
His intention had been by deceit to induce any person who was charged with the duty of seeing that the credit restrictions then current were observed to act in a way in which lie would not act if he had known the true facts, namely, not to prevent the advancing of large sums of money exceeding the limits allowed by law It, the time.
The Court held that the said intention amounted to intend to defraud.
(1) (1903) 1 ch. 732.
(2) , 264, 266.
594 Hilbery, J., speaking for the court, pointed out the distinction between deceit and defraud and came to the conclusion that ,to defraud" is to deprive by deceit." Adverting to the argument that the deprivation must be something of value, i. e. economic loss, the learned judge observed "We have, however, come to the conclusion that this is too narrow at view.
While, no doubt, in most cases of an intention to defraud the intention is to cause an economic loss ' there is no reason to introduce any such limitation.
Provided that the intention is to cause the person deceived to act to his real detriment, it matters not that lie suffers no economic loss.
It is sufficient if the intention is to deprive him of a right or to induce him to do something contrary to what it would have been his duty to do, had lie not been deceived.
" On the basis of the said principle it was held that the accused by deceit induced the finance companies to advance moneys contrary to the credit restrictions and that he was guilty of the offence of forgery.
This decision is therefore a clear authority for the position that the loss or, the injury caused to the person deceived need not be economic loss.
Even a deprivation of a right without any economic consequences would be enough.
This decision has not expressed any definite opinion on the question whether a benefit to the accused without a corresponding loss to the person deceived would amount to fraud.
But it has incidentally touched upon that aspect.
The learned judge again observed. ". . . . . .
This the appellant was doing in order that he might benefit by getting further loans.
" This may indicate that a benefit derived by the 595 person deceiving another may amount to an act to defraud that other.
A full Bench of the Madras High Court , in Kotamraju Venkatrayadu vs Emperor (1) had to consider the case of a person obtaining admission to the matriculation examination of the Madras University as a private candidate producing to the Registrar a certificate purporting to have been signed by the headmaster of it recognized High School that he was of good character land had attained his 20th year.
It was found in that case that the candidate had fabricated the signature of the headmaster.
The court held that the accused was guilty of forgery.
White, C.J., observed : "Intending to defraud means, of course, something more than deceiving." He illustrated this by the following example: "A tells B a lie and B believes him.
B is deceived but it does not follow that A intended to defraud B.
But, as it seems to me, if A tells B a lie intending that B should do something which A conceives to be to his own benefit or advantage, 'and which, if done, would be to the loss or detriment of B, A intends to defraud B." The learned Chief justice indicated his line of thought, which has some bearing on the question now raised, by the following observations : "I may observe, however, in this connection that by section 24 of the Code a person does a thing dishonestly who ' does it with the intention of causing wrongful gain or wrongful loss.
It is not necessary that there should be an intention to cause both.
On the analogy of this definition, it might be said that either an intention (1) Mad.
99,96,97.
596 to secure a benefit or advantage on the one hand, or to cause loss or detriment on the other, by means of deceit, is an intent to defraud.
" But, he found in that case that both the elements were present.
Benson,J., pointed out at p. 114 : "I am of opinion that the act was fraudulent not merely by reason of the advantage which the accused intended to secure for himself ' by means of his ' deceit, but also by reason of the injury which must necessarily result to the University and, through it to the public from such acts if unrepressed.
The University is injured, if through the evasion of its byelaws, it is induced to declare that certain persons have fulfilled the conditions prescribed for Matriculation and are entitled to the benefits of Matriculation, when in fact, they have not fulfilled those conditions, for the value of its examinations is, depreciated in the eyes of the public if it is found that the certificate of the University that they have passed its examinations is no longer a guarantee that they have in truth fulfilled the conditions on which alone the University professes to certify them as passed, and to admit them to the benefis of Matriculation.
" Boddam, J., agreed with the learned Chief justice and Benson, J.
This decision accepts the principle laid down by Stephen, namely, that the intention to defraud is made up of two elements, first an intention to deceive and second, the intention to expose some person either to actual injury or risk of possible injury but the learned judges were also inclined to hold on the analogy of the definition of "dishonestly" in section 24 of the Code that intention to secure a or advantage to the deceiver satisfies the second con dition 597 The Calcutta High Court dealt with this question in Surendra Nath Ghose vs Emperor (1) There, the accused affixed his signature to a kabuliat which was not required by law to be attested by witnesses, after its execution and registration, below the names of the attestings witnesses but without putting a date or alleging actual presence at the time of its execution.
The court held that such an act was not fraud within the first clause of section 464.
of the Penal Code inasmuch as it was not done dishonestly or fraudulently within the meaning of sections 24 and 25 thereof.
Mookerjee, J., defined the words "intention to defraud" thus: "The expression, "intent to defraud" implies conduct coupled with intention to deceive and thereby to injury in other words, "defraud" involves two conceptions, namely, deceit and injury to the person deceived, that is, infringement of some legal right possessed by him, but not necessarily deprivation of property.
" This view is in accord with the English decisions and that expressed by the Full Bench of the Madras High Court.
This decision does not throw any light on the other question whether advantage to the deceiver without a corresponding loss to the deceived would satisfy the second ingredient of the expression "intent to defraud".
A division Bench of the Bombay High Court in Sanjiv Ratnappa vs Emperor (2) had also occasion to consider the scope of the expression "fraudulently" in section 464 of the Penal Code.
The court held that for an act to be fraudulent there must be some advantage on the one side with a corresponding loss on the other.
Adverting to the argument that an advantage secured by the deceiver would constitute fraud Broomfield, J., observed thus "I think in view of the Bombay decisions to which I have referred we must hold that that (1) Cal. 75, 89 90.
(2) A.I.R. 1932 Bom.
545, 550.
598 is an essential ingredient in the definition of forgery.
In the great majority of cases, the point is not very material. . .
But there many occasionally be a case in which the element of loss or injury is absent and I think the present is such a case.
" This decision therefore does not accept the view of White C. J., of the Madras High Court.
A Division Bench of the Lahore High Court,, in Emperor vs Abdul had also expressed its view on the meaning of the word "fraudulently." The learned Judges accepted Stephen 's definition but proceeded to observe as follows "It may be noted in this connection that the word " 'injury" as defined in section 44, Penal Code, is very wide as denoting "any harm whatever, illegally caused to any person, in body, mind, reputation or property." The learned judges were willing to assume that in almost every case an advantage to one would result in an injury to the other in the widest sense indicated by section 44 of the Penal Code.
The other decided case cited at the Bar accept the necessity for the combination of a deceit by one and injury to other constitute an act to defraud and therefore, it is not necessary to multiply citations.
No other decision cited at the Bar throws any light on the further question, namely, whether an advantage secured to the deceiver without a corresponding loss to the deceived would satisfy the second condition laid down by the decisions.
To summarize : the expression " 'defraud" inoslves two elements, namely, deceit and injury to the person deceived.
injury is something other than (1) A.I.R. 1944 Lah.
380,382.
599 economic loss that is ', deprivation of property, whether movable or immovable, or of money, and it will include any harm whatever caused to any person in body, mind, reputation or such others.
In short, it is a non economic or non pecuniary loss.
A benefit or advantage to the deceiver will almost always cause loss or detriment to the deceived.
Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.
Now let us apply the said principles to the facts of the present case.
Certainly, Dr. Vimla was guilty of deceit, for though her name was Vimla, she signed in all the relevant papers as Nalini and made the insurance company believe that her name was Nalini, but the said , deceit did not either secure to her advantage or cause any non economic loss or injury to the insurance company.
The charge does not disclose any such advantage or injury, nor is there any evidence to prove the same.
The fact that Dr. Vimla said that the owner of the car who sold it to her suggested that the taking of the sale of the car in the name of Nalini would be useful for income tax purposes is not of any relevance in the present case, for one reason, the said owner did not say so in his evidence and for the other, it was not indicated in the charge or in the evidence.
In the charge framed, she was alleged to have defrauded the insurance company and the only evidence given was that if it was disclosed that Nalini was a minor, the insurance company might not have paid the money.
But as we have pointed out earlier, the entire transaction was that of Dr. Vimla and it was only put through in the name of her made minor daughter for reasons best known to herself.
On the evidence as disclosed, neither was she benefited nor the insurance company incurred loss in any sense of the term.
In the result, we allow the appeal and hold that the appellant was not guilty of the offence under 600 sections 467 and 468 of the Indian Penal Code.
The conviction and sentence passed on her are set aside.
Fine, if paid, is directed to be refunded to the appellant, Appeal allowed.
|
Dr. Vimla purchased a car in the name of her minor daughter Nalini aged about 6 months.
The price of tile car was paid by her.
The transfer of the car was notified in the name of Nalini to the Motor Registration Authority.
The insurance policy already issued was transferred in the name of Nalini after the proposal form was signed by Dr. Vimla.
Subsequently, Dr. Vimla filed two claims on the ground that the car met with accidents.
She signed the claim forms as Nalini.
She also signed the receipts acknowledging the pay ment of compensation money as Nalini.
Dr. Vimla and her husband were prosecuted under sections 120 B, 419, 467 and 468 of the Indian Penal Code.
Both the accused were acquitted by the Sessions Judge.
The State went in appeal and the High Court convicted Dr. Vimla under section 467 and 468 of the Indian Penal Code.
Dr. Vimla came to this Court by special leave.
Held, that appellant was not guilty of the offence under section 467 and 468 of the Indian Penal Code.
She was certainly guilty of deceit because though her name was Vimla, she signed in all the relevant papers as Nalini and made the Insurance Company believe that her name was Nalini, but the said deceit did not either secure to her advantage or cause any noneconomic loss or injury to the Insurance Company.
The charge did not disclose any such advantage or injury nor was there any evidence to prove the same.
The entire transaction was that of Dr. Vimla and it was only put through in the name of her minor daughter.
Nalini was in fact either a Benamidar for Dr. Vimla or her name was used for luck or other sentimental considerations.
The Insurance Company would not have acted differently even if the car stood in the name of Dr. Vimla.
586 The definition of 'false document ' is a part of the defini tion of forgery ' and both must be read together.
If so read, the ingredients of the offence of forgery relevant to the present case are as follows: (1) fradulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another under his authority ; and (2) making of such a document with an intention to commit fraud or that fraud may be committed.
The expression 'fraud ' involves two elements, deceit and injury to the person deceived.
Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include and any harm whatever caused to any person in body, mind, reputation or such others.
In short, it is a non economic or non pecuniary loss.
A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived.
Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.
Haycraft vs Creasy, ; , in re.
London and Globe Finance Corporation Ltd., R. vs Welham, , Kotamraju Yenkatrayadu vs Emperor Mad. 90, Surendra Nath Ghose vs Emperor, Cal. 75, Sanjiv Ratnappa vs Emperor, A. I. R. and Emperor vs Abdul Hamid, A. 1.
R. , referred to.
|
iminal Appeal No. 213 of 1960.
Appeal by special leave from the judgment and order dated March 24, 1960, of the Punjab High Court (Circuit Bench)Delhi in Criminal Appeal Case No. 41 D of 1958.
H. L. Anand, and K. Baldev Mehta, for the appellant.
V. D. Mahajan and P. D. Menon, for the respondent.
November 29.
The Judgment of the Court was delivered by 587 SUBBA RAO J.
This appeal by Special leave raises the question as to the true meaning of the expression "fraudulently ' in section 464 of the Indian Penal Code.
The facts either admitted or found by the courts below may be briefly stated.
The appellant is the wife of Siri Chand Kaviraj.
On january 20, 1953, she purchased an Austin 10 Horse Power Car with the registration No. DLA.
4796 from Dewan Ram Swarup in the name of her minor daughter Nalini aged about six months at that time.
The price for the car was paid by Dr. Vimla.
The transfer of the car was notified in the name of Nalini to the Motor Registration Authority.
The car at that time was insured against a policy issued by the Bharat Fire & General Insurance Co., Ltd., and the policy was due to expire sometime in April, 1953.
On a request made by Dewan Ram Swarup, the said policy was transferred in the name of Nalini.
In that connection, Dr. Vimla visited the Insurance Company 's Office and signed the proposal form as Nalini.
Subsequently, she also filed two claims on the ground that the car met with accidents.
In connection with these claims, she signed the claim forms as Nalini and also the receipts acknowledging the payments of the compensation money as Nalini.
On a complaint made by the company alleging fraud on the part of Dr. Vimla and her husband, the police made investigation and prosecuted Dr. Vimla and her husband Siri Chand Kaviraj in the Court of Magistrate 1st Class Delhi.
The 'Magistrate committed Dr. Vimla and her husband to Sessions to take their trial under sections 120 B, 419, 467 and 468 of the Indian Penal Code.
The learned Sessions judge held that no case had been made out against the accused under any one of those sections and on that finding, acquitted both of them.
The State preferred an appeal to the High Court of Punjab and the appeal was disposed of by a Division Bench of that court comprising Falshaw 588 and Chopra,JJ.
The learned judges confirmed the acquittal of Siri Chand; but in regard to Dr.
Vimla, they confirmed her acquittal under section 419 of the Indian Penal Code, but set aside her acquittal under sections 467 and 468 of the Code and instead, convicted her under the said sections and sentenced her to imprisonment till the rising of the court and to the payment of a fine of Rs. 100/ or in default to under , go simple imprisonment for two weeks.
Dr. Vimla has preferred the present appeal by special leave against her conviction and sentence.
The facts found may be briefly summarised thus : Dr. Vimla purchased a motor car with her own money in the name of her minor daughter, had the insurance policy transferred in the name of her minor daughter by signing her name and she also received compensation for the claims made by her in regard to the two accidents to the car.
The claims were true claims and she received the moneys by signing in ,he claim forms and also in the receipts as Nalini.
That is to say, Dr. Vim] a in fact and in substance put through her transactions in connection with the said motor car in the name of her minor daughter.
Nalini was in fact either a benamidar for Dr. Vimla or her name was used for luck or other sentimental considerations.
On the facts found, neither Dr. Vimla got any advantage either pecuniary or otherwise by signing the name of Nalini in any of the said documents nor the Insurance Company incurred any loss, pecuniary or otherwise, by dealing with Dr. Vimla in the name of Nalini.
The Insurance Company would not have acted differently even if the, car stood in the name of Dr. Vimla and she made the claims and received the amounts from the insurance company in her name.
On the said facts, the question that arises in this case is whether Dr. vimla was guilty of offences under sections 463 and 464 of the Indian Penal Code.
589 Learned Counsel for the appellant contends that on the facts found, the appellant would not be guilty of forgery as she did not "fraudulently" sign the requisite forms and the receipts in the name of Nalini, as.
by so signing, she did not intend to cause injury to the insurance company.
In other words, the contention was that a person does not act fraudulently within the meaning of section 464 unless he is not only guilty of deceit but also he intends to cause injury to the person or persons deceived, and as in the present case the appellant had never had the intention to cause injury to the insurance company and as on the facts found no injury had been caused at all to the company, the appellant could not be found guilty under the said sections.
Before we consider the decisions cited at the Bar it would be convenient to look at the relevant provisions of the Indian Penal Code.
Section 463 : Whoever makes any false document or part of a document with intent to cause damage or injury, to the public or to any person, or to support any claim or title, or to cause any person to part with property or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery.
Section 464 : A person is said to make a false document First Which dishonestly or fraudulently makes, signs, seals or executes a document or part of a document, or makes any mark denoting the execution of a document, with the intention of causing it to be believed that such document/or part of a document was made, signed, sealed or executed by or by the authority of a person by whom or by whose authority he knows that it was not made, signed, sealed or executed, or at a time 590 at which he knows that it was not made, signed, scaled or executed; or The definition of "false document" is a part of the definition of "forgery".
Both must be read together.
If so read, the ingredients of the offence of forgery relevant to the present enquiry are as follows , (1) fraudulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another or under his authority ; (2) making of such a document with an intention to commit fraud or that fraud may be committed.
In the two definitions, both mens rea described in s.464 i. e., "fradulently" and the intention to commit fraud in section 463 have the same meaning.
This redundancy has perhaps become necessary as the element of fraud is not the ingredient of other in tentions mentioned in section 463.
The idea of deceit is a necessary ingredient of fraud, but it does not exhaust it; an additional element is implicit in the expression.
The scope of that something more is the subject of may decisions.
We shall consider that question at a later stage in the light of the decisions bearing on the subject.
The second thing to be noticed is that in section 464 two adverbs, "dishonestly" and "fraudulently" are used alternatively indicating thereby that one excludes the other.
That means they are not tautological and must be given different meanings.
Section 24 of the Penal Code defines "dishonestly" thus : "Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing dishonestly".
"Fraudulently" is defined in section 25 thus: " A perosn is said to do a thing fraudulently if he does that thing with intent to 591 defrand but not otherwise".
The word "defraud" includes an element of deceit.
Deceit is not an ingredient of the definition of the word "dishonestly" while it is an important ingredient of the definition of the word "fraudulently".
The former involves a pecuniary or economic gain or loss while the latter by construction excludes that element.
Further) the juxtaposition of the two expressions " 'dishonestly" and "fraudulently" used in the various sections of the Code indicates their close affinity and therefore the definition of one may give colour to the other.
To illustrate, in the definition of "dishonestly", wrongful gain or wrongful loss is the necessary enough.
So too, if the expresssion "fraudulently ' were to be held to involve the element of injury to the person or persons deceived, it would be reasonable to assume that the injury should be something other than pecuniary or economic loss.
Though almost always an advantage to one causes loss to another and vice versa, it need not necessarily be so.
Should we hold that the concept of fraud" would include not only deceit but also some injury to the person deceived, it would be appropriate to hold by analogy drawn from the definition of "dishonestly" that to satisfy the definition of " 'fraudulently" it would be enough if there was a non economic advantage to the deceiver or a non economic loss to the deceived.
Both need not co exist.
Let us now consider some of the leading text book writers and, decisions to ascertain the meaning of the word "fraudulently".
The classic definition of the word "fraudulently" is found in Steplien 's History of the Criminal law of England, Vol. 2, at p. 121 and it reads "I shall not attempt to construct a definition which will meet every case which might 592 be suggested, but there is little danger in saving that whenever the words "fraud" or intent to defraud" or "fraudulently" occur in the definition of a crime two elements at least are essential to the commission of the crime : namely, first, deceit or an intention to deceive or in some cases mere secrecy ; and secondly, either actual injury or possible injury or to a risk of possible 'injury by means of that deceit or secrecy. . .
This intent is very seldom the only, or the principal, intention entertained by the fraudulent person, whose principal object in nearly every case is his own advantage. . . .
A practically conclusive test of the fraudulent character of a deception for criminal purposes is this : Did the author of the deceit derive any advantage from it which could not have been had if the truth had been known ? If so it is hardly possible that the advantage should not have had an equivalent in loss or risk of loss to someone else, and if so, there was fraud.
" It would be seen from this passage that " 'fraud" is made up of two ingredients, deceit and injury.
The learned author also realizes that the principal object of every fraudulent person in nearly every case is to derive some advantage though such advantage has a corresponding loss or risk of loss to another.
Though the author has not visualized the extremely rare situation of an advantage secured by one without a corresponding loss to another, this idea is persued in later decisions.
As regards the nature of this injury, in Kenny 's Outline of Criminal Law, 15th Edn., at p. 333, it is stated that pecuniary detriment is unnecessary.
In Haycraft vs Creasy (1) LeBlanc, observed (1) ; 593 "by fraud is meant an intention to deceive; whether it be from any expectation of advantage to the party himself or from the ill will towards the other is immaterial.
" This passage for the first time brings out the distinction between an advantage derived by the person who deceives in contrast to the loss incurred by the person deceived.
Buckley.
J., in Re London & Clobe Finance Corporation Ltd. (1) brings out the ingredients of fraud thus : "To deceive is, I apprehend, to induce a man to believe that a thing is true which is false, and which the person practising the deceit knows or believes to be false.
defraud is to deprive by deceit: it is by deceit to induce a man to act to his injury ' More tersely it may be put, that to deceive is by falsehood to induce a state of mind; to defraud is by deceit to induce a course of action." The English decisions have been elaborately considered by the Court of Criminal Appeal in R. vs Welhant (2).
In that case, hire purchase finance companies advanced money on a hire purchase form and agreement and on credit sale agreements witnessed by the accused.
The form and agreements were forgeries The accused was charged with offences of Uttering forged documents with intent to defraud.
It was not proved that he had intended to cause any loss of once to the finance companies.
His intention had been by deceit to induce any person who was charged with the duty of seeing that the credit restrictions then current were observed to act in a way in which lie would not act if he had known the true facts, namely, not to prevent the advancing of large sums of money exceeding the limits allowed by law It, the time.
The Court held that the said intention amounted to intend to defraud.
(1) (1903) 1 ch. 732.
(2) , 264, 266.
594 Hilbery, J., speaking for the court, pointed out the distinction between deceit and defraud and came to the conclusion that ,to defraud" is to deprive by deceit." Adverting to the argument that the deprivation must be something of value, i. e. economic loss, the learned judge observed "We have, however, come to the conclusion that this is too narrow at view.
While, no doubt, in most cases of an intention to defraud the intention is to cause an economic loss ' there is no reason to introduce any such limitation.
Provided that the intention is to cause the person deceived to act to his real detriment, it matters not that lie suffers no economic loss.
It is sufficient if the intention is to deprive him of a right or to induce him to do something contrary to what it would have been his duty to do, had lie not been deceived.
" On the basis of the said principle it was held that the accused by deceit induced the finance companies to advance moneys contrary to the credit restrictions and that he was guilty of the offence of forgery.
This decision is therefore a clear authority for the position that the loss or, the injury caused to the person deceived need not be economic loss.
Even a deprivation of a right without any economic consequences would be enough.
This decision has not expressed any definite opinion on the question whether a benefit to the accused without a corresponding loss to the person deceived would amount to fraud.
But it has incidentally touched upon that aspect.
The learned judge again observed. ". . . . . .
This the appellant was doing in order that he might benefit by getting further loans.
" This may indicate that a benefit derived by the 595 person deceiving another may amount to an act to defraud that other.
A full Bench of the Madras High Court , in Kotamraju Venkatrayadu vs Emperor (1) had to consider the case of a person obtaining admission to the matriculation examination of the Madras University as a private candidate producing to the Registrar a certificate purporting to have been signed by the headmaster of it recognized High School that he was of good character land had attained his 20th year.
It was found in that case that the candidate had fabricated the signature of the headmaster.
The court held that the accused was guilty of forgery.
White, C.J., observed : "Intending to defraud means, of course, something more than deceiving." He illustrated this by the following example: "A tells B a lie and B believes him.
B is deceived but it does not follow that A intended to defraud B.
But, as it seems to me, if A tells B a lie intending that B should do something which A conceives to be to his own benefit or advantage, 'and which, if done, would be to the loss or detriment of B, A intends to defraud B." The learned Chief justice indicated his line of thought, which has some bearing on the question now raised, by the following observations : "I may observe, however, in this connection that by section 24 of the Code a person does a thing dishonestly who ' does it with the intention of causing wrongful gain or wrongful loss.
It is not necessary that there should be an intention to cause both.
On the analogy of this definition, it might be said that either an intention (1) Mad.
99,96,97.
596 to secure a benefit or advantage on the one hand, or to cause loss or detriment on the other, by means of deceit, is an intent to defraud.
" But, he found in that case that both the elements were present.
Benson,J., pointed out at p. 114 : "I am of opinion that the act was fraudulent not merely by reason of the advantage which the accused intended to secure for himself ' by means of his ' deceit, but also by reason of the injury which must necessarily result to the University and, through it to the public from such acts if unrepressed.
The University is injured, if through the evasion of its byelaws, it is induced to declare that certain persons have fulfilled the conditions prescribed for Matriculation and are entitled to the benefits of Matriculation, when in fact, they have not fulfilled those conditions, for the value of its examinations is, depreciated in the eyes of the public if it is found that the certificate of the University that they have passed its examinations is no longer a guarantee that they have in truth fulfilled the conditions on which alone the University professes to certify them as passed, and to admit them to the benefis of Matriculation.
" Boddam, J., agreed with the learned Chief justice and Benson, J.
This decision accepts the principle laid down by Stephen, namely, that the intention to defraud is made up of two elements, first an intention to deceive and second, the intention to expose some person either to actual injury or risk of possible injury but the learned judges were also inclined to hold on the analogy of the definition of "dishonestly" in section 24 of the Code that intention to secure a or advantage to the deceiver satisfies the second con dition 597 The Calcutta High Court dealt with this question in Surendra Nath Ghose vs Emperor (1) There, the accused affixed his signature to a kabuliat which was not required by law to be attested by witnesses, after its execution and registration, below the names of the attestings witnesses but without putting a date or alleging actual presence at the time of its execution.
The court held that such an act was not fraud within the first clause of section 464.
of the Penal Code inasmuch as it was not done dishonestly or fraudulently within the meaning of sections 24 and 25 thereof.
Mookerjee, J., defined the words "intention to defraud" thus: "The expression, "intent to defraud" implies conduct coupled with intention to deceive and thereby to injury in other words, "defraud" involves two conceptions, namely, deceit and injury to the person deceived, that is, infringement of some legal right possessed by him, but not necessarily deprivation of property.
" This view is in accord with the English decisions and that expressed by the Full Bench of the Madras High Court.
This decision does not throw any light on the other question whether advantage to the deceiver without a corresponding loss to the deceived would satisfy the second ingredient of the expression "intent to defraud".
A division Bench of the Bombay High Court in Sanjiv Ratnappa vs Emperor (2) had also occasion to consider the scope of the expression "fraudulently" in section 464 of the Penal Code.
The court held that for an act to be fraudulent there must be some advantage on the one side with a corresponding loss on the other.
Adverting to the argument that an advantage secured by the deceiver would constitute fraud Broomfield, J., observed thus "I think in view of the Bombay decisions to which I have referred we must hold that that (1) Cal. 75, 89 90.
(2) A.I.R. 1932 Bom.
545, 550.
598 is an essential ingredient in the definition of forgery.
In the great majority of cases, the point is not very material. . .
But there many occasionally be a case in which the element of loss or injury is absent and I think the present is such a case.
" This decision therefore does not accept the view of White C. J., of the Madras High Court.
A Division Bench of the Lahore High Court,, in Emperor vs Abdul had also expressed its view on the meaning of the word "fraudulently." The learned Judges accepted Stephen 's definition but proceeded to observe as follows "It may be noted in this connection that the word " 'injury" as defined in section 44, Penal Code, is very wide as denoting "any harm whatever, illegally caused to any person, in body, mind, reputation or property." The learned judges were willing to assume that in almost every case an advantage to one would result in an injury to the other in the widest sense indicated by section 44 of the Penal Code.
The other decided case cited at the Bar accept the necessity for the combination of a deceit by one and injury to other constitute an act to defraud and therefore, it is not necessary to multiply citations.
No other decision cited at the Bar throws any light on the further question, namely, whether an advantage secured to the deceiver without a corresponding loss to the deceived would satisfy the second condition laid down by the decisions.
To summarize : the expression " 'defraud" inoslves two elements, namely, deceit and injury to the person deceived.
injury is something other than (1) A.I.R. 1944 Lah.
380,382.
599 economic loss that is ', deprivation of property, whether movable or immovable, or of money, and it will include any harm whatever caused to any person in body, mind, reputation or such others.
In short, it is a non economic or non pecuniary loss.
A benefit or advantage to the deceiver will almost always cause loss or detriment to the deceived.
Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.
Now let us apply the said principles to the facts of the present case.
Certainly, Dr. Vimla was guilty of deceit, for though her name was Vimla, she signed in all the relevant papers as Nalini and made the insurance company believe that her name was Nalini, but the said , deceit did not either secure to her advantage or cause any non economic loss or injury to the insurance company.
The charge does not disclose any such advantage or injury, nor is there any evidence to prove the same.
The fact that Dr. Vimla said that the owner of the car who sold it to her suggested that the taking of the sale of the car in the name of Nalini would be useful for income tax purposes is not of any relevance in the present case, for one reason, the said owner did not say so in his evidence and for the other, it was not indicated in the charge or in the evidence.
In the charge framed, she was alleged to have defrauded the insurance company and the only evidence given was that if it was disclosed that Nalini was a minor, the insurance company might not have paid the money.
But as we have pointed out earlier, the entire transaction was that of Dr. Vimla and it was only put through in the name of her made minor daughter for reasons best known to herself.
On the evidence as disclosed, neither was she benefited nor the insurance company incurred loss in any sense of the term.
In the result, we allow the appeal and hold that the appellant was not guilty of the offence under 600 sections 467 and 468 of the Indian Penal Code.
The conviction and sentence passed on her are set aside.
Fine, if paid, is directed to be refunded to the appellant, Appeal allowed.
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Appeal by special leave from the judgment and order dated March 24, 1960, of the Punjab High Court (Circuit Bench)Delhi in Criminal Appeal Case No. H. L. Anand, and K. Baldev Mehta, for the appellant. V. D. Mahajan and P. D. Menon, for the respondent. The facts either admitted or found by the courts below may be briefly stated. The appellant is the wife of Siri Chand Kaviraj. On january 20, 1953, she purchased an Austin 10 Horse Power Car with the registration No. 4796 from Dewan Ram Swarup in the name of her minor daughter Nalini aged about six months at that time. The price for the car was paid by Dr. Vimla. The transfer of the car was notified in the name of Nalini to the Motor Registration Authority. On a request made by Dewan Ram Swarup, the said policy was transferred in the name of Nalini. In that connection, Dr. Vimla visited the Insurance Company 's Office and signed the proposal form as Nalini. Subsequently, she also filed two claims on the ground that the car met with accidents. In connection with these claims, she signed the claim forms as Nalini and also the receipts acknowledging the payments of the compensation money as Nalini. The 'Magistrate committed Dr. Vimla and her husband to Sessions to take their trial under sections 120 B, 419, 467 and 468 of the Indian Penal Code. The learned Sessions judge held that no case had been made out against the accused under any one of those sections and on that finding, acquitted both of them. The State preferred an appeal to the High Court of Punjab and the appeal was disposed of by a Division Bench of that court comprising Falshaw 588 and Chopra,JJ. 100/ or in default to under , go simple imprisonment for two weeks. Dr. Vimla has preferred the present appeal by special leave against her conviction and sentence. The claims were true claims and she received the moneys by signing in ,he claim forms and also in the receipts as Nalini. That is to say, Dr. Vim] a in fact and in substance put through her transactions in connection with the said motor car in the name of her minor daughter. Nalini was in fact either a benamidar for Dr. Vimla or her name was used for luck or other sentimental considerations. by so signing, she did not intend to cause injury to the insurance company. In other words, the contention was that a person does not act fraudulently within the meaning of section 464 unless he is not only guilty of deceit but also he intends to cause injury to the person or persons deceived, and as in the present case the appellant had never had the intention to cause injury to the insurance company and as on the facts found no injury had been caused at all to the company, the appellant could not be found guilty under the said sections. Before we consider the decisions cited at the Bar it would be convenient to look at the relevant provisions of the Indian Penal Code. Section 463 : Whoever makes any false document or part of a document with intent to cause damage or injury, to the public or to any person, or to support any claim or title, or to cause any person to part with property or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery. If so read, the ingredients of the offence of forgery relevant to the present enquiry are as follows , (1) fraudulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another or under his authority ; (2) making of such a document with an intention to commit fraud or that fraud may be committed. In the two definitions, both mens rea described in s.464 i. e., "fradulently" and the intention to commit fraud in section 463 have the same meaning. The idea of deceit is a necessary ingredient of fraud, but it does not exhaust it; an additional element is implicit in the expression. The scope of that something more is the subject of may decisions. We shall consider that question at a later stage in the light of the decisions bearing on the subject. That means they are not tautological and must be given different meanings. Section 24 of the Penal Code defines "dishonestly" thus : "Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing dishonestly". "Fraudulently" is defined in section 25 thus: " A perosn is said to do a thing fraudulently if he does that thing with intent to 591 defrand but not otherwise". The word "defraud" includes an element of deceit. Deceit is not an ingredient of the definition of the word "dishonestly" while it is an important ingredient of the definition of the word "fraudulently". To illustrate, in the definition of "dishonestly", wrongful gain or wrongful loss is the necessary enough. Though almost always an advantage to one causes loss to another and vice versa, it need not necessarily be so. Let us now consider some of the leading text book writers and, decisions to ascertain the meaning of the word "fraudulently". The classic definition of the word "fraudulently" is found in Steplien 's History of the Criminal law of England, Vol. 2, at p. 121 and it reads "I shall not attempt to construct a definition which will meet every case which might 592 be suggested, but there is little danger in saving that whenever the words "fraud" or intent to defraud" or "fraudulently" occur in the definition of a crime two elements at least are essential to the commission of the crime : namely, first, deceit or an intention to deceive or in some cases mere secrecy ; and secondly, either actual injury or possible injury or to a risk of possible 'injury by means of that deceit or secrecy. . . This intent is very seldom the only, or the principal, intention entertained by the fraudulent person, whose principal object in nearly every case is his own advantage. . . . A practically conclusive test of the fraudulent character of a deception for criminal purposes is this : Did the author of the deceit derive any advantage from it which could not have been had if the truth had been known ? If so it is hardly possible that the advantage should not have had an equivalent in loss or risk of loss to someone else, and if so, there was fraud. " It would be seen from this passage that " 'fraud" is made up of two ingredients, deceit and injury. Though the author has not visualized the extremely rare situation of an advantage secured by one without a corresponding loss to another, this idea is persued in later decisions. at p. 333, it is stated that pecuniary detriment is unnecessary. " This passage for the first time brings out the distinction between an advantage derived by the person who deceives in contrast to the loss incurred by the person deceived. J., in Re London & Clobe Finance Corporation Ltd. (1) brings out the ingredients of fraud thus : "To deceive is, I apprehend, to induce a man to believe that a thing is true which is false, and which the person practising the deceit knows or believes to be false. The English decisions have been elaborately considered by the Court of Criminal Appeal in R. vs Welhant (2). In that case, hire purchase finance companies advanced money on a hire purchase form and agreement and on credit sale agreements witnessed by the accused. The form and agreements were forgeries The accused was charged with offences of Uttering forged documents with intent to defraud. It was not proved that he had intended to cause any loss of once to the finance companies. His intention had been by deceit to induce any person who was charged with the duty of seeing that the credit restrictions then current were observed to act in a way in which lie would not act if he had known the true facts, namely, not to prevent the advancing of large sums of money exceeding the limits allowed by law It, the time. The Court held that the said intention amounted to intend to defraud. Adverting to the argument that the deprivation must be something of value, i. e. economic loss, the learned judge observed "We have, however, come to the conclusion that this is too narrow at view. While, no doubt, in most cases of an intention to defraud the intention is to cause an economic loss ' there is no reason to introduce any such limitation. " On the basis of the said principle it was held that the accused by deceit induced the finance companies to advance moneys contrary to the credit restrictions and that he was guilty of the offence of forgery. This decision is therefore a clear authority for the position that the loss or, the injury caused to the person deceived need not be economic loss. Even a deprivation of a right without any economic consequences would be enough. But it has incidentally touched upon that aspect. The learned judge again observed. ". . . . . . " This may indicate that a benefit derived by the 595 person deceiving another may amount to an act to defraud that other. A full Bench of the Madras High Court , in Kotamraju Venkatrayadu vs Emperor (1) had to consider the case of a person obtaining admission to the matriculation examination of the Madras University as a private candidate producing to the Registrar a certificate purporting to have been signed by the headmaster of it recognized High School that he was of good character land had attained his 20th year. It was found in that case that the candidate had fabricated the signature of the headmaster. The court held that the accused was guilty of forgery. White, C.J., observed : "Intending to defraud means, of course, something more than deceiving." He illustrated this by the following example: "A tells B a lie and B believes him. It is not necessary that there should be an intention to cause both. On the analogy of this definition, it might be said that either an intention (1) Mad. " But, he found in that case that both the elements were present. The court held that such an act was not fraud within the first clause of section 464. of the Penal Code inasmuch as it was not done dishonestly or fraudulently within the meaning of sections 24 and 25 thereof. " This view is in accord with the English decisions and that expressed by the Full Bench of the Madras High Court. This decision does not throw any light on the other question whether advantage to the deceiver without a corresponding loss to the deceived would satisfy the second ingredient of the expression "intent to defraud". A division Bench of the Bombay High Court in Sanjiv Ratnappa vs Emperor (2) had also occasion to consider the scope of the expression "fraudulently" in section 464 of the Penal Code. The court held that for an act to be fraudulent there must be some advantage on the one side with a corresponding loss on the other. 598 is an essential ingredient in the definition of forgery. In the great majority of cases, the point is not very material. . . But there many occasionally be a case in which the element of loss or injury is absent and I think the present is such a case. The learned judges were willing to assume that in almost every case an advantage to one would result in an injury to the other in the widest sense indicated by section 44 of the Penal Code. No other decision cited at the Bar throws any light on the further question, namely, whether an advantage secured to the deceiver without a corresponding loss to the deceived would satisfy the second condition laid down by the decisions. To summarize : the expression " 'defraud" inoslves two elements, namely, deceit and injury to the person deceived. injury is something other than (1) A.I.R. 1944 Lah. 599 economic loss that is ', deprivation of property, whether movable or immovable, or of money, and it will include any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non economic or non pecuniary loss. A benefit or advantage to the deceiver will almost always cause loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied. Now let us apply the said principles to the facts of the present case. Certainly, Dr. Vimla was guilty of deceit, for though her name was Vimla, she signed in all the relevant papers as Nalini and made the insurance company believe that her name was Nalini, but the said , deceit did not either secure to her advantage or cause any non economic loss or injury to the insurance company. The charge does not disclose any such advantage or injury, nor is there any evidence to prove the same. But as we have pointed out earlier, the entire transaction was that of Dr. Vimla and it was only put through in the name of her made minor daughter for reasons best known to herself. On the evidence as disclosed, neither was she benefited nor the insurance company incurred loss in any sense of the term. In the result, we allow the appeal and hold that the appellant was not guilty of the offence under 600 sections 467 and 468 of the Indian Penal Code. The conviction and sentence passed on her are set aside. Fine, if paid, is directed to be refunded to the appellant, Appeal allowed.
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Dr. Vimla purchased a car in the name of her minor daughter Nalini aged about 6 months.
The price of tile car was paid by her.
The transfer of the car was notified in the name of Nalini to the Motor Registration Authority.
The insurance policy already issued was transferred in the name of Nalini after the proposal form was signed by Dr. Vimla.
Subsequently, Dr. Vimla filed two claims on the ground that the car met with accidents.
She signed the claim forms as Nalini.
She also signed the receipts acknowledging the pay ment of compensation money as Nalini.
Dr. Vimla and her husband were prosecuted under sections 120 B, 419, 467 and 468 of the Indian Penal Code.
Both the accused were acquitted by the Sessions Judge.
The State went in appeal and the High Court convicted Dr. Vimla under section 467 and 468 of the Indian Penal Code.
Dr. Vimla came to this Court by special leave.
Held, that appellant was not guilty of the offence under section 467 and 468 of the Indian Penal Code.
She was certainly guilty of deceit because though her name was Vimla, she signed in all the relevant papers as Nalini and made the Insurance Company believe that her name was Nalini, but the said deceit did not either secure to her advantage or cause any noneconomic loss or injury to the Insurance Company.
The charge did not disclose any such advantage or injury nor was there any evidence to prove the same.
The entire transaction was that of Dr. Vimla and it was only put through in the name of her minor daughter.
Nalini was in fact either a Benamidar for Dr. Vimla or her name was used for luck or other sentimental considerations.
The Insurance Company would not have acted differently even if the car stood in the name of Dr. Vimla.
586 The definition of 'false document ' is a part of the defini tion of forgery ' and both must be read together.
If so read, the ingredients of the offence of forgery relevant to the present case are as follows: (1) fradulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another under his authority ; and (2) making of such a document with an intention to commit fraud or that fraud may be committed.
The expression 'fraud ' involves two elements, deceit and injury to the person deceived.
Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include and any harm whatever caused to any person in body, mind, reputation or such others.
In short, it is a non economic or non pecuniary loss.
A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived.
Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.
Haycraft vs Creasy, ; , in re.
London and Globe Finance Corporation Ltd., R. vs Welham, , Kotamraju Yenkatrayadu vs Emperor Mad. 90, Surendra Nath Ghose vs Emperor, Cal. 75, Sanjiv Ratnappa vs Emperor, A. I. R. and Emperor vs Abdul Hamid, A. 1.
R. , referred to.
|
Dr. Vimla purchased a car in the name of her minor daughter Nalini aged about 6 months.
The price of tile car was paid by her.
The transfer of the car was notified in the name of Nalini to the Motor Registration Authority.
The insurance policy already issued was transferred in the name of Nalini after the proposal form was signed by Dr. Vimla.
Subsequently, Dr. Vimla filed two claims on the ground that the car met with accidents.
She signed the claim forms as Nalini.
She also signed the receipts acknowledging the pay ment of compensation money as Nalini.
Dr. Vimla and her husband were prosecuted under sections 120 B, 419, 467 and 468 of the Indian Penal Code.
Both the accused were acquitted by the Sessions Judge.
The State went in appeal and the High Court convicted Dr. Vimla under section 467 and 468 of the Indian Penal Code.
Dr. Vimla came to this Court by special leave.
Held, that appellant was not guilty of the offence under section 467 and 468 of the Indian Penal Code.
She was certainly guilty of deceit because though her name was Vimla, she signed in all the relevant papers as Nalini and made the Insurance Company believe that her name was Nalini, but the said deceit did not either secure to her advantage or cause any noneconomic loss or injury to the Insurance Company.
The charge did not disclose any such advantage or injury nor was there any evidence to prove the same.
The entire transaction was that of Dr. Vimla and it was only put through in the name of her minor daughter.
Nalini was in fact either a Benamidar for Dr. Vimla or her name was used for luck or other sentimental considerations.
The Insurance Company would not have acted differently even if the car stood in the name of Dr. Vimla.
586 The definition of 'false document ' is a part of the defini tion of forgery ' and both must be read together.
If so read, the ingredients of the offence of forgery relevant to the present case are as follows: (1) fradulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another under his authority ; and (2) making of such a document with an intention to commit fraud or that fraud may be committed.
The expression 'fraud ' involves two elements, deceit and injury to the person deceived.
Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include and any harm whatever caused to any person in body, mind, reputation or such others.
In short, it is a non economic or non pecuniary loss.
A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived.
Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.
Haycraft vs Creasy, ; , in re.
London and Globe Finance Corporation Ltd., R. vs Welham, , Kotamraju Yenkatrayadu vs Emperor Mad. 90, Surendra Nath Ghose vs Emperor, Cal. 75, Sanjiv Ratnappa vs Emperor, A. I. R. and Emperor vs Abdul Hamid, A. 1.
R. , referred to.
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Civil Appeal No. 906 of 1984.
From the Judgment and Order dated 8.7.1980 of the Bombay High Court in Second Appeal No. 663 of 1971.
V.N. Ganpule for the Appellant.
S.V. Deshpande for the Respondent.
The Judgment of the Court was delivered by VENKATARAMIAH, J.
The short question which arises for consideration in this case is whether a person adopted by a Hindu widow after the coming into force of the (hereinafter referred to as 'the Act ') can claim a share in the property which had devolved on a sole surviving coparcener on the death of the husband of the widow who took him in adoption.
One Shamrao, who was governed by the Mitakshara Hindu Law died leaving behind him two sons Dharma (the appellant in this appeal) and Miragu.
Miragu died issueless in the year 1928 leaving behind him his widow Champabai respondent No. 2.
The properties owned by the joint family of Dharma and Miragu passed on to the hands of Dharma who was the sole surviving coparcener on the death of Miragu.
Under the law, as it stood then, Champabai had only a right of maintenance in the joint family properties.
The Act came into force on 1080 21st December, 1956.
On 9.8.1968 she took Pandurang, the 1st respondent, in adoption and immediately thereafter a suit was filed by Pandurang and Champabai in Regular Civil Suit No. 457 of 1968 on the file of the Civil Judge, Junior Division, Barsi for partition and separate possession of one half share in the properties of the joint family of which Dharma, the appellant herein, and Miragu were coparceners.
Before the said adoption took place, two items of the joint family properties had been sold in favour of Defendant Nos. 3 and 17 for consideration.
Champabai had instituted a suit for maintenance against Dharma and obtained a decree for maintenance.
Dharma resisted the suit on the ground that Pandurang was not entitled to claim any share in the properties which originally belonged to the joint family in view of clause (c) of the proviso to section 12 of the Act and the properties which had been sold by him in favour of third parties could not in any event be the subject matter of the partition suit.
The Trial Court dismissed the suit.
Pandurang and Champabai filed an appeal against the decree of the Trial Court before the District Court, Sholapur in Civil Appeal No. 222 of 1970.
The learned District Judge allowed the appeal and passed a preliminary decree for partition in favour of Pandurang and Champabai and separate possession of one half share of the joint family properties except the two fields which had been sold earlier in favour of third parties.
Aggrieved by the decree of the District Judge, the appellant filed an appeal before the High Court of Bombay in Second Appeal No. 663 of 1971.
The High Court affirmed the decree passed by the learned District Judge following the decision of that Court in Y.K. Nalavade and Others vs Anand G. Chavan and Others, A.I.R. 1981 Bombay 109 in which it had been held that clause (c) of the proviso to section 12 of the Act was not a bar to such a suit for partition.
This appeal by special leave is filed by the appellant against the judgment of the High Court of Bombay.
The only question urged on behalf of the appellant before us is that the suit for partition should have been dismissed by the High Court as the 1st respondent Pandurang could not divest Dharma the appellant of any part of the estate which had been vested in him before the adoption in view of clause (c) of the proviso to section 12 of the Act.
Section 12 of the Act reads thus: 12.
An adopted child shall be deemed to be the child of his or her adoptive father or mother for all purposes with effect from the date of the adoption and from such date all the ties of the child in the family of his or her birth shall be 1081 deemed to be severed and replaced by those created by the adoption in the adoptive family: Provided that (a) the child cannot marry any person whom he or she could not have married if he or she had continued in the family of his or her birth; (b) any property which vested in the adopted child before the adoption shall continue to vest in such person subject to the obligations, if any, attaching to the ownership of such property, including the obligation to maintain relatives in the family of his or her birth; (c) The adopted child shall not divest any person of any estate which vested in him or her before the adoption.
" It is argued that Pandurang became the child of the adoptive mother for all purposes with effect from the date of the adoption and only from that date all the ties of Pandurang in the family of his birth should be deemed to have been severed and replaced by those created by the adoption in the adoptive family and, therefore, Pandurang, the adopted son could not claim a share in the joint family properties which had devolved on the appellant by survivorship on the death of Miragu.
In support of this contention the appellant relied upon the decision of this Court in Sawan Ram & Others vs Kala Wanti & Others, ; The facts involved in that case were these.
A widow, whose husband had died before the Hindu Succession Act came into force, adopted the second respondent in that case after the commencement of the Act.
On the widow 's death the appellant in that case, claiming to be the nearest reversioner of her husband, filed a suit challenging the adoption.
The Trial Court dismissed the suit and the decree of the Trial Court was affirmed by the High Court.
Against the decree of the High Court the appellant therein filed an appeal by special leave before this Court.
In that appeal, the appellant contended that (i) the adoption was invalid under clause (ii) of section 6 read with section 9(2) of the Act as the son was given in adoption by his mother, even though the father was alive, and (ii) since under the Act an independent right of adoption had been given to Hindu female, if a widow adopted a son, he could become the adopted son of the widow only and could not be considered to be the son of her deceased husband also.
This Court negatived both the contentions.
We are not 1082 concerned with the first ground for purposes of this case.
On the second contention this Court held that the provision in section 12 of the Act made it clear that the adopted son of a Hindu female, who had been married, was in fact the adopted son of her husband also.
That decision was sufficient to dismiss the suit filed by the appellant as the adopted son in that case being the nearest heir was entitled to claim the properties involved in the suit to the exclusion of the appellant therein who was a more distant heir was not, therefore, entitled to lay claim to any part of the suit properties.
In the course of the said decision a decision of the Andhra Pradesh High Court in Narra Hanumantha Rao vs Narra Hanumayya and Others, [1964] 1 Andhra Weekly Reporter 156 I.L.R. had been cited before this Court.
In that case the High Court of Andhra Pradesh had taken the view that clause (c) of the proviso to section 12 of the Act laid down explicity that the adoption of a son or daughter by a male or female Hindu was not to result in the divesting of any estate vested in any person prior to the adoption and that clause (c) also applied to the interest which passed on by survivorship on the death of a coparcener to the remaining coparceners.
As pointed out earlier the said question did not actually arise in the appeal before this Court.
This Court, however, observed as follows: "It may, however, be mentioned that the conclusion which we have arrived at does not indicate that the ultimate decision given by the Andhra Pradesh High Court was in any way incorrect.
As we have mentioned earlier, the question in that case was whether E, after the adoption by D, the widow of B, could divest C of the rights which had already vested in C before the adoption.
It is significant that by the year 1936 C was the sole male member of the Hindu joint family which owned the disputed property.
B died in the year 1924 and A died in 1936.
By that time, the Hindu Women 's Rights to Property Act had not been enacted and consequently, C, as the sole male survivor of the family became full owner of that property.
In these circumstances, it was clear that after the adoption of E by D, E could not divest C of the rights already vested in him in view of the special provisions contained in clause (c) of the proviso to section 12 of the Act.
It appears that, by making such a provision, the Act has narrowed down the rights of an adopted child as compared with the rights of a child born posthumously.
Under the Shastriclaw, if a child was adopted by a widow, he was treated as a natural born child 1083 and, consequently, he could divest other members of the family of rights vested in them prior to his adoption.
It was only with the limited object of avoiding any such consequence on the adoption of a child by a Hindu widow that these provisions in clause (c) of the proviso to section 12, and section 13 of the Act were incorporated.
In that respect, the rights of the adopted child were restricted.
It is to be noted that this restriction was placed on the rights of a child adopted by either a male Hindu or a female Hindu and not merely in a case of adoption by a female Hindu.
This restriction on the rights of the adopted child cannot, therefore, in our opinion, lead to any inference that a child adopted by a widow will not be deemed to be the adopted son of her deceased husband.
The second ground taken on behalf of the appellant also, therefore, fails.
" It is no doubt true that the above observations appear to support a case of the appellant but since we are of the view that these observations were not necessary for deciding the case which was before the Court they have to be held obiter dicta.
In Sitabai & Anr.
vs Ram Chandra, ; which was again decided by a bench of three Judges, this Court was called upon to decide a case which was more or less similar to the one before us.
In that case the facts were these.
Two brothers were in possession of ancestral properties consisting of a house and tenancy rights of an ordinary tenant in agricultural lands.
The elder brother died in 1930 leaving a widow, the first appellant therein.
The first appellant continued to live with the younger brother and had an illegitimate son by him, the respondent therein.
In March, 1958, she adopted the second appellant, and some time later, the surviving brother died.
After his putative father died, the respondent who was the illegitimate son took possession of all the joint family properties.
The two appellants thereupon filed a suit for ejectment.
The Trial Court decreed the suit.
The first appellate court held that a will executed by the respondent 's father (the younger brother) was valid in so far as his half share in the house was concerned and, therefore, modified the decree by granting a half share of the house to the respondent.
In second appeal, the High Court held that the appellants were not entitled to any relief and that their suit should be dismissed on two grounds, namely, (i) the joint family properties ceased to have that character in the hands of the surviving brother when he became the sole surviving coparcener, and (2) the second appellant did not become, on his adoption, a copar 1084 cener with his uncle in the joint family properties.
In this Court the appellants in that appeal questioned both the conclusions reached by the High Court.
On the first contention, this Court held that the joint family properties continued to retain their character in the hands of the surviving brother, as the widow (the first appellant) of the elder brother was still alive and continued to enjoy the right of maintenance out of the joint family properties following the decision of this Court in Gowli Buddanna vs Commissioner of Income Tax, Mysore, Bangalore; , On the second contention this Court held that the scheme of sections 11 and 12 of the Act was that in the case of adoption by a widow the adopted child became absorbed in the adoptive family to which the widow belonged.
It further observed that though section 14 of the Act did not expressly state that the child adopted by a widow became the adopted son of her deceased husband, it was a necessary implication of sections 12 and 14 of the Act and that was why section 14 of the Act provided that when a widow adopted a child and subsequently married, that husband became the step father of the adopted child.
Therefore, when the second appellant was adopted by the first appellant he became the adopted son of the first appellant and her deceased husband, namely, the elder brother, and hence became a coparcener with the surviving brother in the joint family properties, and after the death of the surviving brother the second appellant became the sole surviving coparcener entitled to the possession of all the joint family properties except those bequeathed under the will, that is, except the half share of the house.
Applying the above decision it has to be held in the case before us that the joint family properties which belonged to the joint family consisting of Dharma the appellant and his brother Miragu continued to retain the character of joint family properties in the hands of Dharma the appellant as Champabai, the widow of Miragu was still alive and continued to enjoy the right of maintenance out of the said joint family properties.
It should also be held that Pandurang the 1st respondent on adoption became the adopted son of Miragu and became a coparcener with Dharma the appellant in the joint family properties.
When once he became a member of the coparcenary which owned the joint family properties he was entitled to institute a suit for partition and separate possession of his one half share in the joint family properties, of course, except those which had been alienated in favour of third parties before the adoption by Dharma the appellant.
The effect of section 12 of the Act again came up for consideration before this Court in Vasant and Another vs Dattu and Others, A.I.R. 1987 S.C. 399.
In that case interpreting clause (c) to the proviso 1085 of section 12 of the Act Chinnappa Reddy, J. who spoke for the Court observed that in a case of this nature where the joint family properties had passed on to the hands of the remaining members of the coparcenary on the death of one of the coparceners no vesting of the property actually took place in the remaining coparceners while their share in the joint family properties might have increased on the death of one of the coparceners which was bound to decrease on the introduction of one more member into the family either by birth or by adoption.
In the above connection, the Court observed thus: "4.
We are concerned with proviso (c) to section 12.
The introduction of a member into a joint family, by birth or adoption, may have the effect of decreasing the share of the rest of the members of the joint family, but it certainly does not involve any question of divesting any person of any estate vested in him.
The joint family continues to hold the estate, but, with more members than before.
There is no fresh vesting or divesting of the estate in anyone.
The learned Counsel for the appellants urged that on the death of a member of a joint family the property must be considered to have vested in the remaining members by survivorship.
It is not possible to agree with this argument.
The property, no doubt passes by survivorship, but there is no question of any vesting or divesting in the sense contemplated by section 12 of the Act.
To interpret section 12 to include cases of devolution by survivorship on the death of a member of the joint family would be to deny any practical effect to the adoption made by the widow of a member of the joint family.
We do not think that such a result was in the contemplation of Parliament at all.
" We respectfully agree with the above observations of this Court in Vasant 's case (supra).
The joint family property does not cease to be joint family property when it passes to the hands of a sole surviving coparcener.
If a son is born to the sole surviving coparcener, the said properties become the joint family properties in his hands and in the hands of his son.
The only difference between the right of a manager of a joint Hindu family over the joint family properties where there are two or more coparceners and the right of a sole surviving coparcener in respect of the joint family properties is that while the former can alienate the joint family properties only for legal necessity or for family benefit, the latter is entitled to dispose of the coparcenary pro 1086 perty as if it were his separate property as long as he remains a sole surviving coparcener and he may sell or mortgage the coparcenary property even though there is no legal necessity or family benefit or may even make a gift of the coparcenary property.
If a son is subsequently born to or adopted by the sole surviving coparcener or a new coparcener is inducted into the family on an adoption made by a widow of a deceased coparcener an alienation made by the sole surviving coparcener before the birth of a new coparcener or the induction of a coparcener by adoption into the family whether by way of sale, mortgage or gift would however stand, for the coparcener who is born or adopted after the alientation cannot object to alientations made before he was begotten or adopted.
The decision of the High Court of Bombay in Y.K. Nalavade 's case (supra) which was followed by the High Court in dismissing the appeal, out of which the present appeal arises, has been rightly given.
We agree with the reasons given by the High Court of Bombay in that decision for taking the view that clause (c) to proviso of section 12 of the Act would not be attracted to a case of this nature since as observed by this Court in Vasant 's case (supra) there was no 'vesting ' of joint family property in Dharma the appellant took place on the death of Miragu and no 'divesting ' or property took place when Pandurang the first respondent was adopted.
The decision of the Andhra Pradesh High Court in Narra Hanumantha Rao 's case (supra) which takes a contrary view is not approved by us.
It, therefore, stands overruled.
The joint family properties continued to remain in the hands of Dharma the appellant as joint family properties and that on his adoption Pandurang the 1st respondent became a member of the coparcenary entitled to claim one half share in them except those items which had been sold by Dharma the appellant.
In the result this appeal fails and it is dismissed.
There is no order as to costs.
H.S.K. Appeal dismissed.
|
% A person had two sons, the appellant Dharma and another Miragu.
Miragu died issueless in 1928 leaving behind his widow, respondent No. 2.
The Joint family property devolved on the appellant as sole surviving coparcener.
The appellant disposed of certain properties.
In 1956 the came into force.
In 1968 the widow took respondent No. 1 in adoption.
Respondent Nos. 1 and 2 filed a suit for partition and separate possession of one half share in the property of the joint family.
Trial Court dismissed the suit.
Respondent Nos. 1 and 2 filed an appeal which was allowed by the District Judge and a preliminary decree for partition and separate possession was passed.
The appellant filed an appeal before the High Court and the High Court affirmed the decree passed by the District Judge.
Hence this appeal by special leave.
The contention of the appellant was that respondent No. 1 could not divest him of any part of the estate which had been vested in him before the adoption of respondent No. 1 in view of clause (c) of the proviso to section 12 of the Act.
Dismissing the appeal, this Court, ^ HELD: The Joint family property does not cease to be joint family property when it passes to the hands of a sole surviving coparcener.
1078 If a son is born to the sole surviving coparcener, the said properties become the joint family properties in his hands and in the hands of his son.
The only difference between the right of a manager of a joint Hindu family over the joint family properties where there are two or more coparceners and the right of a sole surviving coparceners in respect of the joint family properties is that while the former can alienate the joint family properties only for legal necessity or for family benefit, the latter is entitled to dispose of the coparcenary property as if it were his separate property as long as he remains a sole surviving coparcener and he may sell or mortgage the coparcenary property even though there is no legal necessity or family benefit or may even make a gift of the coparcenary property.
If a son is subsequently born to or adopted by the sole surviving coparcener or a new coparcener is inducted into the family on an adoption made by a widow of a deceased coparcener an alienation made by the sole surviving coparcener before the birth of a new coparcener or the induction of a coparcener by adoption into the family whether by way of sale, mortgage or gift would however stand, for the coparcener who is born or adopted after the alienation cannot object to alienations made before he was begotten or adopted.
[1085G H; 1086A C] In the instant case the joint family properties which belonged to the joint family consisting of Dharma the appellant and his brother Miragu continued to retain the character of joint family properties in the hands of Dharma the appellant as Champabai, the widow of Miragu was still alive and continued to enjoy the right of maintenance out of the said joint family properties.
Pandurang the 1st respondent on adoption became the adopted son of Miragu and became a coparcener with Dharma the appellant in the joint family properties.
When once he became a member of the coparcenary which owned the joint family properties he was entitled to institute a suit for partition and separate possession of his one half share in the joint family properties, of course, except those which had been alienated in favour of third parties before the adoption by Dharma the appellant.
[1084E G] Clause (c) to proviso of section 12 of the Act would not be attracted in the instant case since there was no 'vesting ' of joint family property in Dharma the appellant which took place on the death of Miragu and no 'divesting ' of property took place when Pandurang the first respondent was adopted.
[1086D E] The Joint family properties continued to remain in the hands of Dharma the appellant as joint family properties and that on his adoption Pandurang the 1st respondent became a member of the coparce 1079 nary entitled to claim one half share in them except those items which had been sold by Dharma the appellant.
[1086F] Y.K. Nalavade and Ors.
vs Anand G. Chavan and Ors., A.I.R. 1981 Bombay 109, approved.
Sawan Ram & Ors.
vs Kala Wanti & Ors., [1967] 3 S.C.R. 687; Sitabai and Anr.
vs Ram Chandra, ; , referred to.
Narra Hanumantha Rao vs Narra Hanumayya and Ors., [1964] 1 Andhra Weekly Reporter 156 I.L.R. , overruled.
Gowli Buddanna vs Commissioner of Income Tax, Mysore Bangalore, ; ; Vasant and Anr.
vs Dattu and Ors., A.I.R. 1987 S.C. 399, followed.
|
Civil Appeal No. 906 of 1984.
From the Judgment and Order dated 8.7.1980 of the Bombay High Court in Second Appeal No. 663 of 1971.
V.N. Ganpule for the Appellant.
S.V. Deshpande for the Respondent.
The Judgment of the Court was delivered by VENKATARAMIAH, J.
The short question which arises for consideration in this case is whether a person adopted by a Hindu widow after the coming into force of the (hereinafter referred to as 'the Act ') can claim a share in the property which had devolved on a sole surviving coparcener on the death of the husband of the widow who took him in adoption.
One Shamrao, who was governed by the Mitakshara Hindu Law died leaving behind him two sons Dharma (the appellant in this appeal) and Miragu.
Miragu died issueless in the year 1928 leaving behind him his widow Champabai respondent No. 2.
The properties owned by the joint family of Dharma and Miragu passed on to the hands of Dharma who was the sole surviving coparcener on the death of Miragu.
Under the law, as it stood then, Champabai had only a right of maintenance in the joint family properties.
The Act came into force on 1080 21st December, 1956.
On 9.8.1968 she took Pandurang, the 1st respondent, in adoption and immediately thereafter a suit was filed by Pandurang and Champabai in Regular Civil Suit No. 457 of 1968 on the file of the Civil Judge, Junior Division, Barsi for partition and separate possession of one half share in the properties of the joint family of which Dharma, the appellant herein, and Miragu were coparceners.
Before the said adoption took place, two items of the joint family properties had been sold in favour of Defendant Nos. 3 and 17 for consideration.
Champabai had instituted a suit for maintenance against Dharma and obtained a decree for maintenance.
Dharma resisted the suit on the ground that Pandurang was not entitled to claim any share in the properties which originally belonged to the joint family in view of clause (c) of the proviso to section 12 of the Act and the properties which had been sold by him in favour of third parties could not in any event be the subject matter of the partition suit.
The Trial Court dismissed the suit.
Pandurang and Champabai filed an appeal against the decree of the Trial Court before the District Court, Sholapur in Civil Appeal No. 222 of 1970.
The learned District Judge allowed the appeal and passed a preliminary decree for partition in favour of Pandurang and Champabai and separate possession of one half share of the joint family properties except the two fields which had been sold earlier in favour of third parties.
Aggrieved by the decree of the District Judge, the appellant filed an appeal before the High Court of Bombay in Second Appeal No. 663 of 1971.
The High Court affirmed the decree passed by the learned District Judge following the decision of that Court in Y.K. Nalavade and Others vs Anand G. Chavan and Others, A.I.R. 1981 Bombay 109 in which it had been held that clause (c) of the proviso to section 12 of the Act was not a bar to such a suit for partition.
This appeal by special leave is filed by the appellant against the judgment of the High Court of Bombay.
The only question urged on behalf of the appellant before us is that the suit for partition should have been dismissed by the High Court as the 1st respondent Pandurang could not divest Dharma the appellant of any part of the estate which had been vested in him before the adoption in view of clause (c) of the proviso to section 12 of the Act.
Section 12 of the Act reads thus: 12.
An adopted child shall be deemed to be the child of his or her adoptive father or mother for all purposes with effect from the date of the adoption and from such date all the ties of the child in the family of his or her birth shall be 1081 deemed to be severed and replaced by those created by the adoption in the adoptive family: Provided that (a) the child cannot marry any person whom he or she could not have married if he or she had continued in the family of his or her birth; (b) any property which vested in the adopted child before the adoption shall continue to vest in such person subject to the obligations, if any, attaching to the ownership of such property, including the obligation to maintain relatives in the family of his or her birth; (c) The adopted child shall not divest any person of any estate which vested in him or her before the adoption.
" It is argued that Pandurang became the child of the adoptive mother for all purposes with effect from the date of the adoption and only from that date all the ties of Pandurang in the family of his birth should be deemed to have been severed and replaced by those created by the adoption in the adoptive family and, therefore, Pandurang, the adopted son could not claim a share in the joint family properties which had devolved on the appellant by survivorship on the death of Miragu.
In support of this contention the appellant relied upon the decision of this Court in Sawan Ram & Others vs Kala Wanti & Others, ; The facts involved in that case were these.
A widow, whose husband had died before the Hindu Succession Act came into force, adopted the second respondent in that case after the commencement of the Act.
On the widow 's death the appellant in that case, claiming to be the nearest reversioner of her husband, filed a suit challenging the adoption.
The Trial Court dismissed the suit and the decree of the Trial Court was affirmed by the High Court.
Against the decree of the High Court the appellant therein filed an appeal by special leave before this Court.
In that appeal, the appellant contended that (i) the adoption was invalid under clause (ii) of section 6 read with section 9(2) of the Act as the son was given in adoption by his mother, even though the father was alive, and (ii) since under the Act an independent right of adoption had been given to Hindu female, if a widow adopted a son, he could become the adopted son of the widow only and could not be considered to be the son of her deceased husband also.
This Court negatived both the contentions.
We are not 1082 concerned with the first ground for purposes of this case.
On the second contention this Court held that the provision in section 12 of the Act made it clear that the adopted son of a Hindu female, who had been married, was in fact the adopted son of her husband also.
That decision was sufficient to dismiss the suit filed by the appellant as the adopted son in that case being the nearest heir was entitled to claim the properties involved in the suit to the exclusion of the appellant therein who was a more distant heir was not, therefore, entitled to lay claim to any part of the suit properties.
In the course of the said decision a decision of the Andhra Pradesh High Court in Narra Hanumantha Rao vs Narra Hanumayya and Others, [1964] 1 Andhra Weekly Reporter 156 I.L.R. had been cited before this Court.
In that case the High Court of Andhra Pradesh had taken the view that clause (c) of the proviso to section 12 of the Act laid down explicity that the adoption of a son or daughter by a male or female Hindu was not to result in the divesting of any estate vested in any person prior to the adoption and that clause (c) also applied to the interest which passed on by survivorship on the death of a coparcener to the remaining coparceners.
As pointed out earlier the said question did not actually arise in the appeal before this Court.
This Court, however, observed as follows: "It may, however, be mentioned that the conclusion which we have arrived at does not indicate that the ultimate decision given by the Andhra Pradesh High Court was in any way incorrect.
As we have mentioned earlier, the question in that case was whether E, after the adoption by D, the widow of B, could divest C of the rights which had already vested in C before the adoption.
It is significant that by the year 1936 C was the sole male member of the Hindu joint family which owned the disputed property.
B died in the year 1924 and A died in 1936.
By that time, the Hindu Women 's Rights to Property Act had not been enacted and consequently, C, as the sole male survivor of the family became full owner of that property.
In these circumstances, it was clear that after the adoption of E by D, E could not divest C of the rights already vested in him in view of the special provisions contained in clause (c) of the proviso to section 12 of the Act.
It appears that, by making such a provision, the Act has narrowed down the rights of an adopted child as compared with the rights of a child born posthumously.
Under the Shastriclaw, if a child was adopted by a widow, he was treated as a natural born child 1083 and, consequently, he could divest other members of the family of rights vested in them prior to his adoption.
It was only with the limited object of avoiding any such consequence on the adoption of a child by a Hindu widow that these provisions in clause (c) of the proviso to section 12, and section 13 of the Act were incorporated.
In that respect, the rights of the adopted child were restricted.
It is to be noted that this restriction was placed on the rights of a child adopted by either a male Hindu or a female Hindu and not merely in a case of adoption by a female Hindu.
This restriction on the rights of the adopted child cannot, therefore, in our opinion, lead to any inference that a child adopted by a widow will not be deemed to be the adopted son of her deceased husband.
The second ground taken on behalf of the appellant also, therefore, fails.
" It is no doubt true that the above observations appear to support a case of the appellant but since we are of the view that these observations were not necessary for deciding the case which was before the Court they have to be held obiter dicta.
In Sitabai & Anr.
vs Ram Chandra, ; which was again decided by a bench of three Judges, this Court was called upon to decide a case which was more or less similar to the one before us.
In that case the facts were these.
Two brothers were in possession of ancestral properties consisting of a house and tenancy rights of an ordinary tenant in agricultural lands.
The elder brother died in 1930 leaving a widow, the first appellant therein.
The first appellant continued to live with the younger brother and had an illegitimate son by him, the respondent therein.
In March, 1958, she adopted the second appellant, and some time later, the surviving brother died.
After his putative father died, the respondent who was the illegitimate son took possession of all the joint family properties.
The two appellants thereupon filed a suit for ejectment.
The Trial Court decreed the suit.
The first appellate court held that a will executed by the respondent 's father (the younger brother) was valid in so far as his half share in the house was concerned and, therefore, modified the decree by granting a half share of the house to the respondent.
In second appeal, the High Court held that the appellants were not entitled to any relief and that their suit should be dismissed on two grounds, namely, (i) the joint family properties ceased to have that character in the hands of the surviving brother when he became the sole surviving coparcener, and (2) the second appellant did not become, on his adoption, a copar 1084 cener with his uncle in the joint family properties.
In this Court the appellants in that appeal questioned both the conclusions reached by the High Court.
On the first contention, this Court held that the joint family properties continued to retain their character in the hands of the surviving brother, as the widow (the first appellant) of the elder brother was still alive and continued to enjoy the right of maintenance out of the joint family properties following the decision of this Court in Gowli Buddanna vs Commissioner of Income Tax, Mysore, Bangalore; , On the second contention this Court held that the scheme of sections 11 and 12 of the Act was that in the case of adoption by a widow the adopted child became absorbed in the adoptive family to which the widow belonged.
It further observed that though section 14 of the Act did not expressly state that the child adopted by a widow became the adopted son of her deceased husband, it was a necessary implication of sections 12 and 14 of the Act and that was why section 14 of the Act provided that when a widow adopted a child and subsequently married, that husband became the step father of the adopted child.
Therefore, when the second appellant was adopted by the first appellant he became the adopted son of the first appellant and her deceased husband, namely, the elder brother, and hence became a coparcener with the surviving brother in the joint family properties, and after the death of the surviving brother the second appellant became the sole surviving coparcener entitled to the possession of all the joint family properties except those bequeathed under the will, that is, except the half share of the house.
Applying the above decision it has to be held in the case before us that the joint family properties which belonged to the joint family consisting of Dharma the appellant and his brother Miragu continued to retain the character of joint family properties in the hands of Dharma the appellant as Champabai, the widow of Miragu was still alive and continued to enjoy the right of maintenance out of the said joint family properties.
It should also be held that Pandurang the 1st respondent on adoption became the adopted son of Miragu and became a coparcener with Dharma the appellant in the joint family properties.
When once he became a member of the coparcenary which owned the joint family properties he was entitled to institute a suit for partition and separate possession of his one half share in the joint family properties, of course, except those which had been alienated in favour of third parties before the adoption by Dharma the appellant.
The effect of section 12 of the Act again came up for consideration before this Court in Vasant and Another vs Dattu and Others, A.I.R. 1987 S.C. 399.
In that case interpreting clause (c) to the proviso 1085 of section 12 of the Act Chinnappa Reddy, J. who spoke for the Court observed that in a case of this nature where the joint family properties had passed on to the hands of the remaining members of the coparcenary on the death of one of the coparceners no vesting of the property actually took place in the remaining coparceners while their share in the joint family properties might have increased on the death of one of the coparceners which was bound to decrease on the introduction of one more member into the family either by birth or by adoption.
In the above connection, the Court observed thus: "4.
We are concerned with proviso (c) to section 12.
The introduction of a member into a joint family, by birth or adoption, may have the effect of decreasing the share of the rest of the members of the joint family, but it certainly does not involve any question of divesting any person of any estate vested in him.
The joint family continues to hold the estate, but, with more members than before.
There is no fresh vesting or divesting of the estate in anyone.
The learned Counsel for the appellants urged that on the death of a member of a joint family the property must be considered to have vested in the remaining members by survivorship.
It is not possible to agree with this argument.
The property, no doubt passes by survivorship, but there is no question of any vesting or divesting in the sense contemplated by section 12 of the Act.
To interpret section 12 to include cases of devolution by survivorship on the death of a member of the joint family would be to deny any practical effect to the adoption made by the widow of a member of the joint family.
We do not think that such a result was in the contemplation of Parliament at all.
" We respectfully agree with the above observations of this Court in Vasant 's case (supra).
The joint family property does not cease to be joint family property when it passes to the hands of a sole surviving coparcener.
If a son is born to the sole surviving coparcener, the said properties become the joint family properties in his hands and in the hands of his son.
The only difference between the right of a manager of a joint Hindu family over the joint family properties where there are two or more coparceners and the right of a sole surviving coparcener in respect of the joint family properties is that while the former can alienate the joint family properties only for legal necessity or for family benefit, the latter is entitled to dispose of the coparcenary pro 1086 perty as if it were his separate property as long as he remains a sole surviving coparcener and he may sell or mortgage the coparcenary property even though there is no legal necessity or family benefit or may even make a gift of the coparcenary property.
If a son is subsequently born to or adopted by the sole surviving coparcener or a new coparcener is inducted into the family on an adoption made by a widow of a deceased coparcener an alienation made by the sole surviving coparcener before the birth of a new coparcener or the induction of a coparcener by adoption into the family whether by way of sale, mortgage or gift would however stand, for the coparcener who is born or adopted after the alientation cannot object to alientations made before he was begotten or adopted.
The decision of the High Court of Bombay in Y.K. Nalavade 's case (supra) which was followed by the High Court in dismissing the appeal, out of which the present appeal arises, has been rightly given.
We agree with the reasons given by the High Court of Bombay in that decision for taking the view that clause (c) to proviso of section 12 of the Act would not be attracted to a case of this nature since as observed by this Court in Vasant 's case (supra) there was no 'vesting ' of joint family property in Dharma the appellant took place on the death of Miragu and no 'divesting ' or property took place when Pandurang the first respondent was adopted.
The decision of the Andhra Pradesh High Court in Narra Hanumantha Rao 's case (supra) which takes a contrary view is not approved by us.
It, therefore, stands overruled.
The joint family properties continued to remain in the hands of Dharma the appellant as joint family properties and that on his adoption Pandurang the 1st respondent became a member of the coparcenary entitled to claim one half share in them except those items which had been sold by Dharma the appellant.
In the result this appeal fails and it is dismissed.
There is no order as to costs.
H.S.K. Appeal dismissed.
|
From the Judgment and Order dated 8.7.1980 of the Bombay High Court in Second Appeal No. The Judgment of the Court was delivered by VENKATARAMIAH, J.
The short question which arises for consideration in this case is whether a person adopted by a Hindu widow after the coming into force of the (hereinafter referred to as 'the Act ') can claim a share in the property which had devolved on a sole surviving coparcener on the death of the husband of the widow who took him in adoption. One Shamrao, who was governed by the Mitakshara Hindu Law died leaving behind him two sons Dharma (the appellant in this appeal) and Miragu. Miragu died issueless in the year 1928 leaving behind him his widow Champabai respondent No. The properties owned by the joint family of Dharma and Miragu passed on to the hands of Dharma who was the sole surviving coparcener on the death of Miragu. Under the law, as it stood then, Champabai had only a right of maintenance in the joint family properties. The Act came into force on 1080 21st December, 1956. On 9.8.1968 she took Pandurang, the 1st respondent, in adoption and immediately thereafter a suit was filed by Pandurang and Champabai in Regular Civil Suit No. 457 of 1968 on the file of the Civil Judge, Junior Division, Barsi for partition and separate possession of one half share in the properties of the joint family of which Dharma, the appellant herein, and Miragu were coparceners. Before the said adoption took place, two items of the joint family properties had been sold in favour of Defendant Nos. Champabai had instituted a suit for maintenance against Dharma and obtained a decree for maintenance. Dharma resisted the suit on the ground that Pandurang was not entitled to claim any share in the properties which originally belonged to the joint family in view of clause (c) of the proviso to section 12 of the Act and the properties which had been sold by him in favour of third parties could not in any event be the subject matter of the partition suit. Pandurang and Champabai filed an appeal against the decree of the Trial Court before the District Court, Sholapur in Civil Appeal No. The learned District Judge allowed the appeal and passed a preliminary decree for partition in favour of Pandurang and Champabai and separate possession of one half share of the joint family properties except the two fields which had been sold earlier in favour of third parties. Aggrieved by the decree of the District Judge, the appellant filed an appeal before the High Court of Bombay in Second Appeal No. The High Court affirmed the decree passed by the learned District Judge following the decision of that Court in Y.K. Nalavade and Others vs Anand G. Chavan and Others, A.I.R. 1981 Bombay 109 in which it had been held that clause (c) of the proviso to section 12 of the Act was not a bar to such a suit for partition. This appeal by special leave is filed by the appellant against the judgment of the High Court of Bombay. " It is argued that Pandurang became the child of the adoptive mother for all purposes with effect from the date of the adoption and only from that date all the ties of Pandurang in the family of his birth should be deemed to have been severed and replaced by those created by the adoption in the adoptive family and, therefore, Pandurang, the adopted son could not claim a share in the joint family properties which had devolved on the appellant by survivorship on the death of Miragu. In support of this contention the appellant relied upon the decision of this Court in Sawan Ram & Others vs Kala Wanti & Others, ; The facts involved in that case were these. A widow, whose husband had died before the Hindu Succession Act came into force, adopted the second respondent in that case after the commencement of the Act. On the widow 's death the appellant in that case, claiming to be the nearest reversioner of her husband, filed a suit challenging the adoption. The Trial Court dismissed the suit and the decree of the Trial Court was affirmed by the High Court. Against the decree of the High Court the appellant therein filed an appeal by special leave before this Court. This Court negatived both the contentions. We are not 1082 concerned with the first ground for purposes of this case. On the second contention this Court held that the provision in section 12 of the Act made it clear that the adopted son of a Hindu female, who had been married, was in fact the adopted son of her husband also. That decision was sufficient to dismiss the suit filed by the appellant as the adopted son in that case being the nearest heir was entitled to claim the properties involved in the suit to the exclusion of the appellant therein who was a more distant heir was not, therefore, entitled to lay claim to any part of the suit properties. In the course of the said decision a decision of the Andhra Pradesh High Court in Narra Hanumantha Rao vs Narra Hanumayya and Others, [1964] 1 Andhra Weekly Reporter 156 I.L.R. had been cited before this Court. In that case the High Court of Andhra Pradesh had taken the view that clause (c) of the proviso to section 12 of the Act laid down explicity that the adoption of a son or daughter by a male or female Hindu was not to result in the divesting of any estate vested in any person prior to the adoption and that clause (c) also applied to the interest which passed on by survivorship on the death of a coparcener to the remaining coparceners. As pointed out earlier the said question did not actually arise in the appeal before this Court. This Court, however, observed as follows: "It may, however, be mentioned that the conclusion which we have arrived at does not indicate that the ultimate decision given by the Andhra Pradesh High Court was in any way incorrect. As we have mentioned earlier, the question in that case was whether E, after the adoption by D, the widow of B, could divest C of the rights which had already vested in C before the adoption. It is significant that by the year 1936 C was the sole male member of the Hindu joint family which owned the disputed property. B died in the year 1924 and A died in 1936. By that time, the Hindu Women 's Rights to Property Act had not been enacted and consequently, C, as the sole male survivor of the family became full owner of that property. In these circumstances, it was clear that after the adoption of E by D, E could not divest C of the rights already vested in him in view of the special provisions contained in clause (c) of the proviso to section 12 of the Act. It appears that, by making such a provision, the Act has narrowed down the rights of an adopted child as compared with the rights of a child born posthumously. Under the Shastriclaw, if a child was adopted by a widow, he was treated as a natural born child 1083 and, consequently, he could divest other members of the family of rights vested in them prior to his adoption. It was only with the limited object of avoiding any such consequence on the adoption of a child by a Hindu widow that these provisions in clause (c) of the proviso to section 12, and section 13 of the Act were incorporated. In that respect, the rights of the adopted child were restricted. It is to be noted that this restriction was placed on the rights of a child adopted by either a male Hindu or a female Hindu and not merely in a case of adoption by a female Hindu. This restriction on the rights of the adopted child cannot, therefore, in our opinion, lead to any inference that a child adopted by a widow will not be deemed to be the adopted son of her deceased husband. The second ground taken on behalf of the appellant also, therefore, fails. " It is no doubt true that the above observations appear to support a case of the appellant but since we are of the view that these observations were not necessary for deciding the case which was before the Court they have to be held obiter dicta. vs Ram Chandra, ; which was again decided by a bench of three Judges, this Court was called upon to decide a case which was more or less similar to the one before us. Two brothers were in possession of ancestral properties consisting of a house and tenancy rights of an ordinary tenant in agricultural lands. The elder brother died in 1930 leaving a widow, the first appellant therein. The first appellant continued to live with the younger brother and had an illegitimate son by him, the respondent therein. In March, 1958, she adopted the second appellant, and some time later, the surviving brother died. After his putative father died, the respondent who was the illegitimate son took possession of all the joint family properties. The two appellants thereupon filed a suit for ejectment. The first appellate court held that a will executed by the respondent 's father (the younger brother) was valid in so far as his half share in the house was concerned and, therefore, modified the decree by granting a half share of the house to the respondent. In second appeal, the High Court held that the appellants were not entitled to any relief and that their suit should be dismissed on two grounds, namely, (i) the joint family properties ceased to have that character in the hands of the surviving brother when he became the sole surviving coparcener, and (2) the second appellant did not become, on his adoption, a copar 1084 cener with his uncle in the joint family properties. In this Court the appellants in that appeal questioned both the conclusions reached by the High Court. It further observed that though section 14 of the Act did not expressly state that the child adopted by a widow became the adopted son of her deceased husband, it was a necessary implication of sections 12 and 14 of the Act and that was why section 14 of the Act provided that when a widow adopted a child and subsequently married, that husband became the step father of the adopted child. Therefore, when the second appellant was adopted by the first appellant he became the adopted son of the first appellant and her deceased husband, namely, the elder brother, and hence became a coparcener with the surviving brother in the joint family properties, and after the death of the surviving brother the second appellant became the sole surviving coparcener entitled to the possession of all the joint family properties except those bequeathed under the will, that is, except the half share of the house. Applying the above decision it has to be held in the case before us that the joint family properties which belonged to the joint family consisting of Dharma the appellant and his brother Miragu continued to retain the character of joint family properties in the hands of Dharma the appellant as Champabai, the widow of Miragu was still alive and continued to enjoy the right of maintenance out of the said joint family properties. It should also be held that Pandurang the 1st respondent on adoption became the adopted son of Miragu and became a coparcener with Dharma the appellant in the joint family properties. When once he became a member of the coparcenary which owned the joint family properties he was entitled to institute a suit for partition and separate possession of his one half share in the joint family properties, of course, except those which had been alienated in favour of third parties before the adoption by Dharma the appellant. The effect of section 12 of the Act again came up for consideration before this Court in Vasant and Another vs Dattu and Others, A.I.R. 1987 S.C. 399. In the above connection, the Court observed thus: "4. We are concerned with proviso (c) to section 12. The introduction of a member into a joint family, by birth or adoption, may have the effect of decreasing the share of the rest of the members of the joint family, but it certainly does not involve any question of divesting any person of any estate vested in him. The joint family continues to hold the estate, but, with more members than before. There is no fresh vesting or divesting of the estate in anyone. The learned Counsel for the appellants urged that on the death of a member of a joint family the property must be considered to have vested in the remaining members by survivorship. It is not possible to agree with this argument. The property, no doubt passes by survivorship, but there is no question of any vesting or divesting in the sense contemplated by section 12 of the Act. To interpret section 12 to include cases of devolution by survivorship on the death of a member of the joint family would be to deny any practical effect to the adoption made by the widow of a member of the joint family. We do not think that such a result was in the contemplation of Parliament at all. " We respectfully agree with the above observations of this Court in Vasant 's case (supra). The joint family property does not cease to be joint family property when it passes to the hands of a sole surviving coparcener. If a son is born to the sole surviving coparcener, the said properties become the joint family properties in his hands and in the hands of his son. If a son is subsequently born to or adopted by the sole surviving coparcener or a new coparcener is inducted into the family on an adoption made by a widow of a deceased coparcener an alienation made by the sole surviving coparcener before the birth of a new coparcener or the induction of a coparcener by adoption into the family whether by way of sale, mortgage or gift would however stand, for the coparcener who is born or adopted after the alientation cannot object to alientations made before he was begotten or adopted. We agree with the reasons given by the High Court of Bombay in that decision for taking the view that clause (c) to proviso of section 12 of the Act would not be attracted to a case of this nature since as observed by this Court in Vasant 's case (supra) there was no 'vesting ' of joint family property in Dharma the appellant took place on the death of Miragu and no 'divesting ' or property took place when Pandurang the first respondent was adopted. The decision of the Andhra Pradesh High Court in Narra Hanumantha Rao 's case (supra) which takes a contrary view is not approved by us. In the result this appeal fails and it is dismissed.
|
% A person had two sons, the appellant Dharma and another Miragu.
Miragu died issueless in 1928 leaving behind his widow, respondent No. 2.
The Joint family property devolved on the appellant as sole surviving coparcener.
The appellant disposed of certain properties.
In 1956 the came into force.
In 1968 the widow took respondent No. 1 in adoption.
Respondent Nos. 1 and 2 filed a suit for partition and separate possession of one half share in the property of the joint family.
Trial Court dismissed the suit.
Respondent Nos. 1 and 2 filed an appeal which was allowed by the District Judge and a preliminary decree for partition and separate possession was passed.
The appellant filed an appeal before the High Court and the High Court affirmed the decree passed by the District Judge.
Hence this appeal by special leave.
The contention of the appellant was that respondent No. 1 could not divest him of any part of the estate which had been vested in him before the adoption of respondent No. 1 in view of clause (c) of the proviso to section 12 of the Act.
Dismissing the appeal, this Court, ^ HELD: The Joint family property does not cease to be joint family property when it passes to the hands of a sole surviving coparcener.
1078 If a son is born to the sole surviving coparcener, the said properties become the joint family properties in his hands and in the hands of his son.
The only difference between the right of a manager of a joint Hindu family over the joint family properties where there are two or more coparceners and the right of a sole surviving coparceners in respect of the joint family properties is that while the former can alienate the joint family properties only for legal necessity or for family benefit, the latter is entitled to dispose of the coparcenary property as if it were his separate property as long as he remains a sole surviving coparcener and he may sell or mortgage the coparcenary property even though there is no legal necessity or family benefit or may even make a gift of the coparcenary property.
If a son is subsequently born to or adopted by the sole surviving coparcener or a new coparcener is inducted into the family on an adoption made by a widow of a deceased coparcener an alienation made by the sole surviving coparcener before the birth of a new coparcener or the induction of a coparcener by adoption into the family whether by way of sale, mortgage or gift would however stand, for the coparcener who is born or adopted after the alienation cannot object to alienations made before he was begotten or adopted.
[1085G H; 1086A C] In the instant case the joint family properties which belonged to the joint family consisting of Dharma the appellant and his brother Miragu continued to retain the character of joint family properties in the hands of Dharma the appellant as Champabai, the widow of Miragu was still alive and continued to enjoy the right of maintenance out of the said joint family properties.
Pandurang the 1st respondent on adoption became the adopted son of Miragu and became a coparcener with Dharma the appellant in the joint family properties.
When once he became a member of the coparcenary which owned the joint family properties he was entitled to institute a suit for partition and separate possession of his one half share in the joint family properties, of course, except those which had been alienated in favour of third parties before the adoption by Dharma the appellant.
[1084E G] Clause (c) to proviso of section 12 of the Act would not be attracted in the instant case since there was no 'vesting ' of joint family property in Dharma the appellant which took place on the death of Miragu and no 'divesting ' of property took place when Pandurang the first respondent was adopted.
[1086D E] The Joint family properties continued to remain in the hands of Dharma the appellant as joint family properties and that on his adoption Pandurang the 1st respondent became a member of the coparce 1079 nary entitled to claim one half share in them except those items which had been sold by Dharma the appellant.
[1086F] Y.K. Nalavade and Ors.
vs Anand G. Chavan and Ors., A.I.R. 1981 Bombay 109, approved.
Sawan Ram & Ors.
vs Kala Wanti & Ors., [1967] 3 S.C.R. 687; Sitabai and Anr.
vs Ram Chandra, ; , referred to.
Narra Hanumantha Rao vs Narra Hanumayya and Ors., [1964] 1 Andhra Weekly Reporter 156 I.L.R. , overruled.
Gowli Buddanna vs Commissioner of Income Tax, Mysore Bangalore, ; ; Vasant and Anr.
vs Dattu and Ors., A.I.R. 1987 S.C. 399, followed.
|
% A person had two sons, the appellant Dharma and another Miragu. Miragu died issueless in 1928 leaving behind his widow, respondent No. The Joint family property devolved on the appellant as sole surviving coparcener. The appellant disposed of certain properties. 1 and 2 filed a suit for partition and separate possession of one half share in the property of the joint family. 1 and 2 filed an appeal which was allowed by the District Judge and a preliminary decree for partition and separate possession was passed. The appellant filed an appeal before the High Court and the High Court affirmed the decree passed by the District Judge. The contention of the appellant was that respondent No. 1 could not divest him of any part of the estate which had been vested in him before the adoption of respondent No. 1 in view of clause (c) of the proviso to section 12 of the Act. Dismissing the appeal, this Court, ^ HELD: The Joint family property does not cease to be joint family property when it passes to the hands of a sole surviving coparcener. 1078 If a son is born to the sole surviving coparcener, the said properties become the joint family properties in his hands and in the hands of his son. If a son is subsequently born to or adopted by the sole surviving coparcener or a new coparcener is inducted into the family on an adoption made by a widow of a deceased coparcener an alienation made by the sole surviving coparcener before the birth of a new coparcener or the induction of a coparcener by adoption into the family whether by way of sale, mortgage or gift would however stand, for the coparcener who is born or adopted after the alienation cannot object to alienations made before he was begotten or adopted. Pandurang the 1st respondent on adoption became the adopted son of Miragu and became a coparcener with Dharma the appellant in the joint family properties. [1086D E] The Joint family properties continued to remain in the hands of Dharma the appellant as joint family properties and that on his adoption Pandurang the 1st respondent became a member of the coparce 1079 nary entitled to claim one half share in them except those items which had been sold by Dharma the appellant. Narra Hanumantha Rao vs Narra Hanumayya and Ors., [ 1964] 1 Andhra Weekly Reporter 156 I.L.R. , overruled. Gowli Buddanna vs Commissioner of Income Tax, Mysore Bangalore, ; ; Vasant and Anr.
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Civil Appeal No.877 of 1974.
From the Judgment and Decree dated 17.11.1971 of the Allahabad High Court in First Appeal No. 171 of 1966.
D.N. Mukherjee, G.S. Chatterjee and A. Bhattacharjee for the Appellant.
Prithvi Raj and Mrs. Shobha Dikshit for the Respondent.
The Judgment of the Court was delivered by VENKATACHALIAH, J.
This appeal, for enhancement of compensation, by Special leave, arises out of and is directed against the judgment and decree dated 17th November, 1971 of the High Court of Allahabad in First Appeal No. 171 of 1966 affirming the Award and Decree dated 13.12.1965 of the Ist Addl.
District Judge, Varanasi, made in a Reference Under Section 18 of the Land Acquisition Act 1894.
Property known as "Gopal Lal Villa" a sprawling 60 year old building of about 25,000 square feet of plinth area comprising of 35 rooms, halls and other appurtenances, its large 23.66 acre grounds with 431 fruit and 13 Timber trees; 12 Bamboo clumps, situated on the outskirts of the City of Varanasi, originally part of the estate of Raja P.N. Tagore, and now vesting in the Administrator General, West Bengal, was acquired pursuant to the preliminary notification, published in the Gazette, dated, 4.7.1959 for the purposes of the education department of the Government of Uttar Pradesh.
Before the Land Acquisition Officer, Appellant claimed compensation of Rs.8,00,580 (at Rs.352 per decimal) for the land; Rs.3,50,000 for the building and structures; Rs.41,010 for the tree growth; and Rs.5,000 as compensation for change of residence.
The Land Acquisition Officer, however, by his Award dated 4.11.1961 under Section 11 of the Act determined the market value of the land at Rs.3,31,340 valuing it Rs. 140 per decimal (or Rs.14,000 per 1032 acre); of the building and structures at Rs.57,660 and of the treegrowth at Rs.355.83.
Appellant, not having accepted the offer contained in the award, sought for a reference under Section 18 of the Act to the Civil Court in proceedings pursuant to which the District Court enhanced the market value of the land to Rs.4,73,200 (from Rs.140 to Rs.200 per decimal) leaving the valuation of the building and the tree growth undisturbed.
The High Court has affirmed the Award dismissing appellant 's claim for further enhancement before it.
We have heard Shri D.N. Mukherjee, learned counsel in support of the appeal and Shri Prithviraj, learned Senior Advocate for the respondent.
We have been taken through the judgment under appeal and the evidence on record.
On the contentions urged at the hearing, the following points fall for consideration: (a) Whether the estimate of the market value of the acquiredland at Rs.200 per decimal is unreasonably low and is arrived at ignoring the evidence on record and settled principles of valuation? (b) Whether the valuation of the buildings and structures at a mere Rs.57,660 calls for an upward revision? (c) Whether the award made for the tree growth is inadequate and is required to be valued higher? (d) Whether appellant is entitled to the benefit of Sec.
23(2) of the Act as introduced by the U.P. Law Acquisition (Amendment) Act 1972 providing for solatium and, further, to higher rates of solatium and interest under the Central Amending Act (Act No. 68 of 1984) on the ground that proceedings were pending in appeal before this court on the dates these amendments came into force? 4.
Re: Contention (a) The acquired land had the potentiality for building purposes.
Learned District Judge found that: ".
The Land Acquisition Officer himself realised this fact and has observed that "the land under acquisition is 1033 situated within the Corporation limits in Mohalla Orderly Bazar, a thickly populated locality and is near to Kutchery.
It has, therefore, a potential value as building site.
" I may add here that though the acquired land is at a distance of about 3 to 3 1/2 miles from the main markets of Varanasi City, yet every thing of daily need and of day today utility is available in the market which exists in the locality of the acquired land.
It may also be added that the land adjacent to the west of the acquired land known as 'Tagore Nagar ' formerly formed part of this Gopal Lal Villa and both were covered by one boundary.
The land of Tagore Nagar has been divided into small portions and a colony with residential quarters has grown up there.
This was already in existence before the present acquisition . ." The determination of market value of a piece land with potentialities for urban use is an intricate exercise which calls for collection and collation of diverse economic criteria.
The market value of a piece of property, for purposes of Section 23 of the Act, is stated to be the price at which the property changes hands from a willing seller to a willing, but not too anxious a buyer, dealing at arms length.
The determination of market value, as one author put it, is the prediction of an economic event.
viz, the price outcome of a hypothetical sale, expressed in terms of probabilities.
Prices fetched for similar lands with similar advantages and potentialities under bona fide transactions of sale at or about the time of the preliminary notification are the usual, and indeed the best, evidences of market value.
Other methods of valuation are resorted to if the evidence of sale of similar lands is not available.
In the District court, appellant relied upon eight transactions of what, according to him, were sale, of similar lands.
The transactions at Ext.
18, 20, 21 and 22, dated, 25.3.1952, 1.12.1955, 11.8.1953 & 11.7.1957 respectively were rejected by learned District Judge on the ground that they were long enterior in point of time to the acquisition and lacked the element of contemporaneity.
23 dated, 25.10.1958 and Ext.
24 dated, 18.8.1960 were also held not to afford reliable evidence of market value on the ground that while in the former case the property was sold along with a construction thereon without any indication as to the apportionment of the price between the land and the construction, in the latter case the sale was about an year subsequent to the date of the preliminary notification.
1034 What remained were the evidence of sale transactions at Exts.
2 and 19 dated 16.9.1958 and 22.12.1958 respectively indicating a price of Rs.1250 and Rs.900 per biswa respectively.
The District Judge struck an average of the two and fixed the rate at Rs.1075 per biswa which worked out to about Rs.350, or thereabouts, per decimal.
But since Ext. 2 and Ext. 19 related to very small plots, the learned District Judge on some calculations of his own, fixed the rate of Rs.200 per decimal for the acquired land.
Shri Mukharji in support of the appellant 's claim @ Rs.352 per decimal submitted that the High Court, in affirming the valuation of the land at a mere Rs.200 per decimal, overlooked certain settled principles of valuation in that it approved the process adopted by the learned District Judge of striking an average of the valuations reflected in Ext.
2 and Ext.
19, while the higher of the two figures indicated by Ext. 2, should have been adopted.
Learned Counsel submitted that the acquired land, though situate about 3 1/2 miles away from the heart of Varanasi City, had all the potentiality for use for building purposes and that the rejection of the evidence of market value afforded by Ext.
24, the transaction of sale dated 14.7.1960 which indicated a price of Rs.2,000 per biswa on the ground that it was an year later than the preliminary notification was erroneous.
It is trite proposition that prices fetched for small plots can not form safe bases for valuation of large tracts of land as the two are not comparable properties.
(See Collector of Lakhimpur vs B.C. Dutta, AIR 1971 SC 2015; Mirza Nausherwan Khan & Anr.
vs The Collector (Land Acquisition), Hyderabad, [1975] 1 SCR; Padma Uppal etc.
vs State of Punjab & Ors., [1971] 1 SCR; Smt.
Kaushalya Devi Bogra & Ors.
vs The Land Acquisition Officer Aurangabad & Anr., [1984] 2 SCR.
The principle that evidence of market value of sales of small, developed plots is not a safe guide in valuing large extents of land has to be understood in its proper perspective.
The principle requires that prices fetched for small developed plots cannot directly be adopted in valuing large extents.
However, if it is shown that the large extent to be valued does admit of and is ripe for use for building purposes; that building lots that could be laid out on the land would be good selling propositions and that valuation on the basis of the method of a hypothetical lay out could with justification be adopted, then in valuing such small, laid out sites the valuation indicated by sale of comparable small sites in the area at or about the time of the notification would be relevant.
In such a case, necessary deductions for the extent of land required for the formation of roads and other civic 1035 amenities; expenses of development of the sites by laying out roads, drains, sewers, water and electricity lines, and the interest on the outlays for the period of deferment of the realisation of the price; the profits on the venture etc. are to be made.
In Sahib Singh Kalha & Ors.
vs Amritsar Improvement Trust and Ors., (See , this court indicated that deductions for land required for roads and other developmental expenses can, together, come up to as much as 53%.
But the prices fetched for small plots cannot directly be applied in the case of large areas, for the reason that the former reflects the 'retail ' price of land and the latter the 'wholesale ' price.
The sale transaction at Ext.
24 was an year later.
Such subsequent transactions which are not proximate in point of time to the acquisition can be taken into account for purposes of determining whether as on the date of acquisition there was an upward trend in the prices of land in the area.
Further under certain circumstances where it is shown that the market was stable and there were no fluctuations in the prices between the date of the preliminary notification and the date of such subsequent transaction, the transaction could also be relied upon to ascertain the market value.
This court in State of U.P. vs Maj.
Jitender Kumar, (See observed: ". .
It is true that the sale deed Ext.
21 upon which the High Court has relied is of a date three years later than the Notification under section 4 but no material was produced before the Court to suggest that there was any fluctuation in the market rate at Meerut from 1948 onwards till 1951 and if so to what extent.
In the absence of any material showing any fluctuation in the market rate the High Court thought it fit to rely upon exhibit 21 under which the Housing Society itself had purchased land in the neighbourhood of the land dispute.
On the whole we are not satisified that any error was committed by the High Court in relying upon the sale deed exhibit 21. ." But this principle could be appealed to only where there is evidence to the effect that there was no upward surge in the prices in the interregnum.
The burden of establishing this would be squarely on the party relying on such subsequent transaction.
In the present case appellant did not endeavour to show that between the date of preliminary notification i.e. 4.7.1959 and the date of Ext.
24 i.e. 18.8.1960 there was no appreciation in the value of land in the area.
Therefore, Ext.
24 cannot be relied upon as affording evidence of the market 1036 value as on 4.7.1959.
We cannot accept the argument that the price indicated in Ext.
24 should be accepted after allowing an appropriate deduction for the possible appreciation of the land values during the period of one year.
Apart from other difficulties in this exercise, there is no evidence as to the rate and degree of appreciation in the values of land so that the figure could be jobbed backwards from 14.7.1960 to 4.7.1959.
It appears to us that even if the value at Rs.1,250 as on 27.8.1958 indicated by Ext.
2 is adopted and something is added thereto for the possible appreciation for the period till the preliminary notification, also taking into account the trend of appreciation in the prices in the area as indicated by Ext.
24 and the value of small developed sites is estimated somewhere between Rs.1,400 and Rs.1,600 per biswa or Rs.450 to Rs.500 per decimal, yet, the valuation made in the present case does not call for or justify any upward revision at all.
There is a simple way of cross checking these results.
The value of small plots Rs.500 per decimal as now estimated represents what may be called the "retail" price of the land.
What is to be estimated therefrom is the "wholesale" price of land.
In Bombay Improvement vs Mervanji Manekji Mistry, (See AIR 1926 Bombay 420) Mecleod CJ suggested a simple rule: ". .Valuation cases must be dealt with just as much from the point of view of the hypothetical purchase as of the claimant.
The valuation itself must often be more or less a matter of guesswork.
But it is obviously wrong to fix upon a valuation which, judged by everyday principles, no purchaser would be likely to give . ." ". .I have always been adverse to elaborate hypothetical calculations which are no more likely to lead to a fair conclusion than far simpler methods.
But, in any event, no harm can be done by testing a conclusion arrived at in one way by a conclusion arrived at in another . ." ". .A very simple method of valuing land wholesale from retail prices is to take anything between one and half onethird, according to circumstances of the expected gross valuation, as the wholesale price. ." (emphasis supplied) In the present case, Rs.200 per decimal for the large extent of the 1037 acquired land works out to 40% of the "retail" price even if we take, Rs.500 as the "retail" price.
That apart, in the case of land with potentialities for a more profitable use, it is necessary to acknowledge, and make due allowance for, the possibility that the land might not be applied for the prospective use at all or not so applied within a reasonable time.
There is, therefore, no justification to interfere with the determination of the market value of the land approved by the High Court.
Contention (a) is accordingly answered against the appellant.
Re: Contention (b) The District Court proceeded to value the property on the "Land and Building Method".
The appositeness of this method to the present case was not debated before us.
Usually, land and building thereon constitute one unit.
Land is one kind of property; land and building together constitute an altogether different kind of property.
They must be valued as one unit.
But where, however, the property comprises extensive land and the structures thereon do not indicate a realisation of the full developmental potential of the land, it might not be impermissible to value the property estimating separately the market value of the land with reference to the date of the preliminarynotification and to add to it the value of the structures as at that time.
In this method, building value is estimated on the basis of the primecost or replacement cost less depreciation.
The rate of depreciation is, generally, arrived at by dividing the cost of construction (Less the salvage value at the end of the period of utility) by the number of years of utility of the building.
The factors that prolong the life and utility of the building, such as good maintenance, necessarily influence and bring down the rate of depreciation.
Hari Shanker Misra PW 3 referring to the nature and quality of the building stated: ".
The Northern part of this Villa was double storeyed and rest was single storeyed.
Its plinth was 3 feet high and rooms were 14 feet high.
The building bore 35 rooms and besides this there was a big hall 65 feet x 22 feet.
Its floor was made up of some patent stones.
Some monthly some market and Vkiya were stoned.
The doors were 8 feet x 4 feet and they were made up of Burma teak wood and up ways were double doored.
When Improvement Trust oc 1038 cupied the property of Nejai at that time building was well maintained.
Over and above the main building there were manager quarters.
Kitchen, out house, servant quarters, Chowkidar quarters and a stable.
Now they were in good condition.
Its boundary wall was 7 feet and at some places they were 8 feet high.
This also consists of 2 iron gates.
One is main gate and the other one is by its side of some distance. " Learned District Judge based his valuation almost entirely upon the report of the Chief Engineer, estimating the building at Rs.57,660.
That report itself was not brought on record in the proceedings of reference.
It is not clear from the judgment of the High Court whether this estimate of Rs.57,660 represented the cost of replacement of the structure less depreciation or whether it represented merely the salvage value of the building.
High Court rejected the Valuation Report, Ext.
1 relied upon by the appellant on the ground that it was made with reference to a date which was an year later than the preliminary notification.
The High Court observed: ".
The appellant had examined Narain Chand Das, an Overseer who had assisted the Executive Engineer, in preparing the valuation of the constructions and the well.
The report of the Executive Engineer is Ext.
1 on the record.
It appears from the said report that the valuation was determined on the basis of the rates prevailing in the year 1960 where as the preliminary notification in the instant case was issued in the year 1959.
Moreover, this building appears to be about 60 years old and the market value thereof could not be determined on the basis of the cost of constructions prevailing in the year 1960.
This method of calculating the market value of the property is obviously erroneous and cannot be accepted.
No other evidence was produced by the appellant to determine the value of the constructions and the well.
The evidence produced by him being not satisfactory, the compensation already determined by the Land Acquisition Officer in respect of this item of the property was not liable to be enhanced. ." We are afraid the estimate of the proper market value of the building has not received the requisite attention both before the High Court and the District Court.
It is no doubt true that Ext.
1 was prepared on 20.7.1960, an year after the date of the preliminary notifi 1039 cation in the present case; but the extent of the built area was about 2,500 sq.
1 gives a breakdown of the area of the various parts of the building and sets out the nature of the construction and proceeds to estimate the value in terms of the then current PWD rates less depreciation of 20%.
The rates adopted were not particular to the date of valuation i.e. 20.7.1960.
The PWD rates are operative over a period, generally for an year or so.
The extent or the quality of construction were also not in dispute.
The main building of an area of 18828 sq.
consisted of 35 rooms, and a big hall with 'Marble Flooring ', 'Burma Teak Shutters ', 'Stone Slab Roofing ', a portico with 'Glazed Gracian Pillars ' etc.
In Ext.
1, the main portion was valued at Rs.12 per sq.
Apart from the main building, there were other appurtenances such as the Managers ' quarters, kitchen house, chowkidars ' quarters, out house, stables, pucca wells etc.
The other structures have been valued area wise at much lesser rates, according as the nature of the construction.
The decendants of Raja P.N. Tagore, it was claimed, were residing in the building till a few days before possession was taken.
There is no evidence to suggest that, the rates mentioned and adopted in Ext.
1 were not rates valid for a spread out period.
It appears to us somewhat unreasonable that the extensive building of 25,000 sq.
with big halls and 35 rooms constructed with quality material, marble flooring, burma teak joinery should be valued at a mere Rs.57,660.
No case was made out that the building had lost its utility and that only mode of valuation appropriate to the case was one of awarding merely the salvage value.
The building, according to the evidence, was quite strong though about 60 years old at the time.
Having regard to the circumstances of this case, the appropriate thing to do would have been to set aside the award in so far as the valuation of the building is concerned and remit the matter for a fresh determination of its market value as on 14.7.1959.
But the parties have been at litigation for decades.
The acquisition is of the year 1959.
We, therefore, thought and put to the learned counsel on both sides whether in the interests of justice, it would not be proper to make some rough and ready estimate, drawing such sustenance as the evidence on record could afford and impart a quietus to this vexed litigation.
Learned counsel very fairly submitted that this would be the appropriate course.
In the very nature of things, the exercise that we make, must share the imperfections of the evidence on record.
But then, some element of speculation is inevitable in all valuations.
In the 1040 best of exercises some measure of conjecture and guess work is inherent in the very nature of the exercise.
We may first proceed to estimate the prime cost of the building.
The measurement set out in Ext.
1 is not disputed.
If Ext. 1 is taken as the starting point for the estimate of cost of replacment as on 4.7.1959; the depreciation of 20% allowed in Ext.
1 has to be added back and, further, some deduction towards the possible escalation of costs of construction between the date of preliminary notification and of the period of validity of the rates adopted in Ext.
1 has to be made.
On this basis, the cost of replacement could be estimated at about Rs.4 lakhs.
This works out to Rs.16 sq.
on the average.
Even in respect of 1959, this figure may not be much, having regard to the quality of the construction.
From this sum of Rs.4 lakhs, depreciation for the past life of 60 years of building would have to be deducted.
Depreciation depends upon and is deduced from factors such as the cost of the construction; the expected life span; its salvage value realisable at the end of the period of utility etc.
Rate of depreciation is generally, the prime cost less salvage value divided by the life span.
These, of course, are matters of evidence.
In the present case, if we make a rough and ready estimate of the salvage value at say, 10% of the cost and estimate the period of utility of life span of the building at, say, 90 years, the depreciation which is the annual loss of value due to physical wear and tear works out to about Rs.4,000 per year or roughly 1%.
Without going to the finer details of the calculation of the depreciation on the progressive written down values, we think, an estimate of 50% of the cost of the building may, again on a rough and ready basis, be deducted towards depreciation.
The market value of the building as on the date of the preliminary notification could accordingly be fixed at Rs.2,00,000.
Accordingly, the compensation for the buildings and structures is enhanced from Rs.57,660 to Rs.2,00,000, point (b) is held and answered accordingly.
Re: Contention (c): So far as the tree growth is concerned, it is trite proposition that where land is valued with reference to its potentiality for building purposes and on the basis of prices fetched by small sites in a hypothetical lay out, the tree growth on the land cannot be valued independently on the basis of its horticultural value or with reference to the value of the yield.
But this principle does not 1041 come in the way of awarding the timber value or the salvage value of the tree growth after providing for the cost of cutting and removing.
The evidence shows that there were 471 fruit bearing trees and plants: 13 timber trees and 12 Bamboo clusters.
Though there is some evidence as to the value of the yield, this may not be a relevant factor having regard to the principles of valuation appropriate to the case.
There is no evidence about the timber value and the fuel value of the trees.
Learned District Judge has awarded a sum of Rs.355.85 for the entire tree growth.
Having regard to the large number of trees and to the fact that some of them were timber trees, we think we should award lumpsum of Rs.7,500 under this head.
Accordingly, compensation for the tree growth is enhanced from Rs.355.85 to Rs.7,500. 11.
Re: Contention(d) This leaves us with the question whether the benefit of Section 23(2) introduced by the UP Land Acquisition (Amendment) Act 1972 (Act No. 28 of 1972) providing for a solatium is available to the appellant on the ground that the proceedings in appeal were pending as on the date when that provision was introduced.
It is to be recalled that by U.P. Land Acquisition (Amendment) Act (Act No. 22 of 1954) Section 23(2) had been deleted from the statute.
The preliminary notification was long subsequent to this deletion.
The question is whether the introduction or re introduction of Section 23(2) in 1972 would enure to the benefit of the appellant on the premise that rules of construction appropriate to such remedial measures would require their benefit to be extended to pending proceedings.
Appellant has also claimed the benefit of the further enhancement of the solatium and the rates of interest under Central Amending Act 68 of 1984.
Shri Mukharjee submitted that these amendments, both by the State Law and the Central Law, were remedial legislations and would apply to pending actions.
Shri Prithviraj, on the contrary, submitted that these changes in the law, brought in by the amended provisions are presumptively prospective except to the extent that they are made expressly or by compelling implication retrospective in the extension of their benefits.
Learned Counsel said that application of these provisions even to pending proceedings envisages a principle of retro active application which must expressly be enabled by the statute or is to be inferred as an inevitable implication.
1042 Shri Mukharjee relied upon certain observations of this court in the case of Bhag Singh & Ors.
vs Union Territory of Chandigarh, (See 1985 Suppl.
2 SCR 949).
There are some observations at 958 of the report which tend to lend support to Shri Mukharjee.
But the matter is pending decision at the hands of a larger bench.
In the circumstances, learned counsel on both sides submitted that the appeal be disposed of on the other points leaving it open to the appellant to agitate Contention (d) after a final pronouncement in Bhag Singh 's case, if in the light of the said judgment, this claim or any part of it survives.
We accept this submission and reserve liberty to the appellant accordingly.
Shri Mukharjee sought to raise another point concerning compensation to be awarded for change of residence under Clause 'fifthly ' in Sec.
23(1); but as this point does not appear to have been raised and urged before the High Court.
We think, we should not permit the appellant to re agitate this question over again in this court.
It is also to be observed that no specific ground is taken in this behalf in this appeal either.
In the result, this appeal is allowed in part and while the compensation determined and awarded for the land is left undisturbed, the compensation awarded for the building and tree growth is enhanced from Rs.57,660 to Rs.2,00,000 and from Rs.355.85 to Rs.7,500 respectively.
Appellant shall be entitled to interest at 6% on the enhanced amount of compensation from the date of taking of possession till realisation.
Liberty is reserved to the appellant to seek such additional relief on Contention (d) depending upon the ultimate decision in Bhag Singh 's case.
The appeal is disposed of accordingly.
The appellant shall be entitled to the costs in this appeal.
The advocate 's fee fixed at Rs.2,500.
N.V.K. Appeal allowed.
|
% The suit property known as "Gopal Lal Villa" situated on the outskirts of the city of Varanasi was a sprawling 60 years old building, part of the estate of a Raja, and vested in the appellant.
It was acquired pursuant to preliminary Notification dated 4.7.1959 under the Land Acquisition Act 1894 for the purposes of the Education Department of the Government of Uttar Pradesh.
The building was of about 25,000 square feet plinth area comprising 35 rooms, halls and other appurtenances, and the 23.66 acres of ground appurtenant to the building, had 431 fruit and 13 timber trees and 12 bamboo clumps.
The appellant claimed compensation of Rs.8,00,580 for the land valuing it at Rs.352 per decimal.
Rs.3,50,000 for the building and structures; Rs.41,010 for the tree growth and Rs.5,000 as compensation for change of residence.
The Land Acquisition Officer by his Award dated 4.11.1961 1026 under section 11 of the Land Acquisition Act determined the market value of the land at Rs.3,31,340 valuing it at Rs.140 per decimal; of the building and superstructure at Rs.57,660 and of the tree growth at Rs.355.83.
Being aggrieved with the aforesaid determination of compensation the appellant did not accept the offer contained in the Award, and sought for a reference under section 18 of the Act to the Civil Court.
The District Court enhanced the market value of the land to Rs.4,73,200 i.e. from Rs.140 to Rs.200 per decimal and left the valuation of the building and the tree growth undisturbed.
The High Court affirmed the Award of the District Court and dismissed the appellant 's claim for further enhancement.
In the appeal to this Court, it was contended on behalf of the appellant that the claim of Rs.352 per decimal was not accepted and that the High Court in affirming the valuation of the land at a mere Rs.200 per decimal overlooked certain settled principles of valuation.
It adopted the District Judge 's valuation which was the average of the valuation reflected in Ext.
2 and Ext.
19 while the higher of the two figures indicated by Ext.
2 should have been adopted.
It was further contended that the appellant was entitled to solatium and interest at higher rates in view of the re introduction of section 23(2) in 1972 by the U.P. Land Acquisition (Amendment) Act, 1972 and under the Central Amendment Act 68 of 1984.
On behalf of the respondent it was contended that the changes in law brought about by the State Amendment Act No. 28 of 1972 and the Central Amending Act 68 of 1984 are presumptively prospective except to the extent that they are made expressly or by compelling implication retrospective in the extension of their benefits.
On the question whether: (1) ^ HELD: 1.(i) The determination of market value of a piece of land with potentialities for urban use is an intricate exercise which calls for collection and collation of diverse economic criteria.
[1033C D] (ii) The market value of a piece of property for purposes of section 23 of the Land Acquisition Act is stated to be the price at which the property changes hands from a willing seller to a willing, but not too anxious a buyer, dealing at arm 's length.
[1033D] (iii) Prices fetched for similar lands with similar advantages and potentialities under bonafide transactions of sale at or about the time of the preliminary notification are the usual, and indeed the best, evidences of market value.
Other methods of valuation are resorted to if the evidence of sale of similar lands is not available.
[1033E F] (iv) Prices fetched for smaller plots cannot form safe bases valuation of large tracts of land as the two are not comparable properties.
[1034E] Collector of Lakhimpur vs B.C. Dutta, AIR 1971 SC 2015; Mirza Nausherwan Khan & Anr.
vs The Collector (Land Acquisition), Hyderabad, ; ; Padma Uppal etc.
vs State of Punjab & Ors.
, ; and Smt.
Kaushalya Devi Bogra & Ors.v.
The Land Acquisition Officer, Aurangabad & Anr., ; , referred to.
(v) However, if it is shown that the large extent to be valued does admit of and is ripe for use for building purposes; that building plots that could be laid out on the land would be good selling propositions and that valuation on the basis of the method of a hypothetical lay out 1028 could with justification be adopted, then in valuing such small, laid out sites the valuation indicated by sale of comparabe small sites in the area at or about the time of the notification would be relevant.
[1034G H] (vi) In a case such as the above, necessary deduction for the extent of land required for the formation of roads and other civic amenities; expenses of development of the sites by laying out roads, drains, sewers, water and electricity lines, and the interest on the outlays for the period of deferment of the realisation of the price; the profits on the venture etc.
are to be made.
[1034H; 1035A B] Sahib Singh Kalha & Ors.
vs Amritsar Improvement Trust and Ors., referred to.
(vii) Prices fetched for small plots cannot directly be applied in the case of large areas, for the reason that the former reflects the 'retail ' price of land and the latter the 'wholesale ' price.
[1035B] (viii) Subsequent transactions which are not proximate in point of time to the acquisition can be taken into account for purposes of determining whether as on the date of acquisition there was an upward trend in the prices of land in the area.
[1035C] (ix) Where it is shown that the market was stable and there were no fluctuations in the prices between the date of the preliminary notification and the date of such subsequent transaction, the transaction could also be relied upon to ascertain the market value.
(a) When there is evidence to the effect that there was no upward surge in the prices in the interregnum.
(b) The burden of establishing this would be squarely on the party relying on such subsequent transaction.
[1035C D,G] State of U.P. vs Major Jitender Kumar, referred to.
In the instant case, the appellant did not endeavour to show that between the date of preliminary notification i.e. 4.7.1959 and the date of Ext.
24 i.e. 18.8.
1960 there was no appreciation in the value of land in the area.
Therefore, Ext.
24 cannot be relied upon as affording evidence of the market value as on 4.7.1959.
[1035G H] (xi) The valuation of land made in the present case does not call for or justify any upward revision at all.
(a) There is no justification to interfere with the determination of the market value of the land approved by the High Court.
[1036C D] 1029 In the instant case Rs.200 per decimal for the large extent of the acquired land works out to 40% of the "retail" price even if Rs.500 is taken as the 'retail ' price.
That apart, in the case of land with potentialities for a more profitable use it is necessary to acknowledge, and make due allowance for, the possibility that the land might not be applied for the prospective use at all or not so applied within a reasonable time.
[1036H; 1037A B] Bombay Improvement vs Mervanji Manekji Mistry, AIR 1926 Bombay 420 referred to.
2.(i) Usually land and building thereon constitute one unit.
Land is one kind of property; land and building together constitute an altogether different kind of property.
The latter must be valued as one unit.
[1037C D] (ii) However, where, the property comprises extensive land and the structures standing do not show that full utilisation potential of the land is realised it might not be impermissible to value the property estimating separately the market value of the land with reference to the date of the preliminary notification and to add to it the value of the structures as at that time.
[1037D E] (iii) By the above method, building value is estimated on the basis of the prime cost or replacement cost less depreciation.
The rate of depreciation is, generally, arrived at by dividing the cost of construction (less the salvage valued at the end of the period of utility) by the number of years of utility of the building.
[1037E F] (iv) The factors that prolong the life and utility of the building, such as good maintenance, influence and bring down the rate of depreciation.
[1037F] In the instant case, the estimate of the proper market value of the building has not received the requisite attention both before the High Court and the District Court.
It is no doubt true that the Valuation Report, Ext.
I, was prepared on 20.7.
1960 one year after the date of the preliminary notification.
But the extent of the built area was about 25,000 sq.
There is no evidence to suggest that the rates mentioned and adopted in Ext.
I were not rates valid for a spread out period.
No case was made out that the building had lost its utility and that the only mode of valuation appropriate to the case was one of awarding merely the salvage value.
The building, according to the evidence was quite 1030 strong though about 60 years old at the time.
The appropriate thing to do would have been to set aside the award in so far as the valuation of the building is concerned and remit the matter for a fresh determination of its market value as on 14.7.1959.
However, in the interest of justice it would be proper to make some ready and rough estimate drawing such sustenance as the evidence on record could afford and impart a quietus to this vexed litigation.
Accordingly, the compensation for the buildings and structures is enhanced from Rs.57,660 to Rs.2,00,000.
[1038G H; 1039D G; 1040G] 3.
Where land is valued with reference to its potentiality for building purposes and on the basis of prices fetched by small sites in a hypothetical lay out the tree growth on the land cannot be valued independently on the basis of its horticultural value or with reference to the value of the yield.
This principle, however, does not come in the way of awarding the timber value or the salvage value of the tree growth after providng for the cost of cutting and removing.
[1040G H; 1041A] In the instant case, the evidence shows that there were 471 fruit bearing trees and plants, 13 timber trees and 12 bamboo clusters.
Though there is some evidence as to the value of the yield, there is no evidence about the timber value and fuel value of the trees.
The District Judge has awarded a sum of Rs.355.85 for the entire tree growth.
Having regard to the large number of trees and to the fact that some of them were timber trees, it would be appropriate to award a lump sum of Rs.7,500 under this head.
The compensation for tree growth is accordingly enhanced from Rs.355.85 to Rs.7,500.
[1041A C] 4.
By the U.P. Land Acquisition (Amendment) Act, 1954, Section 23(2) had been deleted from the statute.
It was re introduced by the U.P. Land Acquisition (Amendment) Act 1972.
The preliminary notification for the acquisition was issued subsequent to the deletion.
Whether re introduction of sub section (2) would enure to the benefit of the person whose land is acquired on the ground that proceedings in appeal were pending on the date of introduction of that provision, and availability for further enhancement of the solatium and rates of interest under the Central Amendment Act 68 of 1984 are left open with consent of counsel to be agitated after final decision in Bhag Singh vs U. T. of Chandigarh, by a larger Bench of this Court.
[1041E F; 1042B] 5.
The point concerning compensation to be awarded for change of residence under clause 'fifthly ' in section 23(1) does not appear to have been raised and urged before the High Court.
No specific ground 1031 has also been taken in this behalf in the appeal before this Court.
The appellant should not, therefore, be permitted to re agitate this question over again in this Court.
[1042D]
|
Civil Appeal No.877 of 1974.
From the Judgment and Decree dated 17.11.1971 of the Allahabad High Court in First Appeal No. 171 of 1966.
D.N. Mukherjee, G.S. Chatterjee and A. Bhattacharjee for the Appellant.
Prithvi Raj and Mrs. Shobha Dikshit for the Respondent.
The Judgment of the Court was delivered by VENKATACHALIAH, J.
This appeal, for enhancement of compensation, by Special leave, arises out of and is directed against the judgment and decree dated 17th November, 1971 of the High Court of Allahabad in First Appeal No. 171 of 1966 affirming the Award and Decree dated 13.12.1965 of the Ist Addl.
District Judge, Varanasi, made in a Reference Under Section 18 of the Land Acquisition Act 1894.
Property known as "Gopal Lal Villa" a sprawling 60 year old building of about 25,000 square feet of plinth area comprising of 35 rooms, halls and other appurtenances, its large 23.66 acre grounds with 431 fruit and 13 Timber trees; 12 Bamboo clumps, situated on the outskirts of the City of Varanasi, originally part of the estate of Raja P.N. Tagore, and now vesting in the Administrator General, West Bengal, was acquired pursuant to the preliminary notification, published in the Gazette, dated, 4.7.1959 for the purposes of the education department of the Government of Uttar Pradesh.
Before the Land Acquisition Officer, Appellant claimed compensation of Rs.8,00,580 (at Rs.352 per decimal) for the land; Rs.3,50,000 for the building and structures; Rs.41,010 for the tree growth; and Rs.5,000 as compensation for change of residence.
The Land Acquisition Officer, however, by his Award dated 4.11.1961 under Section 11 of the Act determined the market value of the land at Rs.3,31,340 valuing it Rs. 140 per decimal (or Rs.14,000 per 1032 acre); of the building and structures at Rs.57,660 and of the treegrowth at Rs.355.83.
Appellant, not having accepted the offer contained in the award, sought for a reference under Section 18 of the Act to the Civil Court in proceedings pursuant to which the District Court enhanced the market value of the land to Rs.4,73,200 (from Rs.140 to Rs.200 per decimal) leaving the valuation of the building and the tree growth undisturbed.
The High Court has affirmed the Award dismissing appellant 's claim for further enhancement before it.
We have heard Shri D.N. Mukherjee, learned counsel in support of the appeal and Shri Prithviraj, learned Senior Advocate for the respondent.
We have been taken through the judgment under appeal and the evidence on record.
On the contentions urged at the hearing, the following points fall for consideration: (a) Whether the estimate of the market value of the acquiredland at Rs.200 per decimal is unreasonably low and is arrived at ignoring the evidence on record and settled principles of valuation? (b) Whether the valuation of the buildings and structures at a mere Rs.57,660 calls for an upward revision? (c) Whether the award made for the tree growth is inadequate and is required to be valued higher? (d) Whether appellant is entitled to the benefit of Sec.
23(2) of the Act as introduced by the U.P. Law Acquisition (Amendment) Act 1972 providing for solatium and, further, to higher rates of solatium and interest under the Central Amending Act (Act No. 68 of 1984) on the ground that proceedings were pending in appeal before this court on the dates these amendments came into force? 4.
Re: Contention (a) The acquired land had the potentiality for building purposes.
Learned District Judge found that: ".
The Land Acquisition Officer himself realised this fact and has observed that "the land under acquisition is 1033 situated within the Corporation limits in Mohalla Orderly Bazar, a thickly populated locality and is near to Kutchery.
It has, therefore, a potential value as building site.
" I may add here that though the acquired land is at a distance of about 3 to 3 1/2 miles from the main markets of Varanasi City, yet every thing of daily need and of day today utility is available in the market which exists in the locality of the acquired land.
It may also be added that the land adjacent to the west of the acquired land known as 'Tagore Nagar ' formerly formed part of this Gopal Lal Villa and both were covered by one boundary.
The land of Tagore Nagar has been divided into small portions and a colony with residential quarters has grown up there.
This was already in existence before the present acquisition . ." The determination of market value of a piece land with potentialities for urban use is an intricate exercise which calls for collection and collation of diverse economic criteria.
The market value of a piece of property, for purposes of Section 23 of the Act, is stated to be the price at which the property changes hands from a willing seller to a willing, but not too anxious a buyer, dealing at arms length.
The determination of market value, as one author put it, is the prediction of an economic event.
viz, the price outcome of a hypothetical sale, expressed in terms of probabilities.
Prices fetched for similar lands with similar advantages and potentialities under bona fide transactions of sale at or about the time of the preliminary notification are the usual, and indeed the best, evidences of market value.
Other methods of valuation are resorted to if the evidence of sale of similar lands is not available.
In the District court, appellant relied upon eight transactions of what, according to him, were sale, of similar lands.
The transactions at Ext.
18, 20, 21 and 22, dated, 25.3.1952, 1.12.1955, 11.8.1953 & 11.7.1957 respectively were rejected by learned District Judge on the ground that they were long enterior in point of time to the acquisition and lacked the element of contemporaneity.
23 dated, 25.10.1958 and Ext.
24 dated, 18.8.1960 were also held not to afford reliable evidence of market value on the ground that while in the former case the property was sold along with a construction thereon without any indication as to the apportionment of the price between the land and the construction, in the latter case the sale was about an year subsequent to the date of the preliminary notification.
1034 What remained were the evidence of sale transactions at Exts.
2 and 19 dated 16.9.1958 and 22.12.1958 respectively indicating a price of Rs.1250 and Rs.900 per biswa respectively.
The District Judge struck an average of the two and fixed the rate at Rs.1075 per biswa which worked out to about Rs.350, or thereabouts, per decimal.
But since Ext. 2 and Ext. 19 related to very small plots, the learned District Judge on some calculations of his own, fixed the rate of Rs.200 per decimal for the acquired land.
Shri Mukharji in support of the appellant 's claim @ Rs.352 per decimal submitted that the High Court, in affirming the valuation of the land at a mere Rs.200 per decimal, overlooked certain settled principles of valuation in that it approved the process adopted by the learned District Judge of striking an average of the valuations reflected in Ext.
2 and Ext.
19, while the higher of the two figures indicated by Ext. 2, should have been adopted.
Learned Counsel submitted that the acquired land, though situate about 3 1/2 miles away from the heart of Varanasi City, had all the potentiality for use for building purposes and that the rejection of the evidence of market value afforded by Ext.
24, the transaction of sale dated 14.7.1960 which indicated a price of Rs.2,000 per biswa on the ground that it was an year later than the preliminary notification was erroneous.
It is trite proposition that prices fetched for small plots can not form safe bases for valuation of large tracts of land as the two are not comparable properties.
(See Collector of Lakhimpur vs B.C. Dutta, AIR 1971 SC 2015; Mirza Nausherwan Khan & Anr.
vs The Collector (Land Acquisition), Hyderabad, [1975] 1 SCR; Padma Uppal etc.
vs State of Punjab & Ors., [1971] 1 SCR; Smt.
Kaushalya Devi Bogra & Ors.
vs The Land Acquisition Officer Aurangabad & Anr., [1984] 2 SCR.
The principle that evidence of market value of sales of small, developed plots is not a safe guide in valuing large extents of land has to be understood in its proper perspective.
The principle requires that prices fetched for small developed plots cannot directly be adopted in valuing large extents.
However, if it is shown that the large extent to be valued does admit of and is ripe for use for building purposes; that building lots that could be laid out on the land would be good selling propositions and that valuation on the basis of the method of a hypothetical lay out could with justification be adopted, then in valuing such small, laid out sites the valuation indicated by sale of comparable small sites in the area at or about the time of the notification would be relevant.
In such a case, necessary deductions for the extent of land required for the formation of roads and other civic 1035 amenities; expenses of development of the sites by laying out roads, drains, sewers, water and electricity lines, and the interest on the outlays for the period of deferment of the realisation of the price; the profits on the venture etc. are to be made.
In Sahib Singh Kalha & Ors.
vs Amritsar Improvement Trust and Ors., (See , this court indicated that deductions for land required for roads and other developmental expenses can, together, come up to as much as 53%.
But the prices fetched for small plots cannot directly be applied in the case of large areas, for the reason that the former reflects the 'retail ' price of land and the latter the 'wholesale ' price.
The sale transaction at Ext.
24 was an year later.
Such subsequent transactions which are not proximate in point of time to the acquisition can be taken into account for purposes of determining whether as on the date of acquisition there was an upward trend in the prices of land in the area.
Further under certain circumstances where it is shown that the market was stable and there were no fluctuations in the prices between the date of the preliminary notification and the date of such subsequent transaction, the transaction could also be relied upon to ascertain the market value.
This court in State of U.P. vs Maj.
Jitender Kumar, (See observed: ". .
It is true that the sale deed Ext.
21 upon which the High Court has relied is of a date three years later than the Notification under section 4 but no material was produced before the Court to suggest that there was any fluctuation in the market rate at Meerut from 1948 onwards till 1951 and if so to what extent.
In the absence of any material showing any fluctuation in the market rate the High Court thought it fit to rely upon exhibit 21 under which the Housing Society itself had purchased land in the neighbourhood of the land dispute.
On the whole we are not satisified that any error was committed by the High Court in relying upon the sale deed exhibit 21. ." But this principle could be appealed to only where there is evidence to the effect that there was no upward surge in the prices in the interregnum.
The burden of establishing this would be squarely on the party relying on such subsequent transaction.
In the present case appellant did not endeavour to show that between the date of preliminary notification i.e. 4.7.1959 and the date of Ext.
24 i.e. 18.8.1960 there was no appreciation in the value of land in the area.
Therefore, Ext.
24 cannot be relied upon as affording evidence of the market 1036 value as on 4.7.1959.
We cannot accept the argument that the price indicated in Ext.
24 should be accepted after allowing an appropriate deduction for the possible appreciation of the land values during the period of one year.
Apart from other difficulties in this exercise, there is no evidence as to the rate and degree of appreciation in the values of land so that the figure could be jobbed backwards from 14.7.1960 to 4.7.1959.
It appears to us that even if the value at Rs.1,250 as on 27.8.1958 indicated by Ext.
2 is adopted and something is added thereto for the possible appreciation for the period till the preliminary notification, also taking into account the trend of appreciation in the prices in the area as indicated by Ext.
24 and the value of small developed sites is estimated somewhere between Rs.1,400 and Rs.1,600 per biswa or Rs.450 to Rs.500 per decimal, yet, the valuation made in the present case does not call for or justify any upward revision at all.
There is a simple way of cross checking these results.
The value of small plots Rs.500 per decimal as now estimated represents what may be called the "retail" price of the land.
What is to be estimated therefrom is the "wholesale" price of land.
In Bombay Improvement vs Mervanji Manekji Mistry, (See AIR 1926 Bombay 420) Mecleod CJ suggested a simple rule: ". .Valuation cases must be dealt with just as much from the point of view of the hypothetical purchase as of the claimant.
The valuation itself must often be more or less a matter of guesswork.
But it is obviously wrong to fix upon a valuation which, judged by everyday principles, no purchaser would be likely to give . ." ". .I have always been adverse to elaborate hypothetical calculations which are no more likely to lead to a fair conclusion than far simpler methods.
But, in any event, no harm can be done by testing a conclusion arrived at in one way by a conclusion arrived at in another . ." ". .A very simple method of valuing land wholesale from retail prices is to take anything between one and half onethird, according to circumstances of the expected gross valuation, as the wholesale price. ." (emphasis supplied) In the present case, Rs.200 per decimal for the large extent of the 1037 acquired land works out to 40% of the "retail" price even if we take, Rs.500 as the "retail" price.
That apart, in the case of land with potentialities for a more profitable use, it is necessary to acknowledge, and make due allowance for, the possibility that the land might not be applied for the prospective use at all or not so applied within a reasonable time.
There is, therefore, no justification to interfere with the determination of the market value of the land approved by the High Court.
Contention (a) is accordingly answered against the appellant.
Re: Contention (b) The District Court proceeded to value the property on the "Land and Building Method".
The appositeness of this method to the present case was not debated before us.
Usually, land and building thereon constitute one unit.
Land is one kind of property; land and building together constitute an altogether different kind of property.
They must be valued as one unit.
But where, however, the property comprises extensive land and the structures thereon do not indicate a realisation of the full developmental potential of the land, it might not be impermissible to value the property estimating separately the market value of the land with reference to the date of the preliminarynotification and to add to it the value of the structures as at that time.
In this method, building value is estimated on the basis of the primecost or replacement cost less depreciation.
The rate of depreciation is, generally, arrived at by dividing the cost of construction (Less the salvage value at the end of the period of utility) by the number of years of utility of the building.
The factors that prolong the life and utility of the building, such as good maintenance, necessarily influence and bring down the rate of depreciation.
Hari Shanker Misra PW 3 referring to the nature and quality of the building stated: ".
The Northern part of this Villa was double storeyed and rest was single storeyed.
Its plinth was 3 feet high and rooms were 14 feet high.
The building bore 35 rooms and besides this there was a big hall 65 feet x 22 feet.
Its floor was made up of some patent stones.
Some monthly some market and Vkiya were stoned.
The doors were 8 feet x 4 feet and they were made up of Burma teak wood and up ways were double doored.
When Improvement Trust oc 1038 cupied the property of Nejai at that time building was well maintained.
Over and above the main building there were manager quarters.
Kitchen, out house, servant quarters, Chowkidar quarters and a stable.
Now they were in good condition.
Its boundary wall was 7 feet and at some places they were 8 feet high.
This also consists of 2 iron gates.
One is main gate and the other one is by its side of some distance. " Learned District Judge based his valuation almost entirely upon the report of the Chief Engineer, estimating the building at Rs.57,660.
That report itself was not brought on record in the proceedings of reference.
It is not clear from the judgment of the High Court whether this estimate of Rs.57,660 represented the cost of replacement of the structure less depreciation or whether it represented merely the salvage value of the building.
High Court rejected the Valuation Report, Ext.
1 relied upon by the appellant on the ground that it was made with reference to a date which was an year later than the preliminary notification.
The High Court observed: ".
The appellant had examined Narain Chand Das, an Overseer who had assisted the Executive Engineer, in preparing the valuation of the constructions and the well.
The report of the Executive Engineer is Ext.
1 on the record.
It appears from the said report that the valuation was determined on the basis of the rates prevailing in the year 1960 where as the preliminary notification in the instant case was issued in the year 1959.
Moreover, this building appears to be about 60 years old and the market value thereof could not be determined on the basis of the cost of constructions prevailing in the year 1960.
This method of calculating the market value of the property is obviously erroneous and cannot be accepted.
No other evidence was produced by the appellant to determine the value of the constructions and the well.
The evidence produced by him being not satisfactory, the compensation already determined by the Land Acquisition Officer in respect of this item of the property was not liable to be enhanced. ." We are afraid the estimate of the proper market value of the building has not received the requisite attention both before the High Court and the District Court.
It is no doubt true that Ext.
1 was prepared on 20.7.1960, an year after the date of the preliminary notifi 1039 cation in the present case; but the extent of the built area was about 2,500 sq.
1 gives a breakdown of the area of the various parts of the building and sets out the nature of the construction and proceeds to estimate the value in terms of the then current PWD rates less depreciation of 20%.
The rates adopted were not particular to the date of valuation i.e. 20.7.1960.
The PWD rates are operative over a period, generally for an year or so.
The extent or the quality of construction were also not in dispute.
The main building of an area of 18828 sq.
consisted of 35 rooms, and a big hall with 'Marble Flooring ', 'Burma Teak Shutters ', 'Stone Slab Roofing ', a portico with 'Glazed Gracian Pillars ' etc.
In Ext.
1, the main portion was valued at Rs.12 per sq.
Apart from the main building, there were other appurtenances such as the Managers ' quarters, kitchen house, chowkidars ' quarters, out house, stables, pucca wells etc.
The other structures have been valued area wise at much lesser rates, according as the nature of the construction.
The decendants of Raja P.N. Tagore, it was claimed, were residing in the building till a few days before possession was taken.
There is no evidence to suggest that, the rates mentioned and adopted in Ext.
1 were not rates valid for a spread out period.
It appears to us somewhat unreasonable that the extensive building of 25,000 sq.
with big halls and 35 rooms constructed with quality material, marble flooring, burma teak joinery should be valued at a mere Rs.57,660.
No case was made out that the building had lost its utility and that only mode of valuation appropriate to the case was one of awarding merely the salvage value.
The building, according to the evidence, was quite strong though about 60 years old at the time.
Having regard to the circumstances of this case, the appropriate thing to do would have been to set aside the award in so far as the valuation of the building is concerned and remit the matter for a fresh determination of its market value as on 14.7.1959.
But the parties have been at litigation for decades.
The acquisition is of the year 1959.
We, therefore, thought and put to the learned counsel on both sides whether in the interests of justice, it would not be proper to make some rough and ready estimate, drawing such sustenance as the evidence on record could afford and impart a quietus to this vexed litigation.
Learned counsel very fairly submitted that this would be the appropriate course.
In the very nature of things, the exercise that we make, must share the imperfections of the evidence on record.
But then, some element of speculation is inevitable in all valuations.
In the 1040 best of exercises some measure of conjecture and guess work is inherent in the very nature of the exercise.
We may first proceed to estimate the prime cost of the building.
The measurement set out in Ext.
1 is not disputed.
If Ext. 1 is taken as the starting point for the estimate of cost of replacment as on 4.7.1959; the depreciation of 20% allowed in Ext.
1 has to be added back and, further, some deduction towards the possible escalation of costs of construction between the date of preliminary notification and of the period of validity of the rates adopted in Ext.
1 has to be made.
On this basis, the cost of replacement could be estimated at about Rs.4 lakhs.
This works out to Rs.16 sq.
on the average.
Even in respect of 1959, this figure may not be much, having regard to the quality of the construction.
From this sum of Rs.4 lakhs, depreciation for the past life of 60 years of building would have to be deducted.
Depreciation depends upon and is deduced from factors such as the cost of the construction; the expected life span; its salvage value realisable at the end of the period of utility etc.
Rate of depreciation is generally, the prime cost less salvage value divided by the life span.
These, of course, are matters of evidence.
In the present case, if we make a rough and ready estimate of the salvage value at say, 10% of the cost and estimate the period of utility of life span of the building at, say, 90 years, the depreciation which is the annual loss of value due to physical wear and tear works out to about Rs.4,000 per year or roughly 1%.
Without going to the finer details of the calculation of the depreciation on the progressive written down values, we think, an estimate of 50% of the cost of the building may, again on a rough and ready basis, be deducted towards depreciation.
The market value of the building as on the date of the preliminary notification could accordingly be fixed at Rs.2,00,000.
Accordingly, the compensation for the buildings and structures is enhanced from Rs.57,660 to Rs.2,00,000, point (b) is held and answered accordingly.
Re: Contention (c): So far as the tree growth is concerned, it is trite proposition that where land is valued with reference to its potentiality for building purposes and on the basis of prices fetched by small sites in a hypothetical lay out, the tree growth on the land cannot be valued independently on the basis of its horticultural value or with reference to the value of the yield.
But this principle does not 1041 come in the way of awarding the timber value or the salvage value of the tree growth after providing for the cost of cutting and removing.
The evidence shows that there were 471 fruit bearing trees and plants: 13 timber trees and 12 Bamboo clusters.
Though there is some evidence as to the value of the yield, this may not be a relevant factor having regard to the principles of valuation appropriate to the case.
There is no evidence about the timber value and the fuel value of the trees.
Learned District Judge has awarded a sum of Rs.355.85 for the entire tree growth.
Having regard to the large number of trees and to the fact that some of them were timber trees, we think we should award lumpsum of Rs.7,500 under this head.
Accordingly, compensation for the tree growth is enhanced from Rs.355.85 to Rs.7,500. 11.
Re: Contention(d) This leaves us with the question whether the benefit of Section 23(2) introduced by the UP Land Acquisition (Amendment) Act 1972 (Act No. 28 of 1972) providing for a solatium is available to the appellant on the ground that the proceedings in appeal were pending as on the date when that provision was introduced.
It is to be recalled that by U.P. Land Acquisition (Amendment) Act (Act No. 22 of 1954) Section 23(2) had been deleted from the statute.
The preliminary notification was long subsequent to this deletion.
The question is whether the introduction or re introduction of Section 23(2) in 1972 would enure to the benefit of the appellant on the premise that rules of construction appropriate to such remedial measures would require their benefit to be extended to pending proceedings.
Appellant has also claimed the benefit of the further enhancement of the solatium and the rates of interest under Central Amending Act 68 of 1984.
Shri Mukharjee submitted that these amendments, both by the State Law and the Central Law, were remedial legislations and would apply to pending actions.
Shri Prithviraj, on the contrary, submitted that these changes in the law, brought in by the amended provisions are presumptively prospective except to the extent that they are made expressly or by compelling implication retrospective in the extension of their benefits.
Learned Counsel said that application of these provisions even to pending proceedings envisages a principle of retro active application which must expressly be enabled by the statute or is to be inferred as an inevitable implication.
1042 Shri Mukharjee relied upon certain observations of this court in the case of Bhag Singh & Ors.
vs Union Territory of Chandigarh, (See 1985 Suppl.
2 SCR 949).
There are some observations at 958 of the report which tend to lend support to Shri Mukharjee.
But the matter is pending decision at the hands of a larger bench.
In the circumstances, learned counsel on both sides submitted that the appeal be disposed of on the other points leaving it open to the appellant to agitate Contention (d) after a final pronouncement in Bhag Singh 's case, if in the light of the said judgment, this claim or any part of it survives.
We accept this submission and reserve liberty to the appellant accordingly.
Shri Mukharjee sought to raise another point concerning compensation to be awarded for change of residence under Clause 'fifthly ' in Sec.
23(1); but as this point does not appear to have been raised and urged before the High Court.
We think, we should not permit the appellant to re agitate this question over again in this court.
It is also to be observed that no specific ground is taken in this behalf in this appeal either.
In the result, this appeal is allowed in part and while the compensation determined and awarded for the land is left undisturbed, the compensation awarded for the building and tree growth is enhanced from Rs.57,660 to Rs.2,00,000 and from Rs.355.85 to Rs.7,500 respectively.
Appellant shall be entitled to interest at 6% on the enhanced amount of compensation from the date of taking of possession till realisation.
Liberty is reserved to the appellant to seek such additional relief on Contention (d) depending upon the ultimate decision in Bhag Singh 's case.
The appeal is disposed of accordingly.
The appellant shall be entitled to the costs in this appeal.
The advocate 's fee fixed at Rs.2,500.
N.V.K. Appeal allowed.
|
From the Judgment and Decree dated 17.11.1971 of the Allahabad High Court in First Appeal No. D.N. Mukherjee, G.S. Chatterjee and A. Bhattacharjee for the Appellant. Prithvi Raj and Mrs. Shobha Dikshit for the Respondent. The Judgment of the Court was delivered by VENKATACHALIAH, J.
This appeal, for enhancement of compensation, by Special leave, arises out of and is directed against the judgment and decree dated 17th November, 1971 of the High Court of Allahabad in First Appeal No. 171 of 1966 affirming the Award and Decree dated 13.12.1965 of the Ist Addl. District Judge, Varanasi, made in a Reference Under Section 18 of the Land Acquisition Act 1894. Property known as "Gopal Lal Villa" a sprawling 60 year old building of about 25,000 square feet of plinth area comprising of 35 rooms, halls and other appurtenances, its large 23.66 acre grounds with 431 fruit and 13 Timber trees; 12 Bamboo clumps, situated on the outskirts of the City of Varanasi, originally part of the estate of Raja P.N. Tagore, and now vesting in the Administrator General, West Bengal, was acquired pursuant to the preliminary notification, published in the Gazette, dated, 4.7.1959 for the purposes of the education department of the Government of Uttar Pradesh. 140 per decimal (or Rs.14,000 per 1032 acre); of the building and structures at Rs.57,660 and of the treegrowth at Rs.355.83. Appellant, not having accepted the offer contained in the award, sought for a reference under Section 18 of the Act to the Civil Court in proceedings pursuant to which the District Court enhanced the market value of the land to Rs.4,73,200 (from Rs.140 to Rs.200 per decimal) leaving the valuation of the building and the tree growth undisturbed. The High Court has affirmed the Award dismissing appellant 's claim for further enhancement before it. We have been taken through the judgment under appeal and the evidence on record. c) Whether the award made for the tree growth is inadequate and is required to be valued higher? ( d) Whether appellant is entitled to the benefit of Sec. 23(2) of the Act as introduced by the U.P. Law Acquisition (Amendment) Act 1972 providing for solatium and, further, to higher rates of solatium and interest under the Central Amending Act (Act No. Re: Contention (a) The acquired land had the potentiality for building purposes. It has, therefore, a potential value as building site. The land of Tagore Nagar has been divided into small portions and a colony with residential quarters has grown up there. This was already in existence before the present acquisition . ." The determination of market value of a piece land with potentialities for urban use is an intricate exercise which calls for collection and collation of diverse economic criteria. The determination of market value, as one author put it, is the prediction of an economic event. viz, the price outcome of a hypothetical sale, expressed in terms of probabilities. Prices fetched for similar lands with similar advantages and potentialities under bona fide transactions of sale at or about the time of the preliminary notification are the usual, and indeed the best, evidences of market value. Other methods of valuation are resorted to if the evidence of sale of similar lands is not available. 1034 What remained were the evidence of sale transactions at Exts. 2 and 19 dated 16.9.1958 and 22.12.1958 respectively indicating a price of Rs.1250 and Rs.900 per biswa respectively. Shri Mukharji in support of the appellant 's claim @ Rs.352 per decimal submitted that the High Court, in affirming the valuation of the land at a mere Rs.200 per decimal, overlooked certain settled principles of valuation in that it approved the process adopted by the learned District Judge of striking an average of the valuations reflected in Ext. 19, while the higher of the two figures indicated by Ext. It is trite proposition that prices fetched for small plots can not form safe bases for valuation of large tracts of land as the two are not comparable properties. (See Collector of Lakhimpur vs B.C. Dutta, AIR 1971 SC 2015; Mirza Nausherwan Khan & Anr. vs The Land Acquisition Officer Aurangabad & Anr., [ The principle that evidence of market value of sales of small, developed plots is not a safe guide in valuing large extents of land has to be understood in its proper perspective. The principle requires that prices fetched for small developed plots cannot directly be adopted in valuing large extents. vs Amritsar Improvement Trust and Ors., ( See , this court indicated that deductions for land required for roads and other developmental expenses can, together, come up to as much as 53%. Further under certain circumstances where it is shown that the market was stable and there were no fluctuations in the prices between the date of the preliminary notification and the date of such subsequent transaction, the transaction could also be relied upon to ascertain the market value. In the absence of any material showing any fluctuation in the market rate the High Court thought it fit to rely upon exhibit 21 under which the Housing Society itself had purchased land in the neighbourhood of the land dispute. On the whole we are not satisified that any error was committed by the High Court in relying upon the sale deed exhibit 21. ." The burden of establishing this would be squarely on the party relying on such subsequent transaction. 24 i.e. 18.8.1960 there was no appreciation in the value of land in the area. 24 cannot be relied upon as affording evidence of the market 1036 value as on 4.7.1959. We cannot accept the argument that the price indicated in Ext. It appears to us that even if the value at Rs.1,250 as on 27.8.1958 indicated by Ext. There is a simple way of cross checking these results. What is to be estimated therefrom is the "wholesale" price of land. The valuation itself must often be more or less a matter of guesswork. But it is obviously wrong to fix upon a valuation which, judged by everyday principles, no purchaser would be likely to give . ." ". .I have always been adverse to elaborate hypothetical calculations which are no more likely to lead to a fair conclusion than far simpler methods. But, in any event, no harm can be done by testing a conclusion arrived at in one way by a conclusion arrived at in another . ." ". emphasis supplied) In the present case, Rs.200 per decimal for the large extent of the 1037 acquired land works out to 40% of the "retail" price even if we take, Rs.500 as the "retail" price. Contention (a) is accordingly answered against the appellant. Re: Contention (b) The District Court proceeded to value the property on the "Land and Building Method". The appositeness of this method to the present case was not debated before us. Usually, land and building thereon constitute one unit. Land is one kind of property; land and building together constitute an altogether different kind of property. But where, however, the property comprises extensive land and the structures thereon do not indicate a realisation of the full developmental potential of the land, it might not be impermissible to value the property estimating separately the market value of the land with reference to the date of the preliminarynotification and to add to it the value of the structures as at that time. In this method, building value is estimated on the basis of the primecost or replacement cost less depreciation. The factors that prolong the life and utility of the building, such as good maintenance, necessarily influence and bring down the rate of depreciation. Hari Shanker Misra PW 3 referring to the nature and quality of the building stated: ". The Northern part of this Villa was double storeyed and rest was single storeyed. Its plinth was 3 feet high and rooms were 14 feet high. The building bore 35 rooms and besides this there was a big hall 65 feet x 22 feet. Its floor was made up of some patent stones. Some monthly some market and Vkiya were stoned. The doors were 8 feet x 4 feet and they were made up of Burma teak wood and up ways were double doored. When Improvement Trust oc 1038 cupied the property of Nejai at that time building was well maintained. Over and above the main building there were manager quarters. Kitchen, out house, servant quarters, Chowkidar quarters and a stable. Its boundary wall was 7 feet and at some places they were 8 feet high. One is main gate and the other one is by its side of some distance. " That report itself was not brought on record in the proceedings of reference. High Court rejected the Valuation Report, Ext. 1 relied upon by the appellant on the ground that it was made with reference to a date which was an year later than the preliminary notification. The appellant had examined Narain Chand Das, an Overseer who had assisted the Executive Engineer, in preparing the valuation of the constructions and the well. The report of the Executive Engineer is Ext. We are afraid the estimate of the proper market value of the building has not received the requisite attention both before the High Court and the District Court. 1 was prepared on 20.7.1960, an year after the date of the preliminary notifi 1039 cation in the present case; but the extent of the built area was about 2,500 sq. 1 gives a breakdown of the area of the various parts of the building and sets out the nature of the construction and proceeds to estimate the value in terms of the then current PWD rates less depreciation of 20%. The rates adopted were not particular to the date of valuation i.e. 20.7.1960. The PWD rates are operative over a period, generally for an year or so. The extent or the quality of construction were also not in dispute. The main building of an area of 18828 sq. consisted of 35 rooms, and a big hall with 'Marble Flooring ', 'Burma Teak Shutters ', 'Stone Slab Roofing ', a portico with 'Glazed Gracian Pillars ' etc. 1, the main portion was valued at Rs.12 per sq. The other structures have been valued area wise at much lesser rates, according as the nature of the construction. The decendants of Raja P.N. Tagore, it was claimed, were residing in the building till a few days before possession was taken. There is no evidence to suggest that, the rates mentioned and adopted in Ext. 1 were not rates valid for a spread out period. It appears to us somewhat unreasonable that the extensive building of 25,000 sq. No case was made out that the building had lost its utility and that only mode of valuation appropriate to the case was one of awarding merely the salvage value. The building, according to the evidence, was quite strong though about 60 years old at the time. Having regard to the circumstances of this case, the appropriate thing to do would have been to set aside the award in so far as the valuation of the building is concerned and remit the matter for a fresh determination of its market value as on 14.7.1959. But the parties have been at litigation for decades. Learned counsel very fairly submitted that this would be the appropriate course. In the very nature of things, the exercise that we make, must share the imperfections of the evidence on record. But then, some element of speculation is inevitable in all valuations. In the 1040 best of exercises some measure of conjecture and guess work is inherent in the very nature of the exercise. We may first proceed to estimate the prime cost of the building. 1 has to be added back and, further, some deduction towards the possible escalation of costs of construction between the date of preliminary notification and of the period of validity of the rates adopted in Ext. Even in respect of 1959, this figure may not be much, having regard to the quality of the construction. From this sum of Rs.4 lakhs, depreciation for the past life of 60 years of building would have to be deducted. Depreciation depends upon and is deduced from factors such as the cost of the construction; the expected life span; its salvage value realisable at the end of the period of utility etc. These, of course, are matters of evidence. The evidence shows that there were 471 fruit bearing trees and plants: 13 timber trees and 12 Bamboo clusters. There is no evidence about the timber value and the fuel value of the trees. 28 of 1972) providing for a solatium is available to the appellant on the ground that the proceedings in appeal were pending as on the date when that provision was introduced. 22 of 1954) Section 23(2) had been deleted from the statute. The preliminary notification was long subsequent to this deletion. The question is whether the introduction or re introduction of Section 23(2) in 1972 would enure to the benefit of the appellant on the premise that rules of construction appropriate to such remedial measures would require their benefit to be extended to pending proceedings. Shri Mukharjee submitted that these amendments, both by the State Law and the Central Law, were remedial legislations and would apply to pending actions. Shri Prithviraj, on the contrary, submitted that these changes in the law, brought in by the amended provisions are presumptively prospective except to the extent that they are made expressly or by compelling implication retrospective in the extension of their benefits. 1042 Shri Mukharjee relied upon certain observations of this court in the case of Bhag Singh & Ors. vs Union Territory of Chandigarh, (See 1985 Suppl. There are some observations at 958 of the report which tend to lend support to Shri Mukharjee. But the matter is pending decision at the hands of a larger bench. We accept this submission and reserve liberty to the appellant accordingly. 23(1); but as this point does not appear to have been raised and urged before the High Court. It is also to be observed that no specific ground is taken in this behalf in this appeal either. In the result, this appeal is allowed in part and while the compensation determined and awarded for the land is left undisturbed, the compensation awarded for the building and tree growth is enhanced from Rs.57,660 to Rs.2,00,000 and from Rs.355.85 to Rs.7,500 respectively. The appellant shall be entitled to the costs in this appeal.
|
% The suit property known as "Gopal Lal Villa" situated on the outskirts of the city of Varanasi was a sprawling 60 years old building, part of the estate of a Raja, and vested in the appellant.
It was acquired pursuant to preliminary Notification dated 4.7.1959 under the Land Acquisition Act 1894 for the purposes of the Education Department of the Government of Uttar Pradesh.
The building was of about 25,000 square feet plinth area comprising 35 rooms, halls and other appurtenances, and the 23.66 acres of ground appurtenant to the building, had 431 fruit and 13 timber trees and 12 bamboo clumps.
The appellant claimed compensation of Rs.8,00,580 for the land valuing it at Rs.352 per decimal.
Rs.3,50,000 for the building and structures; Rs.41,010 for the tree growth and Rs.5,000 as compensation for change of residence.
The Land Acquisition Officer by his Award dated 4.11.1961 1026 under section 11 of the Land Acquisition Act determined the market value of the land at Rs.3,31,340 valuing it at Rs.140 per decimal; of the building and superstructure at Rs.57,660 and of the tree growth at Rs.355.83.
Being aggrieved with the aforesaid determination of compensation the appellant did not accept the offer contained in the Award, and sought for a reference under section 18 of the Act to the Civil Court.
The District Court enhanced the market value of the land to Rs.4,73,200 i.e. from Rs.140 to Rs.200 per decimal and left the valuation of the building and the tree growth undisturbed.
The High Court affirmed the Award of the District Court and dismissed the appellant 's claim for further enhancement.
In the appeal to this Court, it was contended on behalf of the appellant that the claim of Rs.352 per decimal was not accepted and that the High Court in affirming the valuation of the land at a mere Rs.200 per decimal overlooked certain settled principles of valuation.
It adopted the District Judge 's valuation which was the average of the valuation reflected in Ext.
2 and Ext.
19 while the higher of the two figures indicated by Ext.
2 should have been adopted.
It was further contended that the appellant was entitled to solatium and interest at higher rates in view of the re introduction of section 23(2) in 1972 by the U.P. Land Acquisition (Amendment) Act, 1972 and under the Central Amendment Act 68 of 1984.
On behalf of the respondent it was contended that the changes in law brought about by the State Amendment Act No. 28 of 1972 and the Central Amending Act 68 of 1984 are presumptively prospective except to the extent that they are made expressly or by compelling implication retrospective in the extension of their benefits.
On the question whether: (1) ^ HELD: 1.(i) The determination of market value of a piece of land with potentialities for urban use is an intricate exercise which calls for collection and collation of diverse economic criteria.
[1033C D] (ii) The market value of a piece of property for purposes of section 23 of the Land Acquisition Act is stated to be the price at which the property changes hands from a willing seller to a willing, but not too anxious a buyer, dealing at arm 's length.
[1033D] (iii) Prices fetched for similar lands with similar advantages and potentialities under bonafide transactions of sale at or about the time of the preliminary notification are the usual, and indeed the best, evidences of market value.
Other methods of valuation are resorted to if the evidence of sale of similar lands is not available.
[1033E F] (iv) Prices fetched for smaller plots cannot form safe bases valuation of large tracts of land as the two are not comparable properties.
[1034E] Collector of Lakhimpur vs B.C. Dutta, AIR 1971 SC 2015; Mirza Nausherwan Khan & Anr.
vs The Collector (Land Acquisition), Hyderabad, ; ; Padma Uppal etc.
vs State of Punjab & Ors.
, ; and Smt.
Kaushalya Devi Bogra & Ors.v.
The Land Acquisition Officer, Aurangabad & Anr., ; , referred to.
(v) However, if it is shown that the large extent to be valued does admit of and is ripe for use for building purposes; that building plots that could be laid out on the land would be good selling propositions and that valuation on the basis of the method of a hypothetical lay out 1028 could with justification be adopted, then in valuing such small, laid out sites the valuation indicated by sale of comparabe small sites in the area at or about the time of the notification would be relevant.
[1034G H] (vi) In a case such as the above, necessary deduction for the extent of land required for the formation of roads and other civic amenities; expenses of development of the sites by laying out roads, drains, sewers, water and electricity lines, and the interest on the outlays for the period of deferment of the realisation of the price; the profits on the venture etc.
are to be made.
[1034H; 1035A B] Sahib Singh Kalha & Ors.
vs Amritsar Improvement Trust and Ors., referred to.
(vii) Prices fetched for small plots cannot directly be applied in the case of large areas, for the reason that the former reflects the 'retail ' price of land and the latter the 'wholesale ' price.
[1035B] (viii) Subsequent transactions which are not proximate in point of time to the acquisition can be taken into account for purposes of determining whether as on the date of acquisition there was an upward trend in the prices of land in the area.
[1035C] (ix) Where it is shown that the market was stable and there were no fluctuations in the prices between the date of the preliminary notification and the date of such subsequent transaction, the transaction could also be relied upon to ascertain the market value.
(a) When there is evidence to the effect that there was no upward surge in the prices in the interregnum.
(b) The burden of establishing this would be squarely on the party relying on such subsequent transaction.
[1035C D,G] State of U.P. vs Major Jitender Kumar, referred to.
In the instant case, the appellant did not endeavour to show that between the date of preliminary notification i.e. 4.7.1959 and the date of Ext.
24 i.e. 18.8.
1960 there was no appreciation in the value of land in the area.
Therefore, Ext.
24 cannot be relied upon as affording evidence of the market value as on 4.7.1959.
[1035G H] (xi) The valuation of land made in the present case does not call for or justify any upward revision at all.
(a) There is no justification to interfere with the determination of the market value of the land approved by the High Court.
[1036C D] 1029 In the instant case Rs.200 per decimal for the large extent of the acquired land works out to 40% of the "retail" price even if Rs.500 is taken as the 'retail ' price.
That apart, in the case of land with potentialities for a more profitable use it is necessary to acknowledge, and make due allowance for, the possibility that the land might not be applied for the prospective use at all or not so applied within a reasonable time.
[1036H; 1037A B] Bombay Improvement vs Mervanji Manekji Mistry, AIR 1926 Bombay 420 referred to.
2.(i) Usually land and building thereon constitute one unit.
Land is one kind of property; land and building together constitute an altogether different kind of property.
The latter must be valued as one unit.
[1037C D] (ii) However, where, the property comprises extensive land and the structures standing do not show that full utilisation potential of the land is realised it might not be impermissible to value the property estimating separately the market value of the land with reference to the date of the preliminary notification and to add to it the value of the structures as at that time.
[1037D E] (iii) By the above method, building value is estimated on the basis of the prime cost or replacement cost less depreciation.
The rate of depreciation is, generally, arrived at by dividing the cost of construction (less the salvage valued at the end of the period of utility) by the number of years of utility of the building.
[1037E F] (iv) The factors that prolong the life and utility of the building, such as good maintenance, influence and bring down the rate of depreciation.
[1037F] In the instant case, the estimate of the proper market value of the building has not received the requisite attention both before the High Court and the District Court.
It is no doubt true that the Valuation Report, Ext.
I, was prepared on 20.7.
1960 one year after the date of the preliminary notification.
But the extent of the built area was about 25,000 sq.
There is no evidence to suggest that the rates mentioned and adopted in Ext.
I were not rates valid for a spread out period.
No case was made out that the building had lost its utility and that the only mode of valuation appropriate to the case was one of awarding merely the salvage value.
The building, according to the evidence was quite 1030 strong though about 60 years old at the time.
The appropriate thing to do would have been to set aside the award in so far as the valuation of the building is concerned and remit the matter for a fresh determination of its market value as on 14.7.1959.
However, in the interest of justice it would be proper to make some ready and rough estimate drawing such sustenance as the evidence on record could afford and impart a quietus to this vexed litigation.
Accordingly, the compensation for the buildings and structures is enhanced from Rs.57,660 to Rs.2,00,000.
[1038G H; 1039D G; 1040G] 3.
Where land is valued with reference to its potentiality for building purposes and on the basis of prices fetched by small sites in a hypothetical lay out the tree growth on the land cannot be valued independently on the basis of its horticultural value or with reference to the value of the yield.
This principle, however, does not come in the way of awarding the timber value or the salvage value of the tree growth after providng for the cost of cutting and removing.
[1040G H; 1041A] In the instant case, the evidence shows that there were 471 fruit bearing trees and plants, 13 timber trees and 12 bamboo clusters.
Though there is some evidence as to the value of the yield, there is no evidence about the timber value and fuel value of the trees.
The District Judge has awarded a sum of Rs.355.85 for the entire tree growth.
Having regard to the large number of trees and to the fact that some of them were timber trees, it would be appropriate to award a lump sum of Rs.7,500 under this head.
The compensation for tree growth is accordingly enhanced from Rs.355.85 to Rs.7,500.
[1041A C] 4.
By the U.P. Land Acquisition (Amendment) Act, 1954, Section 23(2) had been deleted from the statute.
It was re introduced by the U.P. Land Acquisition (Amendment) Act 1972.
The preliminary notification for the acquisition was issued subsequent to the deletion.
Whether re introduction of sub section (2) would enure to the benefit of the person whose land is acquired on the ground that proceedings in appeal were pending on the date of introduction of that provision, and availability for further enhancement of the solatium and rates of interest under the Central Amendment Act 68 of 1984 are left open with consent of counsel to be agitated after final decision in Bhag Singh vs U. T. of Chandigarh, by a larger Bench of this Court.
[1041E F; 1042B] 5.
The point concerning compensation to be awarded for change of residence under clause 'fifthly ' in section 23(1) does not appear to have been raised and urged before the High Court.
No specific ground 1031 has also been taken in this behalf in the appeal before this Court.
The appellant should not, therefore, be permitted to re agitate this question over again in this Court.
[1042D]
|
% The suit property known as "Gopal Lal Villa" situated on the outskirts of the city of Varanasi was a sprawling 60 years old building, part of the estate of a Raja, and vested in the appellant. The Land Acquisition Officer by his Award dated 4.11.1961 1026 under section 11 of the Land Acquisition Act determined the market value of the land at Rs.3,31,340 valuing it at Rs.140 per decimal; of the building and superstructure at Rs.57,660 and of the tree growth at Rs.355.83. In the appeal to this Court, it was contended on behalf of the appellant that the claim of Rs.352 per decimal was not accepted and that the High Court in affirming the valuation of the land at a mere Rs.200 per decimal overlooked certain settled principles of valuation. 19 while the higher of the two figures indicated by Ext. [1034E] Collector of Lakhimpur vs B.C. Dutta, AIR 1971 SC 2015; Mirza Nausherwan Khan & Anr. vs The Collector (Land Acquisition), Hyderabad, ; ; Padma Uppal etc. The Land Acquisition Officer, Aurangabad & Anr., ; , [1034H; 1035A B] Sahib Singh Kalha & Ors. [1035B] (viii) Subsequent transactions which are not proximate in point of time to the acquisition can be taken into account for purposes of determining whether as on the date of acquisition there was an upward trend in the prices of land in the area. 1960 there was no appreciation in the value of land in the area. [1036H; 1037A B] Bombay Improvement vs Mervanji Manekji Mistry, AIR 1926 Bombay 420 referred to. 2.(i) Usually land and building thereon constitute one unit. [1037C D] (ii) However, where, the property comprises extensive land and the structures standing do not show that full utilisation potential of the land is realised it might not be impermissible to value the property estimating separately the market value of the land with reference to the date of the preliminary notification and to add to it the value of the structures as at that time. 1960 one year after the date of the preliminary notification. But the extent of the built area was about 25,000 sq. There is no evidence to suggest that the rates mentioned and adopted in Ext. I were not rates valid for a spread out period. No case was made out that the building had lost its utility and that the only mode of valuation appropriate to the case was one of awarding merely the salvage value. The building, according to the evidence was quite 1030 strong though about 60 years old at the time. However, in the interest of justice it would be proper to make some ready and rough estimate drawing such sustenance as the evidence on record could afford and impart a quietus to this vexed litigation. It was re introduced by the U.P. Land Acquisition (Amendment) Act 1972. The preliminary notification for the acquisition was issued subsequent to the deletion. The point concerning compensation to be awarded for change of residence under clause 'fifthly ' in section 23(1) does not appear to have been raised and urged before the High Court. No specific ground 1031 has also been taken in this behalf in the appeal before this Court.
| 0.363448
| 0.668822
| 0.058531
| 0.412928
|
Civil Appeal No. 571 of 1987.
From the order dated 5.12.1986 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 424/86 B 2.
T.R. Andhyarujina, F.H.J. Talyarkhan, Shri Narain, R.K. Krishnamurthi and Sandeep Narain for the Appellants.
A.K. Ganguli, P. Parmeswaran and Ms. Radha Rangaswamy for the Respondents.
39 The Judgment of the Court was delivered by A RANGANATH MISRA, J.
This appeal under section 130 E of the is directed against the decision of the Customs, Excise & Gold (Control) Appellate Tribunal, New Delhi, by which the Tribunal has reversed the appellate decision of the Collector of Customs (Appeals), Bombay.
The short point involves in this appeal is as to whether the imported "special purpose complex machine" has to be charged to customs duty under item 89.59(1) as claimed by the Revenue or under 84.45/48 of the tariff schedule as maintained by the appellant.
If the appellant 's claim is accepted the duty is at the rate of 40 per cent while if the department 's stand is maintained it is at the rate of 60 per cent.
The Assistant Collector took the view that the imported machine was not manufacturing carburettors and was discharging an individual function of plugging holes in the carburettor body with the help of lead shots.
Therefore, the appropriate entry was 84.59(1) of the Customs Tariff.
The appellant challenged the order of the Assistant Collector by preferring an appeal to the Collector (Appeals).
He took the view that the imported machine by plugging holes on the carburettor body with the help of lead shots was clearly a machine which was fully conforming to the description of a machine for treating metals inasmuch as it was treating carburettor body and preparing it for being revetted.
The plugging on the carburettor body, the Collector felt, was, therefore, in the nature of treatment on the metalic body for making it revetable subsequently; even otherwise also the machine by plugging holes on the carburettor body was confirming to the description of a machine tool as given under heading 84.54/48 of the Customs Tariff.
He therefore, accepted the appellant 's contention.
On further appeal the Tribunal after discussing the stand point of the two sides came to the following conclusion: "Our considered view is that the function of the machine is to plug the holes of carburettor body.
The cutting or trimming operation is incidental to this function as it removes the extruded portion of the lead shots.
The function of checking is also a part of the main function of plugging as the object of checking is to ensure that the plugging has been done perfectly to make it air tight.
None of these functions can be considered to be treating metal within the meaning of sub heading (2) of Tariff Heading 40 84.59.
The function of plugging the holes of carburettor body does not amount to working metal.
It does not change the shape or form of the metal.
The portion of the machine which cuts the extruded portion of lead shot is not a reaming machine working the internal surface of an existing hole to exact dimension within the meaning of Explanatory Note 84.45(A)(5) of the CCC N (Volume 3), Chapter 84.45.
The imported machine in question does not fall within the definition of machine tool given in MC.
Graw Hill Dictionary of Scientific and Technical Term as cited by the learned S.D.R. Classification of the impugned machine under Tariff Heading 84.45/48 is, therefore, ruled out.
Even by taking all the functions of the machine into consideration, the classification for the purpose of customs duty will have to be determined keeping in view Section Note 3 in Section XVI and Chapter Note 5 of Chapter 84 of the First Schedule to the , according to which the principal function will be determining factor.
The principal function of this machine is to plug the holes of carburettor body.
The machine does not fall under any of the heading of Chapter 84 of the Tariff." 84.59 of Schedule I provides: "Machines and mechanical appliances having individual functions, not falling within any other heading of this Chapter: (1). . . (2). . . 60%.
" The entry is, therefore, a residuary one and indisputably if any other entry applies, application of entry 84.59 is ruled out.
The appellant maintains that the appropriate entry to apply to its case is 84.45/48.
That provides: "Machine tools for working metal . 40%." Machine tool, according to Tool Engineers Handbook published by Mc Graw Hills means "any machine operating other than by man power which employs a contact tool for working natural or synthetic 41 material.
Graw Hill Dictionary of Scientific and Technical Terms A gives the following meaning: "A stationary power driven machine for the shaping, cutting, turning, boring, drilling, grinding or polishing of solid parts, especially metals." Even according to the Department, machine tools coming under entry 84.45 are machines used for shaping or surface working metal or metal carbides by either: (i) cutting away or otherwise removing metal or metal carbides (for example, lathes, drilling, planing, slotting, milling or grinding machines).
(ii) changing the shape or form of the metal without removing any of it.
The note indicates that machine tools in general remain classified under this heading even if specialised for a particular industry.
Machine tools include slotting machines, drilling and boring machines, tapping machines, reaming machines and riveting machines.
Counsel for the appellant produced before us a carburettor without being treated by the machine and another which has already been treated.
He also produced a lead shot as also a nozle and indicated the drilling process which is carried on by the machine on the carburettor.
We are of the view that the machine in question is indeed a multy purpose one and keeping its performance in view we are inclined to agree with the submission of the counsel for the appellant that the machine is a "machine tool working on metal" and should legitimately find its way into entry 84.45/48.
Once it is so identified it does not get into the residuary entry.
In our view the Collector had reached the correct conclusion.
The appeal is allowed.
The order of the Tribunal is vacated and that of the Collector is restored.
Parties are directed to bear their own costs.
N.V.K. Appeal allowed.
|
% The appellant firm imported "special purpose complex machine" and claimed that it was classifiable under item 84.45/48 of the tariff schedule and duty was payable at the rate of 40 per cent.
The Assistant Collector took the view that the imported machine was not manufacturing carburettors and was discharging an individual function of plugging holes in the carburettor body with the help of lead shots, and that the appropriate entry was 84.59(1) of the Customs Tariff and duty was payable at the rate of 60 per cent.
The appellant challenged the aforesaid order by preferring an appeal to the Collector (Appeals) who took the view that the imported machine by plugging holes on the carburettor body with the help of lead shots was clearly a machine which was fully conforming to the description of a machine for treating metals inasmuch as it was treating the carburettor body and preparing it for being rivetted, and therefore it was conforming to the description of a machine tool as given under heading 84.45/48 of the Customs Tariff, and allowed the appeal.
On further appeal, the Customs Excise and Gold Control Appellate Tribunal came to the conclusion that the function of the imported machine was to plug the holes of carburettor body, that none of its functions can be considered to be treating metal within the meaning of sub heading (2) of Tariff Heading 84.59, that classification as machine tool under Tariff Heading 84.45/48 has to be ruled out, and that the machine does not fall under any of the Heading of Chapter 84 of the 38 Tariff Schedule.
It accordingly reversed the appellate decision of the Collector of Customs (Appeals).
In the appeal under section 130 E of the to this Court on the question: whether the imported "special purpose complex machine" has to be charged to customs duty under item 84.59(1) as claimed by the Revenue or under 84.45/48 of the tariff schedule as maintained by the appellant.
Allowing the Appeal, ^ HELD: l. Entry 84.59 of Schedule I is a residuary one and indisputably if any other entry applies, application of this entry is ruled out.
[40F G] 2.
Machine tools in general remain classified under entry 84.45 even if specialised for a particular industry Machine tools include slotting machines, drilling and boring machines, tapping machines, reaming machines and rivetting machines.
[41D E] Tool Engineers Handbook Mc Graw Hills: Mc Graw Hill Dictionary of Scientific and Technical Terms referred to.
The machine in the instant case, is indeed a multi purpose one and keeping its performance in view, the machine has to be held as a "machine tool working on metal" and should legitimately find its way into entry 84.45/48.
Once it is so identified, it does not get into the residuary entry 84.59.
The Collector has reached the correct conclusion.
The order of the Tribunal is vacated and that of the Collector is restored.
[41F G]
|
Civil Appeal No. 571 of 1987.
From the order dated 5.12.1986 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 424/86 B 2.
T.R. Andhyarujina, F.H.J. Talyarkhan, Shri Narain, R.K. Krishnamurthi and Sandeep Narain for the Appellants.
A.K. Ganguli, P. Parmeswaran and Ms. Radha Rangaswamy for the Respondents.
39 The Judgment of the Court was delivered by A RANGANATH MISRA, J.
This appeal under section 130 E of the is directed against the decision of the Customs, Excise & Gold (Control) Appellate Tribunal, New Delhi, by which the Tribunal has reversed the appellate decision of the Collector of Customs (Appeals), Bombay.
The short point involves in this appeal is as to whether the imported "special purpose complex machine" has to be charged to customs duty under item 89.59(1) as claimed by the Revenue or under 84.45/48 of the tariff schedule as maintained by the appellant.
If the appellant 's claim is accepted the duty is at the rate of 40 per cent while if the department 's stand is maintained it is at the rate of 60 per cent.
The Assistant Collector took the view that the imported machine was not manufacturing carburettors and was discharging an individual function of plugging holes in the carburettor body with the help of lead shots.
Therefore, the appropriate entry was 84.59(1) of the Customs Tariff.
The appellant challenged the order of the Assistant Collector by preferring an appeal to the Collector (Appeals).
He took the view that the imported machine by plugging holes on the carburettor body with the help of lead shots was clearly a machine which was fully conforming to the description of a machine for treating metals inasmuch as it was treating carburettor body and preparing it for being revetted.
The plugging on the carburettor body, the Collector felt, was, therefore, in the nature of treatment on the metalic body for making it revetable subsequently; even otherwise also the machine by plugging holes on the carburettor body was confirming to the description of a machine tool as given under heading 84.54/48 of the Customs Tariff.
He therefore, accepted the appellant 's contention.
On further appeal the Tribunal after discussing the stand point of the two sides came to the following conclusion: "Our considered view is that the function of the machine is to plug the holes of carburettor body.
The cutting or trimming operation is incidental to this function as it removes the extruded portion of the lead shots.
The function of checking is also a part of the main function of plugging as the object of checking is to ensure that the plugging has been done perfectly to make it air tight.
None of these functions can be considered to be treating metal within the meaning of sub heading (2) of Tariff Heading 40 84.59.
The function of plugging the holes of carburettor body does not amount to working metal.
It does not change the shape or form of the metal.
The portion of the machine which cuts the extruded portion of lead shot is not a reaming machine working the internal surface of an existing hole to exact dimension within the meaning of Explanatory Note 84.45(A)(5) of the CCC N (Volume 3), Chapter 84.45.
The imported machine in question does not fall within the definition of machine tool given in MC.
Graw Hill Dictionary of Scientific and Technical Term as cited by the learned S.D.R. Classification of the impugned machine under Tariff Heading 84.45/48 is, therefore, ruled out.
Even by taking all the functions of the machine into consideration, the classification for the purpose of customs duty will have to be determined keeping in view Section Note 3 in Section XVI and Chapter Note 5 of Chapter 84 of the First Schedule to the , according to which the principal function will be determining factor.
The principal function of this machine is to plug the holes of carburettor body.
The machine does not fall under any of the heading of Chapter 84 of the Tariff." 84.59 of Schedule I provides: "Machines and mechanical appliances having individual functions, not falling within any other heading of this Chapter: (1). . . (2). . . 60%.
" The entry is, therefore, a residuary one and indisputably if any other entry applies, application of entry 84.59 is ruled out.
The appellant maintains that the appropriate entry to apply to its case is 84.45/48.
That provides: "Machine tools for working metal . 40%." Machine tool, according to Tool Engineers Handbook published by Mc Graw Hills means "any machine operating other than by man power which employs a contact tool for working natural or synthetic 41 material.
Graw Hill Dictionary of Scientific and Technical Terms A gives the following meaning: "A stationary power driven machine for the shaping, cutting, turning, boring, drilling, grinding or polishing of solid parts, especially metals." Even according to the Department, machine tools coming under entry 84.45 are machines used for shaping or surface working metal or metal carbides by either: (i) cutting away or otherwise removing metal or metal carbides (for example, lathes, drilling, planing, slotting, milling or grinding machines).
(ii) changing the shape or form of the metal without removing any of it.
The note indicates that machine tools in general remain classified under this heading even if specialised for a particular industry.
Machine tools include slotting machines, drilling and boring machines, tapping machines, reaming machines and riveting machines.
Counsel for the appellant produced before us a carburettor without being treated by the machine and another which has already been treated.
He also produced a lead shot as also a nozle and indicated the drilling process which is carried on by the machine on the carburettor.
We are of the view that the machine in question is indeed a multy purpose one and keeping its performance in view we are inclined to agree with the submission of the counsel for the appellant that the machine is a "machine tool working on metal" and should legitimately find its way into entry 84.45/48.
Once it is so identified it does not get into the residuary entry.
In our view the Collector had reached the correct conclusion.
The appeal is allowed.
The order of the Tribunal is vacated and that of the Collector is restored.
Parties are directed to bear their own costs.
N.V.K. Appeal allowed.
|
Civil Appeal No. 571 of 1987.
From the order dated 5.12.1986 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. 424/86 B 2.
T.R. Andhyarujina, F.H.J. Talyarkhan, Shri Narain, R.K. Krishnamurthi and Sandeep Narain for the Appellants.
A.K. Ganguli, P. Parmeswaran and Ms. Radha Rangaswamy for the Respondents.
39 The Judgment of the Court was delivered by A RANGANATH MISRA, J.
This appeal under section 130 E of the is directed against the decision of the Customs, Excise & Gold (Control) Appellate Tribunal, New Delhi, by which the Tribunal has reversed the appellate decision of the Collector of Customs (Appeals), Bombay.
The short point involves in this appeal is as to whether the imported "special purpose complex machine" has to be charged to customs duty under item 89.59(1) as claimed by the Revenue or under 84.45/48 of the tariff schedule as maintained by the appellant.
If the appellant 's claim is accepted the duty is at the rate of 40 per cent while if the department 's stand is maintained it is at the rate of 60 per cent.
The Assistant Collector took the view that the imported machine was not manufacturing carburettors and was discharging an individual function of plugging holes in the carburettor body with the help of lead shots.
Therefore, the appropriate entry was 84.59(1) of the Customs Tariff.
The appellant challenged the order of the Assistant Collector by preferring an appeal to the Collector (Appeals).
He took the view that the imported machine by plugging holes on the carburettor body with the help of lead shots was clearly a machine which was fully conforming to the description of a machine for treating metals inasmuch as it was treating carburettor body and preparing it for being revetted.
The plugging on the carburettor body, the Collector felt, was, therefore, in the nature of treatment on the metalic body for making it revetable subsequently; even otherwise also the machine by plugging holes on the carburettor body was confirming to the description of a machine tool as given under heading 84.54/48 of the Customs Tariff.
He therefore, accepted the appellant 's contention.
On further appeal the Tribunal after discussing the stand point of the two sides came to the following conclusion: "Our considered view is that the function of the machine is to plug the holes of carburettor body.
The cutting or trimming operation is incidental to this function as it removes the extruded portion of the lead shots.
The function of checking is also a part of the main function of plugging as the object of checking is to ensure that the plugging has been done perfectly to make it air tight.
None of these functions can be considered to be treating metal within the meaning of sub heading (2) of Tariff Heading 40 84.59.
The function of plugging the holes of carburettor body does not amount to working metal.
It does not change the shape or form of the metal.
The portion of the machine which cuts the extruded portion of lead shot is not a reaming machine working the internal surface of an existing hole to exact dimension within the meaning of Explanatory Note 84.45(A)(5) of the CCC N (Volume 3), Chapter 84.45.
The imported machine in question does not fall within the definition of machine tool given in MC.
Graw Hill Dictionary of Scientific and Technical Term as cited by the learned S.D.R. Classification of the impugned machine under Tariff Heading 84.45/48 is, therefore, ruled out.
Even by taking all the functions of the machine into consideration, the classification for the purpose of customs duty will have to be determined keeping in view Section Note 3 in Section XVI and Chapter Note 5 of Chapter 84 of the First Schedule to the , according to which the principal function will be determining factor.
The principal function of this machine is to plug the holes of carburettor body.
The machine does not fall under any of the heading of Chapter 84 of the Tariff." 84.59 of Schedule I provides: "Machines and mechanical appliances having individual functions, not falling within any other heading of this Chapter: (1). . . (2). . . 60%.
" The entry is, therefore, a residuary one and indisputably if any other entry applies, application of entry 84.59 is ruled out.
The appellant maintains that the appropriate entry to apply to its case is 84.45/48.
That provides: "Machine tools for working metal . 40%." Machine tool, according to Tool Engineers Handbook published by Mc Graw Hills means "any machine operating other than by man power which employs a contact tool for working natural or synthetic 41 material.
Graw Hill Dictionary of Scientific and Technical Terms A gives the following meaning: "A stationary power driven machine for the shaping, cutting, turning, boring, drilling, grinding or polishing of solid parts, especially metals." Even according to the Department, machine tools coming under entry 84.45 are machines used for shaping or surface working metal or metal carbides by either: (i) cutting away or otherwise removing metal or metal carbides (for example, lathes, drilling, planing, slotting, milling or grinding machines).
(ii) changing the shape or form of the metal without removing any of it.
The note indicates that machine tools in general remain classified under this heading even if specialised for a particular industry.
Machine tools include slotting machines, drilling and boring machines, tapping machines, reaming machines and riveting machines.
Counsel for the appellant produced before us a carburettor without being treated by the machine and another which has already been treated.
He also produced a lead shot as also a nozle and indicated the drilling process which is carried on by the machine on the carburettor.
We are of the view that the machine in question is indeed a multy purpose one and keeping its performance in view we are inclined to agree with the submission of the counsel for the appellant that the machine is a "machine tool working on metal" and should legitimately find its way into entry 84.45/48.
Once it is so identified it does not get into the residuary entry.
In our view the Collector had reached the correct conclusion.
The appeal is allowed.
The order of the Tribunal is vacated and that of the Collector is restored.
Parties are directed to bear their own costs.
N.V.K. Appeal allowed.
|
% The appellant firm imported "special purpose complex machine" and claimed that it was classifiable under item 84.45/48 of the tariff schedule and duty was payable at the rate of 40 per cent.
The Assistant Collector took the view that the imported machine was not manufacturing carburettors and was discharging an individual function of plugging holes in the carburettor body with the help of lead shots, and that the appropriate entry was 84.59(1) of the Customs Tariff and duty was payable at the rate of 60 per cent.
The appellant challenged the aforesaid order by preferring an appeal to the Collector (Appeals) who took the view that the imported machine by plugging holes on the carburettor body with the help of lead shots was clearly a machine which was fully conforming to the description of a machine for treating metals inasmuch as it was treating the carburettor body and preparing it for being rivetted, and therefore it was conforming to the description of a machine tool as given under heading 84.45/48 of the Customs Tariff, and allowed the appeal.
On further appeal, the Customs Excise and Gold Control Appellate Tribunal came to the conclusion that the function of the imported machine was to plug the holes of carburettor body, that none of its functions can be considered to be treating metal within the meaning of sub heading (2) of Tariff Heading 84.59, that classification as machine tool under Tariff Heading 84.45/48 has to be ruled out, and that the machine does not fall under any of the Heading of Chapter 84 of the 38 Tariff Schedule.
It accordingly reversed the appellate decision of the Collector of Customs (Appeals).
In the appeal under section 130 E of the to this Court on the question: whether the imported "special purpose complex machine" has to be charged to customs duty under item 84.59(1) as claimed by the Revenue or under 84.45/48 of the tariff schedule as maintained by the appellant.
Allowing the Appeal, ^ HELD: l. Entry 84.59 of Schedule I is a residuary one and indisputably if any other entry applies, application of this entry is ruled out.
[40F G] 2.
Machine tools in general remain classified under entry 84.45 even if specialised for a particular industry Machine tools include slotting machines, drilling and boring machines, tapping machines, reaming machines and rivetting machines.
[41D E] Tool Engineers Handbook Mc Graw Hills: Mc Graw Hill Dictionary of Scientific and Technical Terms referred to.
The machine in the instant case, is indeed a multi purpose one and keeping its performance in view, the machine has to be held as a "machine tool working on metal" and should legitimately find its way into entry 84.45/48.
Once it is so identified, it does not get into the residuary entry 84.59.
The Collector has reached the correct conclusion.
The order of the Tribunal is vacated and that of the Collector is restored.
[41F G]
|
% The appellant firm imported "special purpose complex machine" and claimed that it was classifiable under item 84.45/48 of the tariff schedule and duty was payable at the rate of 40 per cent.
The Assistant Collector took the view that the imported machine was not manufacturing carburettors and was discharging an individual function of plugging holes in the carburettor body with the help of lead shots, and that the appropriate entry was 84.59(1) of the Customs Tariff and duty was payable at the rate of 60 per cent.
The appellant challenged the aforesaid order by preferring an appeal to the Collector (Appeals) who took the view that the imported machine by plugging holes on the carburettor body with the help of lead shots was clearly a machine which was fully conforming to the description of a machine for treating metals inasmuch as it was treating the carburettor body and preparing it for being rivetted, and therefore it was conforming to the description of a machine tool as given under heading 84.45/48 of the Customs Tariff, and allowed the appeal.
On further appeal, the Customs Excise and Gold Control Appellate Tribunal came to the conclusion that the function of the imported machine was to plug the holes of carburettor body, that none of its functions can be considered to be treating metal within the meaning of sub heading (2) of Tariff Heading 84.59, that classification as machine tool under Tariff Heading 84.45/48 has to be ruled out, and that the machine does not fall under any of the Heading of Chapter 84 of the 38 Tariff Schedule.
It accordingly reversed the appellate decision of the Collector of Customs (Appeals).
In the appeal under section 130 E of the to this Court on the question: whether the imported "special purpose complex machine" has to be charged to customs duty under item 84.59(1) as claimed by the Revenue or under 84.45/48 of the tariff schedule as maintained by the appellant.
Allowing the Appeal, ^ HELD: l. Entry 84.59 of Schedule I is a residuary one and indisputably if any other entry applies, application of this entry is ruled out.
[40F G] 2.
Machine tools in general remain classified under entry 84.45 even if specialised for a particular industry Machine tools include slotting machines, drilling and boring machines, tapping machines, reaming machines and rivetting machines.
[41D E] Tool Engineers Handbook Mc Graw Hills: Mc Graw Hill Dictionary of Scientific and Technical Terms referred to.
The machine in the instant case, is indeed a multi purpose one and keeping its performance in view, the machine has to be held as a "machine tool working on metal" and should legitimately find its way into entry 84.45/48.
Once it is so identified, it does not get into the residuary entry 84.59.
The Collector has reached the correct conclusion.
The order of the Tribunal is vacated and that of the Collector is restored.
[41F G]
| 1
| 1
| 1
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N: Criminal Appeal No. 690 of 1982 etc.
From the Judgment and order dated 20.5.1982 of the Patna High Court in Criminal Appeal No. 329 of 1980.
R.K. Garg, R.K. Jain, Rajendra Singh, S.N. Jha, R.P. Singh, Rakesh Khanna, Md. Israeli and Ranjit Kumar for the Appellants.
Pramod Swaroop and Mrs. G.S. Misra for the Respondents.
B.B. Singh (Not Present) for the Respondents.
A.K. Panda for the Complainant in all the appeals.
The Judgment of the Court was delivered by DUTT, J.
These appeals are directed against the judgment of the Patna High Court affirming the order of the First Additional Sessions Judge, Arrah, convicting all the appellants under sections 302/34 IPC and section 27 of the Arms Act and sentencing each of them to rigorous imprisonment for life and rigorous imprisonment for three years respectively and further convicting the appellant Hare Krishna Singh under section 379 IPC and sentencing him to rigorous imprisonment for three years; all the sentences are to run concurrently.
The accused included two persons having the same name Paras Singh, one of Village Dhobaha, brother in law of Hare Krishna Singh, one of the appellants in Criminal Appeal No. 690 of 1982, and the other of Village Birampur and nephew of Jagdish Singh, the appellant in Criminal Appeal No. 616 of 1982.
We shall hereinafter refer to 6 the said two persons as 'Paras Singh of Dhobaha ' and 'Paras Singh of Birampur ' respectively.
The prosecution case as appearing from the Fardbeyan or the FIR lodged by one Sarabjit Tiwary (P.W. 3), a social worker, on 12.12.1987 in the Arrah Sadar Police Station, was that on that day at about 7.00 A.M. he was going to his brother in law Raghubir Mishra and just he reached near the main gate of the Sadar Hospital, he saw seven persons, namely, "(1) Hare Krishna Singh, resident of Dhanpura; (2) Sheo Narain Sharma, resident of Berkhembe Gali; (3) Ram Kumar Upadhyaya, resident of village Dumaria; (4) Jagdish Singh 's nephew of Birampur in military service; (5) brother in law of Hare Krishna Singh of Dhobaha in military service" and two more persons whom he could not identify.
All the said persons were armed with rifle, gun and pistol, and were standing near northern side of the eastern gate of the hospital.
At that time, two Rickshaws were coming from the eastern side.
In the front Rickshaw, Jitendra Choudhary and another person named Lallan Rai, Resident of village Maniya, were sitting and in the rear Rickshaw there were two girls.
As the Rickshaw of Jitendra Choudhary came near the persons mentioned above, all of a sudden, Hare Krishna Singh fired at Jitendra Choudhary from his gun, whereupon the latter fell down from the Rickshaw with the rifle which he was carrying with him.
The other persons also fired upon Jitendra Choudhary along with Hare Krishna Singh, as a result of which he died.
After that Hare Krishna Singh picked up the rifle of Jitendra Choudhary and touching his body said, "He is dead, let us take to our heels".
It may be mentioned here that the two girls referred to in the Fardbeyan or FIR are Premlata Choudhary (P.W. 1) and Sobha Choudhary (P.W. 2), sisters of the deceased Jitendra Choudhary.
After investigation by P.W. 9, the chargesheet was submitted against all the appellants and they were put up for trial.
The prosecution examined as many as 9 witnesses, of whom P.Ws. 1, 2, 3 and 8 were eye witnesses.
The defence of Hare Krishna Singh was that he was going to Patna along with the appellant Ram Kumar Upadhyaya and one Madan Singh in a Rickshaw and when the Rickshaw reached near the shop of Sita Ram, he received a bullet from behind and fell down.
He looked back and saw that one Dipu Prasad and Ram Lal were firing.
He also saw the deceased Jitendra Choudhary, Chhatu Choudhary and Lallan Rai (P.W. 8) firing from the eastern gate of the Hospital.
He examined five witnesses, D.Ws. 1 to 5, to prove the nature of injury sustained by him.
7 The defence of Paras Singh of Dhobaha was that he had not visited the village Dhanpura for the last fifteen years.
The defence of other appellants is also a denial of their complicity in the crime.
The learned Additional Sessions Judge, after an elaborate discussion and analysis of the evidence adduced on behalf of the parties, accepted the prosecution case and convicted and sentenced the appellants as mentioned above.
Regarding the injury sustained by Hare Krishna Singh, the learned Additional Sessions Judge was of the view that such injury had been deliberately introduced by him and held that he was not injured in the occurrence.
On appeal by the appellants, the High Court affirmed their convictions and sentences.
Hence these appeals be special leave.
It is contended by Mr. Garg, learned Counsel appearing on behalf of Hare Krishna Singh, one of the appellants in Criminal Appeal No. 690 of 1982, that the prosecution having failed to explain the injury sustained by the appellant in the same occurrence, such injury being a serious one, the prosecution witnesses should be disbelieved.
Counsel submits that in such circumstances, it should be held that the plea of the appellant of self defence has been probabilised, and that the prosecution must have withheld the true facts as to the genesis and origin of the occurrence.
Further, it is submitted that in any event, it has cast a great doubt on the prosecution case and the benefit of that doubt should go to the appellant.
The question, however, is whether it is an invariable rule that whenever an accused sustains an injury in the same occurrence, the prosecution is obliged to explain the injury and on the failure of the prosecution to do so, the prosecution case should be disbelieved.
Before answering the question we may refer to a few decisions of this Court cited at the Bar.
Mr. Garg has placed much reliance upon the decision of this Court in Lakshmi Singh vs State of Bihar, In that case, the accused sustained injuries in the same occurrence.
Fazal Ali, J., who delivered the judgment of the Court, observed that no independent witness had been examined by the prosecution to support the participation of the appellant in the assault.
Further, it was observed that the evidence of P.Ws. 1 to 4 clearly showed that they gave graphic description of the assault with regard to the order, the manner and the parts of the body with absolute consistency which gave an impression that they had given a parrot like version acting under a conspiracy to depose to one set of facts and one set of facts only.
In view of the nature of evidence of P.Ws. 1 to 4, this 8 Court accepted the contention made on behalf of the accused, particularly taking the entire picture of the narrative given by the witnesses, that P.Ws. 1 to 4 had combined together to implicate the accused falsely because of the long standing litigation between them and the said witnesses.
Thereafter, the Court considered the injuries that were inflicted on the person of the accused Dasrath Singh and laid down that where the prosecution fails to explain the injuries on the accused, two results follow: (1) that the evidence of the prosecution witness is untrue; and (2) that the injuries probabilise the plea taken by the appellants.
The principle of law laid down in the earlier decision of this Court in Mohar Rai vs State o f Bihar; , was followed.
In Mohar Rai 's case it has been laid down that in a murder case, the non explanation of the injuries sustained by the accused at about the time of the occurrence or in the case of altercation is a very important circumstance from which the court can draw the following inferences: (1) that the prosecution has suppressed the genesis and the origin of the occurrence and has thus not presented the true version; (2) that the witnesses who have denied the presence of the injuries on the person of the accused are Lying on a most material point and therefore their evidence is unreliable; (3) that in case there is a defence version which explains the injuries on the person of the accused it is rendered probable so as to throw doubt on the prosecution case.
The principles that have been laid down in Lakshmi Singh 's case have to be read in the context of the facts of that case.
It has been already pointed out that the prosecution witnesses have been disbelieved by this Court before it considered the question of failure of the prosecution to explain the injuries sustained by one of the accused.
If the prosecution witnesses had been believed in that case, the non explanation of the injuries sustained by the accused would not have affected the prosecution case.
Indeed, it has been laid down in Lakshmi Singh 's case that the non explanation of the injuries by the prosecution will not affect the prosecution case where injuries sustained by the accused are minor and superficial or where the evidence is so clear and cogent, so independent and disinterested, so probable, consistent and creditworthy, that it far outweighs the effect of the omission on the part of the prosecution to explain the injuries.
In Mohar Rai 's case (supra), the first appellant Mohar Rai was convicted under section 324 IPC for shooting and injuring P.W 1 at the instigation of the second appellant Bharat Rai, who was himself convicted of an offence under section 324 read with section 109 IPC.
9 The prosecution proceeded on the basis that the revolver (exhibit III), which was recovered from Mohar Rai, was the weapon that was used by him in the commission of the offence.
The ballistic expert, who was examined as D.W. 1, was positive that the seized empties as well as the misfired cartridge could not have been fired from exhibit III.
The evidence of D.W. 1 was accepted both by the trial court as well as by the High Court.
This Court rejected the prosecution case that Mohar Rai had fired three shots from exhibit III.
This Court held that once it was proved that the empties recovered from the scene could not have been fired from exhibit III, the prosecution case that those empties were fired from exhibit III by Mohar Rai stood falsified.
Thereafter, the injuries sustained by the two appellants, Mohar Rai and Bharath Rai, were considered by the Court and it held that the prosecution had failed to explain the injuries sustained by the appellants and observed that the failure of the prosecution to offer any explanation in that regard showed that the evidence of prosecution witnesses relating to the incident was not true or, at any rate, not wholly true.
Thus, in this case also the question of non explanation of the injuries on the accused was considered by the Court after it had rejected, on a consideration of evidence, the prosecution case that Mohar Rai had fired from the revolver (exhibit III).
In other words, if the prosecution case had been believed that the appellant Mohar Rai had fired from exhibit III injuring P.W. 1, the non explanation of the injuries sustained by the accused would not have affected the prosecution case.
On the other hand, in Bhaba Nanda Sharma vs State of Assam ; it has been categorically laid down by this Court that the prosecution is not obliged to explain the injuries on the person of the accused in all cases and in all circumstances.
It depends upon the facts and circumstances of each case whether the prosecution case becomes reasonably doubtful for its failure to explain the injuries on the accused.
In Ramlagan Singh vs State of Bihar, this Court again examined the question and it has been laid down that the prosecution is not called upon in all cases to explain the injuries received by the accused persons.
It is for the defence to put questions to the prosecution witnesses regarding the injuries of the accused persons.
When that is not done, there is no occasion for the prosecution witnesses to explain the injuries on the person of the accused.
In the instant case also, the injury sustained by the appellant Hare Krishna Singh, has not been put to the prosecution witnesses and so they had no occasion to explain the same.
In such circumstances, as laid down in Ramlagan Singh 's case, the non mention of the injuries on the person of the appellant in the prosecution evidence would not 10 affect the prosecution case, which has been accepted by the courts below.
In Onkarnath Singh vs State of U. P., this Court has reiterated its view as expressed in Bankey Lal vs State of U.P., and Bhagwan Tana Patil vs State of Maharashtra, that the entire prosecution case cannot be thrown overboard simply because the prosecution witnesses do not explain the injuries on the person of the accused.
Thereafter, it was observed as follows: "Such non explanation, however, is a factor which is to be taken into account in judging the veracity of the prosecution witnesses, and the court will scrutinise their evidence with care.
Each case presents its own features.
In some case, the failure of the prosecution to account for the in juries of the accused may undermine its evidence to the core and falsify the substratum of its story, while in others it may have little or no adverse effect on the prosecution case.
It may also, in a given case, strengthen the plea of private defence set up by the accused.
But it cannot be laid down as an invariable proposition of law of universal application that as soon as it is found that the accused had received injuries in the same transaction in which the complainant party was assaulted, the plea of private defence would stand prima facie established and the burden would shift on to the prosecution to prove that those injuries were caused to the accused in self defence by the complainant party.
For instance where two parties come armed with a determination to measure their strength and to settle a dispute by force of arms and in the ensuing fight both sides receive injuries, no question of private defence arises.
Much reliance has been placed by Mr. Garg on the following observation of Fazal Ali, J. in Jagdish vs State of Rajasthan, ; "It is true that where serious injuries are found on the person of the accused, as a principle of appreciation of evidence, it becomes obligatory on the prosecution to explain the injuries, so as to satisfy the Court as to the circumstances under which the occurrence originated.
But before this obligation is placed on the prosecution two conditions must be satisfied; 11 1.
that the injuries on the person of the accused must be very serious and severe and not superficial; 2. that it must be shown that these injuries must have been caused at the time of the occurrence in question.
" In Jagdish 's case, the High Court believed the prosecution witnesses and accepted the prosecution case that the injuries found on the deceased were very severe which resulted in his death and this Court agreed with the view taken by the High Court in convicting the appellant under section 302 IPC.
In regard to this point we may cite two other decisions relating to the plea of the accused of private defence.
In Munshi Ram vs Delhi Administration, it has been held by this Court that although the accused have not taken the plea of private defence in their statements under section 342 Cr. P.C., necessary basis for that plea had been laid in the cross examination of the prosecution witnesses as well as by adducing defence evidence.
It has been observed that even if an accused does not plead self defence, it is open to the court to consider such plea if the same arises from the material on record.
The burden of establishing that plea is on the accused and that burden can be discharged by showing preponderance of probabilities in favour of that plea on the basis of the material on record.
Munshi Ram 's case arises out of a dispute over the possession of land.
The case of the appellants that their relation was a tenant of the disputed land for over thirty years and that his tenancy was never terminated, was accepted by this Court.
In other words, the appellants were found to be in lawful possession of the land in question and that P.Ws. 17 and 19 had gone to the land with their friends, P.W. 19 being armed with a deadly weapon, with a view to intimidating the relation of the appellants, whose tenancy was not terminated.
They were held to be guilty of criminal trespass and of constituting an unlawful assembly.
In the context of the above facts, this Court made the observation that it is open to the court to consider the plea of private defence even though the same does not find place in the statement under section 342 Cr.
The next case that has been relied upon by Mr. Garg is that of State of Gujarat vs Bai Fatima, in that case, on behalf of the appellants the decision in Munshi Ram 's case (supra) was relied 12 upon in regard to the question of the plea of private defence.
In rejecting the contention of the accused, this Court pointed out that not only the plea of private defence was not taken by the accused in their statements under section 342 Cr.
P.C., but no basis for that plea was laid in the cross examination of the prosecution witnesses or by adducing any defence evidence.
As regards the injuries sustained by one of the accused, this Court observed as follows: "In material particulars the evidence of the three eye witnesses as also the evidence of dying declaration of the deceased before P.W. Gulamnabi is so convincing and natural that no doubt creeps into it for the failure of the prosecution to explain the injuries on the person of respondent No. 1.
The prosecution case is not shaken at all on that account.
We have referred to the above decisions in extenso in order to consider whether it is an invariable proposition of law that the prosecution is obliged to explain the injuries sustained by the accused in the same occurrence and whether failure of the prosecution to so explain the injuries on the person of the accused would mean that the prosecution has suppressed the truth and also the genesis or origin of the occurrence.
Upon a conspectus of the decisions mentioned above, we are of the view that the question as to the obligation of the prosecution to explain the injuries sustained by the accused in the same occurrence may not arise in each and every case.
In other words, it is not an invariable rule that the prosecution has to explain the injuries sustained by the accused in the same occurrence.
The burden of proving the guilt of the accused is undoubtedly on the prosecution.
The accused is not bound to say anything in defence.
The prosecution has to prove the guilt of the accused beyond all reasonable doubts.
If the witnesses examined on behalf of the prosecution are believed by the court in proof of the guilt of the accused beyond any reasonable doubt, the question of the obligation of the prosecution to explain the injuries sustained by the accused will not arise.
When the prosecution comes with a definite case that the offence has been committed by the accused and proves its case beyond any reasonable doubt, it becomes hardly necessary for the prosecution to again explain how and in what circumstances injuries have been inflicted on the person of the accused.
The accused may take the plea of the right of private defence which means that he had inflicted injury on the deceased or the injured 13 person in exercise of his right of private defence.
In other words, his plea may be that the deceased or the injured person was the aggressor and inflicted injury on the accused and in order to defend himself from being the victim of such aggression, he had inflicted injury on the aggressor in the exercise of his right of private defence.
As has been held in Munshi Ram 's case (supra) the burden of establishing the plea of private defence is on the accused and the burden can be discharged by showing preponderance of probabilities in favour of that plea on the basis of the material on record.
It, therefore, follows that simply because the accused has received injuries in the same occurrence, it cannot be taken for granted that the deceased or the injured person was the aggressor and consequently, he had to defend himself by inflicting injury on the deceased or the injured person.
All the decisions of this Court which have been referred to and discussed above, show that when the court has believed the prosecution witnesses as convincing and trustworthy, the court overruled the contention of the accused that as the prosecution had failed to explain the injuries sustained by the accused in the same occurrence, the prosecution case should be disbelieved and the accused should be acquitted.
Thus, it is not the law or invariable rule that whenever the accused sustains an injury in the same occurrence, the prosecution has to explain the injuries failure of which will mean that the prosecution has suppressed the truth and also the origin and genesis of the occurrence.
The learned Additional Sessions Judge has not believed the case of Hare Krishna Singh that he had sustained a bullet injury in the same occurrence and he has given reasons therefor.
The High Court has, however, come to the finding that Hare Krishna Singh was admitted in the hospital in an injured condition immediately after the occurrence.
We do not propose to reassess evidence on the question as to whether Hare Krishna Singh had sustained any injury or not.
We may assume that he had sustained a bullet injury in the same occurrence.
But, even then, in the facts and circumstances of the case the prosecution, in our opinion, is not obliged to account for the injury and that the failure of the prosecution to give a reasonable explanation of the injury would not go against or throw any doubt on the prosecution case.
The injury that was sustained by Hare Krishna Singh was on the back.
The P.Ws. 1 and 2, the two sisters of the deceased Jitendra Choudhary, denied the suggestion put to them on behalf of Hare Krishna Singh that their brother Jitendra Choudhary had been shoot 14 ing from his rifle.
P.W. 3, who is an independent witness and was present on the scene of occurrence, also denied the suggestion of the defence that there was firing on Hare Krishna Singh.
P.W. 8 Lallan Rai also denied such suggestion of the defence.
Hare Krishna Singh made a statement under section 313 Cr.
It is not his case that in self defence he had fired at the deceased Jitendra Choudhary.
He denied that he had any fire arms with him or that he had fired at Jitendra Choudhary.
He also denied that none of the accused had any weapon with him.
All the eye witnesses have stated that the appellant Hare Krishna Singh had fired on Jitendra Choudhary as a result of which he died.
The prosecution witnesses have been believed by the learned Additional Sessions Judge and the High Court.
In the circumstances, we do not think that the materials on record including the statement of Hare Krishna Singh under section 313 Cr. P.C., probabilise any case of self defence or that the deceased had inflicted on him the injury by firing at him from his rifle.
It may be that two empties were found by the side of the dead body of the deceased, but the High Court has rightly observed that the presence of the empties does not necessarily mean that the deceased had fired.
The High Court points out that three live cartridges were also recovered from the pocket of the deceased at the time of inquest and observes that keeping of empty cartridges by the side of the body of the deceased cannot be ruled out.
We do not find any infirmity in the view expressed by the High Court.
It is not at all amenable to reason that the deceased had started from his house along with his two sisters with a view to fighting with the accused.
In the circumstances, we are of the view that the appellant Hare Krishna Singh has been rightly convicted and sentenced as above.
Now we may deal with the case of Paras Singh of Dhobaha, one of the appellants in Criminal Appeal No. 690 of 1982.
He was found with the accused persons including Hare Krishna Singh.
It is not disputed that he is the brother in law of Hare Krishna Singh, as he has been described in the FIR.
It is the categorical evidence of P.Ws. 1, 2, 3 and 8 that Paras Singh of Dhobaha had fired at the deceased Jitendra Choudhary.
He has been identified by P.W. 1 in the T.I. Parade.
In the circumstances, we do not find any reason to interfere with the order of conviction and sentence passed by the courts below.
So far as Paras Singh of Birampur, the nephew of Jagdish Singh and the sole appellant in Criminal Appeal No. 616 of 1982, is concerned, his case stands on a different footing.
Indeed, Mr. Rajender 15 Singh, the learned Counsel appearing on behalf of the appellant, has challenged the very presence of the appellant, Paras Singh of Birampur, at the time of occurrence.
In the FIR, his name has not been mentioned, it has only been stated "Jagdish Singh 's nephew who is in military job of Birampur".
Jagdish Singh may have more than one nephew.
The I.O. (P.W. 9) in his evidence has stated that before the arrest of Paras Singh of Birampur, he did not know his name and he cannot say how many nephews Jagdish Singh has.
The only distinctive particular for identification, as given in the FIR, is that the nephew is in military service.
The prosecution has not adduced any evidence to show that the appellant is in military service, and that no other nephew of Jagdish Singh is in such service.
Thus, the prosecution has not been able to identify the appellant Paras Singh of Birampur with the description of Jagdish Singh 's nephew as given in the FIR.
The most significant fact is that P.W. 3 failed to identify the appellant in the T.I. Parade.
P.W. 8 did not attend the T.I. Parade.
His case is that he was not called to attend the T.I. Parade.
On the other hand, it is the defence case that P.W. 8 was called but he did not attend the T.I. Parade.
Whatever might have been the reason, the fact remains that no attempt was made by the prosecution to have Paras Singh of Birampur identified by P.W. 8.
In such circumstances, the High Court was not justified and committed an error of law in relying upon the statement of P.Ws. 3 and 8 made before the police mentioning the name of Paras Singh of Birampur.
It is true that P.Ws. 3 and 8 identified Paras Singh of Birampur in court, but such identification is useless, particularly in the face of the fact that P.W. 3 had failed to identify him in the T.I. Parade.
In the circumstances, the prosecution has failed to prove the complicity of Paras Singh of Birampur in the crime.
Indeed, the prosecution has failed to prove that Paras Singh of Birampur was present at the time of occurrence.
His conviction and sentence cannot, therefore, be sustained.
Now we may consider the cases of the remaining two accused, namely, Sheo Narain Sharma, the remaining appellant in Criminal Appeal No. 690 of 1982, and Ram Kumar Upadhaya, the sole appellant in Criminal Appeal No. 615 of 1982.
These two appellants have been convicted as a consequence of their sharing the common intention to murder the deceased Jitendra Choudhary.
Both of them have been named in the FIR.
It is submitted by the learned Counsel appearing on behalf of these two appellants that no specific overt act has been attributed to either of them.
It may be that they were found in the company of Hare Krishna Singh and Paras Singh of Dhobaha but, the 16 learned Counsel submits, that fact will not be sufficient to impute common intention to them.
So far as the appellant Ram Kumar Upadhaya is concerned, there is evidence that he went with Hare Krishna Singh, but there is no evidence that he had also left the place of occurrence with him.
It is the evidence of all the eye witnesses, namely, P.Ws. 1, 2, 3 and 8 that Hare Krishna Singh had fired a shot at the deceased Jitendra Choudhary, hitting him in the face and he rolled and fell down from the Rickshaw in front of the gate.
Thereafter, Paras Singh of Dhobaha also fired at the deceased.
After specifically mentioning the names of Hare Krishna Singh and Paras Singh of Dhobaha as persons who had fired at the deceased, P.W. 3 stated that thereafter two/three firings took place and all the accused went to the shop of Sita Ram in front of the gate on the road from where they also fired upon Jitendra Choudhary.
P.W. 8 in his evidence has also made a general statement that all the accused started firing upon Jitendra Choudhary.
It is not readily understandable why the witnesses did not specifically mention the names of Sheo Narain Sharma and Ram Kumar Upadhaya, if they had also fired at the deceased.
Except mentioning that these two appellants were present, no overt act was attributed to either of them.
The question is whether the crime was committed by Hare Krishna Singh and Paras Singh of Dhobaha in furtherance of the common intention of these two appellants also.
Common intention under section 34 IPC is not by itself an offence.
But, it creates a joint and constructive liability for the crime committed in furtherance of such common intention.
As no overt act whatsoever has been attributed to the appellants, Ram Kumar Upadhaya and Sheo Narain Sharma, it is difficult to hold, in the facts and circumstances of the case, that they had shared the common intention with Hare Krishna Singh and Paras Singh of Dhobaha.
When these two appellants were very much known to the eye witnesses, non mention of their names in the evidence as to their participation in firing upon the deceased, throws a great doubt as to their sharing of the common intention.
The convictions and sentences of these two appellants also cannot, therefore, be sustained.
For the reasons aforesaid, the convictions and sentences of Hare Krishna Singh and Paras Singh of Dhobaha are affirmed.
Criminal Appeal No. 690 of 1982, in so far as it relates to Hare Krishna Singh and Paras Singh of Dhobaha, is dismissed.
17 The conviction and sentence of Sheo Narain Sharma are set aside A and he is acquitted of all the charges.
Criminal Appeal No. 690 of 1982, in so far as it relates to Sheo Narain Sharma, is allowed.
Criminal Appeal No. 615 of 1982 is allowed.
The conviction and sentence of Ram Kumar Upadhaya are set aside and he is acquitted of all the charges.
Criminal Appeal No. 616 of 1982 is allowed.
The conviction and sentence of Paras Singh of Birampur are set aside and he is acquitted of all the charges.
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% The prosecution case as appearing from the Fardbeyan or the FIR lodged by P.W. 3, a social worker was that on 12.12.1987 at about 7.00 A.M. he was going to his brother in law and just as he reached the main gate of the Sadar Hospital, he saw seven persons: (1) Hare Krishna Singh.
(2) Sheo Narain Sharma, (3) Ram Kumar Upadhyaya, (4) Jagdish Singh 's nephew Paras Singh of Birampur, (5) Hare Krishna Singh 's brother in law, Paras Nath Singh of Dhobaha, the appellants and two more whom he could not identify.
All these persons were armed with rifle, gun and pistol and were standing near the northern side of the eastern gate, of the Hospital.
At that time two Rickshaws were coming from the eastern side.
In the front rickshaw the deceased Jitendra Choudhary, was sitting along with another person and in the rear rickshaw were his two sisters, PW I and PW 2.
As the rickshaw of the deceased came close to these seven persons, Hare Krishna Singh fired at the deceased from his gun, whereupon the latter fell down from the rickshaw with the rifle which he was carrying.
The other persons also fired upon the deceased as a result of which he died.
After that Hare Krishna Singh picked up the rifle of the deceased and took to his heels.
After investigation by PW 9, the charge sheet was submitted against all the appellants and they were put up for trial.
The prosecution examined as many as 9 witnesses of whom PWs.
1, 2, 3 and 8 were eye witnesses.
The defence of the appellant Hare 2 Krishna Singh was that while he was going to Patna along with appellant Ram Kumar Upadhyaya and one Madan Singh in a rickshaw, and that when the rickshaw in which the deceased was travelling came close to him, the deceased fired at him and that he sustained injuries.
He examined five witnesses DWs.
1 to 5, to prove the nature of injury sustained by him.
The defence of Paras Singh of Dhobaha was that he had not visited the village for the last fifteen years, while the defence of the other remaining appellants was a denial of their complicity in the crime.
The Additional Sessions Judge accepted the prosecution case, and convicted and sentenced the appellants to various periods of imprisonment.
On appeal by the appellants the High Court affirmed the convictions and sentences.
In the appeals by certificate to this Court it was contended: (a) on behalf of Hare Krishna Singh, appellant in Crl.
A. No. 690/82 that the prosecution having failed to explain the injury sustained by Hare Krishna Singh in the same occurrence, such injury being a serious one, the prosecution witnesses should be disbelieved, and that in such circumstances it should be held that the plea of the appellant of self defense shall be probabilised and that the prosecution must have withheld the true facts as to the genesis and origin of the occurrence, and that in any event a great doubt had been cast on the prosecution case and the benefit of that doubt should go to the appellant.
(b) on behalf of Paras Singh of Birampur, the nephew of Jagdish Singh, the sole appellant in Cr. A. No. 616/82 that in the FIR his name was not mentioned, that PW 3 failed to identify him in the T.I. Parade, that PW 8 did not attend the T.I. Parade, and that he was not present at the time of occurrence.
(c) on behalf of Sheo Narain Sharma the remaining appellant in Crl.
A. No. 690/82 and Ram Kumar Upadhayaya sole appellant in Crl.
A. No. 615/82, that no specific overt act had been attributed to either of them and the fact that they were found in the company of Hare Krishna Singh and Paras Singh of Dhobaha could not be sufficient to impute common intention to them.
Dismissing Criminal Appeal No. 690 of 1982 in so far as it relates to Hare Krishna Singh and Paras Singh of Dhobaha, and allowing it in 3 respect of Sheo Narain Sharma and acquitting him of all the charges; and allowing Crl.
A. Nos. 615 and 616 of 1982 and setting aside the convictions and sentences of Ram Kumar Upadhayaya and Paras Singh of Birampur and acquitting them of all the charges.
^ HELD: 1.
It is not an invariable rule that the prosecution has to explain the injuries sustained by the accused in the same occurrence.
The burden of proving the guilt of the accused is undoubtedly on the prosecution.
The accused is not bound to say anything in defence.
The prosecution has to prove the guilt of the accused beyond all reasonable doubts.
If the witnesses examined on behalf of the prosecution are believed by the court in proof of the guilt of the accused beyond any reasonable doubt, the question of the obligation of the prosecution to explain the injuries sustained by the accused will not arise.
[12E F]] 2.
When the prosecution comes with a definite case that the offence has been committed by the accused and proved its case beyond any reasonable doubt, it becomes hardly necessary for the prosecution to again explain how and in what circumstances the injuries have been inflicted on the person of the accused.
[12G] 3.
Simply because the accused has received injuries in the same occurrence, it cannot be taken for granted that the deceased or the injured person was the aggressor and consequently, he had to defend himself by inflicting injury on the deceased or the injured person.
[13B C] 4.
It is not the law or invariable rule that whenever the accused sustains an injury in the same occurrence the prosecution has to explain the injuries failure of which will mean that the prosecution has suppressed the truth and also the origin and genesis of the occurrence.
[13D E]] 5.
Common intention under section 34 IPC is not by itself an offence.
But, it creates a joint and constructive liability for the crime committed in furtherance of such common intention.
[16E F] 6.
As no overt act whatsoever has been attributed to the appellants, Ram Kumar Upadhyaya and Sheo Narain Sharma, it is difficult to hold, in the facts and circumstances of the case, that they had shared the common intention with Hare Krishna Singh and Paras Singh of Dhobaha.
When these two appellants were very much known to the eye witnesses PW 3 and 8 non mention of their names in the evidence as to 4 their participation in firing upon the deceased, throws a great doubt as to their sharing of the common intention.
The conviction and sentences of these two appellants cannot therefore be sustained.
They are therefore acquitted of all the charges.
[16F G] 7.
The Additional Sessions Judge has not believed the case of R Hare Krishna Singh that he had sustained a bullet injury in the same occurrence and he has given reasons therefor.
The High Court has, however, come to the finding that Hare Krishna Singh was admitted in the hospital in an injured condition immediately after the occurrence.
In the facts and circumstances of the case the prosecution is not obliged to account for the injury and that the failure of the prosecution to give a reasonable explanation of the injury would not go against or throw any doubt on the prosecution case.
All the eye witnesses have stated that the appellant Hare Krishna Singh had fired on Jitendra Choudhary as a result of which he died.
The prosecution witnesses have been believed by the Additional Sessions Judge and High Court.
In these circumstances it cannot be thought that the materials on record including the statement of Hare Krishna Singh under section 313 Cr.
P.C. probablise any case of self defence or that the deceased had inflicted on him the injury by firing at him from his rifle.
The appellant Hare Krishna Singh has therefore, been rightly convicted and sentenced.
[13E G; 14B C, F] 8.
As regards Paras Singh of Dhobaha he was found with the accused persons including Hare Krishna Singh.
It is not disputed that he is the brother in law of Hare Krishna Singh as has been described in the FIR.
It is the categorical evidence of PWs.
1, 2, 3 and 8 that Paras Singh of Dhobaha had fired at the deceased.
He has been identified by PW1 in the T.I. Parade.
In these circumstances there is no reason to interfere with the order of conviction and sentence passed by the Courts below.
[14F G]] 9.
The prosecution has not been able to identify the appellant Paras Singh of Birampur with the description of Jagdish Singh 's nephew as given in the FIR.
PW. 3 failed to identify the appellant in the T.I. Parade.
PW. 8 did not attend the T.I. Parade.
In such circumstances, the High Court was not justified and committed an error of law in relying upon the statements of PWs 3 and 8 made before the police mentioning the names of Paras Singh of Birampur.
The prosecution has failed to prove the complicity of Paras Singh of Birampur in the crime and that he was present at the time of occurrence.
His conviction and sentence cannot therefore be sustained and are set aside.
He is acquitted of all the charges.
[15C F] 5 Bhaba Nanda Sharma vs State of Assam, ; ; Ramlagan Singh vs State of Bihar, ; Onkarnath Singh vs State of U.P., ; Bankey Lal vs State of U.P., and Bhagwan Tana Patil vs State of Maharashtra, , relied on.
Lakshmi Singh vs State of Bihar, ; Mohar Rai vs State of Bihar; ; ; Jagdish vs State of Rajasthan; , ; Munshi Ram vs Delhi Administration and State of Gujarat vs Bai Fatima, , distinguished.
|
N: Criminal Appeal No. 690 of 1982 etc.
From the Judgment and order dated 20.5.1982 of the Patna High Court in Criminal Appeal No. 329 of 1980.
R.K. Garg, R.K. Jain, Rajendra Singh, S.N. Jha, R.P. Singh, Rakesh Khanna, Md. Israeli and Ranjit Kumar for the Appellants.
Pramod Swaroop and Mrs. G.S. Misra for the Respondents.
B.B. Singh (Not Present) for the Respondents.
A.K. Panda for the Complainant in all the appeals.
The Judgment of the Court was delivered by DUTT, J.
These appeals are directed against the judgment of the Patna High Court affirming the order of the First Additional Sessions Judge, Arrah, convicting all the appellants under sections 302/34 IPC and section 27 of the Arms Act and sentencing each of them to rigorous imprisonment for life and rigorous imprisonment for three years respectively and further convicting the appellant Hare Krishna Singh under section 379 IPC and sentencing him to rigorous imprisonment for three years; all the sentences are to run concurrently.
The accused included two persons having the same name Paras Singh, one of Village Dhobaha, brother in law of Hare Krishna Singh, one of the appellants in Criminal Appeal No. 690 of 1982, and the other of Village Birampur and nephew of Jagdish Singh, the appellant in Criminal Appeal No. 616 of 1982.
We shall hereinafter refer to 6 the said two persons as 'Paras Singh of Dhobaha ' and 'Paras Singh of Birampur ' respectively.
The prosecution case as appearing from the Fardbeyan or the FIR lodged by one Sarabjit Tiwary (P.W. 3), a social worker, on 12.12.1987 in the Arrah Sadar Police Station, was that on that day at about 7.00 A.M. he was going to his brother in law Raghubir Mishra and just he reached near the main gate of the Sadar Hospital, he saw seven persons, namely, "(1) Hare Krishna Singh, resident of Dhanpura; (2) Sheo Narain Sharma, resident of Berkhembe Gali; (3) Ram Kumar Upadhyaya, resident of village Dumaria; (4) Jagdish Singh 's nephew of Birampur in military service; (5) brother in law of Hare Krishna Singh of Dhobaha in military service" and two more persons whom he could not identify.
All the said persons were armed with rifle, gun and pistol, and were standing near northern side of the eastern gate of the hospital.
At that time, two Rickshaws were coming from the eastern side.
In the front Rickshaw, Jitendra Choudhary and another person named Lallan Rai, Resident of village Maniya, were sitting and in the rear Rickshaw there were two girls.
As the Rickshaw of Jitendra Choudhary came near the persons mentioned above, all of a sudden, Hare Krishna Singh fired at Jitendra Choudhary from his gun, whereupon the latter fell down from the Rickshaw with the rifle which he was carrying with him.
The other persons also fired upon Jitendra Choudhary along with Hare Krishna Singh, as a result of which he died.
After that Hare Krishna Singh picked up the rifle of Jitendra Choudhary and touching his body said, "He is dead, let us take to our heels".
It may be mentioned here that the two girls referred to in the Fardbeyan or FIR are Premlata Choudhary (P.W. 1) and Sobha Choudhary (P.W. 2), sisters of the deceased Jitendra Choudhary.
After investigation by P.W. 9, the chargesheet was submitted against all the appellants and they were put up for trial.
The prosecution examined as many as 9 witnesses, of whom P.Ws. 1, 2, 3 and 8 were eye witnesses.
The defence of Hare Krishna Singh was that he was going to Patna along with the appellant Ram Kumar Upadhyaya and one Madan Singh in a Rickshaw and when the Rickshaw reached near the shop of Sita Ram, he received a bullet from behind and fell down.
He looked back and saw that one Dipu Prasad and Ram Lal were firing.
He also saw the deceased Jitendra Choudhary, Chhatu Choudhary and Lallan Rai (P.W. 8) firing from the eastern gate of the Hospital.
He examined five witnesses, D.Ws. 1 to 5, to prove the nature of injury sustained by him.
7 The defence of Paras Singh of Dhobaha was that he had not visited the village Dhanpura for the last fifteen years.
The defence of other appellants is also a denial of their complicity in the crime.
The learned Additional Sessions Judge, after an elaborate discussion and analysis of the evidence adduced on behalf of the parties, accepted the prosecution case and convicted and sentenced the appellants as mentioned above.
Regarding the injury sustained by Hare Krishna Singh, the learned Additional Sessions Judge was of the view that such injury had been deliberately introduced by him and held that he was not injured in the occurrence.
On appeal by the appellants, the High Court affirmed their convictions and sentences.
Hence these appeals be special leave.
It is contended by Mr. Garg, learned Counsel appearing on behalf of Hare Krishna Singh, one of the appellants in Criminal Appeal No. 690 of 1982, that the prosecution having failed to explain the injury sustained by the appellant in the same occurrence, such injury being a serious one, the prosecution witnesses should be disbelieved.
Counsel submits that in such circumstances, it should be held that the plea of the appellant of self defence has been probabilised, and that the prosecution must have withheld the true facts as to the genesis and origin of the occurrence.
Further, it is submitted that in any event, it has cast a great doubt on the prosecution case and the benefit of that doubt should go to the appellant.
The question, however, is whether it is an invariable rule that whenever an accused sustains an injury in the same occurrence, the prosecution is obliged to explain the injury and on the failure of the prosecution to do so, the prosecution case should be disbelieved.
Before answering the question we may refer to a few decisions of this Court cited at the Bar.
Mr. Garg has placed much reliance upon the decision of this Court in Lakshmi Singh vs State of Bihar, In that case, the accused sustained injuries in the same occurrence.
Fazal Ali, J., who delivered the judgment of the Court, observed that no independent witness had been examined by the prosecution to support the participation of the appellant in the assault.
Further, it was observed that the evidence of P.Ws. 1 to 4 clearly showed that they gave graphic description of the assault with regard to the order, the manner and the parts of the body with absolute consistency which gave an impression that they had given a parrot like version acting under a conspiracy to depose to one set of facts and one set of facts only.
In view of the nature of evidence of P.Ws. 1 to 4, this 8 Court accepted the contention made on behalf of the accused, particularly taking the entire picture of the narrative given by the witnesses, that P.Ws. 1 to 4 had combined together to implicate the accused falsely because of the long standing litigation between them and the said witnesses.
Thereafter, the Court considered the injuries that were inflicted on the person of the accused Dasrath Singh and laid down that where the prosecution fails to explain the injuries on the accused, two results follow: (1) that the evidence of the prosecution witness is untrue; and (2) that the injuries probabilise the plea taken by the appellants.
The principle of law laid down in the earlier decision of this Court in Mohar Rai vs State o f Bihar; , was followed.
In Mohar Rai 's case it has been laid down that in a murder case, the non explanation of the injuries sustained by the accused at about the time of the occurrence or in the case of altercation is a very important circumstance from which the court can draw the following inferences: (1) that the prosecution has suppressed the genesis and the origin of the occurrence and has thus not presented the true version; (2) that the witnesses who have denied the presence of the injuries on the person of the accused are Lying on a most material point and therefore their evidence is unreliable; (3) that in case there is a defence version which explains the injuries on the person of the accused it is rendered probable so as to throw doubt on the prosecution case.
The principles that have been laid down in Lakshmi Singh 's case have to be read in the context of the facts of that case.
It has been already pointed out that the prosecution witnesses have been disbelieved by this Court before it considered the question of failure of the prosecution to explain the injuries sustained by one of the accused.
If the prosecution witnesses had been believed in that case, the non explanation of the injuries sustained by the accused would not have affected the prosecution case.
Indeed, it has been laid down in Lakshmi Singh 's case that the non explanation of the injuries by the prosecution will not affect the prosecution case where injuries sustained by the accused are minor and superficial or where the evidence is so clear and cogent, so independent and disinterested, so probable, consistent and creditworthy, that it far outweighs the effect of the omission on the part of the prosecution to explain the injuries.
In Mohar Rai 's case (supra), the first appellant Mohar Rai was convicted under section 324 IPC for shooting and injuring P.W 1 at the instigation of the second appellant Bharat Rai, who was himself convicted of an offence under section 324 read with section 109 IPC.
9 The prosecution proceeded on the basis that the revolver (exhibit III), which was recovered from Mohar Rai, was the weapon that was used by him in the commission of the offence.
The ballistic expert, who was examined as D.W. 1, was positive that the seized empties as well as the misfired cartridge could not have been fired from exhibit III.
The evidence of D.W. 1 was accepted both by the trial court as well as by the High Court.
This Court rejected the prosecution case that Mohar Rai had fired three shots from exhibit III.
This Court held that once it was proved that the empties recovered from the scene could not have been fired from exhibit III, the prosecution case that those empties were fired from exhibit III by Mohar Rai stood falsified.
Thereafter, the injuries sustained by the two appellants, Mohar Rai and Bharath Rai, were considered by the Court and it held that the prosecution had failed to explain the injuries sustained by the appellants and observed that the failure of the prosecution to offer any explanation in that regard showed that the evidence of prosecution witnesses relating to the incident was not true or, at any rate, not wholly true.
Thus, in this case also the question of non explanation of the injuries on the accused was considered by the Court after it had rejected, on a consideration of evidence, the prosecution case that Mohar Rai had fired from the revolver (exhibit III).
In other words, if the prosecution case had been believed that the appellant Mohar Rai had fired from exhibit III injuring P.W. 1, the non explanation of the injuries sustained by the accused would not have affected the prosecution case.
On the other hand, in Bhaba Nanda Sharma vs State of Assam ; it has been categorically laid down by this Court that the prosecution is not obliged to explain the injuries on the person of the accused in all cases and in all circumstances.
It depends upon the facts and circumstances of each case whether the prosecution case becomes reasonably doubtful for its failure to explain the injuries on the accused.
In Ramlagan Singh vs State of Bihar, this Court again examined the question and it has been laid down that the prosecution is not called upon in all cases to explain the injuries received by the accused persons.
It is for the defence to put questions to the prosecution witnesses regarding the injuries of the accused persons.
When that is not done, there is no occasion for the prosecution witnesses to explain the injuries on the person of the accused.
In the instant case also, the injury sustained by the appellant Hare Krishna Singh, has not been put to the prosecution witnesses and so they had no occasion to explain the same.
In such circumstances, as laid down in Ramlagan Singh 's case, the non mention of the injuries on the person of the appellant in the prosecution evidence would not 10 affect the prosecution case, which has been accepted by the courts below.
In Onkarnath Singh vs State of U. P., this Court has reiterated its view as expressed in Bankey Lal vs State of U.P., and Bhagwan Tana Patil vs State of Maharashtra, that the entire prosecution case cannot be thrown overboard simply because the prosecution witnesses do not explain the injuries on the person of the accused.
Thereafter, it was observed as follows: "Such non explanation, however, is a factor which is to be taken into account in judging the veracity of the prosecution witnesses, and the court will scrutinise their evidence with care.
Each case presents its own features.
In some case, the failure of the prosecution to account for the in juries of the accused may undermine its evidence to the core and falsify the substratum of its story, while in others it may have little or no adverse effect on the prosecution case.
It may also, in a given case, strengthen the plea of private defence set up by the accused.
But it cannot be laid down as an invariable proposition of law of universal application that as soon as it is found that the accused had received injuries in the same transaction in which the complainant party was assaulted, the plea of private defence would stand prima facie established and the burden would shift on to the prosecution to prove that those injuries were caused to the accused in self defence by the complainant party.
For instance where two parties come armed with a determination to measure their strength and to settle a dispute by force of arms and in the ensuing fight both sides receive injuries, no question of private defence arises.
Much reliance has been placed by Mr. Garg on the following observation of Fazal Ali, J. in Jagdish vs State of Rajasthan, ; "It is true that where serious injuries are found on the person of the accused, as a principle of appreciation of evidence, it becomes obligatory on the prosecution to explain the injuries, so as to satisfy the Court as to the circumstances under which the occurrence originated.
But before this obligation is placed on the prosecution two conditions must be satisfied; 11 1.
that the injuries on the person of the accused must be very serious and severe and not superficial; 2. that it must be shown that these injuries must have been caused at the time of the occurrence in question.
" In Jagdish 's case, the High Court believed the prosecution witnesses and accepted the prosecution case that the injuries found on the deceased were very severe which resulted in his death and this Court agreed with the view taken by the High Court in convicting the appellant under section 302 IPC.
In regard to this point we may cite two other decisions relating to the plea of the accused of private defence.
In Munshi Ram vs Delhi Administration, it has been held by this Court that although the accused have not taken the plea of private defence in their statements under section 342 Cr. P.C., necessary basis for that plea had been laid in the cross examination of the prosecution witnesses as well as by adducing defence evidence.
It has been observed that even if an accused does not plead self defence, it is open to the court to consider such plea if the same arises from the material on record.
The burden of establishing that plea is on the accused and that burden can be discharged by showing preponderance of probabilities in favour of that plea on the basis of the material on record.
Munshi Ram 's case arises out of a dispute over the possession of land.
The case of the appellants that their relation was a tenant of the disputed land for over thirty years and that his tenancy was never terminated, was accepted by this Court.
In other words, the appellants were found to be in lawful possession of the land in question and that P.Ws. 17 and 19 had gone to the land with their friends, P.W. 19 being armed with a deadly weapon, with a view to intimidating the relation of the appellants, whose tenancy was not terminated.
They were held to be guilty of criminal trespass and of constituting an unlawful assembly.
In the context of the above facts, this Court made the observation that it is open to the court to consider the plea of private defence even though the same does not find place in the statement under section 342 Cr.
The next case that has been relied upon by Mr. Garg is that of State of Gujarat vs Bai Fatima, in that case, on behalf of the appellants the decision in Munshi Ram 's case (supra) was relied 12 upon in regard to the question of the plea of private defence.
In rejecting the contention of the accused, this Court pointed out that not only the plea of private defence was not taken by the accused in their statements under section 342 Cr.
P.C., but no basis for that plea was laid in the cross examination of the prosecution witnesses or by adducing any defence evidence.
As regards the injuries sustained by one of the accused, this Court observed as follows: "In material particulars the evidence of the three eye witnesses as also the evidence of dying declaration of the deceased before P.W. Gulamnabi is so convincing and natural that no doubt creeps into it for the failure of the prosecution to explain the injuries on the person of respondent No. 1.
The prosecution case is not shaken at all on that account.
We have referred to the above decisions in extenso in order to consider whether it is an invariable proposition of law that the prosecution is obliged to explain the injuries sustained by the accused in the same occurrence and whether failure of the prosecution to so explain the injuries on the person of the accused would mean that the prosecution has suppressed the truth and also the genesis or origin of the occurrence.
Upon a conspectus of the decisions mentioned above, we are of the view that the question as to the obligation of the prosecution to explain the injuries sustained by the accused in the same occurrence may not arise in each and every case.
In other words, it is not an invariable rule that the prosecution has to explain the injuries sustained by the accused in the same occurrence.
The burden of proving the guilt of the accused is undoubtedly on the prosecution.
The accused is not bound to say anything in defence.
The prosecution has to prove the guilt of the accused beyond all reasonable doubts.
If the witnesses examined on behalf of the prosecution are believed by the court in proof of the guilt of the accused beyond any reasonable doubt, the question of the obligation of the prosecution to explain the injuries sustained by the accused will not arise.
When the prosecution comes with a definite case that the offence has been committed by the accused and proves its case beyond any reasonable doubt, it becomes hardly necessary for the prosecution to again explain how and in what circumstances injuries have been inflicted on the person of the accused.
The accused may take the plea of the right of private defence which means that he had inflicted injury on the deceased or the injured 13 person in exercise of his right of private defence.
In other words, his plea may be that the deceased or the injured person was the aggressor and inflicted injury on the accused and in order to defend himself from being the victim of such aggression, he had inflicted injury on the aggressor in the exercise of his right of private defence.
As has been held in Munshi Ram 's case (supra) the burden of establishing the plea of private defence is on the accused and the burden can be discharged by showing preponderance of probabilities in favour of that plea on the basis of the material on record.
It, therefore, follows that simply because the accused has received injuries in the same occurrence, it cannot be taken for granted that the deceased or the injured person was the aggressor and consequently, he had to defend himself by inflicting injury on the deceased or the injured person.
All the decisions of this Court which have been referred to and discussed above, show that when the court has believed the prosecution witnesses as convincing and trustworthy, the court overruled the contention of the accused that as the prosecution had failed to explain the injuries sustained by the accused in the same occurrence, the prosecution case should be disbelieved and the accused should be acquitted.
Thus, it is not the law or invariable rule that whenever the accused sustains an injury in the same occurrence, the prosecution has to explain the injuries failure of which will mean that the prosecution has suppressed the truth and also the origin and genesis of the occurrence.
The learned Additional Sessions Judge has not believed the case of Hare Krishna Singh that he had sustained a bullet injury in the same occurrence and he has given reasons therefor.
The High Court has, however, come to the finding that Hare Krishna Singh was admitted in the hospital in an injured condition immediately after the occurrence.
We do not propose to reassess evidence on the question as to whether Hare Krishna Singh had sustained any injury or not.
We may assume that he had sustained a bullet injury in the same occurrence.
But, even then, in the facts and circumstances of the case the prosecution, in our opinion, is not obliged to account for the injury and that the failure of the prosecution to give a reasonable explanation of the injury would not go against or throw any doubt on the prosecution case.
The injury that was sustained by Hare Krishna Singh was on the back.
The P.Ws. 1 and 2, the two sisters of the deceased Jitendra Choudhary, denied the suggestion put to them on behalf of Hare Krishna Singh that their brother Jitendra Choudhary had been shoot 14 ing from his rifle.
P.W. 3, who is an independent witness and was present on the scene of occurrence, also denied the suggestion of the defence that there was firing on Hare Krishna Singh.
P.W. 8 Lallan Rai also denied such suggestion of the defence.
Hare Krishna Singh made a statement under section 313 Cr.
It is not his case that in self defence he had fired at the deceased Jitendra Choudhary.
He denied that he had any fire arms with him or that he had fired at Jitendra Choudhary.
He also denied that none of the accused had any weapon with him.
All the eye witnesses have stated that the appellant Hare Krishna Singh had fired on Jitendra Choudhary as a result of which he died.
The prosecution witnesses have been believed by the learned Additional Sessions Judge and the High Court.
In the circumstances, we do not think that the materials on record including the statement of Hare Krishna Singh under section 313 Cr. P.C., probabilise any case of self defence or that the deceased had inflicted on him the injury by firing at him from his rifle.
It may be that two empties were found by the side of the dead body of the deceased, but the High Court has rightly observed that the presence of the empties does not necessarily mean that the deceased had fired.
The High Court points out that three live cartridges were also recovered from the pocket of the deceased at the time of inquest and observes that keeping of empty cartridges by the side of the body of the deceased cannot be ruled out.
We do not find any infirmity in the view expressed by the High Court.
It is not at all amenable to reason that the deceased had started from his house along with his two sisters with a view to fighting with the accused.
In the circumstances, we are of the view that the appellant Hare Krishna Singh has been rightly convicted and sentenced as above.
Now we may deal with the case of Paras Singh of Dhobaha, one of the appellants in Criminal Appeal No. 690 of 1982.
He was found with the accused persons including Hare Krishna Singh.
It is not disputed that he is the brother in law of Hare Krishna Singh, as he has been described in the FIR.
It is the categorical evidence of P.Ws. 1, 2, 3 and 8 that Paras Singh of Dhobaha had fired at the deceased Jitendra Choudhary.
He has been identified by P.W. 1 in the T.I. Parade.
In the circumstances, we do not find any reason to interfere with the order of conviction and sentence passed by the courts below.
So far as Paras Singh of Birampur, the nephew of Jagdish Singh and the sole appellant in Criminal Appeal No. 616 of 1982, is concerned, his case stands on a different footing.
Indeed, Mr. Rajender 15 Singh, the learned Counsel appearing on behalf of the appellant, has challenged the very presence of the appellant, Paras Singh of Birampur, at the time of occurrence.
In the FIR, his name has not been mentioned, it has only been stated "Jagdish Singh 's nephew who is in military job of Birampur".
Jagdish Singh may have more than one nephew.
The I.O. (P.W. 9) in his evidence has stated that before the arrest of Paras Singh of Birampur, he did not know his name and he cannot say how many nephews Jagdish Singh has.
The only distinctive particular for identification, as given in the FIR, is that the nephew is in military service.
The prosecution has not adduced any evidence to show that the appellant is in military service, and that no other nephew of Jagdish Singh is in such service.
Thus, the prosecution has not been able to identify the appellant Paras Singh of Birampur with the description of Jagdish Singh 's nephew as given in the FIR.
The most significant fact is that P.W. 3 failed to identify the appellant in the T.I. Parade.
P.W. 8 did not attend the T.I. Parade.
His case is that he was not called to attend the T.I. Parade.
On the other hand, it is the defence case that P.W. 8 was called but he did not attend the T.I. Parade.
Whatever might have been the reason, the fact remains that no attempt was made by the prosecution to have Paras Singh of Birampur identified by P.W. 8.
In such circumstances, the High Court was not justified and committed an error of law in relying upon the statement of P.Ws. 3 and 8 made before the police mentioning the name of Paras Singh of Birampur.
It is true that P.Ws. 3 and 8 identified Paras Singh of Birampur in court, but such identification is useless, particularly in the face of the fact that P.W. 3 had failed to identify him in the T.I. Parade.
In the circumstances, the prosecution has failed to prove the complicity of Paras Singh of Birampur in the crime.
Indeed, the prosecution has failed to prove that Paras Singh of Birampur was present at the time of occurrence.
His conviction and sentence cannot, therefore, be sustained.
Now we may consider the cases of the remaining two accused, namely, Sheo Narain Sharma, the remaining appellant in Criminal Appeal No. 690 of 1982, and Ram Kumar Upadhaya, the sole appellant in Criminal Appeal No. 615 of 1982.
These two appellants have been convicted as a consequence of their sharing the common intention to murder the deceased Jitendra Choudhary.
Both of them have been named in the FIR.
It is submitted by the learned Counsel appearing on behalf of these two appellants that no specific overt act has been attributed to either of them.
It may be that they were found in the company of Hare Krishna Singh and Paras Singh of Dhobaha but, the 16 learned Counsel submits, that fact will not be sufficient to impute common intention to them.
So far as the appellant Ram Kumar Upadhaya is concerned, there is evidence that he went with Hare Krishna Singh, but there is no evidence that he had also left the place of occurrence with him.
It is the evidence of all the eye witnesses, namely, P.Ws. 1, 2, 3 and 8 that Hare Krishna Singh had fired a shot at the deceased Jitendra Choudhary, hitting him in the face and he rolled and fell down from the Rickshaw in front of the gate.
Thereafter, Paras Singh of Dhobaha also fired at the deceased.
After specifically mentioning the names of Hare Krishna Singh and Paras Singh of Dhobaha as persons who had fired at the deceased, P.W. 3 stated that thereafter two/three firings took place and all the accused went to the shop of Sita Ram in front of the gate on the road from where they also fired upon Jitendra Choudhary.
P.W. 8 in his evidence has also made a general statement that all the accused started firing upon Jitendra Choudhary.
It is not readily understandable why the witnesses did not specifically mention the names of Sheo Narain Sharma and Ram Kumar Upadhaya, if they had also fired at the deceased.
Except mentioning that these two appellants were present, no overt act was attributed to either of them.
The question is whether the crime was committed by Hare Krishna Singh and Paras Singh of Dhobaha in furtherance of the common intention of these two appellants also.
Common intention under section 34 IPC is not by itself an offence.
But, it creates a joint and constructive liability for the crime committed in furtherance of such common intention.
As no overt act whatsoever has been attributed to the appellants, Ram Kumar Upadhaya and Sheo Narain Sharma, it is difficult to hold, in the facts and circumstances of the case, that they had shared the common intention with Hare Krishna Singh and Paras Singh of Dhobaha.
When these two appellants were very much known to the eye witnesses, non mention of their names in the evidence as to their participation in firing upon the deceased, throws a great doubt as to their sharing of the common intention.
The convictions and sentences of these two appellants also cannot, therefore, be sustained.
For the reasons aforesaid, the convictions and sentences of Hare Krishna Singh and Paras Singh of Dhobaha are affirmed.
Criminal Appeal No. 690 of 1982, in so far as it relates to Hare Krishna Singh and Paras Singh of Dhobaha, is dismissed.
17 The conviction and sentence of Sheo Narain Sharma are set aside A and he is acquitted of all the charges.
Criminal Appeal No. 690 of 1982, in so far as it relates to Sheo Narain Sharma, is allowed.
Criminal Appeal No. 615 of 1982 is allowed.
The conviction and sentence of Ram Kumar Upadhaya are set aside and he is acquitted of all the charges.
Criminal Appeal No. 616 of 1982 is allowed.
The conviction and sentence of Paras Singh of Birampur are set aside and he is acquitted of all the charges.
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From the Judgment and order dated 20.5.1982 of the Patna High Court in Criminal Appeal No. R.K. Garg, R.K. Jain, Rajendra Singh, S.N. Jha, R.P. Singh, Rakesh Khanna, Md. Israeli and Ranjit Kumar for the Appellants. B.B. Singh (Not Present) for the Respondents. A.K. Panda for the Complainant in all the appeals. 690 of 1982, and the other of Village Birampur and nephew of Jagdish Singh, the appellant in Criminal Appeal No. We shall hereinafter refer to 6 the said two persons as 'Paras Singh of Dhobaha ' and 'Paras Singh of Birampur ' respectively. All the said persons were armed with rifle, gun and pistol, and were standing near northern side of the eastern gate of the hospital. At that time, two Rickshaws were coming from the eastern side. As the Rickshaw of Jitendra Choudhary came near the persons mentioned above, all of a sudden, Hare Krishna Singh fired at Jitendra Choudhary from his gun, whereupon the latter fell down from the Rickshaw with the rifle which he was carrying with him. The other persons also fired upon Jitendra Choudhary along with Hare Krishna Singh, as a result of which he died. After that Hare Krishna Singh picked up the rifle of Jitendra Choudhary and touching his body said, "He is dead, let us take to our heels". After investigation by P.W. 9, the chargesheet was submitted against all the appellants and they were put up for trial. He looked back and saw that one Dipu Prasad and Ram Lal were firing. He also saw the deceased Jitendra Choudhary, Chhatu Choudhary and Lallan Rai (P.W. 8) firing from the eastern gate of the Hospital. 1 to 5, to prove the nature of injury sustained by him. 7 The defence of Paras Singh of Dhobaha was that he had not visited the village Dhanpura for the last fifteen years. The defence of other appellants is also a denial of their complicity in the crime. The learned Additional Sessions Judge, after an elaborate discussion and analysis of the evidence adduced on behalf of the parties, accepted the prosecution case and convicted and sentenced the appellants as mentioned above. Regarding the injury sustained by Hare Krishna Singh, the learned Additional Sessions Judge was of the view that such injury had been deliberately introduced by him and held that he was not injured in the occurrence. On appeal by the appellants, the High Court affirmed their convictions and sentences. The question, however, is whether it is an invariable rule that whenever an accused sustains an injury in the same occurrence, the prosecution is obliged to explain the injury and on the failure of the prosecution to do so, the prosecution case should be disbelieved. Further, it was observed that the evidence of P.Ws. In view of the nature of evidence of P.Ws. 1 to 4, this 8 Court accepted the contention made on behalf of the accused, particularly taking the entire picture of the narrative given by the witnesses, that P.Ws. Thereafter, the Court considered the injuries that were inflicted on the person of the accused Dasrath Singh and laid down that where the prosecution fails to explain the injuries on the accused, two results follow: (1) that the evidence of the prosecution witness is untrue; and (2) that the injuries probabilise the plea taken by the appellants. The principle of law laid down in the earlier decision of this Court in Mohar Rai vs State o f Bihar; , was followed. The principles that have been laid down in Lakshmi Singh 's case have to be read in the context of the facts of that case. If the prosecution witnesses had been believed in that case, the non explanation of the injuries sustained by the accused would not have affected the prosecution case. The evidence of D.W. 1 was accepted both by the trial court as well as by the High Court. This Court rejected the prosecution case that Mohar Rai had fired three shots from exhibit III. In other words, if the prosecution case had been believed that the appellant Mohar Rai had fired from exhibit III injuring P.W. 1, the non explanation of the injuries sustained by the accused would not have affected the prosecution case. On the other hand, in Bhaba Nanda Sharma vs State of Assam ; it has been categorically laid down by this Court that the prosecution is not obliged to explain the injuries on the person of the accused in all cases and in all circumstances. It is for the defence to put questions to the prosecution witnesses regarding the injuries of the accused persons. In Onkarnath Singh vs State of U. P., this Court has reiterated its view as expressed in Bankey Lal vs State of U.P., and Bhagwan Tana Patil vs State of Maharashtra, that the entire prosecution case cannot be thrown overboard simply because the prosecution witnesses do not explain the injuries on the person of the accused. Thereafter, it was observed as follows: "Such non explanation, however, is a factor which is to be taken into account in judging the veracity of the prosecution witnesses, and the court will scrutinise their evidence with care. It may also, in a given case, strengthen the plea of private defence set up by the accused. But it cannot be laid down as an invariable proposition of law of universal application that as soon as it is found that the accused had received injuries in the same transaction in which the complainant party was assaulted, the plea of private defence would stand prima facie established and the burden would shift on to the prosecution to prove that those injuries were caused to the accused in self defence by the complainant party. For instance where two parties come armed with a determination to measure their strength and to settle a dispute by force of arms and in the ensuing fight both sides receive injuries, no question of private defence arises. But before this obligation is placed on the prosecution two conditions must be satisfied; 11 1. that the injuries on the person of the accused must be very serious and severe and not superficial; 2. that it must be shown that these injuries must have been caused at the time of the occurrence in question. In regard to this point we may cite two other decisions relating to the plea of the accused of private defence. P.C., necessary basis for that plea had been laid in the cross examination of the prosecution witnesses as well as by adducing defence evidence. Munshi Ram 's case arises out of a dispute over the possession of land. They were held to be guilty of criminal trespass and of constituting an unlawful assembly. In the context of the above facts, this Court made the observation that it is open to the court to consider the plea of private defence even though the same does not find place in the statement under section 342 Cr. The next case that has been relied upon by Mr. Garg is that of State of Gujarat vs Bai Fatima, in that case, on behalf of the appellants the decision in Munshi Ram 's case (supra) was relied 12 upon in regard to the question of the plea of private defence. The prosecution case is not shaken at all on that account. The accused is not bound to say anything in defence. The prosecution has to prove the guilt of the accused beyond all reasonable doubts. If the witnesses examined on behalf of the prosecution are believed by the court in proof of the guilt of the accused beyond any reasonable doubt, the question of the obligation of the prosecution to explain the injuries sustained by the accused will not arise. When the prosecution comes with a definite case that the offence has been committed by the accused and proves its case beyond any reasonable doubt, it becomes hardly necessary for the prosecution to again explain how and in what circumstances injuries have been inflicted on the person of the accused. The accused may take the plea of the right of private defence which means that he had inflicted injury on the deceased or the injured 13 person in exercise of his right of private defence. It, therefore, follows that simply because the accused has received injuries in the same occurrence, it cannot be taken for granted that the deceased or the injured person was the aggressor and consequently, he had to defend himself by inflicting injury on the deceased or the injured person. Thus, it is not the law or invariable rule that whenever the accused sustains an injury in the same occurrence, the prosecution has to explain the injuries failure of which will mean that the prosecution has suppressed the truth and also the origin and genesis of the occurrence. The learned Additional Sessions Judge has not believed the case of Hare Krishna Singh that he had sustained a bullet injury in the same occurrence and he has given reasons therefor. We do not propose to reassess evidence on the question as to whether Hare Krishna Singh had sustained any injury or not. We may assume that he had sustained a bullet injury in the same occurrence. The injury that was sustained by Hare Krishna Singh was on the back. P.W. 8 Lallan Rai also denied such suggestion of the defence. Hare Krishna Singh made a statement under section 313 Cr. It is not his case that in self defence he had fired at the deceased Jitendra Choudhary. He denied that he had any fire arms with him or that he had fired at Jitendra Choudhary. He also denied that none of the accused had any weapon with him. The prosecution witnesses have been believed by the learned Additional Sessions Judge and the High Court. P.C., probabilise any case of self defence or that the deceased had inflicted on him the injury by firing at him from his rifle. It may be that two empties were found by the side of the dead body of the deceased, but the High Court has rightly observed that the presence of the empties does not necessarily mean that the deceased had fired. We do not find any infirmity in the view expressed by the High Court. Now we may deal with the case of Paras Singh of Dhobaha, one of the appellants in Criminal Appeal No. He was found with the accused persons including Hare Krishna Singh. It is not disputed that he is the brother in law of Hare Krishna Singh, as he has been described in the FIR. 1, 2, 3 and 8 that Paras Singh of Dhobaha had fired at the deceased Jitendra Choudhary. He has been identified by P.W. 1 in the T.I. Parade. In the circumstances, we do not find any reason to interfere with the order of conviction and sentence passed by the courts below. 616 of 1982, is concerned, his case stands on a different footing. In the FIR, his name has not been mentioned, it has only been stated "Jagdish Singh 's nephew who is in military job of Birampur". Jagdish Singh may have more than one nephew. The only distinctive particular for identification, as given in the FIR, is that the nephew is in military service. The most significant fact is that P.W. 3 failed to identify the appellant in the T.I. Parade. His case is that he was not called to attend the T.I. Parade. On the other hand, it is the defence case that P.W. 8 was called but he did not attend the T.I. Parade. Whatever might have been the reason, the fact remains that no attempt was made by the prosecution to have Paras Singh of Birampur identified by P.W. 8. 3 and 8 made before the police mentioning the name of Paras Singh of Birampur. In the circumstances, the prosecution has failed to prove the complicity of Paras Singh of Birampur in the crime. Indeed, the prosecution has failed to prove that Paras Singh of Birampur was present at the time of occurrence. His conviction and sentence cannot, therefore, be sustained. 690 of 1982, and Ram Kumar Upadhaya, the sole appellant in Criminal Appeal No. These two appellants have been convicted as a consequence of their sharing the common intention to murder the deceased Jitendra Choudhary. It is submitted by the learned Counsel appearing on behalf of these two appellants that no specific overt act has been attributed to either of them. Thereafter, Paras Singh of Dhobaha also fired at the deceased. P.W. 8 in his evidence has also made a general statement that all the accused started firing upon Jitendra Choudhary. It is not readily understandable why the witnesses did not specifically mention the names of Sheo Narain Sharma and Ram Kumar Upadhaya, if they had also fired at the deceased. Except mentioning that these two appellants were present, no overt act was attributed to either of them. Common intention under section 34 IPC is not by itself an offence. But, it creates a joint and constructive liability for the crime committed in furtherance of such common intention. As no overt act whatsoever has been attributed to the appellants, Ram Kumar Upadhaya and Sheo Narain Sharma, it is difficult to hold, in the facts and circumstances of the case, that they had shared the common intention with Hare Krishna Singh and Paras Singh of Dhobaha. When these two appellants were very much known to the eye witnesses, non mention of their names in the evidence as to their participation in firing upon the deceased, throws a great doubt as to their sharing of the common intention. The convictions and sentences of these two appellants also cannot, therefore, be sustained. 690 of 1982, in so far as it relates to Hare Krishna Singh and Paras Singh of Dhobaha, is dismissed. 17 The conviction and sentence of Sheo Narain Sharma are set aside A and he is acquitted of all the charges. 690 of 1982, in so far as it relates to Sheo Narain Sharma, is allowed. The conviction and sentence of Ram Kumar Upadhaya are set aside and he is acquitted of all the charges. The conviction and sentence of Paras Singh of Birampur are set aside and he is acquitted of all the charges.
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% The prosecution case as appearing from the Fardbeyan or the FIR lodged by P.W. 3, a social worker was that on 12.12.1987 at about 7.00 A.M. he was going to his brother in law and just as he reached the main gate of the Sadar Hospital, he saw seven persons: (1) Hare Krishna Singh.
(2) Sheo Narain Sharma, (3) Ram Kumar Upadhyaya, (4) Jagdish Singh 's nephew Paras Singh of Birampur, (5) Hare Krishna Singh 's brother in law, Paras Nath Singh of Dhobaha, the appellants and two more whom he could not identify.
All these persons were armed with rifle, gun and pistol and were standing near the northern side of the eastern gate, of the Hospital.
At that time two Rickshaws were coming from the eastern side.
In the front rickshaw the deceased Jitendra Choudhary, was sitting along with another person and in the rear rickshaw were his two sisters, PW I and PW 2.
As the rickshaw of the deceased came close to these seven persons, Hare Krishna Singh fired at the deceased from his gun, whereupon the latter fell down from the rickshaw with the rifle which he was carrying.
The other persons also fired upon the deceased as a result of which he died.
After that Hare Krishna Singh picked up the rifle of the deceased and took to his heels.
After investigation by PW 9, the charge sheet was submitted against all the appellants and they were put up for trial.
The prosecution examined as many as 9 witnesses of whom PWs.
1, 2, 3 and 8 were eye witnesses.
The defence of the appellant Hare 2 Krishna Singh was that while he was going to Patna along with appellant Ram Kumar Upadhyaya and one Madan Singh in a rickshaw, and that when the rickshaw in which the deceased was travelling came close to him, the deceased fired at him and that he sustained injuries.
He examined five witnesses DWs.
1 to 5, to prove the nature of injury sustained by him.
The defence of Paras Singh of Dhobaha was that he had not visited the village for the last fifteen years, while the defence of the other remaining appellants was a denial of their complicity in the crime.
The Additional Sessions Judge accepted the prosecution case, and convicted and sentenced the appellants to various periods of imprisonment.
On appeal by the appellants the High Court affirmed the convictions and sentences.
In the appeals by certificate to this Court it was contended: (a) on behalf of Hare Krishna Singh, appellant in Crl.
A. No. 690/82 that the prosecution having failed to explain the injury sustained by Hare Krishna Singh in the same occurrence, such injury being a serious one, the prosecution witnesses should be disbelieved, and that in such circumstances it should be held that the plea of the appellant of self defense shall be probabilised and that the prosecution must have withheld the true facts as to the genesis and origin of the occurrence, and that in any event a great doubt had been cast on the prosecution case and the benefit of that doubt should go to the appellant.
(b) on behalf of Paras Singh of Birampur, the nephew of Jagdish Singh, the sole appellant in Cr. A. No. 616/82 that in the FIR his name was not mentioned, that PW 3 failed to identify him in the T.I. Parade, that PW 8 did not attend the T.I. Parade, and that he was not present at the time of occurrence.
(c) on behalf of Sheo Narain Sharma the remaining appellant in Crl.
A. No. 690/82 and Ram Kumar Upadhayaya sole appellant in Crl.
A. No. 615/82, that no specific overt act had been attributed to either of them and the fact that they were found in the company of Hare Krishna Singh and Paras Singh of Dhobaha could not be sufficient to impute common intention to them.
Dismissing Criminal Appeal No. 690 of 1982 in so far as it relates to Hare Krishna Singh and Paras Singh of Dhobaha, and allowing it in 3 respect of Sheo Narain Sharma and acquitting him of all the charges; and allowing Crl.
A. Nos. 615 and 616 of 1982 and setting aside the convictions and sentences of Ram Kumar Upadhayaya and Paras Singh of Birampur and acquitting them of all the charges.
^ HELD: 1.
It is not an invariable rule that the prosecution has to explain the injuries sustained by the accused in the same occurrence.
The burden of proving the guilt of the accused is undoubtedly on the prosecution.
The accused is not bound to say anything in defence.
The prosecution has to prove the guilt of the accused beyond all reasonable doubts.
If the witnesses examined on behalf of the prosecution are believed by the court in proof of the guilt of the accused beyond any reasonable doubt, the question of the obligation of the prosecution to explain the injuries sustained by the accused will not arise.
[12E F]] 2.
When the prosecution comes with a definite case that the offence has been committed by the accused and proved its case beyond any reasonable doubt, it becomes hardly necessary for the prosecution to again explain how and in what circumstances the injuries have been inflicted on the person of the accused.
[12G] 3.
Simply because the accused has received injuries in the same occurrence, it cannot be taken for granted that the deceased or the injured person was the aggressor and consequently, he had to defend himself by inflicting injury on the deceased or the injured person.
[13B C] 4.
It is not the law or invariable rule that whenever the accused sustains an injury in the same occurrence the prosecution has to explain the injuries failure of which will mean that the prosecution has suppressed the truth and also the origin and genesis of the occurrence.
[13D E]] 5.
Common intention under section 34 IPC is not by itself an offence.
But, it creates a joint and constructive liability for the crime committed in furtherance of such common intention.
[16E F] 6.
As no overt act whatsoever has been attributed to the appellants, Ram Kumar Upadhyaya and Sheo Narain Sharma, it is difficult to hold, in the facts and circumstances of the case, that they had shared the common intention with Hare Krishna Singh and Paras Singh of Dhobaha.
When these two appellants were very much known to the eye witnesses PW 3 and 8 non mention of their names in the evidence as to 4 their participation in firing upon the deceased, throws a great doubt as to their sharing of the common intention.
The conviction and sentences of these two appellants cannot therefore be sustained.
They are therefore acquitted of all the charges.
[16F G] 7.
The Additional Sessions Judge has not believed the case of R Hare Krishna Singh that he had sustained a bullet injury in the same occurrence and he has given reasons therefor.
The High Court has, however, come to the finding that Hare Krishna Singh was admitted in the hospital in an injured condition immediately after the occurrence.
In the facts and circumstances of the case the prosecution is not obliged to account for the injury and that the failure of the prosecution to give a reasonable explanation of the injury would not go against or throw any doubt on the prosecution case.
All the eye witnesses have stated that the appellant Hare Krishna Singh had fired on Jitendra Choudhary as a result of which he died.
The prosecution witnesses have been believed by the Additional Sessions Judge and High Court.
In these circumstances it cannot be thought that the materials on record including the statement of Hare Krishna Singh under section 313 Cr.
P.C. probablise any case of self defence or that the deceased had inflicted on him the injury by firing at him from his rifle.
The appellant Hare Krishna Singh has therefore, been rightly convicted and sentenced.
[13E G; 14B C, F] 8.
As regards Paras Singh of Dhobaha he was found with the accused persons including Hare Krishna Singh.
It is not disputed that he is the brother in law of Hare Krishna Singh as has been described in the FIR.
It is the categorical evidence of PWs.
1, 2, 3 and 8 that Paras Singh of Dhobaha had fired at the deceased.
He has been identified by PW1 in the T.I. Parade.
In these circumstances there is no reason to interfere with the order of conviction and sentence passed by the Courts below.
[14F G]] 9.
The prosecution has not been able to identify the appellant Paras Singh of Birampur with the description of Jagdish Singh 's nephew as given in the FIR.
PW. 3 failed to identify the appellant in the T.I. Parade.
PW. 8 did not attend the T.I. Parade.
In such circumstances, the High Court was not justified and committed an error of law in relying upon the statements of PWs 3 and 8 made before the police mentioning the names of Paras Singh of Birampur.
The prosecution has failed to prove the complicity of Paras Singh of Birampur in the crime and that he was present at the time of occurrence.
His conviction and sentence cannot therefore be sustained and are set aside.
He is acquitted of all the charges.
[15C F] 5 Bhaba Nanda Sharma vs State of Assam, ; ; Ramlagan Singh vs State of Bihar, ; Onkarnath Singh vs State of U.P., ; Bankey Lal vs State of U.P., and Bhagwan Tana Patil vs State of Maharashtra, , relied on.
Lakshmi Singh vs State of Bihar, ; Mohar Rai vs State of Bihar; ; ; Jagdish vs State of Rajasthan; , ; Munshi Ram vs Delhi Administration and State of Gujarat vs Bai Fatima, , distinguished.
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% The prosecution case as appearing from the Fardbeyan or the FIR lodged by P.W. 3, a social worker was that on 12.12.1987 at about 7.00 A.M. he was going to his brother in law and just as he reached the main gate of the Sadar Hospital, he saw seven persons: (1) Hare Krishna Singh. At that time two Rickshaws were coming from the eastern side. The other persons also fired upon the deceased as a result of which he died. After investigation by PW 9, the charge sheet was submitted against all the appellants and they were put up for trial. 1 to 5, to prove the nature of injury sustained by him. The Additional Sessions Judge accepted the prosecution case, and convicted and sentenced the appellants to various periods of imprisonment. 616/82 that in the FIR his name was not mentioned, that PW 3 failed to identify him in the T.I. Parade, that PW 8 did not attend the T.I. Parade, and that he was not present at the time of occurrence. (c) on behalf of Sheo Narain Sharma the remaining appellant in Crl. 615 and 616 of 1982 and setting aside the convictions and sentences of Ram Kumar Upadhayaya and Paras Singh of Birampur and acquitting them of all the charges. It is not an invariable rule that the prosecution has to explain the injuries sustained by the accused in the same occurrence. The burden of proving the guilt of the accused is undoubtedly on the prosecution. The accused is not bound to say anything in defence. If the witnesses examined on behalf of the prosecution are believed by the court in proof of the guilt of the accused beyond any reasonable doubt, the question of the obligation of the prosecution to explain the injuries sustained by the accused will not arise. When the prosecution comes with a definite case that the offence has been committed by the accused and proved its case beyond any reasonable doubt, it becomes hardly necessary for the prosecution to again explain how and in what circumstances the injuries have been inflicted on the person of the accused. Simply because the accused has received injuries in the same occurrence, it cannot be taken for granted that the deceased or the injured person was the aggressor and consequently, he had to defend himself by inflicting injury on the deceased or the injured person. Common intention under section 34 IPC is not by itself an offence. But, it creates a joint and constructive liability for the crime committed in furtherance of such common intention. As no overt act whatsoever has been attributed to the appellants, Ram Kumar Upadhyaya and Sheo Narain Sharma, it is difficult to hold, in the facts and circumstances of the case, that they had shared the common intention with Hare Krishna Singh and Paras Singh of Dhobaha. They are therefore acquitted of all the charges. The Additional Sessions Judge has not believed the case of R Hare Krishna Singh that he had sustained a bullet injury in the same occurrence and he has given reasons therefor. The prosecution witnesses have been believed by the Additional Sessions Judge and High Court. P.C. probablise any case of self defence or that the deceased had inflicted on him the injury by firing at him from his rifle. The prosecution has failed to prove the complicity of Paras Singh of Birampur in the crime and that he was present at the time of occurrence. His conviction and sentence cannot therefore be sustained and are set aside. Lakshmi Singh vs State of Bihar, ; Mohar Rai vs State of Bihar; ; ; Jagdish vs State of Rajasthan; , ; Munshi Ram vs Delhi Administration and State of Gujarat vs Bai Fatima, , distinguished.
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Civil Appeal No. 297 of 1983.
From the Judgment and order dated 11 1.1983 of the Delhi High Court in C.W No 1858 of 1981 Soli J. Sorabjee, A.N. Haksar, Ravinder Narain P.K. Ram.
703 D.N. Mishra and Appellant in person (in C.A. No. 2658 of 1983) for the Appellants K. Parasaran, Attorney General, A K. Ganguli, K. Swamy and C.V.S. Rao for the Respondents The Judgment of the Court was delivered by DUTT, J.
This appeal is directed against the judgment of the Delhi High Court allowing in part only the petition of the appellants under Article 226 of the Constitution of India The appellant No. 1, J.K. Cotton Spinning & Weaving Mills Limited, has a composite mill wherein it manufactures fabrics of different types.
In order to manufacture the said fabrics, yarn is obtained at an intermediate stage.
The yarn so obtained is further processed in an integrated process in the said composite mill of the appellant No. 1 for weaving the same into fabrics.
The appellants do not dispute that the different kinds of fabrics which are manufactured in the mill are liable to payment of excise duty on their removal from the factory.
They also do not dispute their liability in respect of yarn which is also removed from the factory.
It is the contention of the appellants that no duty of excise can be levied and collected in respect of yarn which is obtained at an intermediate stage and, thereafter, subjected to an integrated process for the manufacture of different fabrics.
Indeed, on a writ petition of the appellants, the Delhi High Court by its judgment dated October 16, 1980 held that yarn obtained and further processed within the factory for the manufacture of fabrics could not be subjected to duty of excise.
It is the case of the appellants that in spite of the said decision of the Delhi High Court, the Central Board of Excise has wrongly issued a circular dated September 24, 1980 purporting to interpret rules 9 and 49 of the Central Excise Rules, 1944 (hereinafter referred to as 'the Rules ') and directing the subordinate excise authorities to levy and collect duty of excise in accordance therewith.
In the said circular, the Board has directed the subordinate excise authorities that "use of goods in manufacture of another commodity even within the place/premises that have been specified in this behalf by the Central Excise officers in terms of the powers conferred under rule 9 of the Rules, will attract duty".
As the said circular was being implemented to the prejudice of the appellants, they filed a writ petition before the Delhi High Court, inter alia, challenging the validity of the circular.
During the pendency of the writ petition in the Delhi High 704 Court, the Central Government by a Notification No . 20/82 C. dated 20.2.1982 amended rules 9 and 49 of the Rules.
Section 51 of the Finance Act, 1982 provides that the amendments in rules 9 and 49 of the Rules shall be deemed to have, and to have always had the effect on and from the date on which the Rules came into force i.e. February 28, 1944.
After the said amendments of the Rules with retrospective effect, the appellants amended the writ petition and challenged the constitutional validity of section 5 1 of the Finance Act, 1982 and of the amendments to rules 9 and 49 of the Rules.
The High Court came to the conclusion that section S I and rules 9 and 49 of the Rules, as amended, were valid.
It has, however, been held that the retrospective effect given by section S I will be subject to the provisions of sections 11A and 11B of the (hereinafter referred to as 'the Act ') Further, it has been held that the yarn which is produced at an intermediate stage in the mill of the appellants and subjected to the integrated process of weaving the same into fabrics, will be liable to payment of excise duty in view of the amended provisions of rules 9 and 49 of the Rules.
But the sized yarn which is actually put into the integrated process will not again be subjected to payment of excise duty for, the unsized yarn, which is sized for the purpose, does not change the nature of the commodity as yarn.
The writ petition was, accordingly, allowed in part.
Hence this appeal by the appellants upon a certificate granted by the High Court.
F At this stage, we may refer to rules 9 and 49 before and after amendment of the same.
The relevant portion of rule 9 before the same was amended is as follows: "Rule 9.
Time and manner of payment of duty. (1) No excisable goods shall be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf whether for consumption, export, or manufacture of any other commodity in or outside such place, until the excise duty leviable thereon has been paid at such place and in such manner as is prescribed in these Rules or as the Collector may require, and except on presentation of an application in the proper form and on obtaining the permission of the proper officer on the form: " [The remaining provisions of rule 9 which are not relevant for our purpose are omitted. ] 705 By a Notification No. 20/82 C.B. dated 20.2.1982 of the Central Government, rule 9 was amended by the addition of the following A Explanation thereto: "Explanation.
For the purposes of this rule excisable goods produced, cured or manufactured in any place and consumed or utilised (i) as such or after subjection to any process or processes; or (ii) for the manufacture of any other commodity, whether in a continuous process or otherwise, in such place or any premises appurtenant thereto, specified by the Collector under sub rule (1), shall be deemed to have been removed from such place or premises immediately before such consumption or utilisation." Rule 49 before its amendment was as follows: "Rule 49.
Duty chargeable only on removal of goods from the factory premises or from an approved place of storage. (1) Payment of duty shall not be required in respect of excisable goods made in a factory until they are about to be issued out of the place or premises specified under rule 9 or are about to be removed from a store room or other place of storage approved by the Collector under rule 47:" [The remaining provisions of rule 49 which are not relevant for our purpose are omitted . ] By the said Notification rule 49 was amended by the addition of an Explanation thereto as follows: "Explanation.
For the purposes of this rule, excisable goods made in a factory and consumed or utilised (i) as such or after subjection to any process or processes; or (ii) for the manufacture of any other commodity, whether in a continuous process or otherwise, in such factory or place or premises specified under rule 9 or store 706 room or other place of storage approved by the Collector under rule 47, shall be deemed to have been issued out of, or removed from such factory, place, premises, store room or other place of storage, as the case may be, immediately before such consumption or utilisation.
" It has been already noticed that by section 5 1 of the Finance Act, 1982, amendments made to rules 9 and 49 have been given retrospective effect from the date on which the Rules came into force, that is to say, from February 28, 1944 It is not disputed before us that under section 3(1) of the Act, the taxing event is the production or manufacture of the goods in question.
Indeed, section 3 provides that there shall be levied and collected in such manner as may be prescribed, duties of excise on all excisable goods other than salt which are produced or manufactured in India and at the rates set forth in the First Schedule.
It is, therefore, clear that as soon as the goods in question are produced or manufactured, they will be liable to payment of excise duty.
While section 3 lays down the taxable event, rules 9 and 49 provide for the collection of duty.
There is a distinction between levy and collection of duty.
In The Province of Madras vs Boddu Paidanna & Sons, A.I.R. 1942 FC 33 it has been observed by the Federal Court as follows: "There is in theory nothing to prevent the Central Legislature from imposing a duty of excise on a commodity as soon as it comes into existence, no matter what happens to it afterwards, whether it be sold, consumed, destroyed or given away.
A taxing authority will not ordinarily impose such a duty, because it is much more convenient administratively to collect the duty (as in the case of most of the Excise Acts) when the commodity leaves the factory for the first time, and also because the duty is intended to be an indirect duty which the manufacturer or producer is to pass on to the ultimate consumer, which he could not do if the commodity had, for example, been destroyed in the factory itself.
It is the fact of manufacture which attracts the duty, even though it may be collected later.
" Relying upon the aforesaid observation of the Federal Court, it has been urged by Mr. Soli Sorabjee, learned Counsel appearing on behalf of the appellants, that although it is true that as soon as the commodity is manufactured or produced it is liable to the payment of 707 excise duty, the duty will not, however, be collected unless the commodity leaves the factory.
It is submitted by him that the commodity must be removed from one place to another either for the purpose of consumption in the factory or for sale outside it before excise duty an be claimed.
Counsel submits that rules 9 and 49, as they stood before they were amended, and even the main part of these two rules after amendment, indicate in clear terms that so long as the goods which are manufactured in the factory are not removed, there is no question of payment of excise duty on the goods.
Several decisions have been cited on behalf of the appellants to show that some High Courts also have taken the view that removal is the main criterion for the collection of excise duty on the commodity produced or manufactured inside the factory or the place of manufacture.
We shall presently refer to these decisions.
It may, however, be noticed that the decisions are not also uniform on the interpretation of rules 9 and 49, as they stood before amendment.
We are, however, really concerned with the interpretation of these two rules after amendment, but as much submissions have been made by the parties in the light of the decisions of the High Courts on the interpretation of these two rules, we would like to refer to the same.
In Caltex oil Refining (India) Ltd. vs Union of India and others, it has been held by the Delhi High Court that there can be removal only if the product goes out of one stream of production into another stream of production or if the product is issued out of or taken out or consumed if no further processing of that product is to be done.
Further, it has been observed that there can be no removal of a product within the plant itself so long as the product is in the process of manufacture.
According to this decision, if the product, which is obtained at an intermediate stage of an integrated and uninterrupted process of manufacture, there is no removal of such product.
But, if the intermediary product is transferred from one plant to another for the manufacture of another commodity, there will be removal for the purpose of collection of duty.
In an earlier decision in Delhi Cloth & General Mills Co. Ltd. vs Joint Secretary, Government of India, the Delhi High Court had taken a different view.
In that case calcium carbide manufactured in the factory in one plant was used to generate acetylene gas by the transfer of the article from one plant to another in the same factory.
The question that came up for consideration of the High Court was whether there was removal of calcium carbide for the 708 purpose of levy and collection of excise duty.
The High Court relied upon the definition of 'factory ' under section 2(e) of the Act and took the view that the definition was not restricted to only the part in which the excisable goods were manufactured.
It was, accordingly, held that it could not, therefore, be said that calcium carbide made by the petitioner Company was removed from the factory in which it was produced.
This decision lays down that so long as a commodity is not removed from the factory premises, there is no removal within the meaning of rules 9 and 49.
A similar view has been taken by the Delhi High Court in a later decision in Modi Carpets Ltd. vs Union of India, where the High Court has expressed the view that o excise duty can be levied and recovered on 'sliver ' obtained by the petitioners, if it is consumed within the very premises in which it is manufactured because in such cases there is no removal of sliver from the place of manufacture as envisaged by rules 9 and 49 More or less a similar view has been taken by the Delhi High Court in another decision in Synthetics and Chemicals Ltd., Bombay vs Government of India, [19801 E.L.T. 675.
In that case, the petitioner manufactured Bentol, a mixture of Benzene and Toluene, in the factory, which was again used for the manufacture or rubber The High Court took the view that it was not a case of removal under rules 9 and 49 and, as such, no excise duty was payable on Bentol.
We may notice another decision of the Delhi High Court in Devi Dayal Electronics and Wires Ltd. vs Union of India, [ In that case it has been held that since the impugned resins (polyester or phenolic resins) are not removed from the place of manufacture but are used for the manufacture of end product (Varnish) within the plant itself, there is no removal of goods within the meaning of rule 9 read with rule 49 of the Rules.
Thus it appears that there is a conflict of opinion in the decisions of the Delhi High Court as to what is meant by the word 'removal ' for the purpose of payment of excise duty.
Two views have been expressed by the Delhi High Court.
One view is that so long as any product manufactured in the factory is not actually removed from the factory premises, there is no removal and, accordingly, no excise duty is payable on the product, even if the product is used for the manufacture of another commodity inside the factory.
The other view is that if at one stage a commodity known to the market is produced and is transferred, within the factory for the manufacture of another commodity, there is removal within the meaning of rules 9 and 49.
709 Apart from the above two views, there is a third view which has A also been expressed by the Delhi High Court, namely, that if an intermediate product is obtained in an integrated process of manufacture of a commodity, there is no removal and, therefore, such intermediate product although known to the market and comes under a particular tariff item yet, as there is no removal, there will be no question of payment of excise duty on such intermediate product.
The Nagpur Bench of the Bombay High Court in Oudh Sugar Mills Ltd. vs Union of India, [ has adopted the second and third views.
It has been held that if the purpose of removal of excisable goods is consumption in the same place where the excisable goods are manufactured or cured or if such excisable goods are used in the manufacture of any other goods in the same place, this cannot be done without payment of excise duty at the place and in the manner prescribed.
Further, it has been held that where the plant of production is treated as a composite plant and where the process of manufacture is an integrated, continuous and uninterrupted process, a transfer of a produce which is a component of the final produce from one part of the plant to another, does not amount to removal as contemplated by rule 9.
According to this decision, a process of onward movement of a component for being converted into a final product is not covered by the concept of removal contemplated by the provision of rule 9 of the Rules.
In Oudh Sugar Mills Ltd. vs Union of India, the Allahabad High Court has taken more or less the same view as that of the Bombay High Court.
It has been observed that an intermediate product which by itself is goods known to the market and is used in captive consumption for bringing out altogether a new goods not by an integrated process, but by a distinct and separate process, is liable to excise duty before its removal.
So far as captive consumption is concerned, the Gujarat High Court has taken the same view as that of the Allahabad High Court in Maneklal Harilal Spg. & Mfg. Co. Ltd. vs Union of India, where it has been held by the Allahabad High Court that excise duty is payable when yarn is removed from the spinning department to the weaving department for the manufacture of fabrics All the above decisions relate to rules 9 and 49 before they were amended.
Leaving aside the question of specification for the time being.
rule 9 before its amendment prohibits the removal of excisable goods 710 whether for consumption, export or manufacture of any other commodity in or outside such place, until the excise duty leviable thereon has been paid.
It is manifestly clear from rule 9 that it contemplates not only removal from the place where the excisable goods are produced, cured or manufactured or any premises appurtenant thereto, but also removal within such place or premises for captive consumption or 'home consumption ', as it is called.
Thus if a commodity which is manufactured in such place or premises and is used for the manufacture of another commodity, then it will be a case of removal for the purpose of payment of excise duty.
This view which we take clearly follows from the expression "whether for consumption, export or manufacture of any other commodity in or outside such place".
Thus consumption of excisable goods may be within such place or outside such place.
The decisions which have taken the view that if a commodity manufactured within the factory in one plant is transferred to another plant for the purpose of production of another commodity will be removal for the purpose of payment of excise duty are, in our opinion, correct.
It is not easily understandable why the definition of expression 'factory ' under section 2(e) of the Act has been taken resort to in some of the decisions for the purpose of interpretation of rule 9.
There can be no doubt that if a commodity is taken outside the factory it will be removal, but rule 9 does not, in any manner, indicate that it is only when the goods are removed from the factory premises it will be removal and when the excisable goods manufactured within the factory is removed from one plant to another it will not be a case of removal.
On the contrary, as noticed already, rule 9 clearly embraces within it captive consumtion of excisable goods, that is to say, when excisable goods manufactured in the factory are used for production of another commodity.
Now the question is whether rule 9 before it was amended also envisaged a case of an intermediate product obtained in an integrated and continuous process of manufacture of another commodity, that is, the end product.
It must be admitted that prima facie rule 9 does not show that it also covers a case of integrated, continuous and uninterrupted process of manufacture producing a commodity at an intermediate stage which again is utilised in such continuous process for the manufacture of the end product The learned Attorney General, appearing on behalf of the Union of India, submits that rule 9 and rule 49 also envisaged such a case of integrated process of manufacture of the end product using a product produced at an intermediate stage In support of his contention he has placed reliance on an unreported decision of the Bombay High Court in Misc.
491 of 1964, dated April, 711 30, 1970 (Nirlon Synthethic Fibres & Chemicals Ltd. vs Shri R.K. Audim, Assistant Collector & Ors.) The learned Single Judge of the Bombay High Court took the view that a continuous or integrated process of manufacture was not initially contemplated by rule 9 or rule 49, but after the addition of a new set of rules being rules 173A to 173K to the Rules by the Notification dated May 11, 1968 a continuous and integrated process of manufacture came to be contemplated by the scheme of the Act and the Rules.
Reliance has been placed by the learned Judge on the Explanation to rule 173A as added by the said Notification dated May 11, 1968.
The Explanation is as follows: "Explanation The expression 'home use ' means the consumption of such goods within India for any purpose and includes use of such goods in the place of production or manufacture or any other place or premises (whether by continuous process or not), for manufacture of any commodity.
Reliance has also been placed on rule 173G which provides for the procedure to be followed by an assessee who is a manufacturer of matches or cigarettes or cheroots.
The relevant portion of rule 173G is a proviso thereto which is as follows: "Provided that the duty due on the goods consumed within the factory in a continuous process may be so paid at the end of the factory day.
" From the above provisions of the Explanation to rule 173A and the proviso to rule 173G, the learned Judge has taken the view that a continuous or integrated process of manufacture has come to be contemplated by the scheme of the Act and the Rules framed thereunder for the first time only in May, 1968, the scheme having been brought into force with effect from June 1, 1968 and prior thereto such a continuous or integrated manufacturing process was never contemplated by the Act or the Rules.
learned Attorney General gets inspiration from the said unreported case of the Bombay High Court and submits that atleast since after May, 1968, rule 9 and rule 49 envisage the case of an integrated and continuous process of manufacture involving the use or utilisation of a commodity produced at an intermediate stage of such process for the manufacture of an end product or commodity.
It is submitted by him that if the interpretation as given by the learned 712 Single Judge of the Bombay High Court in the above unreported decision is accepted, in that case, it will not be necessary to consider the effect of amended rule 9 or rule 49, that is to say, the Explanations that have been added to these two rules.
It may be that the concept of continuous or integrated process of manufacture has been recognised in the Explanation to sub rule (2) of rule 173A and in the proviso to rule 173G but we do not think that rule 9 or rule 49 should be interpreted in the light of provisions of the Explanation to sub rule (2) of rule 173A or the proviso to rule 173G Moreover, we are not concerned with the interpretation of rule 9 and rule 49, as they stood before the amendment.
In the instant case, the appellants have challenged rule 9 and rule 49 as amended by the Notification dated February 20, 1982 We are, therefore, concerned with the interpretation of these rules as amended, particularly the question of validity of these rules.
Before we proceed to consider the contentions made on behalf of the parties, it may be stated that in view of the divergence of judicial opinions as to the interpretation of rules 9 and 49, before they were amended, the Explanations to rules 9 and 49 have been added so as to obviate any doubt.
The Explanations to rule 9 and rule 49, inter alia, provide that commodity obtained at an intermediate stage of manufacture in a continuous process shall be deemed to have been removed from such place or premises as mentioned in sub rule (1) of rule 9 This deeming provision has been given retrospective effect by virtue of section S l of the Finance Act 1982.
It is urged by Mr. Sorabjee, learned Counsel for the appellants, that the amended rule 9 and rule 49 are arbitrary and unreasonable inasmuch as the goods which, in fact, are not removed from the factory and which are incapable of removal because of the nature and construction of the plant or the nature and character of the manufacturing process, are fictionally treated as having been removed.
It is submitted that as a result of the amendment of these rules the appellants are exposed to excessive hardship for not complying with the statutory provisions In view of the length of the retrospective operation of the amendments, namely 38 years from the date of the commencement of the Act, that is, February 28, 1944 the appellants would be called upon to pay enormous amount of duty in respect of the entire quantity of goods which have come into existence and have been captively consumed within the factory premises.
The appellants will not, however, be able to pass on this burden to consumers and will have to bear 713 the same themselves It is submitted that in view of the arbitrariness and unreasonableness of the amendments and the hardships that will be caused to the appellants and other manufacturers of excisable goods, the amendments should be struck down as violative of the provisions of Article 14 and Article 19(1)(g) of the Constitution of India.
It is not disputed that the Legislature is competent to make laws both prospectively and retrospectively But, as pointed out by this Court in Jawaharmal vs State of Rajasthan and others, [ 19661 I S.C. R. 890, the cases may conceivably occur where the court may have to consider the question as to whether excessive retrospective operation prescribed by a taxing statute amounts to the contravention of the citizens ' fundamental rights; and in dealing with such a question the court may have to take into account all the relevant and surrounding facts and circumstances in relation to the taxation.
Again in Rai Ramkrishna & others vs State of Bihar, [ 1964] I S C.R 897 this Court has pointed out that if the retrospective feature of a law is arbitrary and burdensome, the statute will not be sustained and the reasonableness of each retrospective statute will depend on the circumstances of each case; and the test of the length of time covered by the retrospective operation cannot, by itself, necessarily be a decisive test.
The apprehension of the appellants is that the amendments to rules 9 and 49 having been made retrospective from the date the Rules were framed, that is from February 28, 1944, the appellants and others similarly situated may be called upon to pay enormous amounts of duty in respect of intermediate goods which have come into existence and again consumed in the integrated process of manufacture of another commodity There can be no doubt that if one has to pay duty with retrospective effect from 1944, it would really cause great hardship but, in our opinion, in view of section I IA of the Act, there is no cause for such apprehension.
Section I IA(I) of the Act provides as follows: "Section l1A. (1) When any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded, a Central Excise officer may, within six months from the relevant date, serve notice on the person chargeable with the duty which has not been levied or paid or which has been short levied or short paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice: 714 Provided that where any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, by such person or his agent, the provisions of this sub section shall have effect, as if for the words "six months", the words "five years ' were substituted.
Explanation.
Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of six months or five years, as the case may be " Under section 11A( I) the excise authorities cannot recover duties not levied or not paid or short levied or short paid or erroneously refunded beyond the period of six months, the proviso to section l IA not being applicable in the present case.
Thus although section 5 l of the Finance Act, 1982 has given retrospective effect to the amendments of rules 9 and 49, yet it must be subject to the provision of section 11A of the Act.
We are unable to accept the contention of the learned Attorney General that as section 5 1 has made the amendments retrospective in operation since February 28, 1944, it should be held that it overrides the provision of section 11A.
If the intention of the Legislature was to nullify the effect of section 11A, in that case, the Legislature would have specifically provided for the same Section 5 1 does not contain any non obstante clause nor does it refer to the provision of section 1 IA.
In the circumstances it is difficult to hold that section 5 l overrides the provision of section 1 IA.
It is, however, contended by the learned Attorney General that as the law was amended for the first time on February 20, 1982, the cause of action for the excise authorities to demand excise duty in terms of the amended provision, arose on that day, that is, on February 20, 1982 and, accordingly, the authorities are entitled to make such demand with retrospective effect beyond the period of six months.
But such demand, though it may include within it demand for more than six months, must be made within a period of six months from the date of the amendment.
There is no provision in the Act or in the Rules enabling the excise authorities to make any demand beyond the periods mentioned 715 in section 11A of the Act on the ground of the accrual of cause of action.
The question that is really involved is whether in view of section 5 1 of the Finance Act, 1982, section 11A should be ignored or not.
In our view section S I does not, in any manner, affect the provision of section 11A of the Act.
In the absence of any specific provision overriding section 1 IA, it will be consistent with rules of harmonious construction to hold that section 51 of the Finance Act, 1982 in so far as it gives retrospective effect to the amendments made to rules 9 and 49 of the rules, is subject to the provision of section 11A.
In the circumstances, there is no question of the amended provision of rule 9 and rule 49 being arbitrary, unreasonable or violative of the provision of Article 14 and Article 19(1)(g) of the Constitution of India.
We may now deal with the challenge made to the retrospective operation of amendments of rules 9 and 49 on another ground.
In order to appreciate the ground of such challenge, we may once more refer to section 51 of the Finance Act, 1982.
The Explanation to section 5 1 provides as follows: "Explanation.
For the removal of doubts, it is hereby declared that no act or omission on the part of any person shall be punishable as an offence which would not have been so punishable if this section had not come into force.
" Under the Explanation, although rules 9 and 49 have been given retrospective effect, an act or omission which was not punishable before the amendment of the Rules, will not be punishable after amendment.
The Explanation does not however, provide for the penalties and confiscation of goods.
It is the contention of the appellants that as the appellants had not complied with the requirements of the amended rules 9 and 49, they would be subjected to penalties and their goods would be confiscated under the amended rules 9 and 49 read with rule 173Q of the Rules with retrospective effect.
It is, accordingly, submitted on behalf of the appellants that the amendment of these two rules with retrospective effect is arbitrary and unreasonable and should be struck down as violative of Article 14 of the Constitution.
Attractive though the argument is, we regret we are unable to accept the same.
It is true that the Explanation to section 51 has not mentioned anything about the penalties and confiscation of goods but H 716 we do not think that in view of such non mention in the Explanation excluding imposition of penalties for acts or omissions before amendment.
such penalties can be imposed or goods can be confiscated by virtue of the amended provisions of rules 9 and 49.
It will be against all principles of legal jurisprudence to impose a penalty on a person or to confiscate his goods for an act or omission which was lawful at the time when such act was performed or omission made, but subsequently made unlawful by virtue of any provision of law.
The contention made on behalf of the apellants is founded on the assumption that under the Explanation to section 5 1, the penalties can be imposed and goods can be confiscated with retrospective effect.
In the circumstances, the challenge to the amendments of rules 9 and 49, founded on the provision of the Explanation to section 51 of the Finance Act, 1982, is without any substance and is rejected The appellants have also challenged the prospective operation of the Explanation to rules 9 and 49 introduced by amendments of the same.
It is strenuously uged by Mr. Sorabjee, learned Counsel for the appellants, that even after amendment there must be removal of the goods from one place to another for the purpose of collection of excise duty.
Our attention has been drawn on behalf of the appellants to clause (b) of sub section (4) of section 4 of the Act, which defines "place of removal" as follows: "Sub section (4) For the purpose of this section, (a). . . . . . . (b) "place of removal" means (i) a factory or any other place or premises of production or manufacture of the excisable goods; or (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty, from where such goods are removed.
It is submitted on behalf of the appellants that the Explanations to rule 9 and rule 49 are ultra vires the provision of clause (b) of sub section (4) of section 4 of the Act inasmuch as "place of removal" as defined therein, does not contemplate any deemed removal, but a 717 physical and actual removal of the goods from a factory or any other place or premises of production or manufacture or a warehouse etc.
A This contention is unsound and also does not follow from the definition of "place of removal .
Under the definition "place of removal" may be a factory or any other place or premises of production or manufacture of the excisable goods etc The Explanation to rules 9 and 49 do not contain any definition of "place of removal", but provide that excisable goods produced or manufactured in any place or premises at an intermediate stage and consumed or utilised for the manufacture of another commodity in a continuous process, shall be deemed to have been removed from such place or premises immediately before such consumption or utilization.
Clause (b) of sub section (4) of section 4 has defined "place of removal", but it has not defined 'removal '.
There can be no doubt that the word 'removal contemplated shifting of a thing from one place to another.
In other words, it contemplates physical movement of goods from one place to another It is well settled that a deeming provision is an admission of the non existence of the fact deemed.
Therefore, in view of the deeming provisions under Explanations to rules 9 and 49, although the goods which are produced or manufactured at an intermediate stage and, thereafter, consumed or utilised in the integrated process for the manufacture of another commodity is not actually removed, shall be construed and regarded as removed.
The Legislature is quite competent to enact a deeming provision for the purpose of assuming the existence of a fact which does not really exist.
It has been already noticed that the taxing event under section 3 of the Act is the production or manufacture of goods and not removal The Explanations to rules 9 and 49 contemplate the collection of duty levied on the production of a commodity at an intermediate stage of an integrated process of manufacture of another commodity by deeming such production or manufacture of the commodity at an intermediate stage to be removal from such place or premises of manufacture.
The deeming provisions are quite consistent with section 3 of the Act As observed by the Federal Court in Boddu 's case (supra) there is in theory nothing to prevent the central legislature from imposing a duty of excise on a commodity as soon as it comes into existence, no matter what happens to it after wards, whether it be sold, consumed or destroyed or given away.
It is for the convenience of the taxing authority that duty is collected at the time of removal of the commodity.
There is, therefore, nothing unreasonable in the deeming provision and, as discussed above, it is quite in conformity with the provision of section 3 of the Act The contention that the amendments to rules 9 and 49 are ultra vires clause H 718 (b) of sub section (4) of section 4 of the Act, is without substance and is overruled.
It is next contended on behalf of the appellants that even assuming that there can be fictional removal as provided in the Explanation to rules 9 and 49, there cannot be such fictional or deemed removal without the specification of the place where the excisable goods are produced, cured or manufactured or any premises appurtenant thereto.
Rule 9(1), inter alia provides that no excisable goods shall be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf until the excise duty leviable thereon has been paid.
The Explanations to rules 9 and 49 refer to the specification that has been made by the Collector under sub rule (1) of rule 9.
It is submitted on behalf of the appellants that as no specification has been made by the Collector of such place or premises appurtenant thereto, the provision of deemed removal with regard to the commodity produced at the intermediate stage and consumed or utilised in the continuous process of manufacture of the end product, is inapplicable.
It is contended that so long as such specification is not made by the Collector of the place of manufacture or of any premises appurenant thereto, the provision of deemed removal as contained in the Explanations to rule 9 and 49 cannot be given effect to.
On the other hand, it is contended by the learned Attorney General that specification of the place of manufacture and other places for the storage of the goods, is made in the licence which is required to be obtained under rule 174 of the Rules.
Rule ]78 provides for the form.
of licence.
Clause (b) of rule 178(1) provides that every licence granted or renewed under rule 176 shall have reference only to the premises, if any, described in such licence.
Form A L. IV is the form of an application for licence under rule 176.
In the Schedule to the Form, description of the premises intended to be used as a factory and of each main division or sub division of the factory has to be given.
Further, the detailed description of store room or other place of storage and the purpose of each has also to be given in the application form for the grant of licence for the manufacture of excisable goods.
Again under rule 44 of the Rules, the Collector may require any manufacturer to make a prior declaration of factory premises and its equipments.
Such a declaration has to be given in Form D 2 in respect of buildings, rooms, vessel, etc.
In view of the particulars which are required to be given by a licensee for the manufacture of excisable goods, it is submitted by the learned Attorney General that the specification that is 719 required to be made under rule 9(1), is made in the licence and in the declaration that has to be furnished by the manufacturer in Form D 2.
It is true that under rule 9(1) there is a provision for specification by the Collector, but the question is what has to be specified by the Collector.
It is the contention of the appellants that the Collector has to specify the place of manufacture and also any premises appurtenant thereto.
We are, however, unable to accept this contention.
The place where the goods are to be manufactured by a manufacturer, that is to say, the site of the factory cannot be specified by the Collector.
It is for the manufacturer to choose the site or the place where the factory will be constructed and goods will be manufactured.
Rule 9(1), in our opinion, does not require the Collector to specify the place where the excisable goods are produced, cured or manufactured.
The words "which may be specified by the Collector in this behalf" occurring in rule 9(1) of the Rules do not qualify the words "any place where they are produced, cured or manufactured ', but relate to or qualify the words "any premises appurtenant thereto".
In other words, if the place of removal is not the place where the goods are produced, cured or manufactured, but any premises appurtenant to such place, in that case, the Collector has to specify such premises for the purpose of collection of excise duty.
Thus the contention of the appellants that the Collector has to specify the place of manufacture and also any premises appurtenant thereto under rule 9(1) of the Rules, is without any substance.
Our attention has, however, been drawn to the impugned circular dated September 24, 1980 issued by the Central Board of Excise & Customs.
In clause 3 of the circular, it is stated as follows: "Mere approval of the ground plan in a routine manner will not suffice for purposes of rule 9 as under the said rule the place of production etc.
Or premises appurtenant thereto have also to the specified separately " Under the circular, the Collector is required to specify under rule 9(1) both the place of production and premises appurtenant thereto, if any.
In view of this direction given in the circular, the learned Counsel for the appellants submits that it is not only binding on the Collector and the other officers of the Central Excise Department, but also the circular is in the nature of contemporanea exposito rendering useful aid in the construction of the provision of rule 9(I) of the Rules.
This contention finds support from the decision of this Court in K.P. Var 720 ghese vs The Income Tax officer, Ernakulam, [1982] I S.C.R. 629 relied on by the learned Counsel of the appellants.
Indeed, it has been observed in that case that the rule of construction by reference to contemporanea exposito is a well established rule for interpreting a statute by reference to the exposition it has received from contemporary authority, though it must give way where the language of the 13 statute is plain and unambiguous.
In our opinion, the language of rule 9(1) admits of only one interpretation and that is that the specification that has to be made by the Collector is of any premises appurtenant to the place of manufacture or production of the excisable goods.
The specification is not required to be made and, in our view, cannot be made of the place of manufacture or production of the excisable goods.
Apart from that, as observed by Subba Rao, J., upon a review of all the decisions on the point, in an earlier decision of this Court in the Senior Electric Inspector and others vs Laxmi Narayan Chopra, ; , the maxim contemporanea exposito as laid down by Coke was applied to construing ancient statutes but not to interpreting Acts which are comparatively modern.
Further, it has been observed that in a modern progressive society it would be unreasonable to confine the intention of a Legislature to the meaning attributable to the word used at the time the law was made and, unless a contrary intention appears, an interpretation should be given to the words used to take in new facts and situations, if the words are capable of comprehending them.
Most respectfully we agree with the said observation of Subba Rao, J.
In the circumstances, we do not agree with the direction of the Board of Central Excise & Customs given in the impugned circular that both the place of manufacture and the premises appurtenant thereto must be specified by the Collector under rule 9 1(1) of the Rules.
Thus, there being no question of specification of the place of manufacture, the contention of the appellants that without such specification there cannot be any deemed removal, fails.
In view of the discussion made above, we hold that the amendments to rules 9 and 49 are quite legal and valid.
Further, section S 1 of this Finance Act, 1982 giving retrospective effect to the said amendments is also legal and valid.
In the instant case, the appellants are liable to pay excise duty on the yarn which is obtained at an intermediate stage and, thereafter, further processed in an integrated process for weaving the same into fabrics.
Although it has been alleged that the yarn is obtained at an intermediate stage of an integrated process of manufacture of fabrics, it appears to be not so.
After the yarn is produced it is sized and, 721 thereafter, subjected to a process of weaving the same into fabrics.
Be that as it may, as we have held that the commodity which is obtained at an intermediate stage of an integrated process of manufacture of another commodity, is liable to the payment of excise duty, the yarn that is produced by the appellants is also liable to payment of excise duty.
In our view, the High Court by the impugned judgment has rightly held that the appellants are not liable to pay any excise duty on the yarn after it is sized for the purpose of weaving the same into fabrics.
No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn.
For the reason aforesaid, the judgment of the High Court is affirmed and this appeal is dismissed.
There will.
however, be no order as to costs.
Civil Appeal Nos.
2658 and 4168 of 1983.
In view of the judgment passed in Civil Appeal No. 297 of 1983, these appeals are also dismissed.
There will, however, be no order as to costs.
S.L. Appeals dismissed.
|
% The appellant No. 1, J.K. Cotton Spinning and Weaving Mills Limited, has a composite mill wherein it manufactures fabrics of different types, for which yarn is obtained at an intermediate stage, and the yarn is processed in an integrated process in the said composite mill for weaving the same into fabrics.
The Central Board of Excise issued a Circular dated September 24, 1980, purporting to interpret the rules 9 and 49 of the Central Excise Rules, 1944 (the Rules) and directing the subordinate excise authorities to levy and collect excise duty in accordance therewith.
The Board further directed vide the said Circular that the use of the goods in the manufacture of another commodity even within the place premises specified in this behalf by the Central Excise officers in terms of the powers conferred under rule 9 of the Rules, would attract duty.
As the implementation of the Circular worked to the prejudice of the appellants, they filed a writ petition in the High Court, challenging the validity of the Circular.
During the pendency of the said writ petition, the Central Government issued a Notification dated February 20, 1982, amending the rules 9 and 49 of the Rules, with section 51 of the Finance Act, 1982, providing that the amendments in the rules 9 and 49 shall be deemed to have, and to have always had, the effect with retrospective effect from the date on which the Rules came into force i.e. February 28, 1944.
Upon the amendments of the rules 9 and 49, with retrospective effect of the amendments, the appellants amended their writ petition above said to challenge the constitutional validity of Section 51 of the Finance Act abovementioned and the amendments to the rules 9 and 49.
701 The High Court allowed the writ petition in part.
It held (i) that section 51 and the rules 9 and 49 as amended were valid, (ii) the retrospective effect allowed by section 51 would be subject to the provisions of sections 11A and 11B of the (the Act), (iii) the yarn produced at an intermediate stage in the mill of the appellants and subjected to the integrated process of weaving into fabrics, would be liable to payment of excise duty in view of the amended provisions of the rules 9 and 49, but the sized yarn actually put into the integrated process would not again attract excise duty.
The appellants then filed this appeal (Civil Appeal No. 297 of 1983) before this Court by certificate.
Dismissing the Appeal, the Court, ^ HELD: The decisions of various High Courts cited, deal with the rules 9 and 49 of the Central Excise Rules, 1944, as they stood before they were amended by the Government Notification dated February 20, 1982.
In this case, what is involved is the interpretation of the said two rules after their amendment and the constitutional validity of the rules as amended.
The amendments to the rules 9 and 49 are quite legal and valid.
Section 51 of the Finance Act, 1982, giving retrospective effect to the said amendments is also legal and valid.
The apprehension of the appellants that the amendments to rules 9 and 49 having been made retrospective from the date the rules were framed, that is, February 28, 1944, the appellants may be called upon to pay enormous amounts of duty in respect of the intermediate goods which have come into existence and again consumed in the integrated process of manufacture of another commodity, is not right.
In view of section 11A of the Finance Act, there is no cause for such an apprehension.
Under Section 11A(1), the excise authorities cannot recover duties not levied or not paid or short levied or short paid or erroneously refunded beyond the period of six months, the proviso to section 11A not being applicable in the present case.
Thus though section 51 has given retrospective effect to the amendments of rules 9 and 49, it must be subject to the provision of section 11A of the Act.
Section 51 does not contain any non obstante clause, nor does it refer to the provision of section 11A, and it is difficult to hold that section 51 overrides the provision of section 11A. [712F H; 714D F] The appellants are liable to pay excise duty on the yarn obtained at an intermediate stage and, thereafter, further processed in an integrated process for weaving the same into fabrics.
Although it has been alleged that the yarn is obtained at an intermediate stage of an 702 integrated process of manufacture of fabrics, it appears to be not so.
After the yarn is produced, it is sized, and thereafter, subjected to a process of weaving the same into fabrics.
As the Court has held that the commodity which is obtained at an intermediate stage of an integrated process of manufacture of another commodity, is liable to the payment of excise duty, the yarn that is produced by the appellants is also liable to payment of excise duty.
[720G H: 721A B] The High Court has rightly held that the appellants are not liable to pay excise duty on the yarn after it is sized for the purpose of weaving the same into fabrics.
No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn.
The judgment of the High Court affirmed.
[721B C] In view of the decision of the Court in the Civil Appeal No. 297 of 1983, the Civil Appeals Nos. 2658 and 4168 of 1983 also dismissed.
[721D] The Province of Madras vs Boddu Paidanna and Sons AIR ; Caltex oil Refining (India) Ltd. vs Union of India & Ors. , Delhi Cloth and General Mills Co. Ltd. vs Joint Secretary, Government of India, ; Modi Carpets Ltd. vs Union of India, ; Synthetics and Chemicals Ltd. Bombay vs Government of India, , Devi Dayal Electronics and Wires Ltd. vs Union of India, [1982] E.L.T. 33; Oudh Sugar Mills Ltd. vs Union of India, [1980] E.L.T. 327, Oudh Sugar Mills Ltd. vs Union of India, [1982] E.L.T. 927, Maneklal Harilal Spg. & Mfg. Co. Ltd. vs Union of India, ; Nirlon Synthetic Fibres & Chemicals Ltd. vs Shri R.K. Audim; Assistant Collector & Ors.
In Misc.
491 of 1964, unreported judgment of Bombay High Court, dated April 30, 1970, Jawaharmal vs State of Rajasthan & Ors., ; ; Rai Ramkrishna and Ors.
vs State of Bihar, ; , K.P. Verghese vs The Income Tax officer, Ernakulam; , and Senior Electric Inspector and Ors.
vs Laxmi Narayan Chopra, ; , referred to.
|
Civil Appeal No. 297 of 1983.
From the Judgment and order dated 11 1.1983 of the Delhi High Court in C.W No 1858 of 1981 Soli J. Sorabjee, A.N. Haksar, Ravinder Narain P.K. Ram.
703 D.N. Mishra and Appellant in person (in C.A. No. 2658 of 1983) for the Appellants K. Parasaran, Attorney General, A K. Ganguli, K. Swamy and C.V.S. Rao for the Respondents The Judgment of the Court was delivered by DUTT, J.
This appeal is directed against the judgment of the Delhi High Court allowing in part only the petition of the appellants under Article 226 of the Constitution of India The appellant No. 1, J.K. Cotton Spinning & Weaving Mills Limited, has a composite mill wherein it manufactures fabrics of different types.
In order to manufacture the said fabrics, yarn is obtained at an intermediate stage.
The yarn so obtained is further processed in an integrated process in the said composite mill of the appellant No. 1 for weaving the same into fabrics.
The appellants do not dispute that the different kinds of fabrics which are manufactured in the mill are liable to payment of excise duty on their removal from the factory.
They also do not dispute their liability in respect of yarn which is also removed from the factory.
It is the contention of the appellants that no duty of excise can be levied and collected in respect of yarn which is obtained at an intermediate stage and, thereafter, subjected to an integrated process for the manufacture of different fabrics.
Indeed, on a writ petition of the appellants, the Delhi High Court by its judgment dated October 16, 1980 held that yarn obtained and further processed within the factory for the manufacture of fabrics could not be subjected to duty of excise.
It is the case of the appellants that in spite of the said decision of the Delhi High Court, the Central Board of Excise has wrongly issued a circular dated September 24, 1980 purporting to interpret rules 9 and 49 of the Central Excise Rules, 1944 (hereinafter referred to as 'the Rules ') and directing the subordinate excise authorities to levy and collect duty of excise in accordance therewith.
In the said circular, the Board has directed the subordinate excise authorities that "use of goods in manufacture of another commodity even within the place/premises that have been specified in this behalf by the Central Excise officers in terms of the powers conferred under rule 9 of the Rules, will attract duty".
As the said circular was being implemented to the prejudice of the appellants, they filed a writ petition before the Delhi High Court, inter alia, challenging the validity of the circular.
During the pendency of the writ petition in the Delhi High 704 Court, the Central Government by a Notification No . 20/82 C. dated 20.2.1982 amended rules 9 and 49 of the Rules.
Section 51 of the Finance Act, 1982 provides that the amendments in rules 9 and 49 of the Rules shall be deemed to have, and to have always had the effect on and from the date on which the Rules came into force i.e. February 28, 1944.
After the said amendments of the Rules with retrospective effect, the appellants amended the writ petition and challenged the constitutional validity of section 5 1 of the Finance Act, 1982 and of the amendments to rules 9 and 49 of the Rules.
The High Court came to the conclusion that section S I and rules 9 and 49 of the Rules, as amended, were valid.
It has, however, been held that the retrospective effect given by section S I will be subject to the provisions of sections 11A and 11B of the (hereinafter referred to as 'the Act ') Further, it has been held that the yarn which is produced at an intermediate stage in the mill of the appellants and subjected to the integrated process of weaving the same into fabrics, will be liable to payment of excise duty in view of the amended provisions of rules 9 and 49 of the Rules.
But the sized yarn which is actually put into the integrated process will not again be subjected to payment of excise duty for, the unsized yarn, which is sized for the purpose, does not change the nature of the commodity as yarn.
The writ petition was, accordingly, allowed in part.
Hence this appeal by the appellants upon a certificate granted by the High Court.
F At this stage, we may refer to rules 9 and 49 before and after amendment of the same.
The relevant portion of rule 9 before the same was amended is as follows: "Rule 9.
Time and manner of payment of duty. (1) No excisable goods shall be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf whether for consumption, export, or manufacture of any other commodity in or outside such place, until the excise duty leviable thereon has been paid at such place and in such manner as is prescribed in these Rules or as the Collector may require, and except on presentation of an application in the proper form and on obtaining the permission of the proper officer on the form: " [The remaining provisions of rule 9 which are not relevant for our purpose are omitted. ] 705 By a Notification No. 20/82 C.B. dated 20.2.1982 of the Central Government, rule 9 was amended by the addition of the following A Explanation thereto: "Explanation.
For the purposes of this rule excisable goods produced, cured or manufactured in any place and consumed or utilised (i) as such or after subjection to any process or processes; or (ii) for the manufacture of any other commodity, whether in a continuous process or otherwise, in such place or any premises appurtenant thereto, specified by the Collector under sub rule (1), shall be deemed to have been removed from such place or premises immediately before such consumption or utilisation." Rule 49 before its amendment was as follows: "Rule 49.
Duty chargeable only on removal of goods from the factory premises or from an approved place of storage. (1) Payment of duty shall not be required in respect of excisable goods made in a factory until they are about to be issued out of the place or premises specified under rule 9 or are about to be removed from a store room or other place of storage approved by the Collector under rule 47:" [The remaining provisions of rule 49 which are not relevant for our purpose are omitted . ] By the said Notification rule 49 was amended by the addition of an Explanation thereto as follows: "Explanation.
For the purposes of this rule, excisable goods made in a factory and consumed or utilised (i) as such or after subjection to any process or processes; or (ii) for the manufacture of any other commodity, whether in a continuous process or otherwise, in such factory or place or premises specified under rule 9 or store 706 room or other place of storage approved by the Collector under rule 47, shall be deemed to have been issued out of, or removed from such factory, place, premises, store room or other place of storage, as the case may be, immediately before such consumption or utilisation.
" It has been already noticed that by section 5 1 of the Finance Act, 1982, amendments made to rules 9 and 49 have been given retrospective effect from the date on which the Rules came into force, that is to say, from February 28, 1944 It is not disputed before us that under section 3(1) of the Act, the taxing event is the production or manufacture of the goods in question.
Indeed, section 3 provides that there shall be levied and collected in such manner as may be prescribed, duties of excise on all excisable goods other than salt which are produced or manufactured in India and at the rates set forth in the First Schedule.
It is, therefore, clear that as soon as the goods in question are produced or manufactured, they will be liable to payment of excise duty.
While section 3 lays down the taxable event, rules 9 and 49 provide for the collection of duty.
There is a distinction between levy and collection of duty.
In The Province of Madras vs Boddu Paidanna & Sons, A.I.R. 1942 FC 33 it has been observed by the Federal Court as follows: "There is in theory nothing to prevent the Central Legislature from imposing a duty of excise on a commodity as soon as it comes into existence, no matter what happens to it afterwards, whether it be sold, consumed, destroyed or given away.
A taxing authority will not ordinarily impose such a duty, because it is much more convenient administratively to collect the duty (as in the case of most of the Excise Acts) when the commodity leaves the factory for the first time, and also because the duty is intended to be an indirect duty which the manufacturer or producer is to pass on to the ultimate consumer, which he could not do if the commodity had, for example, been destroyed in the factory itself.
It is the fact of manufacture which attracts the duty, even though it may be collected later.
" Relying upon the aforesaid observation of the Federal Court, it has been urged by Mr. Soli Sorabjee, learned Counsel appearing on behalf of the appellants, that although it is true that as soon as the commodity is manufactured or produced it is liable to the payment of 707 excise duty, the duty will not, however, be collected unless the commodity leaves the factory.
It is submitted by him that the commodity must be removed from one place to another either for the purpose of consumption in the factory or for sale outside it before excise duty an be claimed.
Counsel submits that rules 9 and 49, as they stood before they were amended, and even the main part of these two rules after amendment, indicate in clear terms that so long as the goods which are manufactured in the factory are not removed, there is no question of payment of excise duty on the goods.
Several decisions have been cited on behalf of the appellants to show that some High Courts also have taken the view that removal is the main criterion for the collection of excise duty on the commodity produced or manufactured inside the factory or the place of manufacture.
We shall presently refer to these decisions.
It may, however, be noticed that the decisions are not also uniform on the interpretation of rules 9 and 49, as they stood before amendment.
We are, however, really concerned with the interpretation of these two rules after amendment, but as much submissions have been made by the parties in the light of the decisions of the High Courts on the interpretation of these two rules, we would like to refer to the same.
In Caltex oil Refining (India) Ltd. vs Union of India and others, it has been held by the Delhi High Court that there can be removal only if the product goes out of one stream of production into another stream of production or if the product is issued out of or taken out or consumed if no further processing of that product is to be done.
Further, it has been observed that there can be no removal of a product within the plant itself so long as the product is in the process of manufacture.
According to this decision, if the product, which is obtained at an intermediate stage of an integrated and uninterrupted process of manufacture, there is no removal of such product.
But, if the intermediary product is transferred from one plant to another for the manufacture of another commodity, there will be removal for the purpose of collection of duty.
In an earlier decision in Delhi Cloth & General Mills Co. Ltd. vs Joint Secretary, Government of India, the Delhi High Court had taken a different view.
In that case calcium carbide manufactured in the factory in one plant was used to generate acetylene gas by the transfer of the article from one plant to another in the same factory.
The question that came up for consideration of the High Court was whether there was removal of calcium carbide for the 708 purpose of levy and collection of excise duty.
The High Court relied upon the definition of 'factory ' under section 2(e) of the Act and took the view that the definition was not restricted to only the part in which the excisable goods were manufactured.
It was, accordingly, held that it could not, therefore, be said that calcium carbide made by the petitioner Company was removed from the factory in which it was produced.
This decision lays down that so long as a commodity is not removed from the factory premises, there is no removal within the meaning of rules 9 and 49.
A similar view has been taken by the Delhi High Court in a later decision in Modi Carpets Ltd. vs Union of India, where the High Court has expressed the view that o excise duty can be levied and recovered on 'sliver ' obtained by the petitioners, if it is consumed within the very premises in which it is manufactured because in such cases there is no removal of sliver from the place of manufacture as envisaged by rules 9 and 49 More or less a similar view has been taken by the Delhi High Court in another decision in Synthetics and Chemicals Ltd., Bombay vs Government of India, [19801 E.L.T. 675.
In that case, the petitioner manufactured Bentol, a mixture of Benzene and Toluene, in the factory, which was again used for the manufacture or rubber The High Court took the view that it was not a case of removal under rules 9 and 49 and, as such, no excise duty was payable on Bentol.
We may notice another decision of the Delhi High Court in Devi Dayal Electronics and Wires Ltd. vs Union of India, [ In that case it has been held that since the impugned resins (polyester or phenolic resins) are not removed from the place of manufacture but are used for the manufacture of end product (Varnish) within the plant itself, there is no removal of goods within the meaning of rule 9 read with rule 49 of the Rules.
Thus it appears that there is a conflict of opinion in the decisions of the Delhi High Court as to what is meant by the word 'removal ' for the purpose of payment of excise duty.
Two views have been expressed by the Delhi High Court.
One view is that so long as any product manufactured in the factory is not actually removed from the factory premises, there is no removal and, accordingly, no excise duty is payable on the product, even if the product is used for the manufacture of another commodity inside the factory.
The other view is that if at one stage a commodity known to the market is produced and is transferred, within the factory for the manufacture of another commodity, there is removal within the meaning of rules 9 and 49.
709 Apart from the above two views, there is a third view which has A also been expressed by the Delhi High Court, namely, that if an intermediate product is obtained in an integrated process of manufacture of a commodity, there is no removal and, therefore, such intermediate product although known to the market and comes under a particular tariff item yet, as there is no removal, there will be no question of payment of excise duty on such intermediate product.
The Nagpur Bench of the Bombay High Court in Oudh Sugar Mills Ltd. vs Union of India, [ has adopted the second and third views.
It has been held that if the purpose of removal of excisable goods is consumption in the same place where the excisable goods are manufactured or cured or if such excisable goods are used in the manufacture of any other goods in the same place, this cannot be done without payment of excise duty at the place and in the manner prescribed.
Further, it has been held that where the plant of production is treated as a composite plant and where the process of manufacture is an integrated, continuous and uninterrupted process, a transfer of a produce which is a component of the final produce from one part of the plant to another, does not amount to removal as contemplated by rule 9.
According to this decision, a process of onward movement of a component for being converted into a final product is not covered by the concept of removal contemplated by the provision of rule 9 of the Rules.
In Oudh Sugar Mills Ltd. vs Union of India, the Allahabad High Court has taken more or less the same view as that of the Bombay High Court.
It has been observed that an intermediate product which by itself is goods known to the market and is used in captive consumption for bringing out altogether a new goods not by an integrated process, but by a distinct and separate process, is liable to excise duty before its removal.
So far as captive consumption is concerned, the Gujarat High Court has taken the same view as that of the Allahabad High Court in Maneklal Harilal Spg. & Mfg. Co. Ltd. vs Union of India, where it has been held by the Allahabad High Court that excise duty is payable when yarn is removed from the spinning department to the weaving department for the manufacture of fabrics All the above decisions relate to rules 9 and 49 before they were amended.
Leaving aside the question of specification for the time being.
rule 9 before its amendment prohibits the removal of excisable goods 710 whether for consumption, export or manufacture of any other commodity in or outside such place, until the excise duty leviable thereon has been paid.
It is manifestly clear from rule 9 that it contemplates not only removal from the place where the excisable goods are produced, cured or manufactured or any premises appurtenant thereto, but also removal within such place or premises for captive consumption or 'home consumption ', as it is called.
Thus if a commodity which is manufactured in such place or premises and is used for the manufacture of another commodity, then it will be a case of removal for the purpose of payment of excise duty.
This view which we take clearly follows from the expression "whether for consumption, export or manufacture of any other commodity in or outside such place".
Thus consumption of excisable goods may be within such place or outside such place.
The decisions which have taken the view that if a commodity manufactured within the factory in one plant is transferred to another plant for the purpose of production of another commodity will be removal for the purpose of payment of excise duty are, in our opinion, correct.
It is not easily understandable why the definition of expression 'factory ' under section 2(e) of the Act has been taken resort to in some of the decisions for the purpose of interpretation of rule 9.
There can be no doubt that if a commodity is taken outside the factory it will be removal, but rule 9 does not, in any manner, indicate that it is only when the goods are removed from the factory premises it will be removal and when the excisable goods manufactured within the factory is removed from one plant to another it will not be a case of removal.
On the contrary, as noticed already, rule 9 clearly embraces within it captive consumtion of excisable goods, that is to say, when excisable goods manufactured in the factory are used for production of another commodity.
Now the question is whether rule 9 before it was amended also envisaged a case of an intermediate product obtained in an integrated and continuous process of manufacture of another commodity, that is, the end product.
It must be admitted that prima facie rule 9 does not show that it also covers a case of integrated, continuous and uninterrupted process of manufacture producing a commodity at an intermediate stage which again is utilised in such continuous process for the manufacture of the end product The learned Attorney General, appearing on behalf of the Union of India, submits that rule 9 and rule 49 also envisaged such a case of integrated process of manufacture of the end product using a product produced at an intermediate stage In support of his contention he has placed reliance on an unreported decision of the Bombay High Court in Misc.
491 of 1964, dated April, 711 30, 1970 (Nirlon Synthethic Fibres & Chemicals Ltd. vs Shri R.K. Audim, Assistant Collector & Ors.) The learned Single Judge of the Bombay High Court took the view that a continuous or integrated process of manufacture was not initially contemplated by rule 9 or rule 49, but after the addition of a new set of rules being rules 173A to 173K to the Rules by the Notification dated May 11, 1968 a continuous and integrated process of manufacture came to be contemplated by the scheme of the Act and the Rules.
Reliance has been placed by the learned Judge on the Explanation to rule 173A as added by the said Notification dated May 11, 1968.
The Explanation is as follows: "Explanation The expression 'home use ' means the consumption of such goods within India for any purpose and includes use of such goods in the place of production or manufacture or any other place or premises (whether by continuous process or not), for manufacture of any commodity.
Reliance has also been placed on rule 173G which provides for the procedure to be followed by an assessee who is a manufacturer of matches or cigarettes or cheroots.
The relevant portion of rule 173G is a proviso thereto which is as follows: "Provided that the duty due on the goods consumed within the factory in a continuous process may be so paid at the end of the factory day.
" From the above provisions of the Explanation to rule 173A and the proviso to rule 173G, the learned Judge has taken the view that a continuous or integrated process of manufacture has come to be contemplated by the scheme of the Act and the Rules framed thereunder for the first time only in May, 1968, the scheme having been brought into force with effect from June 1, 1968 and prior thereto such a continuous or integrated manufacturing process was never contemplated by the Act or the Rules.
learned Attorney General gets inspiration from the said unreported case of the Bombay High Court and submits that atleast since after May, 1968, rule 9 and rule 49 envisage the case of an integrated and continuous process of manufacture involving the use or utilisation of a commodity produced at an intermediate stage of such process for the manufacture of an end product or commodity.
It is submitted by him that if the interpretation as given by the learned 712 Single Judge of the Bombay High Court in the above unreported decision is accepted, in that case, it will not be necessary to consider the effect of amended rule 9 or rule 49, that is to say, the Explanations that have been added to these two rules.
It may be that the concept of continuous or integrated process of manufacture has been recognised in the Explanation to sub rule (2) of rule 173A and in the proviso to rule 173G but we do not think that rule 9 or rule 49 should be interpreted in the light of provisions of the Explanation to sub rule (2) of rule 173A or the proviso to rule 173G Moreover, we are not concerned with the interpretation of rule 9 and rule 49, as they stood before the amendment.
In the instant case, the appellants have challenged rule 9 and rule 49 as amended by the Notification dated February 20, 1982 We are, therefore, concerned with the interpretation of these rules as amended, particularly the question of validity of these rules.
Before we proceed to consider the contentions made on behalf of the parties, it may be stated that in view of the divergence of judicial opinions as to the interpretation of rules 9 and 49, before they were amended, the Explanations to rules 9 and 49 have been added so as to obviate any doubt.
The Explanations to rule 9 and rule 49, inter alia, provide that commodity obtained at an intermediate stage of manufacture in a continuous process shall be deemed to have been removed from such place or premises as mentioned in sub rule (1) of rule 9 This deeming provision has been given retrospective effect by virtue of section S l of the Finance Act 1982.
It is urged by Mr. Sorabjee, learned Counsel for the appellants, that the amended rule 9 and rule 49 are arbitrary and unreasonable inasmuch as the goods which, in fact, are not removed from the factory and which are incapable of removal because of the nature and construction of the plant or the nature and character of the manufacturing process, are fictionally treated as having been removed.
It is submitted that as a result of the amendment of these rules the appellants are exposed to excessive hardship for not complying with the statutory provisions In view of the length of the retrospective operation of the amendments, namely 38 years from the date of the commencement of the Act, that is, February 28, 1944 the appellants would be called upon to pay enormous amount of duty in respect of the entire quantity of goods which have come into existence and have been captively consumed within the factory premises.
The appellants will not, however, be able to pass on this burden to consumers and will have to bear 713 the same themselves It is submitted that in view of the arbitrariness and unreasonableness of the amendments and the hardships that will be caused to the appellants and other manufacturers of excisable goods, the amendments should be struck down as violative of the provisions of Article 14 and Article 19(1)(g) of the Constitution of India.
It is not disputed that the Legislature is competent to make laws both prospectively and retrospectively But, as pointed out by this Court in Jawaharmal vs State of Rajasthan and others, [ 19661 I S.C. R. 890, the cases may conceivably occur where the court may have to consider the question as to whether excessive retrospective operation prescribed by a taxing statute amounts to the contravention of the citizens ' fundamental rights; and in dealing with such a question the court may have to take into account all the relevant and surrounding facts and circumstances in relation to the taxation.
Again in Rai Ramkrishna & others vs State of Bihar, [ 1964] I S C.R 897 this Court has pointed out that if the retrospective feature of a law is arbitrary and burdensome, the statute will not be sustained and the reasonableness of each retrospective statute will depend on the circumstances of each case; and the test of the length of time covered by the retrospective operation cannot, by itself, necessarily be a decisive test.
The apprehension of the appellants is that the amendments to rules 9 and 49 having been made retrospective from the date the Rules were framed, that is from February 28, 1944, the appellants and others similarly situated may be called upon to pay enormous amounts of duty in respect of intermediate goods which have come into existence and again consumed in the integrated process of manufacture of another commodity There can be no doubt that if one has to pay duty with retrospective effect from 1944, it would really cause great hardship but, in our opinion, in view of section I IA of the Act, there is no cause for such apprehension.
Section I IA(I) of the Act provides as follows: "Section l1A. (1) When any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded, a Central Excise officer may, within six months from the relevant date, serve notice on the person chargeable with the duty which has not been levied or paid or which has been short levied or short paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice: 714 Provided that where any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, by such person or his agent, the provisions of this sub section shall have effect, as if for the words "six months", the words "five years ' were substituted.
Explanation.
Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of six months or five years, as the case may be " Under section 11A( I) the excise authorities cannot recover duties not levied or not paid or short levied or short paid or erroneously refunded beyond the period of six months, the proviso to section l IA not being applicable in the present case.
Thus although section 5 l of the Finance Act, 1982 has given retrospective effect to the amendments of rules 9 and 49, yet it must be subject to the provision of section 11A of the Act.
We are unable to accept the contention of the learned Attorney General that as section 5 1 has made the amendments retrospective in operation since February 28, 1944, it should be held that it overrides the provision of section 11A.
If the intention of the Legislature was to nullify the effect of section 11A, in that case, the Legislature would have specifically provided for the same Section 5 1 does not contain any non obstante clause nor does it refer to the provision of section 1 IA.
In the circumstances it is difficult to hold that section 5 l overrides the provision of section 1 IA.
It is, however, contended by the learned Attorney General that as the law was amended for the first time on February 20, 1982, the cause of action for the excise authorities to demand excise duty in terms of the amended provision, arose on that day, that is, on February 20, 1982 and, accordingly, the authorities are entitled to make such demand with retrospective effect beyond the period of six months.
But such demand, though it may include within it demand for more than six months, must be made within a period of six months from the date of the amendment.
There is no provision in the Act or in the Rules enabling the excise authorities to make any demand beyond the periods mentioned 715 in section 11A of the Act on the ground of the accrual of cause of action.
The question that is really involved is whether in view of section 5 1 of the Finance Act, 1982, section 11A should be ignored or not.
In our view section S I does not, in any manner, affect the provision of section 11A of the Act.
In the absence of any specific provision overriding section 1 IA, it will be consistent with rules of harmonious construction to hold that section 51 of the Finance Act, 1982 in so far as it gives retrospective effect to the amendments made to rules 9 and 49 of the rules, is subject to the provision of section 11A.
In the circumstances, there is no question of the amended provision of rule 9 and rule 49 being arbitrary, unreasonable or violative of the provision of Article 14 and Article 19(1)(g) of the Constitution of India.
We may now deal with the challenge made to the retrospective operation of amendments of rules 9 and 49 on another ground.
In order to appreciate the ground of such challenge, we may once more refer to section 51 of the Finance Act, 1982.
The Explanation to section 5 1 provides as follows: "Explanation.
For the removal of doubts, it is hereby declared that no act or omission on the part of any person shall be punishable as an offence which would not have been so punishable if this section had not come into force.
" Under the Explanation, although rules 9 and 49 have been given retrospective effect, an act or omission which was not punishable before the amendment of the Rules, will not be punishable after amendment.
The Explanation does not however, provide for the penalties and confiscation of goods.
It is the contention of the appellants that as the appellants had not complied with the requirements of the amended rules 9 and 49, they would be subjected to penalties and their goods would be confiscated under the amended rules 9 and 49 read with rule 173Q of the Rules with retrospective effect.
It is, accordingly, submitted on behalf of the appellants that the amendment of these two rules with retrospective effect is arbitrary and unreasonable and should be struck down as violative of Article 14 of the Constitution.
Attractive though the argument is, we regret we are unable to accept the same.
It is true that the Explanation to section 51 has not mentioned anything about the penalties and confiscation of goods but H 716 we do not think that in view of such non mention in the Explanation excluding imposition of penalties for acts or omissions before amendment.
such penalties can be imposed or goods can be confiscated by virtue of the amended provisions of rules 9 and 49.
It will be against all principles of legal jurisprudence to impose a penalty on a person or to confiscate his goods for an act or omission which was lawful at the time when such act was performed or omission made, but subsequently made unlawful by virtue of any provision of law.
The contention made on behalf of the apellants is founded on the assumption that under the Explanation to section 5 1, the penalties can be imposed and goods can be confiscated with retrospective effect.
In the circumstances, the challenge to the amendments of rules 9 and 49, founded on the provision of the Explanation to section 51 of the Finance Act, 1982, is without any substance and is rejected The appellants have also challenged the prospective operation of the Explanation to rules 9 and 49 introduced by amendments of the same.
It is strenuously uged by Mr. Sorabjee, learned Counsel for the appellants, that even after amendment there must be removal of the goods from one place to another for the purpose of collection of excise duty.
Our attention has been drawn on behalf of the appellants to clause (b) of sub section (4) of section 4 of the Act, which defines "place of removal" as follows: "Sub section (4) For the purpose of this section, (a). . . . . . . (b) "place of removal" means (i) a factory or any other place or premises of production or manufacture of the excisable goods; or (ii) a warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without payment of duty, from where such goods are removed.
It is submitted on behalf of the appellants that the Explanations to rule 9 and rule 49 are ultra vires the provision of clause (b) of sub section (4) of section 4 of the Act inasmuch as "place of removal" as defined therein, does not contemplate any deemed removal, but a 717 physical and actual removal of the goods from a factory or any other place or premises of production or manufacture or a warehouse etc.
A This contention is unsound and also does not follow from the definition of "place of removal .
Under the definition "place of removal" may be a factory or any other place or premises of production or manufacture of the excisable goods etc The Explanation to rules 9 and 49 do not contain any definition of "place of removal", but provide that excisable goods produced or manufactured in any place or premises at an intermediate stage and consumed or utilised for the manufacture of another commodity in a continuous process, shall be deemed to have been removed from such place or premises immediately before such consumption or utilization.
Clause (b) of sub section (4) of section 4 has defined "place of removal", but it has not defined 'removal '.
There can be no doubt that the word 'removal contemplated shifting of a thing from one place to another.
In other words, it contemplates physical movement of goods from one place to another It is well settled that a deeming provision is an admission of the non existence of the fact deemed.
Therefore, in view of the deeming provisions under Explanations to rules 9 and 49, although the goods which are produced or manufactured at an intermediate stage and, thereafter, consumed or utilised in the integrated process for the manufacture of another commodity is not actually removed, shall be construed and regarded as removed.
The Legislature is quite competent to enact a deeming provision for the purpose of assuming the existence of a fact which does not really exist.
It has been already noticed that the taxing event under section 3 of the Act is the production or manufacture of goods and not removal The Explanations to rules 9 and 49 contemplate the collection of duty levied on the production of a commodity at an intermediate stage of an integrated process of manufacture of another commodity by deeming such production or manufacture of the commodity at an intermediate stage to be removal from such place or premises of manufacture.
The deeming provisions are quite consistent with section 3 of the Act As observed by the Federal Court in Boddu 's case (supra) there is in theory nothing to prevent the central legislature from imposing a duty of excise on a commodity as soon as it comes into existence, no matter what happens to it after wards, whether it be sold, consumed or destroyed or given away.
It is for the convenience of the taxing authority that duty is collected at the time of removal of the commodity.
There is, therefore, nothing unreasonable in the deeming provision and, as discussed above, it is quite in conformity with the provision of section 3 of the Act The contention that the amendments to rules 9 and 49 are ultra vires clause H 718 (b) of sub section (4) of section 4 of the Act, is without substance and is overruled.
It is next contended on behalf of the appellants that even assuming that there can be fictional removal as provided in the Explanation to rules 9 and 49, there cannot be such fictional or deemed removal without the specification of the place where the excisable goods are produced, cured or manufactured or any premises appurtenant thereto.
Rule 9(1), inter alia provides that no excisable goods shall be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf until the excise duty leviable thereon has been paid.
The Explanations to rules 9 and 49 refer to the specification that has been made by the Collector under sub rule (1) of rule 9.
It is submitted on behalf of the appellants that as no specification has been made by the Collector of such place or premises appurtenant thereto, the provision of deemed removal with regard to the commodity produced at the intermediate stage and consumed or utilised in the continuous process of manufacture of the end product, is inapplicable.
It is contended that so long as such specification is not made by the Collector of the place of manufacture or of any premises appurenant thereto, the provision of deemed removal as contained in the Explanations to rule 9 and 49 cannot be given effect to.
On the other hand, it is contended by the learned Attorney General that specification of the place of manufacture and other places for the storage of the goods, is made in the licence which is required to be obtained under rule 174 of the Rules.
Rule ]78 provides for the form.
of licence.
Clause (b) of rule 178(1) provides that every licence granted or renewed under rule 176 shall have reference only to the premises, if any, described in such licence.
Form A L. IV is the form of an application for licence under rule 176.
In the Schedule to the Form, description of the premises intended to be used as a factory and of each main division or sub division of the factory has to be given.
Further, the detailed description of store room or other place of storage and the purpose of each has also to be given in the application form for the grant of licence for the manufacture of excisable goods.
Again under rule 44 of the Rules, the Collector may require any manufacturer to make a prior declaration of factory premises and its equipments.
Such a declaration has to be given in Form D 2 in respect of buildings, rooms, vessel, etc.
In view of the particulars which are required to be given by a licensee for the manufacture of excisable goods, it is submitted by the learned Attorney General that the specification that is 719 required to be made under rule 9(1), is made in the licence and in the declaration that has to be furnished by the manufacturer in Form D 2.
It is true that under rule 9(1) there is a provision for specification by the Collector, but the question is what has to be specified by the Collector.
It is the contention of the appellants that the Collector has to specify the place of manufacture and also any premises appurtenant thereto.
We are, however, unable to accept this contention.
The place where the goods are to be manufactured by a manufacturer, that is to say, the site of the factory cannot be specified by the Collector.
It is for the manufacturer to choose the site or the place where the factory will be constructed and goods will be manufactured.
Rule 9(1), in our opinion, does not require the Collector to specify the place where the excisable goods are produced, cured or manufactured.
The words "which may be specified by the Collector in this behalf" occurring in rule 9(1) of the Rules do not qualify the words "any place where they are produced, cured or manufactured ', but relate to or qualify the words "any premises appurtenant thereto".
In other words, if the place of removal is not the place where the goods are produced, cured or manufactured, but any premises appurtenant to such place, in that case, the Collector has to specify such premises for the purpose of collection of excise duty.
Thus the contention of the appellants that the Collector has to specify the place of manufacture and also any premises appurtenant thereto under rule 9(1) of the Rules, is without any substance.
Our attention has, however, been drawn to the impugned circular dated September 24, 1980 issued by the Central Board of Excise & Customs.
In clause 3 of the circular, it is stated as follows: "Mere approval of the ground plan in a routine manner will not suffice for purposes of rule 9 as under the said rule the place of production etc.
Or premises appurtenant thereto have also to the specified separately " Under the circular, the Collector is required to specify under rule 9(1) both the place of production and premises appurtenant thereto, if any.
In view of this direction given in the circular, the learned Counsel for the appellants submits that it is not only binding on the Collector and the other officers of the Central Excise Department, but also the circular is in the nature of contemporanea exposito rendering useful aid in the construction of the provision of rule 9(I) of the Rules.
This contention finds support from the decision of this Court in K.P. Var 720 ghese vs The Income Tax officer, Ernakulam, [1982] I S.C.R. 629 relied on by the learned Counsel of the appellants.
Indeed, it has been observed in that case that the rule of construction by reference to contemporanea exposito is a well established rule for interpreting a statute by reference to the exposition it has received from contemporary authority, though it must give way where the language of the 13 statute is plain and unambiguous.
In our opinion, the language of rule 9(1) admits of only one interpretation and that is that the specification that has to be made by the Collector is of any premises appurtenant to the place of manufacture or production of the excisable goods.
The specification is not required to be made and, in our view, cannot be made of the place of manufacture or production of the excisable goods.
Apart from that, as observed by Subba Rao, J., upon a review of all the decisions on the point, in an earlier decision of this Court in the Senior Electric Inspector and others vs Laxmi Narayan Chopra, ; , the maxim contemporanea exposito as laid down by Coke was applied to construing ancient statutes but not to interpreting Acts which are comparatively modern.
Further, it has been observed that in a modern progressive society it would be unreasonable to confine the intention of a Legislature to the meaning attributable to the word used at the time the law was made and, unless a contrary intention appears, an interpretation should be given to the words used to take in new facts and situations, if the words are capable of comprehending them.
Most respectfully we agree with the said observation of Subba Rao, J.
In the circumstances, we do not agree with the direction of the Board of Central Excise & Customs given in the impugned circular that both the place of manufacture and the premises appurtenant thereto must be specified by the Collector under rule 9 1(1) of the Rules.
Thus, there being no question of specification of the place of manufacture, the contention of the appellants that without such specification there cannot be any deemed removal, fails.
In view of the discussion made above, we hold that the amendments to rules 9 and 49 are quite legal and valid.
Further, section S 1 of this Finance Act, 1982 giving retrospective effect to the said amendments is also legal and valid.
In the instant case, the appellants are liable to pay excise duty on the yarn which is obtained at an intermediate stage and, thereafter, further processed in an integrated process for weaving the same into fabrics.
Although it has been alleged that the yarn is obtained at an intermediate stage of an integrated process of manufacture of fabrics, it appears to be not so.
After the yarn is produced it is sized and, 721 thereafter, subjected to a process of weaving the same into fabrics.
Be that as it may, as we have held that the commodity which is obtained at an intermediate stage of an integrated process of manufacture of another commodity, is liable to the payment of excise duty, the yarn that is produced by the appellants is also liable to payment of excise duty.
In our view, the High Court by the impugned judgment has rightly held that the appellants are not liable to pay any excise duty on the yarn after it is sized for the purpose of weaving the same into fabrics.
No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn.
For the reason aforesaid, the judgment of the High Court is affirmed and this appeal is dismissed.
There will.
however, be no order as to costs.
Civil Appeal Nos.
2658 and 4168 of 1983.
In view of the judgment passed in Civil Appeal No. 297 of 1983, these appeals are also dismissed.
There will, however, be no order as to costs.
S.L. Appeals dismissed.
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From the Judgment and order dated 11 1.1983 of the Delhi High Court in C.W No 1858 of 1981 Soli J. Sorabjee, A.N. Haksar, Ravinder Narain P.K. Ram. 703 D.N. Mishra and Appellant in person (in C.A. No. In order to manufacture the said fabrics, yarn is obtained at an intermediate stage. The yarn so obtained is further processed in an integrated process in the said composite mill of the appellant No. The appellants do not dispute that the different kinds of fabrics which are manufactured in the mill are liable to payment of excise duty on their removal from the factory. They also do not dispute their liability in respect of yarn which is also removed from the factory. It is the contention of the appellants that no duty of excise can be levied and collected in respect of yarn which is obtained at an intermediate stage and, thereafter, subjected to an integrated process for the manufacture of different fabrics. As the said circular was being implemented to the prejudice of the appellants, they filed a writ petition before the Delhi High Court, inter alia, challenging the validity of the circular. 20/82 C. dated 20.2.1982 amended rules 9 and 49 of the Rules. Section 51 of the Finance Act, 1982 provides that the amendments in rules 9 and 49 of the Rules shall be deemed to have, and to have always had the effect on and from the date on which the Rules came into force i.e. February 28, 1944. It has, however, been held that the retrospective effect given by section S I will be subject to the provisions of sections 11A and 11B of the (hereinafter referred to as 'the Act ') Further, it has been held that the yarn which is produced at an intermediate stage in the mill of the appellants and subjected to the integrated process of weaving the same into fabrics, will be liable to payment of excise duty in view of the amended provisions of rules 9 and 49 of the Rules. The writ petition was, accordingly, allowed in part. Hence this appeal by the appellants upon a certificate granted by the High Court. The relevant portion of rule 9 before the same was amended is as follows: "Rule 9. 20/82 C.B. dated 20.2.1982 of the Central Government, rule 9 was amended by the addition of the following A Explanation thereto: "Explanation. Rule 49 before its amendment was as follows: "Rule 49. Duty chargeable only on removal of goods from the factory premises or from an approved place of storage. ( For the purposes of this rule, excisable goods made in a factory and consumed or utilised (i) as such or after subjection to any process or processes; or (ii) for the manufacture of any other commodity, whether in a continuous process or otherwise, in such factory or place or premises specified under rule 9 or store 706 room or other place of storage approved by the Collector under rule 47, shall be deemed to have been issued out of, or removed from such factory, place, premises, store room or other place of storage, as the case may be, immediately before such consumption or utilisation. While section 3 lays down the taxable event, rules 9 and 49 provide for the collection of duty. There is a distinction between levy and collection of duty. It is the fact of manufacture which attracts the duty, even though it may be collected later. It is submitted by him that the commodity must be removed from one place to another either for the purpose of consumption in the factory or for sale outside it before excise duty an be claimed. We shall presently refer to these decisions. Further, it has been observed that there can be no removal of a product within the plant itself so long as the product is in the process of manufacture. According to this decision, if the product, which is obtained at an intermediate stage of an integrated and uninterrupted process of manufacture, there is no removal of such product. In that case calcium carbide manufactured in the factory in one plant was used to generate acetylene gas by the transfer of the article from one plant to another in the same factory. The question that came up for consideration of the High Court was whether there was removal of calcium carbide for the 708 purpose of levy and collection of excise duty. It was, accordingly, held that it could not, therefore, be said that calcium carbide made by the petitioner Company was removed from the factory in which it was produced. This decision lays down that so long as a commodity is not removed from the factory premises, there is no removal within the meaning of rules 9 and 49. We may notice another decision of the Delhi High Court in Devi Dayal Electronics and Wires Ltd. vs Union of India, [ In that case it has been held that since the impugned resins (polyester or phenolic resins) are not removed from the place of manufacture but are used for the manufacture of end product (Varnish) within the plant itself, there is no removal of goods within the meaning of rule 9 read with rule 49 of the Rules. Two views have been expressed by the Delhi High Court. According to this decision, a process of onward movement of a component for being converted into a final product is not covered by the concept of removal contemplated by the provision of rule 9 of the Rules. In Oudh Sugar Mills Ltd. vs Union of India, the Allahabad High Court has taken more or less the same view as that of the Bombay High Court. It has been observed that an intermediate product which by itself is goods known to the market and is used in captive consumption for bringing out altogether a new goods not by an integrated process, but by a distinct and separate process, is liable to excise duty before its removal. So far as captive consumption is concerned, the Gujarat High Court has taken the same view as that of the Allahabad High Court in Maneklal Harilal Spg. & Leaving aside the question of specification for the time being. Thus consumption of excisable goods may be within such place or outside such place. It is not easily understandable why the definition of expression 'factory ' under section 2(e) of the Act has been taken resort to in some of the decisions for the purpose of interpretation of rule 9. 491 of 1964, dated April, 711 30, 1970 (Nirlon Synthethic Fibres & Chemicals Ltd. vs Shri R.K. Audim, Assistant Collector & Ors.) In the instant case, the appellants have challenged rule 9 and rule 49 as amended by the Notification dated February 20, 1982 We are, therefore, concerned with the interpretation of these rules as amended, particularly the question of validity of these rules. There is no provision in the Act or in the Rules enabling the excise authorities to make any demand beyond the periods mentioned 715 in section 11A of the Act on the ground of the accrual of cause of action. In the absence of any specific provision overriding section 1 IA, it will be consistent with rules of harmonious construction to hold that section 51 of the Finance Act, 1982 in so far as it gives retrospective effect to the amendments made to rules 9 and 49 of the rules, is subject to the provision of section 11A.
In the circumstances, there is no question of the amended provision of rule 9 and rule 49 being arbitrary, unreasonable or violative of the provision of Article 14 and Article 19(1)(g) of the Constitution of India. We may now deal with the challenge made to the retrospective operation of amendments of rules 9 and 49 on another ground. The Explanation to section 5 1 provides as follows: "Explanation. " Under the Explanation, although rules 9 and 49 have been given retrospective effect, an act or omission which was not punishable before the amendment of the Rules, will not be punishable after amendment. The Explanation does not however, provide for the penalties and confiscation of goods. It is, accordingly, submitted on behalf of the appellants that the amendment of these two rules with retrospective effect is arbitrary and unreasonable and should be struck down as violative of Article 14 of the Constitution. Attractive though the argument is, we regret we are unable to accept the same. such penalties can be imposed or goods can be confiscated by virtue of the amended provisions of rules 9 and 49. The contention made on behalf of the apellants is founded on the assumption that under the Explanation to section 5 1, the penalties can be imposed and goods can be confiscated with retrospective effect. A This contention is unsound and also does not follow from the definition of "place of removal . In other words, it contemplates physical movement of goods from one place to another It is well settled that a deeming provision is an admission of the non existence of the fact deemed. Rule 9(1), inter alia provides that no excisable goods shall be removed from any place where they are produced, cured or manufactured or any premises appurtenant thereto, which may be specified by the Collector in this behalf until the excise duty leviable thereon has been paid. On the other hand, it is contended by the learned Attorney General that specification of the place of manufacture and other places for the storage of the goods, is made in the licence which is required to be obtained under rule 174 of the Rules. Clause (b) of rule 178(1) provides that every licence granted or renewed under rule 176 shall have reference only to the premises, if any, described in such licence. Form A L. IV is the form of an application for licence under rule 176. Such a declaration has to be given in Form D 2 in respect of buildings, rooms, vessel, etc. We are, however, unable to accept this contention. The place where the goods are to be manufactured by a manufacturer, that is to say, the site of the factory cannot be specified by the Collector. It is for the manufacturer to choose the site or the place where the factory will be constructed and goods will be manufactured. Thus the contention of the appellants that the Collector has to specify the place of manufacture and also any premises appurtenant thereto under rule 9(1) of the Rules, is without any substance. Our attention has, however, been drawn to the impugned circular dated September 24, 1980 issued by the Central Board of Excise & Customs. In clause 3 of the circular, it is stated as follows: "Mere approval of the ground plan in a routine manner will not suffice for purposes of rule 9 as under the said rule the place of production etc. In view of this direction given in the circular, the learned Counsel for the appellants submits that it is not only binding on the Collector and the other officers of the Central Excise Department, but also the circular is in the nature of contemporanea exposito rendering useful aid in the construction of the provision of rule 9(I) of the Rules. In our opinion, the language of rule 9(1) admits of only one interpretation and that is that the specification that has to be made by the Collector is of any premises appurtenant to the place of manufacture or production of the excisable goods. The specification is not required to be made and, in our view, cannot be made of the place of manufacture or production of the excisable goods. In view of the discussion made above, we hold that the amendments to rules 9 and 49 are quite legal and valid. Although it has been alleged that the yarn is obtained at an intermediate stage of an integrated process of manufacture of fabrics, it appears to be not so. After the yarn is produced it is sized and, 721 thereafter, subjected to a process of weaving the same into fabrics. No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn. For the reason aforesaid, the judgment of the High Court is affirmed and this appeal is dismissed. In view of the judgment passed in Civil Appeal No. 297 of 1983, these appeals are also dismissed. There will, however, be no order as to costs.
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% The appellant No. 1, J.K. Cotton Spinning and Weaving Mills Limited, has a composite mill wherein it manufactures fabrics of different types, for which yarn is obtained at an intermediate stage, and the yarn is processed in an integrated process in the said composite mill for weaving the same into fabrics.
The Central Board of Excise issued a Circular dated September 24, 1980, purporting to interpret the rules 9 and 49 of the Central Excise Rules, 1944 (the Rules) and directing the subordinate excise authorities to levy and collect excise duty in accordance therewith.
The Board further directed vide the said Circular that the use of the goods in the manufacture of another commodity even within the place premises specified in this behalf by the Central Excise officers in terms of the powers conferred under rule 9 of the Rules, would attract duty.
As the implementation of the Circular worked to the prejudice of the appellants, they filed a writ petition in the High Court, challenging the validity of the Circular.
During the pendency of the said writ petition, the Central Government issued a Notification dated February 20, 1982, amending the rules 9 and 49 of the Rules, with section 51 of the Finance Act, 1982, providing that the amendments in the rules 9 and 49 shall be deemed to have, and to have always had, the effect with retrospective effect from the date on which the Rules came into force i.e. February 28, 1944.
Upon the amendments of the rules 9 and 49, with retrospective effect of the amendments, the appellants amended their writ petition above said to challenge the constitutional validity of Section 51 of the Finance Act abovementioned and the amendments to the rules 9 and 49.
701 The High Court allowed the writ petition in part.
It held (i) that section 51 and the rules 9 and 49 as amended were valid, (ii) the retrospective effect allowed by section 51 would be subject to the provisions of sections 11A and 11B of the (the Act), (iii) the yarn produced at an intermediate stage in the mill of the appellants and subjected to the integrated process of weaving into fabrics, would be liable to payment of excise duty in view of the amended provisions of the rules 9 and 49, but the sized yarn actually put into the integrated process would not again attract excise duty.
The appellants then filed this appeal (Civil Appeal No. 297 of 1983) before this Court by certificate.
Dismissing the Appeal, the Court, ^ HELD: The decisions of various High Courts cited, deal with the rules 9 and 49 of the Central Excise Rules, 1944, as they stood before they were amended by the Government Notification dated February 20, 1982.
In this case, what is involved is the interpretation of the said two rules after their amendment and the constitutional validity of the rules as amended.
The amendments to the rules 9 and 49 are quite legal and valid.
Section 51 of the Finance Act, 1982, giving retrospective effect to the said amendments is also legal and valid.
The apprehension of the appellants that the amendments to rules 9 and 49 having been made retrospective from the date the rules were framed, that is, February 28, 1944, the appellants may be called upon to pay enormous amounts of duty in respect of the intermediate goods which have come into existence and again consumed in the integrated process of manufacture of another commodity, is not right.
In view of section 11A of the Finance Act, there is no cause for such an apprehension.
Under Section 11A(1), the excise authorities cannot recover duties not levied or not paid or short levied or short paid or erroneously refunded beyond the period of six months, the proviso to section 11A not being applicable in the present case.
Thus though section 51 has given retrospective effect to the amendments of rules 9 and 49, it must be subject to the provision of section 11A of the Act.
Section 51 does not contain any non obstante clause, nor does it refer to the provision of section 11A, and it is difficult to hold that section 51 overrides the provision of section 11A. [712F H; 714D F] The appellants are liable to pay excise duty on the yarn obtained at an intermediate stage and, thereafter, further processed in an integrated process for weaving the same into fabrics.
Although it has been alleged that the yarn is obtained at an intermediate stage of an 702 integrated process of manufacture of fabrics, it appears to be not so.
After the yarn is produced, it is sized, and thereafter, subjected to a process of weaving the same into fabrics.
As the Court has held that the commodity which is obtained at an intermediate stage of an integrated process of manufacture of another commodity, is liable to the payment of excise duty, the yarn that is produced by the appellants is also liable to payment of excise duty.
[720G H: 721A B] The High Court has rightly held that the appellants are not liable to pay excise duty on the yarn after it is sized for the purpose of weaving the same into fabrics.
No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn.
The judgment of the High Court affirmed.
[721B C] In view of the decision of the Court in the Civil Appeal No. 297 of 1983, the Civil Appeals Nos. 2658 and 4168 of 1983 also dismissed.
[721D] The Province of Madras vs Boddu Paidanna and Sons AIR ; Caltex oil Refining (India) Ltd. vs Union of India & Ors. , Delhi Cloth and General Mills Co. Ltd. vs Joint Secretary, Government of India, ; Modi Carpets Ltd. vs Union of India, ; Synthetics and Chemicals Ltd. Bombay vs Government of India, , Devi Dayal Electronics and Wires Ltd. vs Union of India, [1982] E.L.T. 33; Oudh Sugar Mills Ltd. vs Union of India, [1980] E.L.T. 327, Oudh Sugar Mills Ltd. vs Union of India, [1982] E.L.T. 927, Maneklal Harilal Spg. & Mfg. Co. Ltd. vs Union of India, ; Nirlon Synthetic Fibres & Chemicals Ltd. vs Shri R.K. Audim; Assistant Collector & Ors.
In Misc.
491 of 1964, unreported judgment of Bombay High Court, dated April 30, 1970, Jawaharmal vs State of Rajasthan & Ors., ; ; Rai Ramkrishna and Ors.
vs State of Bihar, ; , K.P. Verghese vs The Income Tax officer, Ernakulam; , and Senior Electric Inspector and Ors.
vs Laxmi Narayan Chopra, ; , referred to.
|
1, J.K. Cotton Spinning and Weaving Mills Limited, has a composite mill wherein it manufactures fabrics of different types, for which yarn is obtained at an intermediate stage, and the yarn is processed in an integrated process in the said composite mill for weaving the same into fabrics. During the pendency of the said writ petition, the Central Government issued a Notification dated February 20, 1982, amending the rules 9 and 49 of the Rules, with section 51 of the Finance Act, 1982, providing that the amendments in the rules 9 and 49 shall be deemed to have, and to have always had, the effect with retrospective effect from the date on which the Rules came into force i.e. February 28, 1944. Upon the amendments of the rules 9 and 49, with retrospective effect of the amendments, the appellants amended their writ petition above said to challenge the constitutional validity of Section 51 of the Finance Act abovementioned and the amendments to the rules 9 and 49. 701 The High Court allowed the writ petition in part. The appellants then filed this appeal (Civil Appeal No. 297 of 1983) before this Court by certificate. In this case, what is involved is the interpretation of the said two rules after their amendment and the constitutional validity of the rules as amended. The amendments to the rules 9 and 49 are quite legal and valid. In view of section 11A of the Finance Act, there is no cause for such an apprehension. Thus though section 51 has given retrospective effect to the amendments of rules 9 and 49, it must be subject to the provision of section 11A of the Act. Section 51 does not contain any non obstante clause, nor does it refer to the provision of section 11A, and it is difficult to hold that section 51 overrides the provision of section 11A. [712F H; 714D F] The appellants are liable to pay excise duty on the yarn obtained at an intermediate stage and, thereafter, further processed in an integrated process for weaving the same into fabrics. Although it has been alleged that the yarn is obtained at an intermediate stage of an 702 integrated process of manufacture of fabrics, it appears to be not so. After the yarn is produced, it is sized, and thereafter, subjected to a process of weaving the same into fabrics. No distinction can be made between unsized yarn and sized yarn, for the unsized yarn when converted into sized yarn does not lose its character as yarn. [721B C] In view of the decision of the Court in the Civil Appeal No. [721D] The Province of Madras vs Boddu Paidanna and Sons AIR ; Caltex oil Refining (India) Ltd. vs Union of India & Ors. , Delhi Cloth and General Mills Co. Ltd. vs Joint Secretary, Government of India, ; Modi Carpets Ltd. vs Union of India, ; Synthetics and Chemicals Ltd. Bombay vs Government of India, , Devi Dayal Electronics and Wires Ltd. vs Union of India, [1982] E.L.T. 33; Oudh Sugar Mills Ltd. vs Union of India, [1980] E.L.T. 327, Oudh Sugar Mills Ltd. vs Union of India, [1982] E.L.T. 927, Maneklal Harilal Spg. & Co. Ltd. vs Union of India, ; Nirlon Synthetic Fibres & Chemicals Ltd. vs Shri R.K. Audim; Assistant Collector & Ors. 491 of 1964, unreported judgment of Bombay High Court, dated April 30, 1970, Jawaharmal vs State of Rajasthan & Ors., ; ; vs Laxmi Narayan Chopra, ; , referred to.
| 0.05401
| 0.411209
| 0.396415
| 0.688915
|
Civil Appeal No. 2456 of 1987.
From the Order dated 27.5.1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. E 2312/85 C. K.K. Venugopal, R. Narain, section Ganesh, R. Shah, R.K. Ram and D.N. Mishra for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
In this appeal under section 35L of the Central Excise and Salt Act, 1944 (hereinafter called 'the Act '), the question involved is whether "Decoplast" manufactured by the Asian Paints India Ltd., the appellant herein, is plastic emulsion paint 341 and, therefore, classifiable under Tariff Item 14(I)(3)(iv) of the First Schedule of the Act as plastic emulsion paint or it should be classifiable under Tariff Item No. 14(I)(v) that is as "paints not otherwise specified".
The Customs Excise and Gold (Control) Appellate Tribunal (hereinafter called 'the CEGAT '), by the impugned order challenged in this appeal held that Decoplast is plastic emulsion paint.
The appellant felt aggrieved thereby.
In so holding the Technical Member of the Tribunal observed that in view of its composition, characteristics and uses, Decoplast should be considered as emulsion paint.
The Judicial Member of the Tribunal was of the view that the Revenue had not adduced any evidence of rebuttal of the evidence adduced by the appellant as the commercial understanding but the evidence adduced by the appellant was intrinsically untrustworthy.
Therefore, inspite of the affidavits and absence of evidence in rebuttal, he agreed with the other member that Decoplast is plastic emulsion paint and the appeal before the Tribunal should be dismissed.
It appears that the appellants had filed revision application before the Government of India against the order of the Revenue authorities.
Ultimately, the same was rejected by the Government of India.
It is not necessary to set out in detail all the events.
The appellant had moved the High Court of Bombay against the order of the Government of India and the High Court by its order directed as follows: "The order dated 17th December, 1979 passed by the Govt.
Of India in revision in the Petitioners ' case is set aside inasmuch as the Revision Authorities have not controverted or rebutted the evidence in the form of affidavits relied on by the Petitioners to show that their product could not be regarded as a plastic emulsion paint amongst persons dealing in such products.
The Revision order thus failed to follow the well established rule of interpreting entries in the Excise Tariff namely to classify products by their common parlance and trade understanding and not by their scientific or technical meaning.
It is necessary that the matter be remanded to the Revision Authorities to decide the same afresh according to law.
However, as the Revision Authority under the demanded Central Excise and Salt Act has been replaced by the Customs Excise and Gold (Control) Appellate Tribunal, the said Tribunal is directed to 342 hear the Petitioners ' Revision Petition and to determine the same as an appeal before it.
The Tribunal shall give an opportunity to both the petitioners and the Excise Authorities to rely on any evidence and material either on record or otherwise which they may lead or produce in support of their case.
The parties will be given full opportunity of affidavits if any during the hearing".
In pursuance to the said order, the matter came before the Tribunal.
Before the Tribunal it was contended on behalf of the appellant that the manufacture was water thinable paint but the same could not be held to be plastic emulsion paint for the product was not known in the trade as plastic emulsion paint nor was it bought and sold so.
According to the appellant, the paint essentially comprised of pigment and a binder or a vehicle and that while the binder and the vehicle were interchangeable, it was stated that the binder generally referred to solid part which in this case was synthetic resin and the solvent could be water or some other diluent.
There was elaborate evidence adduced before the Tribunal on behalf of the appellant.
Reference was made to the specifications of plastic emulsion paint as given by ISI.
It was contended on behalf of the appellant that Decoplast could not be considered as plastic emulsion paint for reasons, inter alia, as follow: i) Plastic emulsion paint comprises of one emulsion as against two contained in Decoplast; ii) In the case of plastic emulsion drying takes place by evap oration of water whereas in the case of decoplast by oxidation of alkyd; iii) Trade did not recognise decoplast as plastic emulsion paint; iv) In the literature published by them, decoplast was not described as plastic emulsion paint; v) Decoplast was substitute for cement paint; vi) Even though decoplast could be used both for interior and exterior use, it was a product inferior to plastic emulsion paint; vii) In case of plastic emulsion paint, primer had to be applied to The surface to be pained while in the case of Decoplast on 343 coating on Decoplast itself serves as a primer.
A In support of appellant 's contention, affidavits had been filed by them and the same were considered in extenso by the Tribunal.
Reference has also been made to the Book "Outlines of Paint Technology" by W.M. Morgan.
On the other hand, on behalf of the Revenue, it was stated that it was not disputed that Decoplast is a water soluble paint and that it had got two resins in emulsion form, namely, Polymer Vinyle Acetate and copolymer alkyds.
Attention was drawn to the Indian Standard Specification for plastic emulsion paint, which is as follow: "The material shall consist of pigments with suitable extenders in suitable proportions, in a medium consisting of any state synthetic polymer emulsion in water with other suitable ingredients as may be necessary to produce a material so also satisfy the requirements of this standard.
" Our attention was also drawn to the definition given by ISI, which is as under: "Generally, a paint in which the medium is an 'emulsion ' or an emulsion like dispersion of an organic binder in water.
Industrially the same is mainly restricted to those paints in which the medium is an 'emulsion ' of a synthetic resin.
The medium may also be called a latex by analogy with a natural rubber latex, polyvinyl acetat emulsion paint is a typical example".
The Tribunal addressed itself to the question whether Decoplast could be considered as plastic emulsion paint in view of (i) its composition; (ii) its characteristics; (iii) its uses; and (iv) its reputation in trade parlance.
It is well settled that the commercial meaning has to be given to the expressions in Tariff items.
Where definition of a word has not been given, it must be construed in its popular sense.
Popular sense means that sense which people conversant with the subject matter with which the Statute is dealing, would attribute to it.
See C.I.T., Andhra Pradesh vs M/s. Taj Mahal Hotel, Secunderabad, This Court observed in Indo International Industries vs Commissioner of Sales Tax, U.P., ; that in interpreting items in statutes like the Excise Act or Sales Tax Acts, whose primary object 344 was to raise revenue and for which purpose to classify diverse products, articles and substances, resort should be had, not to the scientific and technical meaning of the terms or expressions used but to their popular meaning, that is to say, the meaning attached to them by those dealing in them.
Justice Cameron of the Canadian Exchequer Court in King vs Planter 's Co., [1951] CLR (exhibit) 122 and the decision of the United States Supreme Court in 'Two Hundred Chests of Tea '; , emphasised that commercial understanding in respect of the tariff items should be preferred.
It was observed that the legislature does not suppose our merchants to be naturalists or geologists, or botanists.
In this case the use of these two items and their composition when analysed, revealed that in essence they performed the same functions as plastic emulsion paint does, though there was some difference in them.
Affidavits of traders and others had been filed.
These were examined and accepted by the Technical Member and these were not rejected by the Judicial Member.
The Revenue did not adduce any evidence in rebuttal.
Therefore, in view of the composition, characteristics, user and how it is known in the trade, the Tribunal came to the conclusion that Decoplast was plastic emulsion paint.
This is a finding of fact arrived at on relevant and valid materials.
There was no misdirection in law.
Therefore, there is no ground for interference with the said order.
In the aforesaid view of the matter, we decline to entertain the appeal under section 35L of the Act.
The appeal is, therefore, dismissed.
G.N. Appeal dismissed.
|
% The question as to whether "Decoplast" manufactured by the appellant is plastic emulsion paint or not had been determined in the affirmative by the Revenue, and revision application before the Government of India was rejected.
Thereafter the appellant moved the Bombay High Court, which directed the Customs Excise and Gold (Control) Appellate Tribunal to hear the petition and to decide the same as an appeal before it.
On behalf of the appellant, elaborate evidence had been adduced before the Tribunal.
Reference was made to the specifications of plastic emulsion paint and the definition as given by ISI.
The Tribunal addressed itself to the question whether "Decoplast" could be considered as plastic emulsion paint having regard to (i) its composition; (ii) its characteristics; (iii) its uses and (iv) its reputation in trade parlance, and held that "Decoplast" is a plastic emulsion paint.
Aggrieved by the order the appellant appealed under Section 35L of the Central Excise and Salt Act, 1944 to this Court, which.
Dismissing the appeal, ^ HELD: 1.1 The commercial meaning has to be given to the expressions in Tariff items.
Where definition of a word has not been given, it 340 must be construed in its popular sense.
Popular sense means that sense which people conversant with the subject matter with which the statute is dealing, would attribute to it.
[343G] 1.2 In the instant case the use of these two items and their composition, when analysed, revealed that in essence they performed the same functions as plastic emulsion paint does, though there was some difference in them.
The affidavits of traders and others were examined by the Tribunal.
The Revenue did not adduce evidence in rebuttal.
Therefore, in view of the composition, characteristics, uses and how it is known in the trade, the Tribunal came to the conclusion that "Decoplast" was plastic emulsion paint.
This is a finding of fact arrived at on relevant and valid materials.
There was no misdirection in law.
[344C E] 2.
In interpreting items in statutes like the Excise Act or Sales Tax Act, resort should be had, not to the scientific and technical meaning of the terms or expressions used, but to the popular meaning, that is to say, the meaning attached to them by those dealing in them.
[343H; 344A B] C.l. T., Andhra Pradesh vs M/s. Taj Mahal Hotel, Secunderabad and Indo International Industries vs Commissioner of Sales Tax, U.P., ; ,referred to.
King vs Planter 's Co. [1951] CLR (exhibit) 122 and 'Two Hundred Chests of Tea ', [1824]6 L.Ed. 128, referred to.
|
Civil Appeal No. 2456 of 1987.
From the Order dated 27.5.1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. E 2312/85 C. K.K. Venugopal, R. Narain, section Ganesh, R. Shah, R.K. Ram and D.N. Mishra for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
In this appeal under section 35L of the Central Excise and Salt Act, 1944 (hereinafter called 'the Act '), the question involved is whether "Decoplast" manufactured by the Asian Paints India Ltd., the appellant herein, is plastic emulsion paint 341 and, therefore, classifiable under Tariff Item 14(I)(3)(iv) of the First Schedule of the Act as plastic emulsion paint or it should be classifiable under Tariff Item No. 14(I)(v) that is as "paints not otherwise specified".
The Customs Excise and Gold (Control) Appellate Tribunal (hereinafter called 'the CEGAT '), by the impugned order challenged in this appeal held that Decoplast is plastic emulsion paint.
The appellant felt aggrieved thereby.
In so holding the Technical Member of the Tribunal observed that in view of its composition, characteristics and uses, Decoplast should be considered as emulsion paint.
The Judicial Member of the Tribunal was of the view that the Revenue had not adduced any evidence of rebuttal of the evidence adduced by the appellant as the commercial understanding but the evidence adduced by the appellant was intrinsically untrustworthy.
Therefore, inspite of the affidavits and absence of evidence in rebuttal, he agreed with the other member that Decoplast is plastic emulsion paint and the appeal before the Tribunal should be dismissed.
It appears that the appellants had filed revision application before the Government of India against the order of the Revenue authorities.
Ultimately, the same was rejected by the Government of India.
It is not necessary to set out in detail all the events.
The appellant had moved the High Court of Bombay against the order of the Government of India and the High Court by its order directed as follows: "The order dated 17th December, 1979 passed by the Govt.
Of India in revision in the Petitioners ' case is set aside inasmuch as the Revision Authorities have not controverted or rebutted the evidence in the form of affidavits relied on by the Petitioners to show that their product could not be regarded as a plastic emulsion paint amongst persons dealing in such products.
The Revision order thus failed to follow the well established rule of interpreting entries in the Excise Tariff namely to classify products by their common parlance and trade understanding and not by their scientific or technical meaning.
It is necessary that the matter be remanded to the Revision Authorities to decide the same afresh according to law.
However, as the Revision Authority under the demanded Central Excise and Salt Act has been replaced by the Customs Excise and Gold (Control) Appellate Tribunal, the said Tribunal is directed to 342 hear the Petitioners ' Revision Petition and to determine the same as an appeal before it.
The Tribunal shall give an opportunity to both the petitioners and the Excise Authorities to rely on any evidence and material either on record or otherwise which they may lead or produce in support of their case.
The parties will be given full opportunity of affidavits if any during the hearing".
In pursuance to the said order, the matter came before the Tribunal.
Before the Tribunal it was contended on behalf of the appellant that the manufacture was water thinable paint but the same could not be held to be plastic emulsion paint for the product was not known in the trade as plastic emulsion paint nor was it bought and sold so.
According to the appellant, the paint essentially comprised of pigment and a binder or a vehicle and that while the binder and the vehicle were interchangeable, it was stated that the binder generally referred to solid part which in this case was synthetic resin and the solvent could be water or some other diluent.
There was elaborate evidence adduced before the Tribunal on behalf of the appellant.
Reference was made to the specifications of plastic emulsion paint as given by ISI.
It was contended on behalf of the appellant that Decoplast could not be considered as plastic emulsion paint for reasons, inter alia, as follow: i) Plastic emulsion paint comprises of one emulsion as against two contained in Decoplast; ii) In the case of plastic emulsion drying takes place by evap oration of water whereas in the case of decoplast by oxidation of alkyd; iii) Trade did not recognise decoplast as plastic emulsion paint; iv) In the literature published by them, decoplast was not described as plastic emulsion paint; v) Decoplast was substitute for cement paint; vi) Even though decoplast could be used both for interior and exterior use, it was a product inferior to plastic emulsion paint; vii) In case of plastic emulsion paint, primer had to be applied to The surface to be pained while in the case of Decoplast on 343 coating on Decoplast itself serves as a primer.
A In support of appellant 's contention, affidavits had been filed by them and the same were considered in extenso by the Tribunal.
Reference has also been made to the Book "Outlines of Paint Technology" by W.M. Morgan.
On the other hand, on behalf of the Revenue, it was stated that it was not disputed that Decoplast is a water soluble paint and that it had got two resins in emulsion form, namely, Polymer Vinyle Acetate and copolymer alkyds.
Attention was drawn to the Indian Standard Specification for plastic emulsion paint, which is as follow: "The material shall consist of pigments with suitable extenders in suitable proportions, in a medium consisting of any state synthetic polymer emulsion in water with other suitable ingredients as may be necessary to produce a material so also satisfy the requirements of this standard.
" Our attention was also drawn to the definition given by ISI, which is as under: "Generally, a paint in which the medium is an 'emulsion ' or an emulsion like dispersion of an organic binder in water.
Industrially the same is mainly restricted to those paints in which the medium is an 'emulsion ' of a synthetic resin.
The medium may also be called a latex by analogy with a natural rubber latex, polyvinyl acetat emulsion paint is a typical example".
The Tribunal addressed itself to the question whether Decoplast could be considered as plastic emulsion paint in view of (i) its composition; (ii) its characteristics; (iii) its uses; and (iv) its reputation in trade parlance.
It is well settled that the commercial meaning has to be given to the expressions in Tariff items.
Where definition of a word has not been given, it must be construed in its popular sense.
Popular sense means that sense which people conversant with the subject matter with which the Statute is dealing, would attribute to it.
See C.I.T., Andhra Pradesh vs M/s. Taj Mahal Hotel, Secunderabad, This Court observed in Indo International Industries vs Commissioner of Sales Tax, U.P., ; that in interpreting items in statutes like the Excise Act or Sales Tax Acts, whose primary object 344 was to raise revenue and for which purpose to classify diverse products, articles and substances, resort should be had, not to the scientific and technical meaning of the terms or expressions used but to their popular meaning, that is to say, the meaning attached to them by those dealing in them.
Justice Cameron of the Canadian Exchequer Court in King vs Planter 's Co., [1951] CLR (exhibit) 122 and the decision of the United States Supreme Court in 'Two Hundred Chests of Tea '; , emphasised that commercial understanding in respect of the tariff items should be preferred.
It was observed that the legislature does not suppose our merchants to be naturalists or geologists, or botanists.
In this case the use of these two items and their composition when analysed, revealed that in essence they performed the same functions as plastic emulsion paint does, though there was some difference in them.
Affidavits of traders and others had been filed.
These were examined and accepted by the Technical Member and these were not rejected by the Judicial Member.
The Revenue did not adduce any evidence in rebuttal.
Therefore, in view of the composition, characteristics, user and how it is known in the trade, the Tribunal came to the conclusion that Decoplast was plastic emulsion paint.
This is a finding of fact arrived at on relevant and valid materials.
There was no misdirection in law.
Therefore, there is no ground for interference with the said order.
In the aforesaid view of the matter, we decline to entertain the appeal under section 35L of the Act.
The appeal is, therefore, dismissed.
G.N. Appeal dismissed.
|
Civil Appeal No. 2456 of 1987.
From the Order dated 27.5.1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. E 2312/85 C. K.K. Venugopal, R. Narain, section Ganesh, R. Shah, R.K. Ram and D.N. Mishra for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
In this appeal under section 35L of the Central Excise and Salt Act, 1944 (hereinafter called 'the Act '), the question involved is whether "Decoplast" manufactured by the Asian Paints India Ltd., the appellant herein, is plastic emulsion paint 341 and, therefore, classifiable under Tariff Item 14(I)(3)(iv) of the First Schedule of the Act as plastic emulsion paint or it should be classifiable under Tariff Item No. 14(I)(v) that is as "paints not otherwise specified".
The Customs Excise and Gold (Control) Appellate Tribunal (hereinafter called 'the CEGAT '), by the impugned order challenged in this appeal held that Decoplast is plastic emulsion paint.
The appellant felt aggrieved thereby.
In so holding the Technical Member of the Tribunal observed that in view of its composition, characteristics and uses, Decoplast should be considered as emulsion paint.
The Judicial Member of the Tribunal was of the view that the Revenue had not adduced any evidence of rebuttal of the evidence adduced by the appellant as the commercial understanding but the evidence adduced by the appellant was intrinsically untrustworthy.
Therefore, inspite of the affidavits and absence of evidence in rebuttal, he agreed with the other member that Decoplast is plastic emulsion paint and the appeal before the Tribunal should be dismissed.
It appears that the appellants had filed revision application before the Government of India against the order of the Revenue authorities.
Ultimately, the same was rejected by the Government of India.
It is not necessary to set out in detail all the events.
The appellant had moved the High Court of Bombay against the order of the Government of India and the High Court by its order directed as follows: "The order dated 17th December, 1979 passed by the Govt.
Of India in revision in the Petitioners ' case is set aside inasmuch as the Revision Authorities have not controverted or rebutted the evidence in the form of affidavits relied on by the Petitioners to show that their product could not be regarded as a plastic emulsion paint amongst persons dealing in such products.
The Revision order thus failed to follow the well established rule of interpreting entries in the Excise Tariff namely to classify products by their common parlance and trade understanding and not by their scientific or technical meaning.
It is necessary that the matter be remanded to the Revision Authorities to decide the same afresh according to law.
However, as the Revision Authority under the demanded Central Excise and Salt Act has been replaced by the Customs Excise and Gold (Control) Appellate Tribunal, the said Tribunal is directed to 342 hear the Petitioners ' Revision Petition and to determine the same as an appeal before it.
The Tribunal shall give an opportunity to both the petitioners and the Excise Authorities to rely on any evidence and material either on record or otherwise which they may lead or produce in support of their case.
The parties will be given full opportunity of affidavits if any during the hearing".
In pursuance to the said order, the matter came before the Tribunal.
Before the Tribunal it was contended on behalf of the appellant that the manufacture was water thinable paint but the same could not be held to be plastic emulsion paint for the product was not known in the trade as plastic emulsion paint nor was it bought and sold so.
According to the appellant, the paint essentially comprised of pigment and a binder or a vehicle and that while the binder and the vehicle were interchangeable, it was stated that the binder generally referred to solid part which in this case was synthetic resin and the solvent could be water or some other diluent.
There was elaborate evidence adduced before the Tribunal on behalf of the appellant.
Reference was made to the specifications of plastic emulsion paint as given by ISI.
It was contended on behalf of the appellant that Decoplast could not be considered as plastic emulsion paint for reasons, inter alia, as follow: i) Plastic emulsion paint comprises of one emulsion as against two contained in Decoplast; ii) In the case of plastic emulsion drying takes place by evap oration of water whereas in the case of decoplast by oxidation of alkyd; iii) Trade did not recognise decoplast as plastic emulsion paint; iv) In the literature published by them, decoplast was not described as plastic emulsion paint; v) Decoplast was substitute for cement paint; vi) Even though decoplast could be used both for interior and exterior use, it was a product inferior to plastic emulsion paint; vii) In case of plastic emulsion paint, primer had to be applied to The surface to be pained while in the case of Decoplast on 343 coating on Decoplast itself serves as a primer.
A In support of appellant 's contention, affidavits had been filed by them and the same were considered in extenso by the Tribunal.
Reference has also been made to the Book "Outlines of Paint Technology" by W.M. Morgan.
On the other hand, on behalf of the Revenue, it was stated that it was not disputed that Decoplast is a water soluble paint and that it had got two resins in emulsion form, namely, Polymer Vinyle Acetate and copolymer alkyds.
Attention was drawn to the Indian Standard Specification for plastic emulsion paint, which is as follow: "The material shall consist of pigments with suitable extenders in suitable proportions, in a medium consisting of any state synthetic polymer emulsion in water with other suitable ingredients as may be necessary to produce a material so also satisfy the requirements of this standard.
" Our attention was also drawn to the definition given by ISI, which is as under: "Generally, a paint in which the medium is an 'emulsion ' or an emulsion like dispersion of an organic binder in water.
Industrially the same is mainly restricted to those paints in which the medium is an 'emulsion ' of a synthetic resin.
The medium may also be called a latex by analogy with a natural rubber latex, polyvinyl acetat emulsion paint is a typical example".
The Tribunal addressed itself to the question whether Decoplast could be considered as plastic emulsion paint in view of (i) its composition; (ii) its characteristics; (iii) its uses; and (iv) its reputation in trade parlance.
It is well settled that the commercial meaning has to be given to the expressions in Tariff items.
Where definition of a word has not been given, it must be construed in its popular sense.
Popular sense means that sense which people conversant with the subject matter with which the Statute is dealing, would attribute to it.
See C.I.T., Andhra Pradesh vs M/s. Taj Mahal Hotel, Secunderabad, This Court observed in Indo International Industries vs Commissioner of Sales Tax, U.P., ; that in interpreting items in statutes like the Excise Act or Sales Tax Acts, whose primary object 344 was to raise revenue and for which purpose to classify diverse products, articles and substances, resort should be had, not to the scientific and technical meaning of the terms or expressions used but to their popular meaning, that is to say, the meaning attached to them by those dealing in them.
Justice Cameron of the Canadian Exchequer Court in King vs Planter 's Co., [1951] CLR (exhibit) 122 and the decision of the United States Supreme Court in 'Two Hundred Chests of Tea '; , emphasised that commercial understanding in respect of the tariff items should be preferred.
It was observed that the legislature does not suppose our merchants to be naturalists or geologists, or botanists.
In this case the use of these two items and their composition when analysed, revealed that in essence they performed the same functions as plastic emulsion paint does, though there was some difference in them.
Affidavits of traders and others had been filed.
These were examined and accepted by the Technical Member and these were not rejected by the Judicial Member.
The Revenue did not adduce any evidence in rebuttal.
Therefore, in view of the composition, characteristics, user and how it is known in the trade, the Tribunal came to the conclusion that Decoplast was plastic emulsion paint.
This is a finding of fact arrived at on relevant and valid materials.
There was no misdirection in law.
Therefore, there is no ground for interference with the said order.
In the aforesaid view of the matter, we decline to entertain the appeal under section 35L of the Act.
The appeal is, therefore, dismissed.
G.N. Appeal dismissed.
|
% The question as to whether "Decoplast" manufactured by the appellant is plastic emulsion paint or not had been determined in the affirmative by the Revenue, and revision application before the Government of India was rejected.
Thereafter the appellant moved the Bombay High Court, which directed the Customs Excise and Gold (Control) Appellate Tribunal to hear the petition and to decide the same as an appeal before it.
On behalf of the appellant, elaborate evidence had been adduced before the Tribunal.
Reference was made to the specifications of plastic emulsion paint and the definition as given by ISI.
The Tribunal addressed itself to the question whether "Decoplast" could be considered as plastic emulsion paint having regard to (i) its composition; (ii) its characteristics; (iii) its uses and (iv) its reputation in trade parlance, and held that "Decoplast" is a plastic emulsion paint.
Aggrieved by the order the appellant appealed under Section 35L of the Central Excise and Salt Act, 1944 to this Court, which.
Dismissing the appeal, ^ HELD: 1.1 The commercial meaning has to be given to the expressions in Tariff items.
Where definition of a word has not been given, it 340 must be construed in its popular sense.
Popular sense means that sense which people conversant with the subject matter with which the statute is dealing, would attribute to it.
[343G] 1.2 In the instant case the use of these two items and their composition, when analysed, revealed that in essence they performed the same functions as plastic emulsion paint does, though there was some difference in them.
The affidavits of traders and others were examined by the Tribunal.
The Revenue did not adduce evidence in rebuttal.
Therefore, in view of the composition, characteristics, uses and how it is known in the trade, the Tribunal came to the conclusion that "Decoplast" was plastic emulsion paint.
This is a finding of fact arrived at on relevant and valid materials.
There was no misdirection in law.
[344C E] 2.
In interpreting items in statutes like the Excise Act or Sales Tax Act, resort should be had, not to the scientific and technical meaning of the terms or expressions used, but to the popular meaning, that is to say, the meaning attached to them by those dealing in them.
[343H; 344A B] C.l. T., Andhra Pradesh vs M/s. Taj Mahal Hotel, Secunderabad and Indo International Industries vs Commissioner of Sales Tax, U.P., ; ,referred to.
King vs Planter 's Co. [1951] CLR (exhibit) 122 and 'Two Hundred Chests of Tea ', [1824]6 L.Ed. 128, referred to.
|
% The question as to whether "Decoplast" manufactured by the appellant is plastic emulsion paint or not had been determined in the affirmative by the Revenue, and revision application before the Government of India was rejected.
Thereafter the appellant moved the Bombay High Court, which directed the Customs Excise and Gold (Control) Appellate Tribunal to hear the petition and to decide the same as an appeal before it.
On behalf of the appellant, elaborate evidence had been adduced before the Tribunal.
Reference was made to the specifications of plastic emulsion paint and the definition as given by ISI.
The Tribunal addressed itself to the question whether "Decoplast" could be considered as plastic emulsion paint having regard to (i) its composition; (ii) its characteristics; (iii) its uses and (iv) its reputation in trade parlance, and held that "Decoplast" is a plastic emulsion paint.
Aggrieved by the order the appellant appealed under Section 35L of the Central Excise and Salt Act, 1944 to this Court, which.
Dismissing the appeal, ^ HELD: 1.1 The commercial meaning has to be given to the expressions in Tariff items.
Where definition of a word has not been given, it 340 must be construed in its popular sense.
Popular sense means that sense which people conversant with the subject matter with which the statute is dealing, would attribute to it.
[343G] 1.2 In the instant case the use of these two items and their composition, when analysed, revealed that in essence they performed the same functions as plastic emulsion paint does, though there was some difference in them.
The affidavits of traders and others were examined by the Tribunal.
The Revenue did not adduce evidence in rebuttal.
Therefore, in view of the composition, characteristics, uses and how it is known in the trade, the Tribunal came to the conclusion that "Decoplast" was plastic emulsion paint.
This is a finding of fact arrived at on relevant and valid materials.
There was no misdirection in law.
[344C E] 2.
In interpreting items in statutes like the Excise Act or Sales Tax Act, resort should be had, not to the scientific and technical meaning of the terms or expressions used, but to the popular meaning, that is to say, the meaning attached to them by those dealing in them.
[343H; 344A B] C.l. T., Andhra Pradesh vs M/s. Taj Mahal Hotel, Secunderabad and Indo International Industries vs Commissioner of Sales Tax, U.P., ; ,referred to.
King vs Planter 's Co. [1951] CLR (exhibit) 122 and 'Two Hundred Chests of Tea ', [1824]6 L.Ed. 128, referred to.
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Civil Appeal No 757 of 1988.
From the Judgment and Order dated 14.8.1986 of the Allahabad High Court in F.A. No. 448 of 1978.
G. Ramaswamy, Additional Solicitor General, Pramod Swarup and P. Parmeshwaran for the Appellants.
R.P. Gupta for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The appeal is disposed of by the judgment hereunder.
It appears that on or about 18th September, 1969, four agreements were entered into between M/s. L.K. Ahuja & Co. and Union of India, represented by the Executive Engineer, Northern Railway, Allahabad, for the construction of certain quarters.
It was followed by supplementary agreement entered into sometime in 1972.
It is stated that all the four contracts were executed and completed by the first respondent on diverse dates.
The last one was on 30th May, 1971.
Between 29th May, 1972 to 19th June, 1972, the respondent accepted the four final bills and gave no claim declaration in respect of the four contracts.
The respondent wrote a letter to the Additional Chief Engineer, R.E.N.R. Allahabad, stating that Rs.1,91,137 were due on account of the work executed and requested him to refer the dispute to the Arbitrator.
On 4th June, 1976 a reply was sent to the above letter stating that there was no dispute between the parties and, hence, no question of appointment of any Arbitrator arose.
On 13th December, 1976, an application was filed by the respondent in the Court of Civil Judge, Allahabad, for appointment of an Arbitrator under Section 20 of the (hereinafter called `the Act ').
That application was dismissed on 10th February, 1978 as being barred by limitation.
There was an appeal from the said decision to the High Court of Allahabad and the High Court by its impugned Judgment and Order dated 14th August, 1986 allowed the appeal.
Hence, this appeal.
The sole question, involved in this appeal, is whether the High Court was right in dismissing the application.
In matters of this nature, the main question is whether the application under Section 20 was within time.
Though there was some doubt before but now it is well 405 settled in view of the decision of this Court in Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amson & Beson, Kerala, ; that Article 137 would apply to any petition or application filed under any Act to a Civil Court.
The Words "any other application" this Court held under Article 137, cannot be read on the principle of ejusdem generis to be applications under the Civil Procedure Code other than those mentioned in part I of the third division.
The aforesaid view has to be harmonised with the view of this Court in Wazirchand Mahajan & Anr.
vs Union of India, ; There this Court found that the second appellant had purchased from the Himachal Pradesh Government the right to extract and collect certain medicinal herbs from the forests of Chamba District.
The period of agreement was one year from September 1, 1960.
Under an arbitration clause in the agreement all disputes between the parties were to be referred to the Deputy Commissioner, Mandi District Himachal Pradesh.
The second appellant transferred all his rights under the agreement to the first appellant with the consent of the State of Himachal Pradesh.
Disputes arose between the parties in October, 1950.
On May 30, 1952 the appellants addressed a letter to the Chief Conservator of Forests, Himachal Pradesh requiring that officer to submit the matters in difference to the arbitration of the Deputy Commissioner, Mandi Distt.
By a letter dated June 23, 1952, the Chief Conservator declined to agree to a reference contending that the matters desired to be referred were outside the arbitration clause.
On June 22, 1955 the appellants applied to the District Court of Chamba for an order that the agreement be filed in Court and the disputes between them and the State be referred to the sole arbitration of the Deputy Commissioner of Mandi Distt.
The State of Himachal Pradesh contended, inter alia that the application for filing the arbitration agreement was barred by law of limitation as the right to apply if any arose in 1950 and not in June, 1952 as alleged.
The Court of First Instance held in favour of the appellants.
In appeal the Judicial Commissioner reversed the order of the Trial Court.
In the view of the Judicial Commissioner an application for filing an arbitration agreement under Section 20 of the Act was governed by Article 181 of the Limitation Act, 1908 and since the period of three years prescribed thereby commenced to run from the date on which the differences arose between the parties from the month of September, 1950 and in any case on September 1, 1951, the application of the appellants was held to be barred.
The Judicial Commissioner was in error, hence, according to this Court in rejecting the application of the appellants for filing the arbitration agreement as barred under Article 181 of the Limitation 406 Act.
It was reiterated that the terms of Article 181, though general and apparently not restricted to applications under the Code of Civil Procedure have always been interpreted as so restricted.
In the aforesaid background this Court directed the arbitration agreement to be filed.
This question was again considered by this Court in Mohd. Usman Military Contractor, Jhansi vs Union of India, Ministry of Defence, There the appellant had entered into a contract with the Government of India.
The contract contained an arbitration clause.
For certain supplies made under the contract the appellant made representations to the Government for payment and for arbitration of disputes.
On or about July 10, 1958 Government refused to refer the matter for arbitration.
On July 11, 1961 the appellant filed an application in the Court of District Judge under Sections 8 & 20 of the Act, for filing the arbitration agreement and for an order of reference of the disputes to an arbitrator appointed by the Court.
The respondent contended that the application was barred by Limitation.
The learned District Judge allowed the application, holding that there was no limitation for making an application under Sections 8 & 20 of the Act.
The defendant 's appeal was dismissed by the High Court as incompetent insofar as it challenged the order under Section 8 but was allowed insofar as it challenged the order under Section 20 of the Act.
The High Court held that an application under Section 20 was governed by Article 181 of the Indian Limitation Act, 1908.
In coming to this conclusion the High Court took into account the settled judicial view that the operation of Article 181 was limited to applications under the Code of Civil Procedure and reasoned that Article 181 should be construed as if the words `under the Code ' were added in it.
The repealed para 17 of the second schedule to the Code and re enacted it in Section 70 with minor modifications.
That being so Section 8(1) of the applied and the implied reference in Article 181 to para 17 of the second schedule to the Code should be construed as a reference to Section 20 of the Act.
In the appeal by certificate this Court held that by the the Legislature amended Articles 158 and 178 of the Limitation Act and made them applicable to the relevant proceedings under the but no similar change was made in Article 181.
It was manifest that save as provided in Articles 158 & 178 there would not be any limitation for other application.
In the circumstances the Court found it impossible to construe the implied reference in Article 181 as a reference to the , or to hold that Article 181 applied to applications under that Act.
In the premises the Court held that an application under Sections 8 & 20 of 407 the was not governed by Article 181 of the Limitation Act.
In that view of the matter the application was held to be barred by limitation.
The question is now concluded as mentioned hereinbefore vide this Court 's decision in Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amsom & Besom, (supra).
It appears that these questions were discussed in the decision of the Calcutta High Court in Jiwnani Engineering Works P. Ltd. vs Union of India, where (one of us Sabyasachi Mukharji) was a party and which held after discussing all these authorities the question whether the claim sought to be raised was barred by limitation or not, was not relevant for an Order under Section 20 of the Act.
Therefore, there are two aspects.
One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the Limitation Act and secondly, whether the claim made for application under Section 20 is barred.
In order to be a valid claim for reference under Section 20 of the , it is necessary that there should be an arbitration agreement and secondly differences must arise to which the agreement in question applied and, thirdly, that must be within time as stipulated in Section 20 of the Act.
In the instant case it appears that there was an arbitration agreement as found by the High Court covering the disputes.
It is also obvious that differences existed.
There was an assertion of claim and denial of the same.
It is stated in the judgment of the High Court that under the agreement the appellants had claimed a sum of Rs. 1,91,636 and, as such, the dispute was liable to be referred to arbitration in terms of the agreements entered into between the parties.
Further, for the purpose of getting an arbitrator appointed, a letter dated June 4, 1976 was sent by the appellant to the Additional Chief Engineer, Allahabad.
The respondent did not take any step in time.
The appellant filed an application on 4.6.1976 under Section 20 of the Act.
It was contended before the learned Trial Judge that the work under all the four contracts had been fully executed by the appellant on different dates and the respondents claimed that the appellant had accepted full and final payment of the agreements which had been executed by it and no claim declaration in respect of the same had been given by the appellant.
It was, therefore, submitted that since there was no dispute, the application filed under Section 20 of the Act, was misconceived.
The Trial Court held that the Court had no jurisdiction under Section 20 of the Act.
The respondent came up in appeal before the High Court.
The question, therefore, was whether there was a valid claim under section 20 of the Act to be referred in accordance with law.
408 In view of the well settled principles we are of the view that it will be entirely a wrong to mix up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator, was barred by lapse of time.
The second is a matter which the arbitrator would decide unless, however, if on admitted facts a claim is found at the time of making an Order under Section 20 of the , to be barred by limitation.
In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same.
It is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable.
In this case the claim for reference was made within three years commencing from April 16, 1976 and the application was filed on December 18, 1976.
We are, therefore, of the view that the High Court was right in this case.
See in this connection the observations of this Court in Major (Retd.) Inder Singh Rekhi vs D.D.A., ; In the aforesaid view of the matter this appeal must fail and is accordingly dismissed.
The costs of this appeal would be the costs in the arbitration proceedings.
S.L. Appeal dismissed.
|
% Four agreements were entered into between the respondent and the appellant Union of India through the Executive Engineer, Northern Railway, followed by a supplementary agreement.
All the four contracts were executed and completed by the respondent on diverse dates.
The respondent accepted four final bills and gave no claim declaration in respect of the four contracts.
Thereafter, the respondent wrote to the Additional Chief Engineer, R.E.N.R., that Rs.1,91,137 were due on account of work executed and asked for a reference of the dispute to the Arbitrator.
A reply was sent to the respondent that there was no dispute between the parties and no question of appointment of any Arbitrator arose.
The respondent then filed an application in the Court of Civil Judge for the appointment of an Arbitrator under Section 20 of the (`the Act ').
The application was dismissed as being barred by limitation.
An appeal from the decision of Civil Judge was allowed by the High Court.
The appellants then moved this Court for relief by this appeal.
Dismissing the appeal, the Court, ^ HELD: The sole question involved in this appeal was whether the Civil Judge was right in dismissing the application and whether the application under section 20 was within time.
[404H] It is well settled in view of the decision of this Court in Kerala State Electricity Board, Trivendrum vs T.P.K.K. Amsom and Besom, Kerala, ; that Article 137 would apply to any petition or application filed under any Act in a Civil Court.
The words "any other application", this Court held under Article 137, cannot be read on the principle of ejusdem generis to be applications under the Civil Procedure Code other than those mentioned in Part I of the third division.
[405A B] 403 There are two aspects of the matter.
One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the limitation Act, and secondly, whether the claim made for application under section 20 is barred.
To be a valid claim for reference under section 20 of the , it is necessary that there should be an arbitration agreement and secondly, differences must arise to which the agreement in question applied, and thirdly, that must be within time as stipulated in section 20 of the Act.
In this case, there was an arbitration agreement as found by the High Court, covering the disputes.
It was also obvious that differences had existed.
There was assertion of claim and denial of it.
As such, the dispute was liable to be referred to arbitration in terms of the agreements between the parties.
The question was whether there was a valid claim under section 20 of the Act to be referred in accordance with law.
[407C E, G H] In view of the well settled principles, it would be entirely wrong to mix up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator was barred by lapse of time.
The second is a matter which the arbitrator would decide unless on admitted facts a claim is found at the time of making an order under Section 20 of the Act, to be barred by time.
To be entitled to ask for a reference under section 20 of the Act, there must be entitlement to money and a difference or a dispute in respect of the same.
It is true that on completion of work the right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists, and whether it does subsist is a matter which is arbitrable.
In this case, the claim for reference was made within three years commencing from April 16, 1976, and the application was filed on December 18, 1976.
[408A D] The High Court was right in this case.
See in this connection the observations of this Court in Major (Retd.) Inder Singh Rekhi vs D.D.A., ; The appeal failed.
[408D] Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amsom and Besom, Kerala, ; ; Wazirchand Mahajan & Anr.
vs Union of India, ; ; Mohd. Usman Military Contractor, Jhansi vs Union of India, Ministry of Defence, ; Jiwnani Engineering Works P. Ltd. vs Union of India, and Major (Retd.) Inder Singh Rekhi vs D.D.A., ; referred to. 404
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Civil Appeal No 757 of 1988.
From the Judgment and Order dated 14.8.1986 of the Allahabad High Court in F.A. No. 448 of 1978.
G. Ramaswamy, Additional Solicitor General, Pramod Swarup and P. Parmeshwaran for the Appellants.
R.P. Gupta for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The appeal is disposed of by the judgment hereunder.
It appears that on or about 18th September, 1969, four agreements were entered into between M/s. L.K. Ahuja & Co. and Union of India, represented by the Executive Engineer, Northern Railway, Allahabad, for the construction of certain quarters.
It was followed by supplementary agreement entered into sometime in 1972.
It is stated that all the four contracts were executed and completed by the first respondent on diverse dates.
The last one was on 30th May, 1971.
Between 29th May, 1972 to 19th June, 1972, the respondent accepted the four final bills and gave no claim declaration in respect of the four contracts.
The respondent wrote a letter to the Additional Chief Engineer, R.E.N.R. Allahabad, stating that Rs.1,91,137 were due on account of the work executed and requested him to refer the dispute to the Arbitrator.
On 4th June, 1976 a reply was sent to the above letter stating that there was no dispute between the parties and, hence, no question of appointment of any Arbitrator arose.
On 13th December, 1976, an application was filed by the respondent in the Court of Civil Judge, Allahabad, for appointment of an Arbitrator under Section 20 of the (hereinafter called `the Act ').
That application was dismissed on 10th February, 1978 as being barred by limitation.
There was an appeal from the said decision to the High Court of Allahabad and the High Court by its impugned Judgment and Order dated 14th August, 1986 allowed the appeal.
Hence, this appeal.
The sole question, involved in this appeal, is whether the High Court was right in dismissing the application.
In matters of this nature, the main question is whether the application under Section 20 was within time.
Though there was some doubt before but now it is well 405 settled in view of the decision of this Court in Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amson & Beson, Kerala, ; that Article 137 would apply to any petition or application filed under any Act to a Civil Court.
The Words "any other application" this Court held under Article 137, cannot be read on the principle of ejusdem generis to be applications under the Civil Procedure Code other than those mentioned in part I of the third division.
The aforesaid view has to be harmonised with the view of this Court in Wazirchand Mahajan & Anr.
vs Union of India, ; There this Court found that the second appellant had purchased from the Himachal Pradesh Government the right to extract and collect certain medicinal herbs from the forests of Chamba District.
The period of agreement was one year from September 1, 1960.
Under an arbitration clause in the agreement all disputes between the parties were to be referred to the Deputy Commissioner, Mandi District Himachal Pradesh.
The second appellant transferred all his rights under the agreement to the first appellant with the consent of the State of Himachal Pradesh.
Disputes arose between the parties in October, 1950.
On May 30, 1952 the appellants addressed a letter to the Chief Conservator of Forests, Himachal Pradesh requiring that officer to submit the matters in difference to the arbitration of the Deputy Commissioner, Mandi Distt.
By a letter dated June 23, 1952, the Chief Conservator declined to agree to a reference contending that the matters desired to be referred were outside the arbitration clause.
On June 22, 1955 the appellants applied to the District Court of Chamba for an order that the agreement be filed in Court and the disputes between them and the State be referred to the sole arbitration of the Deputy Commissioner of Mandi Distt.
The State of Himachal Pradesh contended, inter alia that the application for filing the arbitration agreement was barred by law of limitation as the right to apply if any arose in 1950 and not in June, 1952 as alleged.
The Court of First Instance held in favour of the appellants.
In appeal the Judicial Commissioner reversed the order of the Trial Court.
In the view of the Judicial Commissioner an application for filing an arbitration agreement under Section 20 of the Act was governed by Article 181 of the Limitation Act, 1908 and since the period of three years prescribed thereby commenced to run from the date on which the differences arose between the parties from the month of September, 1950 and in any case on September 1, 1951, the application of the appellants was held to be barred.
The Judicial Commissioner was in error, hence, according to this Court in rejecting the application of the appellants for filing the arbitration agreement as barred under Article 181 of the Limitation 406 Act.
It was reiterated that the terms of Article 181, though general and apparently not restricted to applications under the Code of Civil Procedure have always been interpreted as so restricted.
In the aforesaid background this Court directed the arbitration agreement to be filed.
This question was again considered by this Court in Mohd. Usman Military Contractor, Jhansi vs Union of India, Ministry of Defence, There the appellant had entered into a contract with the Government of India.
The contract contained an arbitration clause.
For certain supplies made under the contract the appellant made representations to the Government for payment and for arbitration of disputes.
On or about July 10, 1958 Government refused to refer the matter for arbitration.
On July 11, 1961 the appellant filed an application in the Court of District Judge under Sections 8 & 20 of the Act, for filing the arbitration agreement and for an order of reference of the disputes to an arbitrator appointed by the Court.
The respondent contended that the application was barred by Limitation.
The learned District Judge allowed the application, holding that there was no limitation for making an application under Sections 8 & 20 of the Act.
The defendant 's appeal was dismissed by the High Court as incompetent insofar as it challenged the order under Section 8 but was allowed insofar as it challenged the order under Section 20 of the Act.
The High Court held that an application under Section 20 was governed by Article 181 of the Indian Limitation Act, 1908.
In coming to this conclusion the High Court took into account the settled judicial view that the operation of Article 181 was limited to applications under the Code of Civil Procedure and reasoned that Article 181 should be construed as if the words `under the Code ' were added in it.
The repealed para 17 of the second schedule to the Code and re enacted it in Section 70 with minor modifications.
That being so Section 8(1) of the applied and the implied reference in Article 181 to para 17 of the second schedule to the Code should be construed as a reference to Section 20 of the Act.
In the appeal by certificate this Court held that by the the Legislature amended Articles 158 and 178 of the Limitation Act and made them applicable to the relevant proceedings under the but no similar change was made in Article 181.
It was manifest that save as provided in Articles 158 & 178 there would not be any limitation for other application.
In the circumstances the Court found it impossible to construe the implied reference in Article 181 as a reference to the , or to hold that Article 181 applied to applications under that Act.
In the premises the Court held that an application under Sections 8 & 20 of 407 the was not governed by Article 181 of the Limitation Act.
In that view of the matter the application was held to be barred by limitation.
The question is now concluded as mentioned hereinbefore vide this Court 's decision in Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amsom & Besom, (supra).
It appears that these questions were discussed in the decision of the Calcutta High Court in Jiwnani Engineering Works P. Ltd. vs Union of India, where (one of us Sabyasachi Mukharji) was a party and which held after discussing all these authorities the question whether the claim sought to be raised was barred by limitation or not, was not relevant for an Order under Section 20 of the Act.
Therefore, there are two aspects.
One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the Limitation Act and secondly, whether the claim made for application under Section 20 is barred.
In order to be a valid claim for reference under Section 20 of the , it is necessary that there should be an arbitration agreement and secondly differences must arise to which the agreement in question applied and, thirdly, that must be within time as stipulated in Section 20 of the Act.
In the instant case it appears that there was an arbitration agreement as found by the High Court covering the disputes.
It is also obvious that differences existed.
There was an assertion of claim and denial of the same.
It is stated in the judgment of the High Court that under the agreement the appellants had claimed a sum of Rs. 1,91,636 and, as such, the dispute was liable to be referred to arbitration in terms of the agreements entered into between the parties.
Further, for the purpose of getting an arbitrator appointed, a letter dated June 4, 1976 was sent by the appellant to the Additional Chief Engineer, Allahabad.
The respondent did not take any step in time.
The appellant filed an application on 4.6.1976 under Section 20 of the Act.
It was contended before the learned Trial Judge that the work under all the four contracts had been fully executed by the appellant on different dates and the respondents claimed that the appellant had accepted full and final payment of the agreements which had been executed by it and no claim declaration in respect of the same had been given by the appellant.
It was, therefore, submitted that since there was no dispute, the application filed under Section 20 of the Act, was misconceived.
The Trial Court held that the Court had no jurisdiction under Section 20 of the Act.
The respondent came up in appeal before the High Court.
The question, therefore, was whether there was a valid claim under section 20 of the Act to be referred in accordance with law.
408 In view of the well settled principles we are of the view that it will be entirely a wrong to mix up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator, was barred by lapse of time.
The second is a matter which the arbitrator would decide unless, however, if on admitted facts a claim is found at the time of making an Order under Section 20 of the , to be barred by limitation.
In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same.
It is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable.
In this case the claim for reference was made within three years commencing from April 16, 1976 and the application was filed on December 18, 1976.
We are, therefore, of the view that the High Court was right in this case.
See in this connection the observations of this Court in Major (Retd.) Inder Singh Rekhi vs D.D.A., ; In the aforesaid view of the matter this appeal must fail and is accordingly dismissed.
The costs of this appeal would be the costs in the arbitration proceedings.
S.L. Appeal dismissed.
|
Civil Appeal No 757 of 1988.
From the Judgment and Order dated 14.8.1986 of the Allahabad High Court in F.A. No. 448 of 1978.
G. Ramaswamy, Additional Solicitor General, Pramod Swarup and P. Parmeshwaran for the Appellants.
R.P. Gupta for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Special leave granted.
The appeal is disposed of by the judgment hereunder.
It appears that on or about 18th September, 1969, four agreements were entered into between M/s. L.K. Ahuja & Co. and Union of India, represented by the Executive Engineer, Northern Railway, Allahabad, for the construction of certain quarters.
It was followed by supplementary agreement entered into sometime in 1972.
It is stated that all the four contracts were executed and completed by the first respondent on diverse dates.
The last one was on 30th May, 1971.
Between 29th May, 1972 to 19th June, 1972, the respondent accepted the four final bills and gave no claim declaration in respect of the four contracts.
The respondent wrote a letter to the Additional Chief Engineer, R.E.N.R. Allahabad, stating that Rs.1,91,137 were due on account of the work executed and requested him to refer the dispute to the Arbitrator.
On 4th June, 1976 a reply was sent to the above letter stating that there was no dispute between the parties and, hence, no question of appointment of any Arbitrator arose.
On 13th December, 1976, an application was filed by the respondent in the Court of Civil Judge, Allahabad, for appointment of an Arbitrator under Section 20 of the (hereinafter called `the Act ').
That application was dismissed on 10th February, 1978 as being barred by limitation.
There was an appeal from the said decision to the High Court of Allahabad and the High Court by its impugned Judgment and Order dated 14th August, 1986 allowed the appeal.
Hence, this appeal.
The sole question, involved in this appeal, is whether the High Court was right in dismissing the application.
In matters of this nature, the main question is whether the application under Section 20 was within time.
Though there was some doubt before but now it is well 405 settled in view of the decision of this Court in Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amson & Beson, Kerala, ; that Article 137 would apply to any petition or application filed under any Act to a Civil Court.
The Words "any other application" this Court held under Article 137, cannot be read on the principle of ejusdem generis to be applications under the Civil Procedure Code other than those mentioned in part I of the third division.
The aforesaid view has to be harmonised with the view of this Court in Wazirchand Mahajan & Anr.
vs Union of India, ; There this Court found that the second appellant had purchased from the Himachal Pradesh Government the right to extract and collect certain medicinal herbs from the forests of Chamba District.
The period of agreement was one year from September 1, 1960.
Under an arbitration clause in the agreement all disputes between the parties were to be referred to the Deputy Commissioner, Mandi District Himachal Pradesh.
The second appellant transferred all his rights under the agreement to the first appellant with the consent of the State of Himachal Pradesh.
Disputes arose between the parties in October, 1950.
On May 30, 1952 the appellants addressed a letter to the Chief Conservator of Forests, Himachal Pradesh requiring that officer to submit the matters in difference to the arbitration of the Deputy Commissioner, Mandi Distt.
By a letter dated June 23, 1952, the Chief Conservator declined to agree to a reference contending that the matters desired to be referred were outside the arbitration clause.
On June 22, 1955 the appellants applied to the District Court of Chamba for an order that the agreement be filed in Court and the disputes between them and the State be referred to the sole arbitration of the Deputy Commissioner of Mandi Distt.
The State of Himachal Pradesh contended, inter alia that the application for filing the arbitration agreement was barred by law of limitation as the right to apply if any arose in 1950 and not in June, 1952 as alleged.
The Court of First Instance held in favour of the appellants.
In appeal the Judicial Commissioner reversed the order of the Trial Court.
In the view of the Judicial Commissioner an application for filing an arbitration agreement under Section 20 of the Act was governed by Article 181 of the Limitation Act, 1908 and since the period of three years prescribed thereby commenced to run from the date on which the differences arose between the parties from the month of September, 1950 and in any case on September 1, 1951, the application of the appellants was held to be barred.
The Judicial Commissioner was in error, hence, according to this Court in rejecting the application of the appellants for filing the arbitration agreement as barred under Article 181 of the Limitation 406 Act.
It was reiterated that the terms of Article 181, though general and apparently not restricted to applications under the Code of Civil Procedure have always been interpreted as so restricted.
In the aforesaid background this Court directed the arbitration agreement to be filed.
This question was again considered by this Court in Mohd. Usman Military Contractor, Jhansi vs Union of India, Ministry of Defence, There the appellant had entered into a contract with the Government of India.
The contract contained an arbitration clause.
For certain supplies made under the contract the appellant made representations to the Government for payment and for arbitration of disputes.
On or about July 10, 1958 Government refused to refer the matter for arbitration.
On July 11, 1961 the appellant filed an application in the Court of District Judge under Sections 8 & 20 of the Act, for filing the arbitration agreement and for an order of reference of the disputes to an arbitrator appointed by the Court.
The respondent contended that the application was barred by Limitation.
The learned District Judge allowed the application, holding that there was no limitation for making an application under Sections 8 & 20 of the Act.
The defendant 's appeal was dismissed by the High Court as incompetent insofar as it challenged the order under Section 8 but was allowed insofar as it challenged the order under Section 20 of the Act.
The High Court held that an application under Section 20 was governed by Article 181 of the Indian Limitation Act, 1908.
In coming to this conclusion the High Court took into account the settled judicial view that the operation of Article 181 was limited to applications under the Code of Civil Procedure and reasoned that Article 181 should be construed as if the words `under the Code ' were added in it.
The repealed para 17 of the second schedule to the Code and re enacted it in Section 70 with minor modifications.
That being so Section 8(1) of the applied and the implied reference in Article 181 to para 17 of the second schedule to the Code should be construed as a reference to Section 20 of the Act.
In the appeal by certificate this Court held that by the the Legislature amended Articles 158 and 178 of the Limitation Act and made them applicable to the relevant proceedings under the but no similar change was made in Article 181.
It was manifest that save as provided in Articles 158 & 178 there would not be any limitation for other application.
In the circumstances the Court found it impossible to construe the implied reference in Article 181 as a reference to the , or to hold that Article 181 applied to applications under that Act.
In the premises the Court held that an application under Sections 8 & 20 of 407 the was not governed by Article 181 of the Limitation Act.
In that view of the matter the application was held to be barred by limitation.
The question is now concluded as mentioned hereinbefore vide this Court 's decision in Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amsom & Besom, (supra).
It appears that these questions were discussed in the decision of the Calcutta High Court in Jiwnani Engineering Works P. Ltd. vs Union of India, where (one of us Sabyasachi Mukharji) was a party and which held after discussing all these authorities the question whether the claim sought to be raised was barred by limitation or not, was not relevant for an Order under Section 20 of the Act.
Therefore, there are two aspects.
One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the Limitation Act and secondly, whether the claim made for application under Section 20 is barred.
In order to be a valid claim for reference under Section 20 of the , it is necessary that there should be an arbitration agreement and secondly differences must arise to which the agreement in question applied and, thirdly, that must be within time as stipulated in Section 20 of the Act.
In the instant case it appears that there was an arbitration agreement as found by the High Court covering the disputes.
It is also obvious that differences existed.
There was an assertion of claim and denial of the same.
It is stated in the judgment of the High Court that under the agreement the appellants had claimed a sum of Rs. 1,91,636 and, as such, the dispute was liable to be referred to arbitration in terms of the agreements entered into between the parties.
Further, for the purpose of getting an arbitrator appointed, a letter dated June 4, 1976 was sent by the appellant to the Additional Chief Engineer, Allahabad.
The respondent did not take any step in time.
The appellant filed an application on 4.6.1976 under Section 20 of the Act.
It was contended before the learned Trial Judge that the work under all the four contracts had been fully executed by the appellant on different dates and the respondents claimed that the appellant had accepted full and final payment of the agreements which had been executed by it and no claim declaration in respect of the same had been given by the appellant.
It was, therefore, submitted that since there was no dispute, the application filed under Section 20 of the Act, was misconceived.
The Trial Court held that the Court had no jurisdiction under Section 20 of the Act.
The respondent came up in appeal before the High Court.
The question, therefore, was whether there was a valid claim under section 20 of the Act to be referred in accordance with law.
408 In view of the well settled principles we are of the view that it will be entirely a wrong to mix up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator, was barred by lapse of time.
The second is a matter which the arbitrator would decide unless, however, if on admitted facts a claim is found at the time of making an Order under Section 20 of the , to be barred by limitation.
In order to be entitled to ask for a reference under Section 20 of the Act, there must be an entitlement to money and a difference or dispute in respect of the same.
It is true that on completion of the work, right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists and whether it does subsist, is a matter which is arbitrable.
In this case the claim for reference was made within three years commencing from April 16, 1976 and the application was filed on December 18, 1976.
We are, therefore, of the view that the High Court was right in this case.
See in this connection the observations of this Court in Major (Retd.) Inder Singh Rekhi vs D.D.A., ; In the aforesaid view of the matter this appeal must fail and is accordingly dismissed.
The costs of this appeal would be the costs in the arbitration proceedings.
S.L. Appeal dismissed.
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% Four agreements were entered into between the respondent and the appellant Union of India through the Executive Engineer, Northern Railway, followed by a supplementary agreement.
All the four contracts were executed and completed by the respondent on diverse dates.
The respondent accepted four final bills and gave no claim declaration in respect of the four contracts.
Thereafter, the respondent wrote to the Additional Chief Engineer, R.E.N.R., that Rs.1,91,137 were due on account of work executed and asked for a reference of the dispute to the Arbitrator.
A reply was sent to the respondent that there was no dispute between the parties and no question of appointment of any Arbitrator arose.
The respondent then filed an application in the Court of Civil Judge for the appointment of an Arbitrator under Section 20 of the (`the Act ').
The application was dismissed as being barred by limitation.
An appeal from the decision of Civil Judge was allowed by the High Court.
The appellants then moved this Court for relief by this appeal.
Dismissing the appeal, the Court, ^ HELD: The sole question involved in this appeal was whether the Civil Judge was right in dismissing the application and whether the application under section 20 was within time.
[404H] It is well settled in view of the decision of this Court in Kerala State Electricity Board, Trivendrum vs T.P.K.K. Amsom and Besom, Kerala, ; that Article 137 would apply to any petition or application filed under any Act in a Civil Court.
The words "any other application", this Court held under Article 137, cannot be read on the principle of ejusdem generis to be applications under the Civil Procedure Code other than those mentioned in Part I of the third division.
[405A B] 403 There are two aspects of the matter.
One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the limitation Act, and secondly, whether the claim made for application under section 20 is barred.
To be a valid claim for reference under section 20 of the , it is necessary that there should be an arbitration agreement and secondly, differences must arise to which the agreement in question applied, and thirdly, that must be within time as stipulated in section 20 of the Act.
In this case, there was an arbitration agreement as found by the High Court, covering the disputes.
It was also obvious that differences had existed.
There was assertion of claim and denial of it.
As such, the dispute was liable to be referred to arbitration in terms of the agreements between the parties.
The question was whether there was a valid claim under section 20 of the Act to be referred in accordance with law.
[407C E, G H] In view of the well settled principles, it would be entirely wrong to mix up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator was barred by lapse of time.
The second is a matter which the arbitrator would decide unless on admitted facts a claim is found at the time of making an order under Section 20 of the Act, to be barred by time.
To be entitled to ask for a reference under section 20 of the Act, there must be entitlement to money and a difference or a dispute in respect of the same.
It is true that on completion of work the right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists, and whether it does subsist is a matter which is arbitrable.
In this case, the claim for reference was made within three years commencing from April 16, 1976, and the application was filed on December 18, 1976.
[408A D] The High Court was right in this case.
See in this connection the observations of this Court in Major (Retd.) Inder Singh Rekhi vs D.D.A., ; The appeal failed.
[408D] Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amsom and Besom, Kerala, ; ; Wazirchand Mahajan & Anr.
vs Union of India, ; ; Mohd. Usman Military Contractor, Jhansi vs Union of India, Ministry of Defence, ; Jiwnani Engineering Works P. Ltd. vs Union of India, and Major (Retd.) Inder Singh Rekhi vs D.D.A., ; referred to. 404
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% Four agreements were entered into between the respondent and the appellant Union of India through the Executive Engineer, Northern Railway, followed by a supplementary agreement.
All the four contracts were executed and completed by the respondent on diverse dates.
The respondent accepted four final bills and gave no claim declaration in respect of the four contracts.
Thereafter, the respondent wrote to the Additional Chief Engineer, R.E.N.R., that Rs.1,91,137 were due on account of work executed and asked for a reference of the dispute to the Arbitrator.
A reply was sent to the respondent that there was no dispute between the parties and no question of appointment of any Arbitrator arose.
The respondent then filed an application in the Court of Civil Judge for the appointment of an Arbitrator under Section 20 of the (`the Act ').
The application was dismissed as being barred by limitation.
An appeal from the decision of Civil Judge was allowed by the High Court.
The appellants then moved this Court for relief by this appeal.
Dismissing the appeal, the Court, ^ HELD: The sole question involved in this appeal was whether the Civil Judge was right in dismissing the application and whether the application under section 20 was within time.
[404H] It is well settled in view of the decision of this Court in Kerala State Electricity Board, Trivendrum vs T.P.K.K. Amsom and Besom, Kerala, ; that Article 137 would apply to any petition or application filed under any Act in a Civil Court.
The words "any other application", this Court held under Article 137, cannot be read on the principle of ejusdem generis to be applications under the Civil Procedure Code other than those mentioned in Part I of the third division.
[405A B] 403 There are two aspects of the matter.
One is whether the claim made in the arbitration is barred by limitation under the relevant provisions of the limitation Act, and secondly, whether the claim made for application under section 20 is barred.
To be a valid claim for reference under section 20 of the , it is necessary that there should be an arbitration agreement and secondly, differences must arise to which the agreement in question applied, and thirdly, that must be within time as stipulated in section 20 of the Act.
In this case, there was an arbitration agreement as found by the High Court, covering the disputes.
It was also obvious that differences had existed.
There was assertion of claim and denial of it.
As such, the dispute was liable to be referred to arbitration in terms of the agreements between the parties.
The question was whether there was a valid claim under section 20 of the Act to be referred in accordance with law.
[407C E, G H] In view of the well settled principles, it would be entirely wrong to mix up the two aspects, namely, whether there was any valid claim for reference under Section 20 of the Act and, secondly, whether the claim to be adjudicated by the arbitrator was barred by lapse of time.
The second is a matter which the arbitrator would decide unless on admitted facts a claim is found at the time of making an order under Section 20 of the Act, to be barred by time.
To be entitled to ask for a reference under section 20 of the Act, there must be entitlement to money and a difference or a dispute in respect of the same.
It is true that on completion of work the right to get payment would normally arise and it is also true that on settlement of the final bill, the right to get further payment gets weakened but the claim subsists, and whether it does subsist is a matter which is arbitrable.
In this case, the claim for reference was made within three years commencing from April 16, 1976, and the application was filed on December 18, 1976.
[408A D] The High Court was right in this case.
See in this connection the observations of this Court in Major (Retd.) Inder Singh Rekhi vs D.D.A., ; The appeal failed.
[408D] Kerala State Electricity Board, Trivandrum vs T.P.K.K. Amsom and Besom, Kerala, ; ; Wazirchand Mahajan & Anr.
vs Union of India, ; ; Mohd. Usman Military Contractor, Jhansi vs Union of India, Ministry of Defence, ; Jiwnani Engineering Works P. Ltd. vs Union of India, and Major (Retd.) Inder Singh Rekhi vs D.D.A., ; referred to. 404
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Petition No. 1398 of 1962.
Appeal against the order of the Deputy Registrar dated March 28, 1962 in Civil Appeals Nos.
41 to 49 of 1962.
A.Ranganadham Chetty, B.D. Dhawan, S.K. Mehta and K.L. Mehta, for the petitioner.
C. K. Daphtary, Attorney Generalfor India, R. Ganapathy Iyer and R. N. Sachthey, for the respondents.
April 5.
The Order of the court was delivered by SARKAR J.
This is an appeal against the order of the Deputy Registrar directing the present case to be registered as nine appeals and requiring the appellant to pay nine sets of court fees.
The Deputy Registrar had relied on two cases of this Court, namely, Lajwanti Sial 's case (Petition for Special Leave No. 673 of 1959) and Kishinchand Chellaram 's case (Civil Appeals No. 462 to 465 of 1960).
We do not think that these precedents cover the present case.
In Lajwanti 's Case there were a number of applications under section 66 (2) of the Income tax Act for reference of the same question.
There were in tact a number of separate references but they were 887 dealt with by one judgment from which the appeal to this Court arose.
That was really a case of five appeals for the common judgment must be taken to have been delivered in each of the different reference cases.
Kishinchand Chellaram '8 case is also not helpful because there four applications by four different assessees had been made for reference of three identical questions arising in each assessment case under section 66 (1) of the Income tax Act.
Though it appears that there was one order of reference to the High Court and the High Court treated the case as a single case of reference, it could be said that there were in fact a number of references.
The present case however originated out of one petition under article 226 of the Constitution challenging the validity of various assessment orders.
Obviously here, there was only one proceeding.
It could not be said that there were as many proceedings as there were assessment orders for the petitioner had by a single petition callenged them all together.
When an appeal is taken to this Court from the judgment of the High Court in such a petition, it is impossible to contend that there are more appeals than one.
Therefore, the appellant before us is liable only to pay one set of court fee and other charges as in a single appeal.
Action may be taken accordingly by the office, if necessary, by refunding the excess charges made.
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This appeal was against the order of the Deputy Registrar directing the present case to be registered as nine appeals and requiring the appellant to pay nine sets of court fees.
The case originated out of one petition under article 226 of the Constition challenging the validity of various assessment orders.
The High Court passed one order on the petition and one appeal was filed in this Court.
886 Held that the appellant should pay only one set of court fee and other charges as in a single appeal.
It could not be said that there were as many proceedings as there were assessment orders as the appellant had by a single petition challenged them all together.
Lajwanti Sial 's case, Petition for special leave No. 673 of 1959 and Kishinchand Chellaram 's case, C.A. Nos.
462 to 465 of 1960, referred to.
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Petition No. 1398 of 1962.
Appeal against the order of the Deputy Registrar dated March 28, 1962 in Civil Appeals Nos.
41 to 49 of 1962.
A.Ranganadham Chetty, B.D. Dhawan, S.K. Mehta and K.L. Mehta, for the petitioner.
C. K. Daphtary, Attorney Generalfor India, R. Ganapathy Iyer and R. N. Sachthey, for the respondents.
April 5.
The Order of the court was delivered by SARKAR J.
This is an appeal against the order of the Deputy Registrar directing the present case to be registered as nine appeals and requiring the appellant to pay nine sets of court fees.
The Deputy Registrar had relied on two cases of this Court, namely, Lajwanti Sial 's case (Petition for Special Leave No. 673 of 1959) and Kishinchand Chellaram 's case (Civil Appeals No. 462 to 465 of 1960).
We do not think that these precedents cover the present case.
In Lajwanti 's Case there were a number of applications under section 66 (2) of the Income tax Act for reference of the same question.
There were in tact a number of separate references but they were 887 dealt with by one judgment from which the appeal to this Court arose.
That was really a case of five appeals for the common judgment must be taken to have been delivered in each of the different reference cases.
Kishinchand Chellaram '8 case is also not helpful because there four applications by four different assessees had been made for reference of three identical questions arising in each assessment case under section 66 (1) of the Income tax Act.
Though it appears that there was one order of reference to the High Court and the High Court treated the case as a single case of reference, it could be said that there were in fact a number of references.
The present case however originated out of one petition under article 226 of the Constitution challenging the validity of various assessment orders.
Obviously here, there was only one proceeding.
It could not be said that there were as many proceedings as there were assessment orders for the petitioner had by a single petition callenged them all together.
When an appeal is taken to this Court from the judgment of the High Court in such a petition, it is impossible to contend that there are more appeals than one.
Therefore, the appellant before us is liable only to pay one set of court fee and other charges as in a single appeal.
Action may be taken accordingly by the office, if necessary, by refunding the excess charges made.
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Petition No. 1398 of 1962.
Appeal against the order of the Deputy Registrar dated March 28, 1962 in Civil Appeals Nos.
41 to 49 of 1962.
A.Ranganadham Chetty, B.D. Dhawan, S.K. Mehta and K.L. Mehta, for the petitioner.
C. K. Daphtary, Attorney Generalfor India, R. Ganapathy Iyer and R. N. Sachthey, for the respondents.
April 5.
The Order of the court was delivered by SARKAR J.
This is an appeal against the order of the Deputy Registrar directing the present case to be registered as nine appeals and requiring the appellant to pay nine sets of court fees.
The Deputy Registrar had relied on two cases of this Court, namely, Lajwanti Sial 's case (Petition for Special Leave No. 673 of 1959) and Kishinchand Chellaram 's case (Civil Appeals No. 462 to 465 of 1960).
We do not think that these precedents cover the present case.
In Lajwanti 's Case there were a number of applications under section 66 (2) of the Income tax Act for reference of the same question.
There were in tact a number of separate references but they were 887 dealt with by one judgment from which the appeal to this Court arose.
That was really a case of five appeals for the common judgment must be taken to have been delivered in each of the different reference cases.
Kishinchand Chellaram '8 case is also not helpful because there four applications by four different assessees had been made for reference of three identical questions arising in each assessment case under section 66 (1) of the Income tax Act.
Though it appears that there was one order of reference to the High Court and the High Court treated the case as a single case of reference, it could be said that there were in fact a number of references.
The present case however originated out of one petition under article 226 of the Constitution challenging the validity of various assessment orders.
Obviously here, there was only one proceeding.
It could not be said that there were as many proceedings as there were assessment orders for the petitioner had by a single petition callenged them all together.
When an appeal is taken to this Court from the judgment of the High Court in such a petition, it is impossible to contend that there are more appeals than one.
Therefore, the appellant before us is liable only to pay one set of court fee and other charges as in a single appeal.
Action may be taken accordingly by the office, if necessary, by refunding the excess charges made.
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This appeal was against the order of the Deputy Registrar directing the present case to be registered as nine appeals and requiring the appellant to pay nine sets of court fees.
The case originated out of one petition under article 226 of the Constition challenging the validity of various assessment orders.
The High Court passed one order on the petition and one appeal was filed in this Court.
886 Held that the appellant should pay only one set of court fee and other charges as in a single appeal.
It could not be said that there were as many proceedings as there were assessment orders as the appellant had by a single petition challenged them all together.
Lajwanti Sial 's case, Petition for special leave No. 673 of 1959 and Kishinchand Chellaram 's case, C.A. Nos.
462 to 465 of 1960, referred to.
|
This appeal was against the order of the Deputy Registrar directing the present case to be registered as nine appeals and requiring the appellant to pay nine sets of court fees.
The case originated out of one petition under article 226 of the Constition challenging the validity of various assessment orders.
The High Court passed one order on the petition and one appeal was filed in this Court.
886 Held that the appellant should pay only one set of court fee and other charges as in a single appeal.
It could not be said that there were as many proceedings as there were assessment orders as the appellant had by a single petition challenged them all together.
Lajwanti Sial 's case, Petition for special leave No. 673 of 1959 and Kishinchand Chellaram 's case, C.A. Nos.
462 to 465 of 1960, referred to.
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The prayer in the present petition under Section 438 Cr.P.C. is
for the grant of anticipatory bail to the petitioner in case FIR No.130
dated10.08.2021 under Sections 21,23 and 29 of the NDPS Act, registered at
2. The brief facts of the case are that secret information was
received by the investigating agency that Gurmeet Singh son of Jasbir Singh,
resident of Village Narli, District Tarn Taran was indulging in the smuggling
of heroin for a long time and had close contacts with Pakistan based
smugglers. He got heroin from Pakistan in huge quantity and supplied the
same in various parts of Punjab. He was in touch with Pakistani smugglers
and was likely to finalize a deal with them soon. As per the deal, the
Pakistani dealers would send a huge consignment of heroin to Gurmeet
Singh on the intervening night of 09/10.08.2021 via BOP Muhawa over the
border fencing. If checking was done at BOP, Muhawa, then the Pakistani
heroin smugglers could be apprehended alongwith Gurmeet Singh with a
huge consignment of heroin.
Based on the secret information, An FIR No.130 dated
10.08.2021 under Sections 21,23 and 29 of the NDPS Act Police Station
Special Task Force, SAS Nagar, came to be registered. Pursuant thereto, a
raid was conducted on the intervening night of 09/10.08.2021 on the basis of
the secret information but no recovery could be effected and the petitioner
was not found at the spot. A similar raid was conducted on 18/19.08.2021,
which was unsuccessful. Subsequently, on 25.05.2022, secret information
was received once again by the investigating agency that the petitioner was
smuggling a huge quantity of heroin in the area of BOP Bharowal.
Thereafter, one SI Vinod Sharma alongwith other police officials reached at
BOP Bharowal and informed the officials of BSF 144 Battalion. At about
11.00 p.m., a drone was found coming from the Pakistan side which was
fired at. It dropped two packets of heroin and went back to the Pakistan
side. The packets contained 1.120 grams of heroin each. Thereby 02 Kilos
240 grams of heroin was recovered.
3. The petitioner sought the concession of anticipatory bail, which
was dismissed by the Court of Additional Sessions Judge, Amritsar vide
order dated 13.07.2022. Pursuant thereto, the petitioner sought the
concession of anticipatory bail from this Court and vide order dated
31.08.2022, he was asked to join the investigation.
4. On 10.12.2022, a short reply on behalf of the respondent-State
by way of an affidavit of Sikander Singh, PPS, Deputy Superintendent of
Police, Special Task Force, Border Range, District Amritsar, was filed. The
sequence of events pursuant to the registration of the FIR was narrated.
Thereafter, it was stated that the petitioner had joined investigation in terms
of the orders dated 31.08.2022 on 05.09.2022. He was asked to provide his
mobile phone alongwith SIM card but he stated that he would provide the
same on 12.09.2022. However, he did not do so. On the other hand, he
stated that his mother had destroyed the mobile phone as well as the SIM
card by burning the same. Thereafter, the matter came up for hearing before
this Court on 12.12.2022 on which date, the petitioner was directed to appear
before the Investigating Agency on 13.12.2022 and handover his phone
allegedly used by him to contact Pakistan based smugglers. The matter has
come for arguments today i.e. 16.12.2022.
5. The learned counsel for the petitioner contends that the FIR was
registered on 10.08.2021 and the contraband was recovered on the
intervening night of 25/26.05.2022. During the interim period, the
investigating agency had raided the alleged place of occurrence i.e. BOP
Muhawa on 09/10.08.2021 but no recovery was effected. He contends that
the recovery allegedly effected on 25.05.2022 brought in through a drone at
BOP Bharowal cannot be connected to him. He has already disclosed to the
investigating agency that his mother had destroyed his mobile phone and
SIM card. He, on the other hand, handed over the mobile phone of his wife
to the investigating agency pursuant to the order dated 12.12.2022 passed by
this Court. He, thus, contends that the recovery cannot be connected to the
petitioner in any manner, and therefore, he be granted the concession of
anticipatory bail, moreso, when, he has no criminal antecedents.
6. The learned counsel for the State, on the other hand, while
referring to the reply dated 10.12.2022 contends that the petitioner is
deliberately misleading the investigating agency. As per police
investigation, the petitioner was in touch with Pakistan based smugglers.
Though, he had joined the investigation, he refused to handover his phone
and SIM card to the investigating agency. On the contrary he stated that the
same had been destroyed by his mother. Subsequently, pursuant to an order
of this Court, he has handed over a mobile phone of his wife. He, thus,
contends that the serious nature of the allegations against the petitioner of
being in contact with Pakistan based smugglers for the smuggling of drugs
does not entitle him to the grant of anticipatory bail, moreso, when he is
deliberately misleading the investigation.
7. I have heard the learned counsel for the parties at length.
8. The allegations against the petitioner are very serious. As per
secret information, the petitioner is stated to have been in contact with
Pakistan based smugglers on a number of occasions. In fact, drugs were
brought in from Pakistan by a drone on the intervening night 25/26.05.2022
and the same has been connected to the petitioner. On joining investigation,
the petitioner has made deliberate attempts to mislead the investigation
firstly, by stating that his phone and SIM card have been destroyed by his
mother and thereafter, by handing over the mobile phone of his wife to the
investigating agency. Therefore, it is apparent that the petitioner is
withholding vital information, which is necessary for the investigating
agency to take the investigation of the present case to the logical conclusion.
Even otherwise, the allegations against the petitioner are extremely grave
and serious. With increased use of drones to transport drugs and weapons,
cross border narco-terrorism is on the rise and must be nipped in the bud
with a heavy hand. Therefore, the investigating agencies must have
complete latitude in investigating such cases.
9. In view of the above, the custodial interrogation of the
petitioner is certainly necessary keeping in view the nature of offence, his
conduct during investigation as also to take the investigation of the present
case to its logical conclusion.
10. Therefore, I find no merit in the present petition and the same is
hereby dismissed.
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The Punjab and Haryana High Court, while rejecting an anticipatory bail application on Wednesday filed by an alleged drug smuggler in close contacts with suppliers from Pakistan, made serious observations on the situation of rising cross border narco-terrorism with increasing use of drones to smuggle drugs and weapons across borders.
Rejecting the anticipatory bail plea, a single bench of Justice Jasjit Singh Bedi said that:
"The allegations against the petitioner are extremely grave and serious. With increased use of drones to transport drugs and weapons, cross border narco-terrorism is on the rise and must be nipped in the bud with a heavy hand. Therefore, the investigating agencies must have complete latitude in investigating such cases."
The matter reached the Court when a petition was filed under Section 438 CrPC for grant of anticipatory bail by a resident of the Pakistan-bordering Tarn Taran district of Punjab in an FIR registered under Sections 21, 23 and 29 of the NDPS Act.
The Police lodged the FIR upon secret information connecting the petitioner with a drone found coming from Pakistan, which dropped two packets of heroin, each containing 1.12 Kgs of heroin, and flew back in the direction of Pakistan. A total of 2.24 Kgs heroin was recovered, resulting in the FIR.
The petitioner contended that FIR was registered on 10.08.2021 and the contraband was recovered on the intervening night of 25/26.05.2022. During the interim period, the investigating agency had made raids, however, no recovery was ever made. Stating that the recovery allegedly effected on 25.05.2022 through a drone could not be connected to him, he contended that he should be granted anticipatory bail.
The State, on the other hand, contended that the petitioner was in touch with Pakistan based smugglers. It was contended that the petitioner was not cooperative. The State argued that the petitioner refused to hand over his mobile phone and SIM card to the investigating agency. On the contrary, he stated that the same had been destroyed by his mother. Subsequently, he handed over his wife's mobile phone and was deliberately misleading the investigating agency.
The petitioner had earlier sought the concession of anticipatory bail, which was dismissed by the Court of Additional Sessions Judge, Amritsar and later by the High Court, asking him to join the investigation.
The Court, noting the seriousness of allegations against accused, increasing cross border narco-terrorism and the conduct of the petitioner said that:
"The allegations against the petitioner are very serious. As per secret information, the petitioner is stated to have been in contact with Pakistan based smugglers on a number of occasions. In fact, drugs were brought in from Pakistan by a drone on the intervening night 25/26.05.2022 and the same has been connected to the petitioner."
The Court further added that:
"On joining investigation, he has made deliberate attempts to mislead the investigation firstly, by stating that his phone and SIM card were destroyed by his mother and thereafter, by handing over his wife's phone. Therefore, it is apparent that he is withholding vital information, necessary for the investigating agency. In view of the above, his custodial interrogation is certainly necessary."
Case Title: Gurmeet Singh v. State of Punjab
Coram: Justice Jasjit Singh Bedi
|
The prayer in the present petition under Section 438 Cr.P.C. is
for the grant of anticipatory bail to the petitioner in case FIR No.130
dated10.08.2021 under Sections 21,23 and 29 of the NDPS Act, registered at
2. The brief facts of the case are that secret information was
received by the investigating agency that Gurmeet Singh son of Jasbir Singh,
resident of Village Narli, District Tarn Taran was indulging in the smuggling
of heroin for a long time and had close contacts with Pakistan based
smugglers. He got heroin from Pakistan in huge quantity and supplied the
same in various parts of Punjab. He was in touch with Pakistani smugglers
and was likely to finalize a deal with them soon. As per the deal, the
Pakistani dealers would send a huge consignment of heroin to Gurmeet
Singh on the intervening night of 09/10.08.2021 via BOP Muhawa over the
border fencing. If checking was done at BOP, Muhawa, then the Pakistani
heroin smugglers could be apprehended alongwith Gurmeet Singh with a
huge consignment of heroin.
Based on the secret information, An FIR No.130 dated
10.08.2021 under Sections 21,23 and 29 of the NDPS Act Police Station
Special Task Force, SAS Nagar, came to be registered. Pursuant thereto, a
raid was conducted on the intervening night of 09/10.08.2021 on the basis of
the secret information but no recovery could be effected and the petitioner
was not found at the spot. A similar raid was conducted on 18/19.08.2021,
which was unsuccessful. Subsequently, on 25.05.2022, secret information
was received once again by the investigating agency that the petitioner was
smuggling a huge quantity of heroin in the area of BOP Bharowal.
Thereafter, one SI Vinod Sharma alongwith other police officials reached at
BOP Bharowal and informed the officials of BSF 144 Battalion. At about
11.00 p.m., a drone was found coming from the Pakistan side which was
fired at. It dropped two packets of heroin and went back to the Pakistan
side. The packets contained 1.120 grams of heroin each. Thereby 02 Kilos
240 grams of heroin was recovered.
3. The petitioner sought the concession of anticipatory bail, which
was dismissed by the Court of Additional Sessions Judge, Amritsar vide
order dated 13.07.2022. Pursuant thereto, the petitioner sought the
concession of anticipatory bail from this Court and vide order dated
31.08.2022, he was asked to join the investigation.
4. On 10.12.2022, a short reply on behalf of the respondent-State
by way of an affidavit of Sikander Singh, PPS, Deputy Superintendent of
Police, Special Task Force, Border Range, District Amritsar, was filed. The
sequence of events pursuant to the registration of the FIR was narrated.
Thereafter, it was stated that the petitioner had joined investigation in terms
of the orders dated 31.08.2022 on 05.09.2022. He was asked to provide his
mobile phone alongwith SIM card but he stated that he would provide the
same on 12.09.2022. However, he did not do so. On the other hand, he
stated that his mother had destroyed the mobile phone as well as the SIM
card by burning the same. Thereafter, the matter came up for hearing before
this Court on 12.12.2022 on which date, the petitioner was directed to appear
before the Investigating Agency on 13.12.2022 and handover his phone
allegedly used by him to contact Pakistan based smugglers. The matter has
come for arguments today i.e. 16.12.2022.
5. The learned counsel for the petitioner contends that the FIR was
registered on 10.08.2021 and the contraband was recovered on the
intervening night of 25/26.05.2022. During the interim period, the
investigating agency had raided the alleged place of occurrence i.e. BOP
Muhawa on 09/10.08.2021 but no recovery was effected. He contends that
the recovery allegedly effected on 25.05.2022 brought in through a drone at
BOP Bharowal cannot be connected to him. He has already disclosed to the
investigating agency that his mother had destroyed his mobile phone and
SIM card. He, on the other hand, handed over the mobile phone of his wife
to the investigating agency pursuant to the order dated 12.12.2022 passed by
this Court. He, thus, contends that the recovery cannot be connected to the
petitioner in any manner, and therefore, he be granted the concession of
anticipatory bail, moreso, when, he has no criminal antecedents.
6. The learned counsel for the State, on the other hand, while
referring to the reply dated 10.12.2022 contends that the petitioner is
deliberately misleading the investigating agency. As per police
investigation, the petitioner was in touch with Pakistan based smugglers.
Though, he had joined the investigation, he refused to handover his phone
and SIM card to the investigating agency. On the contrary he stated that the
same had been destroyed by his mother. Subsequently, pursuant to an order
of this Court, he has handed over a mobile phone of his wife. He, thus,
contends that the serious nature of the allegations against the petitioner of
being in contact with Pakistan based smugglers for the smuggling of drugs
does not entitle him to the grant of anticipatory bail, moreso, when he is
deliberately misleading the investigation.
7. I have heard the learned counsel for the parties at length.
8. The allegations against the petitioner are very serious. As per
secret information, the petitioner is stated to have been in contact with
Pakistan based smugglers on a number of occasions. In fact, drugs were
brought in from Pakistan by a drone on the intervening night 25/26.05.2022
and the same has been connected to the petitioner. On joining investigation,
the petitioner has made deliberate attempts to mislead the investigation
firstly, by stating that his phone and SIM card have been destroyed by his
mother and thereafter, by handing over the mobile phone of his wife to the
investigating agency. Therefore, it is apparent that the petitioner is
withholding vital information, which is necessary for the investigating
agency to take the investigation of the present case to the logical conclusion.
Even otherwise, the allegations against the petitioner are extremely grave
and serious. With increased use of drones to transport drugs and weapons,
cross border narco-terrorism is on the rise and must be nipped in the bud
with a heavy hand. Therefore, the investigating agencies must have
complete latitude in investigating such cases.
9. In view of the above, the custodial interrogation of the
petitioner is certainly necessary keeping in view the nature of offence, his
conduct during investigation as also to take the investigation of the present
case to its logical conclusion.
10. Therefore, I find no merit in the present petition and the same is
hereby dismissed.
|
The prayer in the present petition under Section 438 Cr.P.C. is
for the grant of anticipatory bail to the petitioner in case FIR No.130
dated10.08.2021 under Sections 21,23 and 29 of the NDPS Act, registered at
2. The brief facts of the case are that secret information was
received by the investigating agency that Gurmeet Singh son of Jasbir Singh,
resident of Village Narli, District Tarn Taran was indulging in the smuggling
of heroin for a long time and had close contacts with Pakistan based
smugglers. He got heroin from Pakistan in huge quantity and supplied the
same in various parts of Punjab. He was in touch with Pakistani smugglers
and was likely to finalize a deal with them soon. As per the deal, the
Pakistani dealers would send a huge consignment of heroin to Gurmeet
Singh on the intervening night of 09/10.08.2021 via BOP Muhawa over the
border fencing. If checking was done at BOP, Muhawa, then the Pakistani
heroin smugglers could be apprehended alongwith Gurmeet Singh with a
huge consignment of heroin.
Based on the secret information, An FIR No.130 dated
10.08.2021 under Sections 21,23 and 29 of the NDPS Act Police Station
Special Task Force, SAS Nagar, came to be registered. Pursuant thereto, a
raid was conducted on the intervening night of 09/10.08.2021 on the basis of
the secret information but no recovery could be effected and the petitioner
was not found at the spot. A similar raid was conducted on 18/19.08.2021,
which was unsuccessful. Subsequently, on 25.05.2022, secret information
was received once again by the investigating agency that the petitioner was
smuggling a huge quantity of heroin in the area of BOP Bharowal.
Thereafter, one SI Vinod Sharma alongwith other police officials reached at
BOP Bharowal and informed the officials of BSF 144 Battalion. At about
11.00 p.m., a drone was found coming from the Pakistan side which was
fired at. It dropped two packets of heroin and went back to the Pakistan
side. The packets contained 1.120 grams of heroin each. Thereby 02 Kilos
240 grams of heroin was recovered.
3. The petitioner sought the concession of anticipatory bail, which
was dismissed by the Court of Additional Sessions Judge, Amritsar vide
order dated 13.07.2022. Pursuant thereto, the petitioner sought the
concession of anticipatory bail from this Court and vide order dated
31.08.2022, he was asked to join the investigation.
4. On 10.12.2022, a short reply on behalf of the respondent-State
by way of an affidavit of Sikander Singh, PPS, Deputy Superintendent of
Police, Special Task Force, Border Range, District Amritsar, was filed. The
sequence of events pursuant to the registration of the FIR was narrated.
Thereafter, it was stated that the petitioner had joined investigation in terms
of the orders dated 31.08.2022 on 05.09.2022. He was asked to provide his
mobile phone alongwith SIM card but he stated that he would provide the
same on 12.09.2022. However, he did not do so. On the other hand, he
stated that his mother had destroyed the mobile phone as well as the SIM
card by burning the same. Thereafter, the matter came up for hearing before
this Court on 12.12.2022 on which date, the petitioner was directed to appear
before the Investigating Agency on 13.12.2022 and handover his phone
allegedly used by him to contact Pakistan based smugglers. The matter has
come for arguments today i.e. 16.12.2022.
5. The learned counsel for the petitioner contends that the FIR was
registered on 10.08.2021 and the contraband was recovered on the
intervening night of 25/26.05.2022. During the interim period, the
investigating agency had raided the alleged place of occurrence i.e. BOP
Muhawa on 09/10.08.2021 but no recovery was effected. He contends that
the recovery allegedly effected on 25.05.2022 brought in through a drone at
BOP Bharowal cannot be connected to him. He has already disclosed to the
investigating agency that his mother had destroyed his mobile phone and
SIM card. He, on the other hand, handed over the mobile phone of his wife
to the investigating agency pursuant to the order dated 12.12.2022 passed by
this Court. He, thus, contends that the recovery cannot be connected to the
petitioner in any manner, and therefore, he be granted the concession of
anticipatory bail, moreso, when, he has no criminal antecedents.
6. The learned counsel for the State, on the other hand, while
referring to the reply dated 10.12.2022 contends that the petitioner is
deliberately misleading the investigating agency. As per police
investigation, the petitioner was in touch with Pakistan based smugglers.
Though, he had joined the investigation, he refused to handover his phone
and SIM card to the investigating agency. On the contrary he stated that the
same had been destroyed by his mother. Subsequently, pursuant to an order
of this Court, he has handed over a mobile phone of his wife. He, thus,
contends that the serious nature of the allegations against the petitioner of
being in contact with Pakistan based smugglers for the smuggling of drugs
does not entitle him to the grant of anticipatory bail, moreso, when he is
deliberately misleading the investigation.
7. I have heard the learned counsel for the parties at length.
8. The allegations against the petitioner are very serious. As per
secret information, the petitioner is stated to have been in contact with
Pakistan based smugglers on a number of occasions. In fact, drugs were
brought in from Pakistan by a drone on the intervening night 25/26.05.2022
and the same has been connected to the petitioner. On joining investigation,
the petitioner has made deliberate attempts to mislead the investigation
firstly, by stating that his phone and SIM card have been destroyed by his
mother and thereafter, by handing over the mobile phone of his wife to the
investigating agency. Therefore, it is apparent that the petitioner is
withholding vital information, which is necessary for the investigating
agency to take the investigation of the present case to the logical conclusion.
Even otherwise, the allegations against the petitioner are extremely grave
and serious. With increased use of drones to transport drugs and weapons,
cross border narco-terrorism is on the rise and must be nipped in the bud
with a heavy hand. Therefore, the investigating agencies must have
complete latitude in investigating such cases.
9. In view of the above, the custodial interrogation of the
petitioner is certainly necessary keeping in view the nature of offence, his
conduct during investigation as also to take the investigation of the present
case to its logical conclusion.
10. Therefore, I find no merit in the present petition and the same is
hereby dismissed.
|
The Punjab and Haryana High Court, while rejecting an anticipatory bail application on Wednesday filed by an alleged drug smuggler in close contacts with suppliers from Pakistan, made serious observations on the situation of rising cross border narco-terrorism with increasing use of drones to smuggle drugs and weapons across borders.
Rejecting the anticipatory bail plea, a single bench of Justice Jasjit Singh Bedi said that:
"The allegations against the petitioner are extremely grave and serious. With increased use of drones to transport drugs and weapons, cross border narco-terrorism is on the rise and must be nipped in the bud with a heavy hand. Therefore, the investigating agencies must have complete latitude in investigating such cases."
The matter reached the Court when a petition was filed under Section 438 CrPC for grant of anticipatory bail by a resident of the Pakistan-bordering Tarn Taran district of Punjab in an FIR registered under Sections 21, 23 and 29 of the NDPS Act.
The Police lodged the FIR upon secret information connecting the petitioner with a drone found coming from Pakistan, which dropped two packets of heroin, each containing 1.12 Kgs of heroin, and flew back in the direction of Pakistan. A total of 2.24 Kgs heroin was recovered, resulting in the FIR.
The petitioner contended that FIR was registered on 10.08.2021 and the contraband was recovered on the intervening night of 25/26.05.2022. During the interim period, the investigating agency had made raids, however, no recovery was ever made. Stating that the recovery allegedly effected on 25.05.2022 through a drone could not be connected to him, he contended that he should be granted anticipatory bail.
The State, on the other hand, contended that the petitioner was in touch with Pakistan based smugglers. It was contended that the petitioner was not cooperative. The State argued that the petitioner refused to hand over his mobile phone and SIM card to the investigating agency. On the contrary, he stated that the same had been destroyed by his mother. Subsequently, he handed over his wife's mobile phone and was deliberately misleading the investigating agency.
The petitioner had earlier sought the concession of anticipatory bail, which was dismissed by the Court of Additional Sessions Judge, Amritsar and later by the High Court, asking him to join the investigation.
The Court, noting the seriousness of allegations against accused, increasing cross border narco-terrorism and the conduct of the petitioner said that:
"The allegations against the petitioner are very serious. As per secret information, the petitioner is stated to have been in contact with Pakistan based smugglers on a number of occasions. In fact, drugs were brought in from Pakistan by a drone on the intervening night 25/26.05.2022 and the same has been connected to the petitioner."
The Court further added that:
"On joining investigation, he has made deliberate attempts to mislead the investigation firstly, by stating that his phone and SIM card were destroyed by his mother and thereafter, by handing over his wife's phone. Therefore, it is apparent that he is withholding vital information, necessary for the investigating agency. In view of the above, his custodial interrogation is certainly necessary."
Case Title: Gurmeet Singh v. State of Punjab
Coram: Justice Jasjit Singh Bedi
|
The Punjab and Haryana High Court, while rejecting an anticipatory bail application on Wednesday filed by an alleged drug smuggler in close contacts with suppliers from Pakistan, made serious observations on the situation of rising cross border narco-terrorism with increasing use of drones to smuggle drugs and weapons across borders.
Rejecting the anticipatory bail plea, a single bench of Justice Jasjit Singh Bedi said that:
"The allegations against the petitioner are extremely grave and serious. With increased use of drones to transport drugs and weapons, cross border narco-terrorism is on the rise and must be nipped in the bud with a heavy hand. Therefore, the investigating agencies must have complete latitude in investigating such cases."
The matter reached the Court when a petition was filed under Section 438 CrPC for grant of anticipatory bail by a resident of the Pakistan-bordering Tarn Taran district of Punjab in an FIR registered under Sections 21, 23 and 29 of the NDPS Act.
The Police lodged the FIR upon secret information connecting the petitioner with a drone found coming from Pakistan, which dropped two packets of heroin, each containing 1.12 Kgs of heroin, and flew back in the direction of Pakistan. A total of 2.24 Kgs heroin was recovered, resulting in the FIR.
The petitioner contended that FIR was registered on 10.08.2021 and the contraband was recovered on the intervening night of 25/26.05.2022. During the interim period, the investigating agency had made raids, however, no recovery was ever made. Stating that the recovery allegedly effected on 25.05.2022 through a drone could not be connected to him, he contended that he should be granted anticipatory bail.
The State, on the other hand, contended that the petitioner was in touch with Pakistan based smugglers. It was contended that the petitioner was not cooperative. The State argued that the petitioner refused to hand over his mobile phone and SIM card to the investigating agency. On the contrary, he stated that the same had been destroyed by his mother. Subsequently, he handed over his wife's mobile phone and was deliberately misleading the investigating agency.
The petitioner had earlier sought the concession of anticipatory bail, which was dismissed by the Court of Additional Sessions Judge, Amritsar and later by the High Court, asking him to join the investigation.
The Court, noting the seriousness of allegations against accused, increasing cross border narco-terrorism and the conduct of the petitioner said that:
"The allegations against the petitioner are very serious. As per secret information, the petitioner is stated to have been in contact with Pakistan based smugglers on a number of occasions. In fact, drugs were brought in from Pakistan by a drone on the intervening night 25/26.05.2022 and the same has been connected to the petitioner."
The Court further added that:
"On joining investigation, he has made deliberate attempts to mislead the investigation firstly, by stating that his phone and SIM card were destroyed by his mother and thereafter, by handing over his wife's phone. Therefore, it is apparent that he is withholding vital information, necessary for the investigating agency. In view of the above, his custodial interrogation is certainly necessary."
Case Title: Gurmeet Singh v. State of Punjab
Coram: Justice Jasjit Singh Bedi
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1. The instant contempt petition has been filed for the alleged willful
violation of the orders dated 15.10.2020 and 21.12.2020, passed by this
Court in W.P.(C) No. 7356/2021 & CM No. 33867/2020.
2. The facts, in brief, leading to the instant contempt petition are as
a) Aggrieved by the non-consideration of her application for
putting up a boundary wall to secure her property in terms of
Digitally Signed CONT.CAS(C) 92/2022 Page 1 of 10
the revenue land records, the Petitioner herein approached this
Court by filing W.P.(C) No. 7356/2021.
b) Notice was issued on the writ petition and a Status Report was
filed by the Police. The Status Report has been reproduced in
the order dated 15.10.2020. After considering the Status Report,
this Court on 15.10.2020 passed the following order:
“5. The photographs show that the petitioner’s
property is unprotected and can be walked into
and put to misuse by anybody. It is in nobody’s
interest that the place be open to mischief.
Therefore, in the interest of the parties, it should
be secured in such a manner that all mischief is
obviated. The petitioner is ready and willing to
give an undertaking to the effect that if the
boundary wall is secured, she will remove it in
terms of such order as may be passed by the
Deputy Commissioner Revenue, in her appeal and
applications which are pending for more than half
a decade.
6. In the circumstances, let the Deputy
Commissioner dispose-off her appeal and/or her
application for securing her property in terms of
the above, preferably within a period of 2 months
from today. The parties may be heard through
video conferencing, through counsel.”
c) As proper police protection had not been granted to the
Petitioner, the Petitioner moved an application, being CM
APPL. 33867/2020, seeking directions. The said application
was considered by this Court on 21.12.2020 wherein this Court,
in terms of the order dated 15.10.2020, directed the Police to
grant protection to the Petitioner at the time of construction of
Digitally Signed CONT.CAS(C) 92/2022 Page 2 of 10
the boundary wall. Relevant portion of the said order reads as
“4. The learned counsel for the
applicant/petitioner submits that the boundary
wall has not been constructed as the petitioner
was awaiting due action by the respondents.
5. The Court would note that assurance was given
by the learned ASC for the State that status quo
apropos the petitioner’s possession of the
property would be secured. Since the petitioner is
stated to be in possession of the property by the
learned ASC for the State, let the boundary wall
be constructed to secure the property in terms of
the previous order as soon as possible, with due
intimation to the learned ASC for the State. Albeit,
the same would be without prejudice to the rights
and contentions of the parties, in particular those
of R-6, who states that some possession has been
given to him.
6. The objective of the aforesaid exercise is that
the property be secured from mischief. The
appropriate undertaking as indicated in para 5 of
the aforesaid order, shall be furnished by the
petitioner before the Deputy Commissioner
(Revenue) and a copy thereof shall be filed in this
Court within one month.
7. The learned ASC for the State states that
because of COVID-19 pandemic related
administrative exigencies, the demarcation could
not be carried out. Therefore, he seeks and is
granted 3 more weeks’ time to comply with the
order, with due notice to the parties. An
endeavour shall also be made to dispose-off the
petitioner’s appeal within a period of 5 months
Digitally Signed CONT.CAS(C) 92/2022 Page 3 of 10
d) It is stated that the boundary wall was constructed on
24.12.2020, and in terms of the orders dated 15.10.2020 and
21.12.2020, passed by this Court in W.P.(C) No. 7356/2021 &
CM No. 33867/2020, an undertaking was given by the
Petitioner on 23.12.2020 that in case it was found that the
boundary wall had not been constructed in terms of the orders
of this Court or if the Deputy Commissioner, Revenue, so
ordered, the Petitioner would demolish the boundary wall.
e) It is stated that on 03.01.2022, the Respondent No.1 herein,
with the aid of certain persons, arrived at the premises and
demolished the boundary wall constructed by the Petitioner.
f) It is stated that the Petitioner lodged an FIR against the
Respondent No.1 at Police Station Burari, being FIR
No.17/2022, dated 04.01.2022 for offences under Sections
448/511 IPC, and also approached this Court by filing the
instant contempt petition.
g) It is pertinent to note that Charge-sheet in the abovementioned
FIR for offences under Sections 447/448/451/511/34 IPC was
filed on 04.05.2022 before the learned MM, Tis Hazari Courts.
3. Notice in the instant contempt petition was issued on 27.01.2022
wherein this Court observed as under:
“7. An FIR dated 04.01.2022, has been lodged against
respondent no.1 by the petitioner. It is odd that the
local police have done nothing in the matter, despite a
lapse of 23 days since registration of the FIR. Surely, a
prompt and robust response was expected from the
Digitally Signed CONT.CAS(C) 92/2022 Page 4 of 10
police, especially when the wall had been built up in
terms of the court's orders, with due intimation to the
police and the State.
8. Let the DCP look into the matter and file an affidavit
before the next date. The learned ASC for GNCTD
submits that the needful shall be done.
9. Issue notice to respondent No.1 through ordinary
process, approved courier, Speed Post, WhatsApp, e-
mail, SMS, Signal, and other viable modes of
electronic service, through counsel as well, returnable
on 07.03.2022.”
4. On 07.03.2022, this Court found that the Petitioner is guilty of
contempt of Court and the apology tendered by the Respondent
No.1/Contemnor was rejected by this Court on the ground that the manner in
which the demolition was done by the Respondent No.1/Contemnor with the
help of a JCB excavator machine, as evidenced in the photographs
reproduced in the said order, portrayed that the demolition was a willful and
deliberate act on the part of the Respondent No.1/Contemnor to flout the
orders of this Court. Relevant portion of the said order reads as under:
“2. At the outset, the learned counsel for the R-1
submits that the wall demolished by the said
respondent was possibly due to misconstruing of the
court's directions, for which an apology is tendered.
When the demolition was being carried out, with the
assistance of a JCB excavator machine, as evidenced
in the photographs, reproduced in the aforesaid order,
the local police was intimated about the same and they
reached the site.
3. The court is informed that an FIR has been
registered. The court is informed that the wall has been
Digitally Signed CONT.CAS(C) 92/2022 Page 5 of 10
rebuilt by the petitioner with due protection being
provided by the local police at the initiative of the SHO
himself. He assures a thorough investigation in the
matter. The court is also assured by the learned
counsel for the State, that the charge-sheet, as may be,
shall be filed shortly.
4. The learned counsel for the petitioner submits that
the expenses for building up the wall are in the amount
of Rs. 10,000/-. Let the said monies be paid by R-1 to
the petitioner.
5. Insofar as the wall was built under the directions of
the court, and the built wall is a part of record of this
court, R-1 could not possibly have demolished it on his
own. It was always open to R-1 to approach the court
for variation in the order and/or to intimate the court,
that he believed that the petitioner had mislead the
court. Instead, R-1 has taken the law in his hands and
has with much fanfare demolished the wall by a JCB
excavator machine and has breached the court's
directions. In the circumstances, R-1 is held guilty of
having committed contempt of court under sections
2(b) and 12 of Contempt of Courts Act, 1971.
6. The oral apology tendered by R-1 lacks remorse and
is accordingly rejected.
7. List for orders on sentencing on 11.05.2022.
8. The local police assures the court of due protection
of the petitioner who is apprehensive of harm from R-
5. The matter was fixed for orders on sentencing on 11.05.2022. On
11.05.2022, the matter was adjourned to 12.05.2022, and thereafter to today,
i.e. 13.05.2022.
Digitally Signed CONT.CAS(C) 92/2022 Page 6 of 10
6. Heard Ms. Vertika Sharma, learned counsel for the Petitioner, Mr.
Debopriyo Moulik, learned counsel for the Respondent No.1/Contemnor,
and Mr. Sameer Vashisht, learned ASC(Civil) GNCTD, and perused the
material on record.
7. Learned counsel for the Respondent No.1/Contemnor contends that
the property of the Petitioner is adjacent to the property of the Respondent
No.1 and there is a dispute between them regarding demarcation of the
property. He, therefore, submits that demolition was conducted because
Respondent No.1 was under the misconception that the wall had been
constructed on his land. He tenders an unconditional apology and prays that
the Respondent No.1 ought not be punished under the Contempt of Courts
8. The submissions of the learned counsel for the Respondent
No.1/Contemnor cannot be accepted by this Court. The order dated
15.10.2020 was passed in the presence of the Respondent No.1/Contemnor
wherein the Petitioner was directed to construct a boundary wall. Order
dated 21.12.2020, granting protection to the Petitioner herein, was also
passed in the presence of the Respondent No.1/Contemnor. The Respondent
No.1/Contemnor cannot now plead ignorance regarding the area where the
boundary wall had been constructed.
9. The boundary wall was constructed on 23.12.2020. Photographs
evidencing the said construction have been filed along with the instant
contempt petition (Annexure CP-3). Admittedly, the dispute as to whether
the boundary wall has been constructed on the property of the Petitioner or
on the property of the Respondent No.1/Contemnor is pending before the
Deputy Commissioner, Revenue. Demolition of the boundary wall took
Digitally Signed CONT.CAS(C) 92/2022 Page 7 of 10
place on 03.01.2022, i.e. after more than a year of the construction of the
boundary wall. This action, therefore, was not in the heat of the moment
and, therefore, can only be construed as an attempt by the Respondent
No.1/Contemnor to willfully flout the orders passed by this Court.
10. The manner in which the demolition took place, i.e. by using a JCB
excavator and with the aid of other people, also indicate that the Respondent
No.1/Contemnor harboured the intention to terrorize the Petitioner. This
demonstrates that the Respondent No.1/Contemnor possess scant regard
towards the orders of the Court, and has undermined the dignity of the Court
and outraged the majesty of law. The action of the Respondent
No.1/Contemnor cannot be said to be an outcome of confusion regarding the
site where the boundary wall has been constructed, especially when the
matter was still under consideration before the Deputy Commissioner,
Revenue. In any event, the Petitioner had given an undertaking that in case it
was found that the boundary wall is not constructed in terms of the orders of
this Court or if the Deputy Commissioner, Revenue, so orders, the Petitioner
would demolish the boundary wall.
11. The Supreme Court in the case of In Re: Vinay Chandra, (1995) 2
SCC 584, had delineated the purpose of the law of contempt in building
confidence in the judicial process. The relevant paragraph of the said
judgement has been reproduced as follows:
“39. The rule of law is the foundation of a democratic
society. The Judiciary is the guardian of the rule of law.
Hence judiciary is not only the third pillar, but the
central pillar of the democratic State. In a democracy
like ours, where there is a written Constitution which is
above all individuals and institutions and where the
power of judicial review is vested in the superior courts,
Digitally Signed CONT.CAS(C) 92/2022 Page 8 of 10
the judiciary has a special and additional duty to
perform, viz., to oversee that all individuals and
institutions including the executive and the legislature act
within the framework of not only the law but also the
fundamental law of the land. This duty is apart from the
function of adjudicating the disputes between the parties
which is essential to peaceful and orderly development of
the society. If the judiciary is to perform its duties and
functions effectively and remain true to the spirit with
which they are sacredly entrusted to it, the dignity and
authority of the courts have to be respected and protected
at all costs. Otherwise, the very cornerstone of our
constitutional scheme will give way and with it will
disappear the rule of law and the civilized life in the
society. It is for this purpose that the courts are entrusted
with the extraordinary power of punishing those who
indulge in acts whether inside or outside the courts,
which tend to undermine their authority and bring them
in disrepute and disrespect by scandalising them and
obstructing them from discharging their duties without
fear or favour. When the court exercises this power, it
does not do so to vindicate the dignity and honour of the
individual judge who is personally attacked or
scandalised, but to uphold the majesty of the law and of
the administration of justice. The foundation of the
judiciary is the trust and the confidence of the people in
its ability to deliver fearless and impartial justice. When
the foundation itself is shaken by acts which tend to
create disaffection and disrespect for the authority of the
court by creating distrust in its working, the edifice of the
judicial system gets eroded.”
12. The purpose of contempt jurisdiction is to uphold the majesty and
dignity of the courts of law, since the respect and authority commanded by
the courts of law are the greatest guarantee to an ordinary citizen and the
democratic fabric of society will suffer if respect for the judiciary is
Digitally Signed CONT.CAS(C) 92/2022 Page 9 of 10
undermined. For the acts done by the Respondent No.1/Contemnor, he
deserves no mercy from this Court. A strong message has to be sent to the
society that the orders of the Court cannot be flouted by using strong arm
tactics.
13. Keeping in view the contumacious conduct of the Respondent
No.1/Contemnor (Shyam Sunder Tyagi), this Court sentences the
Respondent No.1/Contemnor (Shyam Sunder Tyagi), who is present in
Court today, to undergo 45 days of simple imprisonment along with a fine of
14. The Respondent No.1/Contemnor (Shyam Sunder Tyagi) is directed
to be taken in custody forthwith.
15. Registry is directed to prepare the necessary warrants forthwith.
16. With these observations, the petition is disposed, of along with all the
pending application(s), if any.
Digitally Signed CONT.CAS(C) 92/2022 Page 10 of 10
|
Observing that the purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law, the Delhi High Court has said that the democratic fabric of society will suffer if respect for the judiciary is undermined.
Justice Subramonium Prasad observed thus:
"The purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law, since the respect and authority commanded by the courts of law are the greatest guarantee to an ordinary citizen and the democratic fabric of society will suffer if respect for the judiciary is undermined."
The Court was dealing with a contempt plea filed for the alleged willful violation of the two orders passed by the High Court.
The facts of the matter are that being aggrieved by the non-consideration of her application for putting up a boundary wall to secure her property in terms of the revenue land records, the Petitioner had approached the High Court by filing a writ plea. As proper police protection had not been granted to the Petitioner, she had moved an application, by way of which the Court directed the Police to grant protection to the Petitioner at the time of construction of the boundary wall.
It was thus stated that the boundary wall was constructed on 24.12.2020, and in terms of the orders dated 15.10.2020 and 21.12.2020, an undertaking was given by the Petitioner on 23.12.2020 that in case it was found that the boundary wall had not been constructed in terms of the orders or if the Deputy Commissioner, Revenue, so ordered, the Petitioner would demolish the boundary wall.
Furthermore , it was stated that on 03.01.2022, the Respondent No.1, with the aid of certain persons, arrived at the premises and demolished the boundary wall constructed by the Petitioner.
It was stated that the Petitioner had then lodged an FIR against the Respondent No.1 for offences under sec. 448 and 511 of IPC, and also approached High Court by filing the contempt petition.
Thereafter, on 07.03.2022, the Court had found that the Petitioner was guilty of contempt of Court and that the apology tendered by the Respondent No.1 Contemnor was rejected on the ground that the manner in which the demolition was done with the help of a JCB excavator machine, portrayed that the demolition was a willful and deliberate act on the part of the Respondent No.1 to flout the Court orders.
"The manner in which the demolition took place, i.e. by using a JCB excavator and with the aid of other people, also indicate that the Respondent No.1/Contemnor harboured the intention to terrorize the Petitioner. This demonstrates that the Respondent No.1/Contemnor possess scant regard towards the orders of the Court, and has undermined the dignity of the Court and outraged the majesty of law," the Court observed.
It added that the action of the Respondent No.1 Contemnor could not be said to be an outcome of confusion regarding the site where the boundary wall was constructed, especially when the matter was still under consideration before the Deputy Commissioner, Revenue.
"In any event, the Petitioner had given an undertaking that in case it was found that the boundary wall is not constructed in terms of the orders of this Court or if the Deputy Commissioner, Revenue, so orders, the Petitioner would demolish the boundary wall," it said.
Thus, in view the contumacious conduct of the Respondent No.1 Contemnor, the Court sentenced him to undergo 45 days of simple imprisonment along with a fine of Rs.2,000.
The Court directed the Contemnor to be taken in custody forthwith.
Case Title: NIRMAL JINDAL v. SHYAM SUNDER TYAGI & ORS
|
1. The instant contempt petition has been filed for the alleged willful
violation of the orders dated 15.10.2020 and 21.12.2020, passed by this
Court in W.P.(C) No. 7356/2021 & CM No. 33867/2020.
2. The facts, in brief, leading to the instant contempt petition are as
a) Aggrieved by the non-consideration of her application for
putting up a boundary wall to secure her property in terms of
Digitally Signed CONT.CAS(C) 92/2022 Page 1 of 10
the revenue land records, the Petitioner herein approached this
Court by filing W.P.(C) No. 7356/2021.
b) Notice was issued on the writ petition and a Status Report was
filed by the Police. The Status Report has been reproduced in
the order dated 15.10.2020. After considering the Status Report,
this Court on 15.10.2020 passed the following order:
“5. The photographs show that the petitioner’s
property is unprotected and can be walked into
and put to misuse by anybody. It is in nobody’s
interest that the place be open to mischief.
Therefore, in the interest of the parties, it should
be secured in such a manner that all mischief is
obviated. The petitioner is ready and willing to
give an undertaking to the effect that if the
boundary wall is secured, she will remove it in
terms of such order as may be passed by the
Deputy Commissioner Revenue, in her appeal and
applications which are pending for more than half
a decade.
6. In the circumstances, let the Deputy
Commissioner dispose-off her appeal and/or her
application for securing her property in terms of
the above, preferably within a period of 2 months
from today. The parties may be heard through
video conferencing, through counsel.”
c) As proper police protection had not been granted to the
Petitioner, the Petitioner moved an application, being CM
APPL. 33867/2020, seeking directions. The said application
was considered by this Court on 21.12.2020 wherein this Court,
in terms of the order dated 15.10.2020, directed the Police to
grant protection to the Petitioner at the time of construction of
Digitally Signed CONT.CAS(C) 92/2022 Page 2 of 10
the boundary wall. Relevant portion of the said order reads as
“4. The learned counsel for the
applicant/petitioner submits that the boundary
wall has not been constructed as the petitioner
was awaiting due action by the respondents.
5. The Court would note that assurance was given
by the learned ASC for the State that status quo
apropos the petitioner’s possession of the
property would be secured. Since the petitioner is
stated to be in possession of the property by the
learned ASC for the State, let the boundary wall
be constructed to secure the property in terms of
the previous order as soon as possible, with due
intimation to the learned ASC for the State. Albeit,
the same would be without prejudice to the rights
and contentions of the parties, in particular those
of R-6, who states that some possession has been
given to him.
6. The objective of the aforesaid exercise is that
the property be secured from mischief. The
appropriate undertaking as indicated in para 5 of
the aforesaid order, shall be furnished by the
petitioner before the Deputy Commissioner
(Revenue) and a copy thereof shall be filed in this
Court within one month.
7. The learned ASC for the State states that
because of COVID-19 pandemic related
administrative exigencies, the demarcation could
not be carried out. Therefore, he seeks and is
granted 3 more weeks’ time to comply with the
order, with due notice to the parties. An
endeavour shall also be made to dispose-off the
petitioner’s appeal within a period of 5 months
Digitally Signed CONT.CAS(C) 92/2022 Page 3 of 10
d) It is stated that the boundary wall was constructed on
24.12.2020, and in terms of the orders dated 15.10.2020 and
21.12.2020, passed by this Court in W.P.(C) No. 7356/2021 &
CM No. 33867/2020, an undertaking was given by the
Petitioner on 23.12.2020 that in case it was found that the
boundary wall had not been constructed in terms of the orders
of this Court or if the Deputy Commissioner, Revenue, so
ordered, the Petitioner would demolish the boundary wall.
e) It is stated that on 03.01.2022, the Respondent No.1 herein,
with the aid of certain persons, arrived at the premises and
demolished the boundary wall constructed by the Petitioner.
f) It is stated that the Petitioner lodged an FIR against the
Respondent No.1 at Police Station Burari, being FIR
No.17/2022, dated 04.01.2022 for offences under Sections
448/511 IPC, and also approached this Court by filing the
instant contempt petition.
g) It is pertinent to note that Charge-sheet in the abovementioned
FIR for offences under Sections 447/448/451/511/34 IPC was
filed on 04.05.2022 before the learned MM, Tis Hazari Courts.
3. Notice in the instant contempt petition was issued on 27.01.2022
wherein this Court observed as under:
“7. An FIR dated 04.01.2022, has been lodged against
respondent no.1 by the petitioner. It is odd that the
local police have done nothing in the matter, despite a
lapse of 23 days since registration of the FIR. Surely, a
prompt and robust response was expected from the
Digitally Signed CONT.CAS(C) 92/2022 Page 4 of 10
police, especially when the wall had been built up in
terms of the court's orders, with due intimation to the
police and the State.
8. Let the DCP look into the matter and file an affidavit
before the next date. The learned ASC for GNCTD
submits that the needful shall be done.
9. Issue notice to respondent No.1 through ordinary
process, approved courier, Speed Post, WhatsApp, e-
mail, SMS, Signal, and other viable modes of
electronic service, through counsel as well, returnable
on 07.03.2022.”
4. On 07.03.2022, this Court found that the Petitioner is guilty of
contempt of Court and the apology tendered by the Respondent
No.1/Contemnor was rejected by this Court on the ground that the manner in
which the demolition was done by the Respondent No.1/Contemnor with the
help of a JCB excavator machine, as evidenced in the photographs
reproduced in the said order, portrayed that the demolition was a willful and
deliberate act on the part of the Respondent No.1/Contemnor to flout the
orders of this Court. Relevant portion of the said order reads as under:
“2. At the outset, the learned counsel for the R-1
submits that the wall demolished by the said
respondent was possibly due to misconstruing of the
court's directions, for which an apology is tendered.
When the demolition was being carried out, with the
assistance of a JCB excavator machine, as evidenced
in the photographs, reproduced in the aforesaid order,
the local police was intimated about the same and they
reached the site.
3. The court is informed that an FIR has been
registered. The court is informed that the wall has been
Digitally Signed CONT.CAS(C) 92/2022 Page 5 of 10
rebuilt by the petitioner with due protection being
provided by the local police at the initiative of the SHO
himself. He assures a thorough investigation in the
matter. The court is also assured by the learned
counsel for the State, that the charge-sheet, as may be,
shall be filed shortly.
4. The learned counsel for the petitioner submits that
the expenses for building up the wall are in the amount
of Rs. 10,000/-. Let the said monies be paid by R-1 to
the petitioner.
5. Insofar as the wall was built under the directions of
the court, and the built wall is a part of record of this
court, R-1 could not possibly have demolished it on his
own. It was always open to R-1 to approach the court
for variation in the order and/or to intimate the court,
that he believed that the petitioner had mislead the
court. Instead, R-1 has taken the law in his hands and
has with much fanfare demolished the wall by a JCB
excavator machine and has breached the court's
directions. In the circumstances, R-1 is held guilty of
having committed contempt of court under sections
2(b) and 12 of Contempt of Courts Act, 1971.
6. The oral apology tendered by R-1 lacks remorse and
is accordingly rejected.
7. List for orders on sentencing on 11.05.2022.
8. The local police assures the court of due protection
of the petitioner who is apprehensive of harm from R-
5. The matter was fixed for orders on sentencing on 11.05.2022. On
11.05.2022, the matter was adjourned to 12.05.2022, and thereafter to today,
i.e. 13.05.2022.
Digitally Signed CONT.CAS(C) 92/2022 Page 6 of 10
6. Heard Ms. Vertika Sharma, learned counsel for the Petitioner, Mr.
Debopriyo Moulik, learned counsel for the Respondent No.1/Contemnor,
and Mr. Sameer Vashisht, learned ASC(Civil) GNCTD, and perused the
material on record.
7. Learned counsel for the Respondent No.1/Contemnor contends that
the property of the Petitioner is adjacent to the property of the Respondent
No.1 and there is a dispute between them regarding demarcation of the
property. He, therefore, submits that demolition was conducted because
Respondent No.1 was under the misconception that the wall had been
constructed on his land. He tenders an unconditional apology and prays that
the Respondent No.1 ought not be punished under the Contempt of Courts
8. The submissions of the learned counsel for the Respondent
No.1/Contemnor cannot be accepted by this Court. The order dated
15.10.2020 was passed in the presence of the Respondent No.1/Contemnor
wherein the Petitioner was directed to construct a boundary wall. Order
dated 21.12.2020, granting protection to the Petitioner herein, was also
passed in the presence of the Respondent No.1/Contemnor. The Respondent
No.1/Contemnor cannot now plead ignorance regarding the area where the
boundary wall had been constructed.
9. The boundary wall was constructed on 23.12.2020. Photographs
evidencing the said construction have been filed along with the instant
contempt petition (Annexure CP-3). Admittedly, the dispute as to whether
the boundary wall has been constructed on the property of the Petitioner or
on the property of the Respondent No.1/Contemnor is pending before the
Deputy Commissioner, Revenue. Demolition of the boundary wall took
Digitally Signed CONT.CAS(C) 92/2022 Page 7 of 10
place on 03.01.2022, i.e. after more than a year of the construction of the
boundary wall. This action, therefore, was not in the heat of the moment
and, therefore, can only be construed as an attempt by the Respondent
No.1/Contemnor to willfully flout the orders passed by this Court.
10. The manner in which the demolition took place, i.e. by using a JCB
excavator and with the aid of other people, also indicate that the Respondent
No.1/Contemnor harboured the intention to terrorize the Petitioner. This
demonstrates that the Respondent No.1/Contemnor possess scant regard
towards the orders of the Court, and has undermined the dignity of the Court
and outraged the majesty of law. The action of the Respondent
No.1/Contemnor cannot be said to be an outcome of confusion regarding the
site where the boundary wall has been constructed, especially when the
matter was still under consideration before the Deputy Commissioner,
Revenue. In any event, the Petitioner had given an undertaking that in case it
was found that the boundary wall is not constructed in terms of the orders of
this Court or if the Deputy Commissioner, Revenue, so orders, the Petitioner
would demolish the boundary wall.
11. The Supreme Court in the case of In Re: Vinay Chandra, (1995) 2
SCC 584, had delineated the purpose of the law of contempt in building
confidence in the judicial process. The relevant paragraph of the said
judgement has been reproduced as follows:
“39. The rule of law is the foundation of a democratic
society. The Judiciary is the guardian of the rule of law.
Hence judiciary is not only the third pillar, but the
central pillar of the democratic State. In a democracy
like ours, where there is a written Constitution which is
above all individuals and institutions and where the
power of judicial review is vested in the superior courts,
Digitally Signed CONT.CAS(C) 92/2022 Page 8 of 10
the judiciary has a special and additional duty to
perform, viz., to oversee that all individuals and
institutions including the executive and the legislature act
within the framework of not only the law but also the
fundamental law of the land. This duty is apart from the
function of adjudicating the disputes between the parties
which is essential to peaceful and orderly development of
the society. If the judiciary is to perform its duties and
functions effectively and remain true to the spirit with
which they are sacredly entrusted to it, the dignity and
authority of the courts have to be respected and protected
at all costs. Otherwise, the very cornerstone of our
constitutional scheme will give way and with it will
disappear the rule of law and the civilized life in the
society. It is for this purpose that the courts are entrusted
with the extraordinary power of punishing those who
indulge in acts whether inside or outside the courts,
which tend to undermine their authority and bring them
in disrepute and disrespect by scandalising them and
obstructing them from discharging their duties without
fear or favour. When the court exercises this power, it
does not do so to vindicate the dignity and honour of the
individual judge who is personally attacked or
scandalised, but to uphold the majesty of the law and of
the administration of justice. The foundation of the
judiciary is the trust and the confidence of the people in
its ability to deliver fearless and impartial justice. When
the foundation itself is shaken by acts which tend to
create disaffection and disrespect for the authority of the
court by creating distrust in its working, the edifice of the
judicial system gets eroded.”
12. The purpose of contempt jurisdiction is to uphold the majesty and
dignity of the courts of law, since the respect and authority commanded by
the courts of law are the greatest guarantee to an ordinary citizen and the
democratic fabric of society will suffer if respect for the judiciary is
Digitally Signed CONT.CAS(C) 92/2022 Page 9 of 10
undermined. For the acts done by the Respondent No.1/Contemnor, he
deserves no mercy from this Court. A strong message has to be sent to the
society that the orders of the Court cannot be flouted by using strong arm
tactics.
13. Keeping in view the contumacious conduct of the Respondent
No.1/Contemnor (Shyam Sunder Tyagi), this Court sentences the
Respondent No.1/Contemnor (Shyam Sunder Tyagi), who is present in
Court today, to undergo 45 days of simple imprisonment along with a fine of
14. The Respondent No.1/Contemnor (Shyam Sunder Tyagi) is directed
to be taken in custody forthwith.
15. Registry is directed to prepare the necessary warrants forthwith.
16. With these observations, the petition is disposed, of along with all the
pending application(s), if any.
Digitally Signed CONT.CAS(C) 92/2022 Page 10 of 10
|
1. The instant contempt petition has been filed for the alleged willful
violation of the orders dated 15.10.2020 and 21.12.2020, passed by this
Court in W.P.(C) No. 7356/2021 & CM No. 33867/2020.
2. The facts, in brief, leading to the instant contempt petition are as
a) Aggrieved by the non-consideration of her application for
putting up a boundary wall to secure her property in terms of
Digitally Signed CONT.CAS(C) 92/2022 Page 1 of 10
the revenue land records, the Petitioner herein approached this
Court by filing W.P.(C) No. 7356/2021.
b) Notice was issued on the writ petition and a Status Report was
filed by the Police. The Status Report has been reproduced in
the order dated 15.10.2020. After considering the Status Report,
this Court on 15.10.2020 passed the following order:
“5. The photographs show that the petitioner’s
property is unprotected and can be walked into
and put to misuse by anybody. It is in nobody’s
interest that the place be open to mischief.
Therefore, in the interest of the parties, it should
be secured in such a manner that all mischief is
obviated. The petitioner is ready and willing to
give an undertaking to the effect that if the
boundary wall is secured, she will remove it in
terms of such order as may be passed by the
Deputy Commissioner Revenue, in her appeal and
applications which are pending for more than half
a decade.
6. In the circumstances, let the Deputy
Commissioner dispose-off her appeal and/or her
application for securing her property in terms of
the above, preferably within a period of 2 months
from today. The parties may be heard through
video conferencing, through counsel.”
c) As proper police protection had not been granted to the
Petitioner, the Petitioner moved an application, being CM
APPL. 33867/2020, seeking directions. The said application
was considered by this Court on 21.12.2020 wherein this Court,
in terms of the order dated 15.10.2020, directed the Police to
grant protection to the Petitioner at the time of construction of
Digitally Signed CONT.CAS(C) 92/2022 Page 2 of 10
the boundary wall. Relevant portion of the said order reads as
“4. The learned counsel for the
applicant/petitioner submits that the boundary
wall has not been constructed as the petitioner
was awaiting due action by the respondents.
5. The Court would note that assurance was given
by the learned ASC for the State that status quo
apropos the petitioner’s possession of the
property would be secured. Since the petitioner is
stated to be in possession of the property by the
learned ASC for the State, let the boundary wall
be constructed to secure the property in terms of
the previous order as soon as possible, with due
intimation to the learned ASC for the State. Albeit,
the same would be without prejudice to the rights
and contentions of the parties, in particular those
of R-6, who states that some possession has been
given to him.
6. The objective of the aforesaid exercise is that
the property be secured from mischief. The
appropriate undertaking as indicated in para 5 of
the aforesaid order, shall be furnished by the
petitioner before the Deputy Commissioner
(Revenue) and a copy thereof shall be filed in this
Court within one month.
7. The learned ASC for the State states that
because of COVID-19 pandemic related
administrative exigencies, the demarcation could
not be carried out. Therefore, he seeks and is
granted 3 more weeks’ time to comply with the
order, with due notice to the parties. An
endeavour shall also be made to dispose-off the
petitioner’s appeal within a period of 5 months
Digitally Signed CONT.CAS(C) 92/2022 Page 3 of 10
d) It is stated that the boundary wall was constructed on
24.12.2020, and in terms of the orders dated 15.10.2020 and
21.12.2020, passed by this Court in W.P.(C) No. 7356/2021 &
CM No. 33867/2020, an undertaking was given by the
Petitioner on 23.12.2020 that in case it was found that the
boundary wall had not been constructed in terms of the orders
of this Court or if the Deputy Commissioner, Revenue, so
ordered, the Petitioner would demolish the boundary wall.
e) It is stated that on 03.01.2022, the Respondent No.1 herein,
with the aid of certain persons, arrived at the premises and
demolished the boundary wall constructed by the Petitioner.
f) It is stated that the Petitioner lodged an FIR against the
Respondent No.1 at Police Station Burari, being FIR
No.17/2022, dated 04.01.2022 for offences under Sections
448/511 IPC, and also approached this Court by filing the
instant contempt petition.
g) It is pertinent to note that Charge-sheet in the abovementioned
FIR for offences under Sections 447/448/451/511/34 IPC was
filed on 04.05.2022 before the learned MM, Tis Hazari Courts.
3. Notice in the instant contempt petition was issued on 27.01.2022
wherein this Court observed as under:
“7. An FIR dated 04.01.2022, has been lodged against
respondent no.1 by the petitioner. It is odd that the
local police have done nothing in the matter, despite a
lapse of 23 days since registration of the FIR. Surely, a
prompt and robust response was expected from the
Digitally Signed CONT.CAS(C) 92/2022 Page 4 of 10
police, especially when the wall had been built up in
terms of the court's orders, with due intimation to the
police and the State.
8. Let the DCP look into the matter and file an affidavit
before the next date. The learned ASC for GNCTD
submits that the needful shall be done.
9. Issue notice to respondent No.1 through ordinary
process, approved courier, Speed Post, WhatsApp, e-
mail, SMS, Signal, and other viable modes of
electronic service, through counsel as well, returnable
on 07.03.2022.”
4. On 07.03.2022, this Court found that the Petitioner is guilty of
contempt of Court and the apology tendered by the Respondent
No.1/Contemnor was rejected by this Court on the ground that the manner in
which the demolition was done by the Respondent No.1/Contemnor with the
help of a JCB excavator machine, as evidenced in the photographs
reproduced in the said order, portrayed that the demolition was a willful and
deliberate act on the part of the Respondent No.1/Contemnor to flout the
orders of this Court. Relevant portion of the said order reads as under:
“2. At the outset, the learned counsel for the R-1
submits that the wall demolished by the said
respondent was possibly due to misconstruing of the
court's directions, for which an apology is tendered.
When the demolition was being carried out, with the
assistance of a JCB excavator machine, as evidenced
in the photographs, reproduced in the aforesaid order,
the local police was intimated about the same and they
reached the site.
3. The court is informed that an FIR has been
registered. The court is informed that the wall has been
Digitally Signed CONT.CAS(C) 92/2022 Page 5 of 10
rebuilt by the petitioner with due protection being
provided by the local police at the initiative of the SHO
himself. He assures a thorough investigation in the
matter. The court is also assured by the learned
counsel for the State, that the charge-sheet, as may be,
shall be filed shortly.
4. The learned counsel for the petitioner submits that
the expenses for building up the wall are in the amount
of Rs. 10,000/-. Let the said monies be paid by R-1 to
the petitioner.
5. Insofar as the wall was built under the directions of
the court, and the built wall is a part of record of this
court, R-1 could not possibly have demolished it on his
own. It was always open to R-1 to approach the court
for variation in the order and/or to intimate the court,
that he believed that the petitioner had mislead the
court. Instead, R-1 has taken the law in his hands and
has with much fanfare demolished the wall by a JCB
excavator machine and has breached the court's
directions. In the circumstances, R-1 is held guilty of
having committed contempt of court under sections
2(b) and 12 of Contempt of Courts Act, 1971.
6. The oral apology tendered by R-1 lacks remorse and
is accordingly rejected.
7. List for orders on sentencing on 11.05.2022.
8. The local police assures the court of due protection
of the petitioner who is apprehensive of harm from R-
5. The matter was fixed for orders on sentencing on 11.05.2022. On
11.05.2022, the matter was adjourned to 12.05.2022, and thereafter to today,
i.e. 13.05.2022.
Digitally Signed CONT.CAS(C) 92/2022 Page 6 of 10
6. Heard Ms. Vertika Sharma, learned counsel for the Petitioner, Mr.
Debopriyo Moulik, learned counsel for the Respondent No.1/Contemnor,
and Mr. Sameer Vashisht, learned ASC(Civil) GNCTD, and perused the
material on record.
7. Learned counsel for the Respondent No.1/Contemnor contends that
the property of the Petitioner is adjacent to the property of the Respondent
No.1 and there is a dispute between them regarding demarcation of the
property. He, therefore, submits that demolition was conducted because
Respondent No.1 was under the misconception that the wall had been
constructed on his land. He tenders an unconditional apology and prays that
the Respondent No.1 ought not be punished under the Contempt of Courts
8. The submissions of the learned counsel for the Respondent
No.1/Contemnor cannot be accepted by this Court. The order dated
15.10.2020 was passed in the presence of the Respondent No.1/Contemnor
wherein the Petitioner was directed to construct a boundary wall. Order
dated 21.12.2020, granting protection to the Petitioner herein, was also
passed in the presence of the Respondent No.1/Contemnor. The Respondent
No.1/Contemnor cannot now plead ignorance regarding the area where the
boundary wall had been constructed.
9. The boundary wall was constructed on 23.12.2020. Photographs
evidencing the said construction have been filed along with the instant
contempt petition (Annexure CP-3). Admittedly, the dispute as to whether
the boundary wall has been constructed on the property of the Petitioner or
on the property of the Respondent No.1/Contemnor is pending before the
Deputy Commissioner, Revenue. Demolition of the boundary wall took
Digitally Signed CONT.CAS(C) 92/2022 Page 7 of 10
place on 03.01.2022, i.e. after more than a year of the construction of the
boundary wall. This action, therefore, was not in the heat of the moment
and, therefore, can only be construed as an attempt by the Respondent
No.1/Contemnor to willfully flout the orders passed by this Court.
10. The manner in which the demolition took place, i.e. by using a JCB
excavator and with the aid of other people, also indicate that the Respondent
No.1/Contemnor harboured the intention to terrorize the Petitioner. This
demonstrates that the Respondent No.1/Contemnor possess scant regard
towards the orders of the Court, and has undermined the dignity of the Court
and outraged the majesty of law. The action of the Respondent
No.1/Contemnor cannot be said to be an outcome of confusion regarding the
site where the boundary wall has been constructed, especially when the
matter was still under consideration before the Deputy Commissioner,
Revenue. In any event, the Petitioner had given an undertaking that in case it
was found that the boundary wall is not constructed in terms of the orders of
this Court or if the Deputy Commissioner, Revenue, so orders, the Petitioner
would demolish the boundary wall.
11. The Supreme Court in the case of In Re: Vinay Chandra, (1995) 2
SCC 584, had delineated the purpose of the law of contempt in building
confidence in the judicial process. The relevant paragraph of the said
judgement has been reproduced as follows:
“39. The rule of law is the foundation of a democratic
society. The Judiciary is the guardian of the rule of law.
Hence judiciary is not only the third pillar, but the
central pillar of the democratic State. In a democracy
like ours, where there is a written Constitution which is
above all individuals and institutions and where the
power of judicial review is vested in the superior courts,
Digitally Signed CONT.CAS(C) 92/2022 Page 8 of 10
the judiciary has a special and additional duty to
perform, viz., to oversee that all individuals and
institutions including the executive and the legislature act
within the framework of not only the law but also the
fundamental law of the land. This duty is apart from the
function of adjudicating the disputes between the parties
which is essential to peaceful and orderly development of
the society. If the judiciary is to perform its duties and
functions effectively and remain true to the spirit with
which they are sacredly entrusted to it, the dignity and
authority of the courts have to be respected and protected
at all costs. Otherwise, the very cornerstone of our
constitutional scheme will give way and with it will
disappear the rule of law and the civilized life in the
society. It is for this purpose that the courts are entrusted
with the extraordinary power of punishing those who
indulge in acts whether inside or outside the courts,
which tend to undermine their authority and bring them
in disrepute and disrespect by scandalising them and
obstructing them from discharging their duties without
fear or favour. When the court exercises this power, it
does not do so to vindicate the dignity and honour of the
individual judge who is personally attacked or
scandalised, but to uphold the majesty of the law and of
the administration of justice. The foundation of the
judiciary is the trust and the confidence of the people in
its ability to deliver fearless and impartial justice. When
the foundation itself is shaken by acts which tend to
create disaffection and disrespect for the authority of the
court by creating distrust in its working, the edifice of the
judicial system gets eroded.”
12. The purpose of contempt jurisdiction is to uphold the majesty and
dignity of the courts of law, since the respect and authority commanded by
the courts of law are the greatest guarantee to an ordinary citizen and the
democratic fabric of society will suffer if respect for the judiciary is
Digitally Signed CONT.CAS(C) 92/2022 Page 9 of 10
undermined. For the acts done by the Respondent No.1/Contemnor, he
deserves no mercy from this Court. A strong message has to be sent to the
society that the orders of the Court cannot be flouted by using strong arm
tactics.
13. Keeping in view the contumacious conduct of the Respondent
No.1/Contemnor (Shyam Sunder Tyagi), this Court sentences the
Respondent No.1/Contemnor (Shyam Sunder Tyagi), who is present in
Court today, to undergo 45 days of simple imprisonment along with a fine of
14. The Respondent No.1/Contemnor (Shyam Sunder Tyagi) is directed
to be taken in custody forthwith.
15. Registry is directed to prepare the necessary warrants forthwith.
16. With these observations, the petition is disposed, of along with all the
pending application(s), if any.
Digitally Signed CONT.CAS(C) 92/2022 Page 10 of 10
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Observing that the purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law, the Delhi High Court has said that the democratic fabric of society will suffer if respect for the judiciary is undermined.
Justice Subramonium Prasad observed thus:
"The purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law, since the respect and authority commanded by the courts of law are the greatest guarantee to an ordinary citizen and the democratic fabric of society will suffer if respect for the judiciary is undermined."
The Court was dealing with a contempt plea filed for the alleged willful violation of the two orders passed by the High Court.
The facts of the matter are that being aggrieved by the non-consideration of her application for putting up a boundary wall to secure her property in terms of the revenue land records, the Petitioner had approached the High Court by filing a writ plea. As proper police protection had not been granted to the Petitioner, she had moved an application, by way of which the Court directed the Police to grant protection to the Petitioner at the time of construction of the boundary wall.
It was thus stated that the boundary wall was constructed on 24.12.2020, and in terms of the orders dated 15.10.2020 and 21.12.2020, an undertaking was given by the Petitioner on 23.12.2020 that in case it was found that the boundary wall had not been constructed in terms of the orders or if the Deputy Commissioner, Revenue, so ordered, the Petitioner would demolish the boundary wall.
Furthermore , it was stated that on 03.01.2022, the Respondent No.1, with the aid of certain persons, arrived at the premises and demolished the boundary wall constructed by the Petitioner.
It was stated that the Petitioner had then lodged an FIR against the Respondent No.1 for offences under sec. 448 and 511 of IPC, and also approached High Court by filing the contempt petition.
Thereafter, on 07.03.2022, the Court had found that the Petitioner was guilty of contempt of Court and that the apology tendered by the Respondent No.1 Contemnor was rejected on the ground that the manner in which the demolition was done with the help of a JCB excavator machine, portrayed that the demolition was a willful and deliberate act on the part of the Respondent No.1 to flout the Court orders.
"The manner in which the demolition took place, i.e. by using a JCB excavator and with the aid of other people, also indicate that the Respondent No.1/Contemnor harboured the intention to terrorize the Petitioner. This demonstrates that the Respondent No.1/Contemnor possess scant regard towards the orders of the Court, and has undermined the dignity of the Court and outraged the majesty of law," the Court observed.
It added that the action of the Respondent No.1 Contemnor could not be said to be an outcome of confusion regarding the site where the boundary wall was constructed, especially when the matter was still under consideration before the Deputy Commissioner, Revenue.
"In any event, the Petitioner had given an undertaking that in case it was found that the boundary wall is not constructed in terms of the orders of this Court or if the Deputy Commissioner, Revenue, so orders, the Petitioner would demolish the boundary wall," it said.
Thus, in view the contumacious conduct of the Respondent No.1 Contemnor, the Court sentenced him to undergo 45 days of simple imprisonment along with a fine of Rs.2,000.
The Court directed the Contemnor to be taken in custody forthwith.
Case Title: NIRMAL JINDAL v. SHYAM SUNDER TYAGI & ORS
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Observing that the purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law, the Delhi High Court has said that the democratic fabric of society will suffer if respect for the judiciary is undermined.
Justice Subramonium Prasad observed thus:
"The purpose of contempt jurisdiction is to uphold the majesty and dignity of the courts of law, since the respect and authority commanded by the courts of law are the greatest guarantee to an ordinary citizen and the democratic fabric of society will suffer if respect for the judiciary is undermined."
The Court was dealing with a contempt plea filed for the alleged willful violation of the two orders passed by the High Court.
The facts of the matter are that being aggrieved by the non-consideration of her application for putting up a boundary wall to secure her property in terms of the revenue land records, the Petitioner had approached the High Court by filing a writ plea. As proper police protection had not been granted to the Petitioner, she had moved an application, by way of which the Court directed the Police to grant protection to the Petitioner at the time of construction of the boundary wall.
It was thus stated that the boundary wall was constructed on 24.12.2020, and in terms of the orders dated 15.10.2020 and 21.12.2020, an undertaking was given by the Petitioner on 23.12.2020 that in case it was found that the boundary wall had not been constructed in terms of the orders or if the Deputy Commissioner, Revenue, so ordered, the Petitioner would demolish the boundary wall.
Furthermore , it was stated that on 03.01.2022, the Respondent No.1, with the aid of certain persons, arrived at the premises and demolished the boundary wall constructed by the Petitioner.
It was stated that the Petitioner had then lodged an FIR against the Respondent No.1 for offences under sec. 448 and 511 of IPC, and also approached High Court by filing the contempt petition.
Thereafter, on 07.03.2022, the Court had found that the Petitioner was guilty of contempt of Court and that the apology tendered by the Respondent No.1 Contemnor was rejected on the ground that the manner in which the demolition was done with the help of a JCB excavator machine, portrayed that the demolition was a willful and deliberate act on the part of the Respondent No.1 to flout the Court orders.
"The manner in which the demolition took place, i.e. by using a JCB excavator and with the aid of other people, also indicate that the Respondent No.1/Contemnor harboured the intention to terrorize the Petitioner. This demonstrates that the Respondent No.1/Contemnor possess scant regard towards the orders of the Court, and has undermined the dignity of the Court and outraged the majesty of law," the Court observed.
It added that the action of the Respondent No.1 Contemnor could not be said to be an outcome of confusion regarding the site where the boundary wall was constructed, especially when the matter was still under consideration before the Deputy Commissioner, Revenue.
"In any event, the Petitioner had given an undertaking that in case it was found that the boundary wall is not constructed in terms of the orders of this Court or if the Deputy Commissioner, Revenue, so orders, the Petitioner would demolish the boundary wall," it said.
Thus, in view the contumacious conduct of the Respondent No.1 Contemnor, the Court sentenced him to undergo 45 days of simple imprisonment along with a fine of Rs.2,000.
The Court directed the Contemnor to be taken in custody forthwith.
Case Title: NIRMAL JINDAL v. SHYAM SUNDER TYAGI & ORS
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1. The application filed on behalf of the defendant under Section 8 of the
Arbitration and Conciliation Act, 1996, being I.A. No.2863/2020, was
allowed by this Court on 31st March, 2022 and a sole arbitrator was
2. The only issue to be adjudicated in the suit was whether the plaintiff
is entitled to refund of court fees in terms of Section 16 of the Court Fees
Act, 1870 read with Section 89 of the Code of Civil Procedure, 1908 (CPC).
3. Counsel for the plaintiff submits that in terms of Section 89, the
plaintiff is entitled to refund of court fees in view of the fact that the matter
has been referred to arbitration. In this regard, reliance has been placed on
the order dated 15th January, 2019 in RV Solutions Pvt. Ltd. v. Ajay Kumar
4. On the other hand, the counsel for the defendant opposes the said
5. At this stage, reference may be made to relevant provisions for the
refund of court fees. Section 16 of the Court Fees Act, 1870 is set out below:
“16. Refund of fee.—Where the Court refers the parties to the suit
to any one of the mode of settlement of dispute referred to in section
89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff
shall be entitled to a certificate from the Court authorising him to
receive back from the collector, the full amount of the fee paid in
respect of such plaint.”
6. The relevant portion of Section 89 of the CPC has been set out below:
“89. Settlement of disputes outside the Court.—(1) Where it
appears to the Court that there exist elements of a settlement which
may be acceptable to the parties, the Court shall formulate the
terms of settlement and give them to the parties for their
observations and after receiving the observations of the parties, the
Court may reformulate the terms of a possible settlement and refer
(c) judicial settlement including settlement through Lok Adalat:
(2) Were a dispute has been referred—
(a) for arbitration or conciliation, the provisions of the
Arbitration and Conciliation Act, 1996 (26 of 1996)
shall apply as if the proceedings for arbitration or
conciliation were referred for settlement under the
provisions of that Act
7. Sub-section (1) of Section 89 provides that if it appears to the Court
that settlement may be arrived between the parties, the court may refer the
matter for arbitration or conciliation or mediation or to the Lok Adalat. The
key word here is “settlement”. A reading of the aforesaid provisions leaves
no doubt in my mind that the said provisions for refund of court fees are
only applicable when the matter is referred for arbitration in the context of
8. In the present case, an application under Section 8 of the Arbitration
and Conciliation Act filed on behalf of the defendant has been allowed and
the matter has been referred for adjudication to a sole arbitrator. The matter
was not referred in terms of Section 89 of the CPC for settlement. Therefore,
the plaintiff is not entitled to refund of court fees in terms of Section 16 of
9. It is settled law that a litigant is not entitled to refund of court fees in
case of rejection of plaint under Order VII Rule 11 of the CPC where the
plaint does not disclose a cause of action. On the same analogy, the plaintiff
cannot be entitled for refund of court fees in the event of an application
under Section 8 of the Arbitration and Conciliation Act being allowed and
the parties being referred for arbitration. The rationale being that the
plaintiff has invoked a wrong remedy of filing the suit when it should have
invoked the arbitration proceedings.
10. The reliance placed by the counsel for the plaintiff on the judgment
placed in RV Solutions (supra) is misplaced. There is only a direction given
in the said case that court fees may be refunded as the matter has been
referred to arbitration. The same would not constitute a dicta to hold that
any of the cases where Section 8(1) of the application is allowed and the
matter is referred for arbitration, the plaintiff would be entitled to refund of
court fees.
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The High Court of Delhi has held that the plaintiff is not entitled to return of Court Fess when the parties are referred to arbitration under Section 8 of the A&C Act.
The Single Bench of Justice Amit Bansal held that the benefit of Section 16[1] of the Court Fees Act would only be available to the plaintiff when the parties are referred to arbitration for settlement in terms of Section 89 of the CPC and not under Section 8 of the A&C Act.
The plaintiff contented that as the application filed by the defendant under Section 8 of the A&C Act is allowed, it is entitled to refund of Court Fees in terms of Section 16 of the Courts Fees Act, 1870.
The Plaintiff relied on the decision of the Court in RV Solutions Pvt. Ltd. v. Ajay Kumar CS(COMM) 745/2017 to contend that the Court is bound to refund the Courts Fess when the matter is referred to arbitration.
The Court rejected the argument of the plaintiff that it is entitled to the refund of the Courts Fees. The Court held that the in terms of Section 16 of the Courts Fees Act, the fees is only returnable when the parties are referred to arbitration for settlement under Section 89 of the CPC.
The Court held that the plaintiff cannot be entitled to refund of court fees when it has wrongly filed the civil suit when it should have actually invoked the arbitration clause.
The Court held that the reliance on the decision of the Court in RV Solutions (supra) is misplaced as the direction given in that case was not a dicta and but a merely a passing direction.
Case Title: A-One Realtors Pvt. Ltd. v. Energy Efficiency Services Ltd.
Date: 23.05.2022
Counsel for the Plaintiff: Ms. Mahima Ahuja, Advocate.
Counsel for the Defendant: Mr. Samdarshi Sanjay, Advocate.
[1] Section16. Refund of fee. —Where the Court refers the parties to the suit to any one of the mode of settlement of dispute referred to in section 89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff shall be entitled to a certificate from the Court authorising him to receive back from the collector, the full amount of the fee paid in respect of such plaint.
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1. The application filed on behalf of the defendant under Section 8 of the
Arbitration and Conciliation Act, 1996, being I.A. No.2863/2020, was
allowed by this Court on 31st March, 2022 and a sole arbitrator was
2. The only issue to be adjudicated in the suit was whether the plaintiff
is entitled to refund of court fees in terms of Section 16 of the Court Fees
Act, 1870 read with Section 89 of the Code of Civil Procedure, 1908 (CPC).
3. Counsel for the plaintiff submits that in terms of Section 89, the
plaintiff is entitled to refund of court fees in view of the fact that the matter
has been referred to arbitration. In this regard, reliance has been placed on
the order dated 15th January, 2019 in RV Solutions Pvt. Ltd. v. Ajay Kumar
4. On the other hand, the counsel for the defendant opposes the said
5. At this stage, reference may be made to relevant provisions for the
refund of court fees. Section 16 of the Court Fees Act, 1870 is set out below:
“16. Refund of fee.—Where the Court refers the parties to the suit
to any one of the mode of settlement of dispute referred to in section
89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff
shall be entitled to a certificate from the Court authorising him to
receive back from the collector, the full amount of the fee paid in
respect of such plaint.”
6. The relevant portion of Section 89 of the CPC has been set out below:
“89. Settlement of disputes outside the Court.—(1) Where it
appears to the Court that there exist elements of a settlement which
may be acceptable to the parties, the Court shall formulate the
terms of settlement and give them to the parties for their
observations and after receiving the observations of the parties, the
Court may reformulate the terms of a possible settlement and refer
(c) judicial settlement including settlement through Lok Adalat:
(2) Were a dispute has been referred—
(a) for arbitration or conciliation, the provisions of the
Arbitration and Conciliation Act, 1996 (26 of 1996)
shall apply as if the proceedings for arbitration or
conciliation were referred for settlement under the
provisions of that Act
7. Sub-section (1) of Section 89 provides that if it appears to the Court
that settlement may be arrived between the parties, the court may refer the
matter for arbitration or conciliation or mediation or to the Lok Adalat. The
key word here is “settlement”. A reading of the aforesaid provisions leaves
no doubt in my mind that the said provisions for refund of court fees are
only applicable when the matter is referred for arbitration in the context of
8. In the present case, an application under Section 8 of the Arbitration
and Conciliation Act filed on behalf of the defendant has been allowed and
the matter has been referred for adjudication to a sole arbitrator. The matter
was not referred in terms of Section 89 of the CPC for settlement. Therefore,
the plaintiff is not entitled to refund of court fees in terms of Section 16 of
9. It is settled law that a litigant is not entitled to refund of court fees in
case of rejection of plaint under Order VII Rule 11 of the CPC where the
plaint does not disclose a cause of action. On the same analogy, the plaintiff
cannot be entitled for refund of court fees in the event of an application
under Section 8 of the Arbitration and Conciliation Act being allowed and
the parties being referred for arbitration. The rationale being that the
plaintiff has invoked a wrong remedy of filing the suit when it should have
invoked the arbitration proceedings.
10. The reliance placed by the counsel for the plaintiff on the judgment
placed in RV Solutions (supra) is misplaced. There is only a direction given
in the said case that court fees may be refunded as the matter has been
referred to arbitration. The same would not constitute a dicta to hold that
any of the cases where Section 8(1) of the application is allowed and the
matter is referred for arbitration, the plaintiff would be entitled to refund of
court fees.
|
1. The application filed on behalf of the defendant under Section 8 of the
Arbitration and Conciliation Act, 1996, being I.A. No.2863/2020, was
allowed by this Court on 31st March, 2022 and a sole arbitrator was
2. The only issue to be adjudicated in the suit was whether the plaintiff
is entitled to refund of court fees in terms of Section 16 of the Court Fees
Act, 1870 read with Section 89 of the Code of Civil Procedure, 1908 (CPC).
3. Counsel for the plaintiff submits that in terms of Section 89, the
plaintiff is entitled to refund of court fees in view of the fact that the matter
has been referred to arbitration. In this regard, reliance has been placed on
the order dated 15th January, 2019 in RV Solutions Pvt. Ltd. v. Ajay Kumar
4. On the other hand, the counsel for the defendant opposes the said
5. At this stage, reference may be made to relevant provisions for the
refund of court fees. Section 16 of the Court Fees Act, 1870 is set out below:
“16. Refund of fee.—Where the Court refers the parties to the suit
to any one of the mode of settlement of dispute referred to in section
89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff
shall be entitled to a certificate from the Court authorising him to
receive back from the collector, the full amount of the fee paid in
respect of such plaint.”
6. The relevant portion of Section 89 of the CPC has been set out below:
“89. Settlement of disputes outside the Court.—(1) Where it
appears to the Court that there exist elements of a settlement which
may be acceptable to the parties, the Court shall formulate the
terms of settlement and give them to the parties for their
observations and after receiving the observations of the parties, the
Court may reformulate the terms of a possible settlement and refer
(c) judicial settlement including settlement through Lok Adalat:
(2) Were a dispute has been referred—
(a) for arbitration or conciliation, the provisions of the
Arbitration and Conciliation Act, 1996 (26 of 1996)
shall apply as if the proceedings for arbitration or
conciliation were referred for settlement under the
provisions of that Act
7. Sub-section (1) of Section 89 provides that if it appears to the Court
that settlement may be arrived between the parties, the court may refer the
matter for arbitration or conciliation or mediation or to the Lok Adalat. The
key word here is “settlement”. A reading of the aforesaid provisions leaves
no doubt in my mind that the said provisions for refund of court fees are
only applicable when the matter is referred for arbitration in the context of
8. In the present case, an application under Section 8 of the Arbitration
and Conciliation Act filed on behalf of the defendant has been allowed and
the matter has been referred for adjudication to a sole arbitrator. The matter
was not referred in terms of Section 89 of the CPC for settlement. Therefore,
the plaintiff is not entitled to refund of court fees in terms of Section 16 of
9. It is settled law that a litigant is not entitled to refund of court fees in
case of rejection of plaint under Order VII Rule 11 of the CPC where the
plaint does not disclose a cause of action. On the same analogy, the plaintiff
cannot be entitled for refund of court fees in the event of an application
under Section 8 of the Arbitration and Conciliation Act being allowed and
the parties being referred for arbitration. The rationale being that the
plaintiff has invoked a wrong remedy of filing the suit when it should have
invoked the arbitration proceedings.
10. The reliance placed by the counsel for the plaintiff on the judgment
placed in RV Solutions (supra) is misplaced. There is only a direction given
in the said case that court fees may be refunded as the matter has been
referred to arbitration. The same would not constitute a dicta to hold that
any of the cases where Section 8(1) of the application is allowed and the
matter is referred for arbitration, the plaintiff would be entitled to refund of
court fees.
|
The High Court of Delhi has held that the plaintiff is not entitled to return of Court Fess when the parties are referred to arbitration under Section 8 of the A&C Act.
The Single Bench of Justice Amit Bansal held that the benefit of Section 16[1] of the Court Fees Act would only be available to the plaintiff when the parties are referred to arbitration for settlement in terms of Section 89 of the CPC and not under Section 8 of the A&C Act.
The plaintiff contented that as the application filed by the defendant under Section 8 of the A&C Act is allowed, it is entitled to refund of Court Fees in terms of Section 16 of the Courts Fees Act, 1870.
The Plaintiff relied on the decision of the Court in RV Solutions Pvt. Ltd. v. Ajay Kumar CS(COMM) 745/2017 to contend that the Court is bound to refund the Courts Fess when the matter is referred to arbitration.
The Court rejected the argument of the plaintiff that it is entitled to the refund of the Courts Fees. The Court held that the in terms of Section 16 of the Courts Fees Act, the fees is only returnable when the parties are referred to arbitration for settlement under Section 89 of the CPC.
The Court held that the plaintiff cannot be entitled to refund of court fees when it has wrongly filed the civil suit when it should have actually invoked the arbitration clause.
The Court held that the reliance on the decision of the Court in RV Solutions (supra) is misplaced as the direction given in that case was not a dicta and but a merely a passing direction.
Case Title: A-One Realtors Pvt. Ltd. v. Energy Efficiency Services Ltd.
Date: 23.05.2022
Counsel for the Plaintiff: Ms. Mahima Ahuja, Advocate.
Counsel for the Defendant: Mr. Samdarshi Sanjay, Advocate.
[1] Section16. Refund of fee. —Where the Court refers the parties to the suit to any one of the mode of settlement of dispute referred to in section 89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff shall be entitled to a certificate from the Court authorising him to receive back from the collector, the full amount of the fee paid in respect of such plaint.
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The High Court of Delhi has held that the plaintiff is not entitled to return of Court Fess when the parties are referred to arbitration under Section 8 of the A&C Act.
The Single Bench of Justice Amit Bansal held that the benefit of Section 16[1] of the Court Fees Act would only be available to the plaintiff when the parties are referred to arbitration for settlement in terms of Section 89 of the CPC and not under Section 8 of the A&C Act.
The plaintiff contented that as the application filed by the defendant under Section 8 of the A&C Act is allowed, it is entitled to refund of Court Fees in terms of Section 16 of the Courts Fees Act, 1870.
The Plaintiff relied on the decision of the Court in RV Solutions Pvt. Ltd. v. Ajay Kumar CS(COMM) 745/2017 to contend that the Court is bound to refund the Courts Fess when the matter is referred to arbitration.
The Court rejected the argument of the plaintiff that it is entitled to the refund of the Courts Fees. The Court held that the in terms of Section 16 of the Courts Fees Act, the fees is only returnable when the parties are referred to arbitration for settlement under Section 89 of the CPC.
The Court held that the plaintiff cannot be entitled to refund of court fees when it has wrongly filed the civil suit when it should have actually invoked the arbitration clause.
The Court held that the reliance on the decision of the Court in RV Solutions (supra) is misplaced as the direction given in that case was not a dicta and but a merely a passing direction.
Case Title: A-One Realtors Pvt. Ltd. v. Energy Efficiency Services Ltd.
Date: 23.05.2022
Counsel for the Plaintiff: Ms. Mahima Ahuja, Advocate.
Counsel for the Defendant: Mr. Samdarshi Sanjay, Advocate.
[1] Section16. Refund of fee. —Where the Court refers the parties to the suit to any one of the mode of settlement of dispute referred to in section 89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff shall be entitled to a certificate from the Court authorising him to receive back from the collector, the full amount of the fee paid in respect of such plaint.
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1. The instant petition under Section 482 of the Code of Criminal
Procedure, 1973 (hereinafter “Cr.P.C.”) has been filed by the petitioners
praying for quashing of FIR bearing No. 702/2006 registered at Police
Station Mangol Puri, Delhi for offences punishable under Sections
498A/406/34 of the Indian Penal Code, 1860 (hereinafter “IPC”) and all
consequential proceedings emanating therefrom.
2. Petitioner no. 1 is present before this Court and has been identified by
their counsel Mr. Saurabh Kumar Tuteja and Investigating Officer SI Hawa
Singh, Police Station Mangol Puri. Respondent No.2 is also present in the
Court and has been identified by her counsel and the Investigating Officer.
3. On the query made by this Court, respondent no. 2 has categorically
stated that she has entered into compromise on her own free will and without
any pressure. It is also stated by respondent no.2 that the entire dispute has
been amicably settled between the parties.
4. The brief facts of the case are that the petitioner no.1 and respondent
no.2 got married to each other on 20th April, 2003 at Mangol Puri according
to Hindu rites and ceremonies but due to some temperamental differences
between them, they started living separately since May, 2005. There is one
girl child born out of their wedlock, who is now major.
5. Despite several efforts of reconciliation, both the parties could not
settle the differences. Respondent no. 2 lodged a complaint in C.A.W. Cell
which culminated into the aforesaid FIR against all the petitioners on 27th
6. With the intervention of family members and relatives, both the
parties entered into settlement before Mediation Centre, Tis Hazari Courts.
7. Further, in pursuance of the said settlement, the parties moved for
divorce under the Hindu Marriage Act, 1955 (hereinafter “HMA”).
Petitioner No.1 and respondent no.2 filed their first motion of the divorce
petition under Section 13B(1) of HMA which was allowed on 31st August,
2021 before the Principal Judge, Family Court, North-West, Rohini, New
Delhi. Petition under Section 13B(2) of HMA was filed by the parties and
the marriage between petitioner no. 1 and respondent no. 2 stood dissolved
by mutual consent vide order dated 10th December, 2021.
8. It is submitted that respondent no.2 has settled all her claims in
respect of her dowry articles, stridhan, marriage expenses, jewellery, gift
items and claims of past, present and future maintenance and permanent
alimony with petitioner No.1 and other family members for a sum of Rs.
15,50,000/- (Rupees Fifteen Lakhs Fifty Thousand Only) and all disputes of
any nature whatsoever, out of which Rs. 10,00,000/- (Rupees Ten Lakhs
Only) have already been paid while remaining Rs. 5,50,000/- (Rupees Five
Lakhs Fifty Thousand Only) was agreed to be paid at the time of quashing
of the FIR.
9. Petitioner no.1 has handed over a Demand Draft bearing No. 715854
for the balance amount of Rs.5,50,000/- (Rupees Five Lakhs Fifty Thousand
Only) dated 3rd March, 2022 in the name of respondent no.2 today in the
Court. Respondent No.2 has verified the particulars of the Demand Draft to
her satisfaction and stated them to be correct.
10. It is prayed that the instant FIR be quashed on the basis of
Memorandum of Understanding dated 12th March, 2021 and as per the
Judgment of the Hon’ble Supreme Court passed in Gian Singh vs. State of
11. Mr. Panna Lal Sharma, learned APP for the State submitted that there
is no opposition to the prayer made by the petitioners seeking quashing of
the FIR in question in view of the settlement arrived at between the parties.
12. Heard learned counsel for the parties and perused the record.
13. The instant criminal proceedings in respect of non-compoundable
offences are private in nature and do not have a serious impact on the
society especially when there is a settlement/compromise between victim
and accused. In such cases, it is settled law that High Court is also required
to consider the conduct and antecedents of the accused in order to ascertain
that the settlement has been entered into by her own free will and has not
been imposed upon her by the petitioner or any person related to him. In the
present case, the complainant is present in Court and has categorically stated
that she has entered into compromise and settled the entire disputes
amicably with petitioner no.1 and his family members by her own free will
without any pressure or coercion. There is also no allegation from
respondent no. 2 that the conduct and antecedents of petitioners have been
bad towards her after the compromise. As per the settlement, the respondent
no. 2 has received the entire settled amount.
14. In the case of B.S. Joshi & Ors. vs. State of Haryana & Ors (2003) 4
SCC 675, the Hon’ble Supreme Court has held that if for purpose of
securing the ends of justice, quashing of FIR becomes necessary, Section
320 Cr.P.C. would not be a bar to the exercise of the power of quashing
under Section 482 Cr.P.C.
15. Moreover, the Hon’ble Supreme Court in Jitendra Raghuvanshi &
Ors. vs. Babita Raghuvanshi & Anr. (2013) 4 SCC 58, has held that
criminal proceedings on FIR or complaint can be quashed under Section 482
Cr.P.C. in appropriate cases in order to meet ends of justice. Even in non-
compoundable offences pertaining to the matrimonial disputes, if Court is
satisfied that parties have settled the disputes amicably and without any
pressure, then for the purpose of securing ends of justice, FIRs or complaints
or subsequent criminal proceedings in respect of offences can be quashed.
16. In the instant case, as stated above, the parties have reached on the
compromise and amicably settled the entire disputes without any pressure.
In view of the settlement arrived at between the parties and the law laid
down by the Hon’ble Supreme Court, the present petition is allowed.
Accordingly, FIR bearing No. 702/2006 registered at Police Station Mangol
Puri, Delhi for offences punishable under Sections 498A/406/34 of the IPC
and all consequential proceedings emanating therefrom are quashed.
17. The petition stands disposed of.
|
The Delhi High Court has observed that FIR or complaints can be quashed even in respect of non-compoundable offences pertaining to matrimonial disputes if the Court is satisfied that the parties have settled their disputes amicably, without any pressure. Justice Chandra Dhari Singh observed thus:"Even in non- compoundable offences pertaining to the matrimonial disputes, if Court is satisfied...
The Delhi High Court has observed that FIR or complaints can be quashed even in respect of non-compoundable offences pertaining to matrimonial disputes if the Court is satisfied that the parties have settled their disputes amicably, without any pressure.
Justice Chandra Dhari Singh observed thus:
"Even in non- compoundable offences pertaining to the matrimonial disputes, if Court is satisfied that parties have settled the disputes amicably and without any pressure, then for the purpose of securing ends of justice, FIRs or complaints or subsequent criminal proceedings in respect of offences can be quashed."
The Court quashed an FIR registered under sec. 498A, 406 and 34 of the Indian Penal Code, 1860. The petitioner no.1 (husband) and respondent no.2 (wife) got married to each other on 20th April, 2003 but due to some temperamental differences between them, they started living separately since May, 2005. There was a girl child born out of their wedlock, who was now major.
Despite several efforts of reconciliation, both the parties could not settle the differences. The wife had the lodged a complaint in C.A.W. Cell which culminated into the FIR against all the petitioners.
With the intervention of family members and relatives, both the parties had later entered into settlement before Mediation Centre, Tis Hazari Courts.
In pursuance of the said settlement, the parties moved for divorce under the Hindu Marriage Act, 1955. The husband and wife had filed their first motion of the divorce petition under sec. 13B(1) which was allowed on 31st August, 2021.
The Petition under sec. 13B(2) of HMA was filed by the parties and their marriage was dissolved by mutual consent vide order dated 10th December, 2021.
It was thus submitted that the wife had settled all her claims in respect of her dowry articles, stridhan, marriage expenses, jewellery, gift items and claims of past, present and future maintenance and permanent alimony with the husband and other family members for a sum of Rs. 15,50,000 and Rs. 10,00,000 were already paid while remaining Rs. 5,50,000 was agreed to be paid at the time of quashing of the FIR.
It was therefore prayed that the FIR be quashed on the basis of Memorandum of Understanding and as per the Judgment of the Supreme Court in Gian Singh vs. State of Punjab.
"The instant criminal proceedings in respect of non-compoundable offences are private in nature and do not have a serious impact on the society especially when there is a settlement/compromise between victim and accused. In such cases, it is settled law that High Court is also required to consider the conduct and antecedents of the accused in order to ascertain that the settlement has been entered into by her own free will and has not been imposed upon her by the petitioner or any person related to him," the Court said.
The Court noted that there was no allegation from the wife that the conduct and antecedents of petitioners had been bad towards her after the compromise and that according to the settlement, she had received the entire settled amount.
"In the instant case, as stated above, the parties have reached on the compromise and amicably settled the entire disputes without any pressure. In view of the settlement arrived at between the parties and the law laid down by the Hon'ble Supreme Court, the present petition is allowed," the Court said.
Accordingly, the plea was disposed of.
Case Title: RAJA BERWA & ORS v. STATE & ANR
|
1. The instant petition under Section 482 of the Code of Criminal
Procedure, 1973 (hereinafter “Cr.P.C.”) has been filed by the petitioners
praying for quashing of FIR bearing No. 702/2006 registered at Police
Station Mangol Puri, Delhi for offences punishable under Sections
498A/406/34 of the Indian Penal Code, 1860 (hereinafter “IPC”) and all
consequential proceedings emanating therefrom.
2. Petitioner no. 1 is present before this Court and has been identified by
their counsel Mr. Saurabh Kumar Tuteja and Investigating Officer SI Hawa
Singh, Police Station Mangol Puri. Respondent No.2 is also present in the
Court and has been identified by her counsel and the Investigating Officer.
3. On the query made by this Court, respondent no. 2 has categorically
stated that she has entered into compromise on her own free will and without
any pressure. It is also stated by respondent no.2 that the entire dispute has
been amicably settled between the parties.
4. The brief facts of the case are that the petitioner no.1 and respondent
no.2 got married to each other on 20th April, 2003 at Mangol Puri according
to Hindu rites and ceremonies but due to some temperamental differences
between them, they started living separately since May, 2005. There is one
girl child born out of their wedlock, who is now major.
5. Despite several efforts of reconciliation, both the parties could not
settle the differences. Respondent no. 2 lodged a complaint in C.A.W. Cell
which culminated into the aforesaid FIR against all the petitioners on 27th
6. With the intervention of family members and relatives, both the
parties entered into settlement before Mediation Centre, Tis Hazari Courts.
7. Further, in pursuance of the said settlement, the parties moved for
divorce under the Hindu Marriage Act, 1955 (hereinafter “HMA”).
Petitioner No.1 and respondent no.2 filed their first motion of the divorce
petition under Section 13B(1) of HMA which was allowed on 31st August,
2021 before the Principal Judge, Family Court, North-West, Rohini, New
Delhi. Petition under Section 13B(2) of HMA was filed by the parties and
the marriage between petitioner no. 1 and respondent no. 2 stood dissolved
by mutual consent vide order dated 10th December, 2021.
8. It is submitted that respondent no.2 has settled all her claims in
respect of her dowry articles, stridhan, marriage expenses, jewellery, gift
items and claims of past, present and future maintenance and permanent
alimony with petitioner No.1 and other family members for a sum of Rs.
15,50,000/- (Rupees Fifteen Lakhs Fifty Thousand Only) and all disputes of
any nature whatsoever, out of which Rs. 10,00,000/- (Rupees Ten Lakhs
Only) have already been paid while remaining Rs. 5,50,000/- (Rupees Five
Lakhs Fifty Thousand Only) was agreed to be paid at the time of quashing
of the FIR.
9. Petitioner no.1 has handed over a Demand Draft bearing No. 715854
for the balance amount of Rs.5,50,000/- (Rupees Five Lakhs Fifty Thousand
Only) dated 3rd March, 2022 in the name of respondent no.2 today in the
Court. Respondent No.2 has verified the particulars of the Demand Draft to
her satisfaction and stated them to be correct.
10. It is prayed that the instant FIR be quashed on the basis of
Memorandum of Understanding dated 12th March, 2021 and as per the
Judgment of the Hon’ble Supreme Court passed in Gian Singh vs. State of
11. Mr. Panna Lal Sharma, learned APP for the State submitted that there
is no opposition to the prayer made by the petitioners seeking quashing of
the FIR in question in view of the settlement arrived at between the parties.
12. Heard learned counsel for the parties and perused the record.
13. The instant criminal proceedings in respect of non-compoundable
offences are private in nature and do not have a serious impact on the
society especially when there is a settlement/compromise between victim
and accused. In such cases, it is settled law that High Court is also required
to consider the conduct and antecedents of the accused in order to ascertain
that the settlement has been entered into by her own free will and has not
been imposed upon her by the petitioner or any person related to him. In the
present case, the complainant is present in Court and has categorically stated
that she has entered into compromise and settled the entire disputes
amicably with petitioner no.1 and his family members by her own free will
without any pressure or coercion. There is also no allegation from
respondent no. 2 that the conduct and antecedents of petitioners have been
bad towards her after the compromise. As per the settlement, the respondent
no. 2 has received the entire settled amount.
14. In the case of B.S. Joshi & Ors. vs. State of Haryana & Ors (2003) 4
SCC 675, the Hon’ble Supreme Court has held that if for purpose of
securing the ends of justice, quashing of FIR becomes necessary, Section
320 Cr.P.C. would not be a bar to the exercise of the power of quashing
under Section 482 Cr.P.C.
15. Moreover, the Hon’ble Supreme Court in Jitendra Raghuvanshi &
Ors. vs. Babita Raghuvanshi & Anr. (2013) 4 SCC 58, has held that
criminal proceedings on FIR or complaint can be quashed under Section 482
Cr.P.C. in appropriate cases in order to meet ends of justice. Even in non-
compoundable offences pertaining to the matrimonial disputes, if Court is
satisfied that parties have settled the disputes amicably and without any
pressure, then for the purpose of securing ends of justice, FIRs or complaints
or subsequent criminal proceedings in respect of offences can be quashed.
16. In the instant case, as stated above, the parties have reached on the
compromise and amicably settled the entire disputes without any pressure.
In view of the settlement arrived at between the parties and the law laid
down by the Hon’ble Supreme Court, the present petition is allowed.
Accordingly, FIR bearing No. 702/2006 registered at Police Station Mangol
Puri, Delhi for offences punishable under Sections 498A/406/34 of the IPC
and all consequential proceedings emanating therefrom are quashed.
17. The petition stands disposed of.
|
1. The instant petition under Section 482 of the Code of Criminal
Procedure, 1973 (hereinafter “Cr.P.C.”) has been filed by the petitioners
praying for quashing of FIR bearing No. 702/2006 registered at Police
Station Mangol Puri, Delhi for offences punishable under Sections
498A/406/34 of the Indian Penal Code, 1860 (hereinafter “IPC”) and all
consequential proceedings emanating therefrom.
2. Petitioner no. 1 is present before this Court and has been identified by
their counsel Mr. Saurabh Kumar Tuteja and Investigating Officer SI Hawa
Singh, Police Station Mangol Puri. Respondent No.2 is also present in the
Court and has been identified by her counsel and the Investigating Officer.
3. On the query made by this Court, respondent no. 2 has categorically
stated that she has entered into compromise on her own free will and without
any pressure. It is also stated by respondent no.2 that the entire dispute has
been amicably settled between the parties.
4. The brief facts of the case are that the petitioner no.1 and respondent
no.2 got married to each other on 20th April, 2003 at Mangol Puri according
to Hindu rites and ceremonies but due to some temperamental differences
between them, they started living separately since May, 2005. There is one
girl child born out of their wedlock, who is now major.
5. Despite several efforts of reconciliation, both the parties could not
settle the differences. Respondent no. 2 lodged a complaint in C.A.W. Cell
which culminated into the aforesaid FIR against all the petitioners on 27th
6. With the intervention of family members and relatives, both the
parties entered into settlement before Mediation Centre, Tis Hazari Courts.
7. Further, in pursuance of the said settlement, the parties moved for
divorce under the Hindu Marriage Act, 1955 (hereinafter “HMA”).
Petitioner No.1 and respondent no.2 filed their first motion of the divorce
petition under Section 13B(1) of HMA which was allowed on 31st August,
2021 before the Principal Judge, Family Court, North-West, Rohini, New
Delhi. Petition under Section 13B(2) of HMA was filed by the parties and
the marriage between petitioner no. 1 and respondent no. 2 stood dissolved
by mutual consent vide order dated 10th December, 2021.
8. It is submitted that respondent no.2 has settled all her claims in
respect of her dowry articles, stridhan, marriage expenses, jewellery, gift
items and claims of past, present and future maintenance and permanent
alimony with petitioner No.1 and other family members for a sum of Rs.
15,50,000/- (Rupees Fifteen Lakhs Fifty Thousand Only) and all disputes of
any nature whatsoever, out of which Rs. 10,00,000/- (Rupees Ten Lakhs
Only) have already been paid while remaining Rs. 5,50,000/- (Rupees Five
Lakhs Fifty Thousand Only) was agreed to be paid at the time of quashing
of the FIR.
9. Petitioner no.1 has handed over a Demand Draft bearing No. 715854
for the balance amount of Rs.5,50,000/- (Rupees Five Lakhs Fifty Thousand
Only) dated 3rd March, 2022 in the name of respondent no.2 today in the
Court. Respondent No.2 has verified the particulars of the Demand Draft to
her satisfaction and stated them to be correct.
10. It is prayed that the instant FIR be quashed on the basis of
Memorandum of Understanding dated 12th March, 2021 and as per the
Judgment of the Hon’ble Supreme Court passed in Gian Singh vs. State of
11. Mr. Panna Lal Sharma, learned APP for the State submitted that there
is no opposition to the prayer made by the petitioners seeking quashing of
the FIR in question in view of the settlement arrived at between the parties.
12. Heard learned counsel for the parties and perused the record.
13. The instant criminal proceedings in respect of non-compoundable
offences are private in nature and do not have a serious impact on the
society especially when there is a settlement/compromise between victim
and accused. In such cases, it is settled law that High Court is also required
to consider the conduct and antecedents of the accused in order to ascertain
that the settlement has been entered into by her own free will and has not
been imposed upon her by the petitioner or any person related to him. In the
present case, the complainant is present in Court and has categorically stated
that she has entered into compromise and settled the entire disputes
amicably with petitioner no.1 and his family members by her own free will
without any pressure or coercion. There is also no allegation from
respondent no. 2 that the conduct and antecedents of petitioners have been
bad towards her after the compromise. As per the settlement, the respondent
no. 2 has received the entire settled amount.
14. In the case of B.S. Joshi & Ors. vs. State of Haryana & Ors (2003) 4
SCC 675, the Hon’ble Supreme Court has held that if for purpose of
securing the ends of justice, quashing of FIR becomes necessary, Section
320 Cr.P.C. would not be a bar to the exercise of the power of quashing
under Section 482 Cr.P.C.
15. Moreover, the Hon’ble Supreme Court in Jitendra Raghuvanshi &
Ors. vs. Babita Raghuvanshi & Anr. (2013) 4 SCC 58, has held that
criminal proceedings on FIR or complaint can be quashed under Section 482
Cr.P.C. in appropriate cases in order to meet ends of justice. Even in non-
compoundable offences pertaining to the matrimonial disputes, if Court is
satisfied that parties have settled the disputes amicably and without any
pressure, then for the purpose of securing ends of justice, FIRs or complaints
or subsequent criminal proceedings in respect of offences can be quashed.
16. In the instant case, as stated above, the parties have reached on the
compromise and amicably settled the entire disputes without any pressure.
In view of the settlement arrived at between the parties and the law laid
down by the Hon’ble Supreme Court, the present petition is allowed.
Accordingly, FIR bearing No. 702/2006 registered at Police Station Mangol
Puri, Delhi for offences punishable under Sections 498A/406/34 of the IPC
and all consequential proceedings emanating therefrom are quashed.
17. The petition stands disposed of.
|
The Delhi High Court has observed that FIR or complaints can be quashed even in respect of non-compoundable offences pertaining to matrimonial disputes if the Court is satisfied that the parties have settled their disputes amicably, without any pressure. Justice Chandra Dhari Singh observed thus:"Even in non- compoundable offences pertaining to the matrimonial disputes, if Court is satisfied...
The Delhi High Court has observed that FIR or complaints can be quashed even in respect of non-compoundable offences pertaining to matrimonial disputes if the Court is satisfied that the parties have settled their disputes amicably, without any pressure.
Justice Chandra Dhari Singh observed thus:
"Even in non- compoundable offences pertaining to the matrimonial disputes, if Court is satisfied that parties have settled the disputes amicably and without any pressure, then for the purpose of securing ends of justice, FIRs or complaints or subsequent criminal proceedings in respect of offences can be quashed."
The Court quashed an FIR registered under sec. 498A, 406 and 34 of the Indian Penal Code, 1860. The petitioner no.1 (husband) and respondent no.2 (wife) got married to each other on 20th April, 2003 but due to some temperamental differences between them, they started living separately since May, 2005. There was a girl child born out of their wedlock, who was now major.
Despite several efforts of reconciliation, both the parties could not settle the differences. The wife had the lodged a complaint in C.A.W. Cell which culminated into the FIR against all the petitioners.
With the intervention of family members and relatives, both the parties had later entered into settlement before Mediation Centre, Tis Hazari Courts.
In pursuance of the said settlement, the parties moved for divorce under the Hindu Marriage Act, 1955. The husband and wife had filed their first motion of the divorce petition under sec. 13B(1) which was allowed on 31st August, 2021.
The Petition under sec. 13B(2) of HMA was filed by the parties and their marriage was dissolved by mutual consent vide order dated 10th December, 2021.
It was thus submitted that the wife had settled all her claims in respect of her dowry articles, stridhan, marriage expenses, jewellery, gift items and claims of past, present and future maintenance and permanent alimony with the husband and other family members for a sum of Rs. 15,50,000 and Rs. 10,00,000 were already paid while remaining Rs. 5,50,000 was agreed to be paid at the time of quashing of the FIR.
It was therefore prayed that the FIR be quashed on the basis of Memorandum of Understanding and as per the Judgment of the Supreme Court in Gian Singh vs. State of Punjab.
"The instant criminal proceedings in respect of non-compoundable offences are private in nature and do not have a serious impact on the society especially when there is a settlement/compromise between victim and accused. In such cases, it is settled law that High Court is also required to consider the conduct and antecedents of the accused in order to ascertain that the settlement has been entered into by her own free will and has not been imposed upon her by the petitioner or any person related to him," the Court said.
The Court noted that there was no allegation from the wife that the conduct and antecedents of petitioners had been bad towards her after the compromise and that according to the settlement, she had received the entire settled amount.
"In the instant case, as stated above, the parties have reached on the compromise and amicably settled the entire disputes without any pressure. In view of the settlement arrived at between the parties and the law laid down by the Hon'ble Supreme Court, the present petition is allowed," the Court said.
Accordingly, the plea was disposed of.
Case Title: RAJA BERWA & ORS v. STATE & ANR
|
The Delhi High Court has observed that FIR or complaints can be quashed even in respect of non-compoundable offences pertaining to matrimonial disputes if the Court is satisfied that the parties have settled their disputes amicably, without any pressure. Justice Chandra Dhari Singh observed thus:"Even in non- compoundable offences pertaining to the matrimonial disputes, if Court is satisfied...
The Delhi High Court has observed that FIR or complaints can be quashed even in respect of non-compoundable offences pertaining to matrimonial disputes if the Court is satisfied that the parties have settled their disputes amicably, without any pressure.
Justice Chandra Dhari Singh observed thus:
"Even in non- compoundable offences pertaining to the matrimonial disputes, if Court is satisfied that parties have settled the disputes amicably and without any pressure, then for the purpose of securing ends of justice, FIRs or complaints or subsequent criminal proceedings in respect of offences can be quashed."
The Court quashed an FIR registered under sec. 498A, 406 and 34 of the Indian Penal Code, 1860. The petitioner no.1 (husband) and respondent no.2 (wife) got married to each other on 20th April, 2003 but due to some temperamental differences between them, they started living separately since May, 2005. There was a girl child born out of their wedlock, who was now major.
Despite several efforts of reconciliation, both the parties could not settle the differences. The wife had the lodged a complaint in C.A.W. Cell which culminated into the FIR against all the petitioners.
With the intervention of family members and relatives, both the parties had later entered into settlement before Mediation Centre, Tis Hazari Courts.
In pursuance of the said settlement, the parties moved for divorce under the Hindu Marriage Act, 1955. The husband and wife had filed their first motion of the divorce petition under sec. 13B(1) which was allowed on 31st August, 2021.
The Petition under sec. 13B(2) of HMA was filed by the parties and their marriage was dissolved by mutual consent vide order dated 10th December, 2021.
It was thus submitted that the wife had settled all her claims in respect of her dowry articles, stridhan, marriage expenses, jewellery, gift items and claims of past, present and future maintenance and permanent alimony with the husband and other family members for a sum of Rs. 15,50,000 and Rs. 10,00,000 were already paid while remaining Rs. 5,50,000 was agreed to be paid at the time of quashing of the FIR.
It was therefore prayed that the FIR be quashed on the basis of Memorandum of Understanding and as per the Judgment of the Supreme Court in Gian Singh vs. State of Punjab.
"The instant criminal proceedings in respect of non-compoundable offences are private in nature and do not have a serious impact on the society especially when there is a settlement/compromise between victim and accused. In such cases, it is settled law that High Court is also required to consider the conduct and antecedents of the accused in order to ascertain that the settlement has been entered into by her own free will and has not been imposed upon her by the petitioner or any person related to him," the Court said.
The Court noted that there was no allegation from the wife that the conduct and antecedents of petitioners had been bad towards her after the compromise and that according to the settlement, she had received the entire settled amount.
"In the instant case, as stated above, the parties have reached on the compromise and amicably settled the entire disputes without any pressure. In view of the settlement arrived at between the parties and the law laid down by the Hon'ble Supreme Court, the present petition is allowed," the Court said.
Accordingly, the plea was disposed of.
Case Title: RAJA BERWA & ORS v. STATE & ANR
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1. As per our previous order dated 25th February 2022, we had directed
MSRDC (Respondent No.8) to deposit a sum of Rs. 10 crores (i.e. Rs. 1 Lakh per
affected family comprising the Petitioner Society) to be available for distribution as
ad-hoc interim compensation. On that day, Shri Radhesyam Mopalwar, Managing
Director, MSRDC who was present before us, undertook to deposit this sum of Rs.
10 crores with the Registrar, Judicial I, of this Court. MSRDC has accordingly
deposited this sum with this Court. The matter was placed today to hear the parties
on disbursement of this amount to the affected fisherfolk families comprising the
2. Shri. Zaman Ali, learned Advocate for the Petitioner, submitted that
despite over 7 months having passed since our detailed order dated 12 th August 2021
directing compensation to be paid to the Petitioner for the loss of their fishing
livelihood, no compensation whatsoever has been paid. In light of this, the learned
counsel for the Petitioner submits that the entire amount of Rs. 10 crores deposited
in Court should be paid out to the Petitioner Society, as per the suggestion made by
the Learned Amicus at the previous hearing. The Petitioner Society, he submits, will
distribute this money to its individual members and keep detailed accounts of all such
disbursements, which shall be placed before this Court.
3. Shri. Milind Sathe, learned Senior Advocate for MSRDC (Respondent
No. 8) opposed any disbursement being made to the Petitioner or its members at this
stage on the ground that the impact of the TCB-III project on the livelihood of
fisherfolk has not yet been ascertained. Shri Sathe submitted that there has not been
any determination of whether TCB-III project will have any impact at all on the
livelihood of fisherfolk. He said that this exercise will have to be carried out by a
specialized agency and that until the impact of the TCB-III project on the Petitioner
Society (and its members being the Koli fisherfolk community) is assessed, there can
be no distribution of compensation be it ad hoc or final. Therefore, he submits that
no disbursement should be made till the Central Marine Fisheries Research Institute
(CMFRI), who has been engaged to study the detailed impact of TCB-III on the
livelihood of fisherfolk, submits its report. MSRDC’s apprehension is that that
should the final compensation amount be less than interim compensation of Rs. 1
lakh per family, then MSRDC will be put to hardship in recovering any excess
amounts from the Petitioner’s 900-odd members.
4. According to Shri. Sharan Jagtiani, Learned Senior Advocate and
Amicus Curiae, MSRDC’s submission that that there has been no determination of
whether TCB-III project will have any impact at all on the livelihood of the Petitioner
fisherfolk is incorrect. Shri. Jagtiani relies on our Order and Judgment dated 12 th
August, 2021, more particularly paragraphs 1, 3, 46 to 49 and 51 to 58, to submit that
there is in fact a finding, at least prima facie, of the TCB-III project’s adverse impact
on the livelihood of fisherfolk who are defined in the above Order and Judgment as
Project Affected Persons because of the ongoing construction of TCB-III. At the time
when the matter was being argued this position was not contested by the
Respondents on this aspect as such.
5. Further, Shri Jagtiani submitted that MSRDC’s concern about
recovery of excess compensation is based on a highly unlikely scenario that the final
compensation will be less than the interim compensation. He points to the Draft
Compensation Policy dated 29 November 2021 which adopts the approach of the
National Green Tribunal in its order dated 27 February 2015 (in the matter of
Ramdas Janardan Kohli) in respect of quantifying compensation. The NGT found
that there was a loss of the customary right to fishing and awarded ad-hoc
compensation in the following manner. The NGT presumed: (i) loss of livelihood
would be for a period of three years; (ii) a family consists of 4 members who would be
earning Rs. 200 per person per day (i.e Rs. 800 per family per day) which annually
amounts to Rs. 2,92,000/- per family; (iii) due to mere subsistence 1/3 of this
amount was reduced and the final figure of compensation was Rs. 1,94,666/- per
family per year. The total compensation per family for a period of 3 years awarded
was Rs. 5,83,998/-. Given that this Court has already found that TCB-III is likely to
affect the customary rights of fisherfolk vide order dated 12 th August 2021 and that
the state’s draft compensation policy has recommended the NGT approach for
quantifying compensation, the final compensation amount will almost certainly
exceed Rs. 1 lakh per family. If the final policy is based on other formula’s such as that
of the Mumbai Trans Harbour Link then the compensation would be even more.
Therefore, Shri Jagtiani submits that MSRDC’s concern of recovering any excess
compensation amount paid to the Petitioner’s members is not a realistic concern.
6. Having heard the parties, we are unable to accept the contention of
Shri. Sathe, learned Senior Advocate appearing for MSRDC, that there has not been
any determination of whether TCB-III project will have any impact at all on the
livelihood of fisherfolk. As rightly pointed out by Shri. Jagtiani, Amicus Curiae, we
have in our order dated 12th August 2021 held that the TCB-III project is likely to
have an adverse impact on the customary right of the Petitioner’s members to fish for
a living. In fact, the entire subject matter of Issue No. (ii) in our order dated 12 th
August 2021 was a consideration of this question: whether TCB III is likely to
detrimentally impact customary right of the Petitioner’s members to fish for a living.
We have also determined, in answering Issue No. (i) that the Petitioner has
established that they have a customary right to carry on the activity of fishing in the
Thane Creek. The issues that fell for determination before us in our Order of 12 th
August 2021 were as follows:
(i) Whether the Petitioner can prove that the Project Affected
Fishermen (as defined in paragraph 1) have a customary right to fish for a
(ii) Whether TCB III is likely to detrimentally impact the practice of
(iii) Whether a state-wide policy for all categories of persons whose
customary rights are affected by infrastructure projects is required? If yes, what is
the framework for such a policy that can be recommended to the appropriate
(iv) If the answer to Issue (i), Issue (ii) and Issue (iii) is yes, what should be
the contours of a policy compensating those affected by TCB III? ”
7. In paragraph no. 1, we defined Project Affected Fishermen as the
members of the Petitioner Society:
“1. The Petitioner is a society registered under the Maharashtra
Cooperative Societies Act, 1960. The Petitioner states that it comprises of
members from the traditional fishermen community known as Koli
community, from Koliwadas such as Vashigaon, Juhugaon,
Koparkhairane, Ghansoli, and Diva (“Project Affected Fishermen”). The
Petitioner states that it was formed in 2001, and is actively engaged in raising
welfare concerns on behalf of fishermen from Koliwadas located in and around
8. In paragraph 3, we described the TCB-III project as:
“TCB III is a proposed six-lane bridge on the Sion-Panvel Highway. It is being
constructed as an addition to the existing Thane Creek Bridge, near Vashi,
Maharashtra. The Thane Creek Bridge is built across Thane Creek,
connecting the city of Mumbai to the main land at Navi Mumbai. It is one of
the four entry points into Mumbai, the other three being the Airoli Bridge,
Mulund Check Naka and Dahisar Check Naka. According to Respondent
No.8, Thane Creek Bridge I (“TCB I”) was constructed in 1973 and Thane
Creek Bridge II (“TCB II”) was built and opened to traffic in 1997…”
9. After analyzing the various documents placed on record by the
Petitioner, in respect to issue (i), we concluded in paragraph 49 that:
49. The documents, therefore, establish with sufficient clarity that
the Project Affected Fishermen have a customary right to fish for a
living in Thane creek. Most importantly, the Affidavits in Reply of
Respondent No. 1 also appears to accept this position.
10. Having found that the Petitioner’s members (Project Affected
Fishermen) have established their customary right to fish for a living in the Thane
creek, we proceeded to consider the question of whether TCB III is likely to
detrimentally impact the practice of such customary rights in issue (ii).
11. It is pertinent to note that regarding this issue no (ii), none of the
Respondents even contended before us that the TCB-III would not have any impact
at all on the ecology and the customary rights of fisherfolk. The Respondents
“SUBMISSIONS ON ISSUE (ii) – Whether TCB III is likely to detrimentally
affect the practice of customary rights?
19. Respondent No. 8 has in its Affidavit not denied the possible
impact that TCB III will have during the construction phase and
thereafter, on the mangroves, biodiversity, fish catch etc.
20. However, Respondent No. 8 submitted that the navigational
channels for fishing activities will not be impacted, as TCB III is only in
the nature of expansion of TCB II. It is planned parallel to the existing
TCB I and TCB II and is sandwiched between TCB II and the railway
bridge next to it. For this reason, Respondent No.8 submits that the
addition of TCB III will have no material effect on the navigational
channels.
21. Shri Patel for Respondent Nos. 1 and 2 submitted that TCB III
is likely to impact the fisheries and livelihood of the Project Affected
Fishermen, because, during the construction period, movement in the
inter-tidal fishing areas will be curtailed and mangroves, mudflats,
and creeklets in Thane Creek will to some extent be destroyed.”
12. Our findings were as follows:
51. We have analyzed the submissions of the various parties. On an
appreciation of the material before us, we are of the view that TCB III
is likely to impact the Project Affected Fishermen’s customary right to
fish for a living, and therefore answer Issue (ii) in the affirmative.
52. The Court only needs to satisfy itself that there will be some
or a likely impact. If it is so satisfied, which it is, then that is enough
for us to hold that the customary rights to fish for a livelihood are
being impacted. The extent of the impact may be considered in greater
depth by the committee to be constituted, as discussed later in this
judgment.
53. The livelihood of fishermen is dependent on a healthy
environment and balanced ecology. The Department of Environment,
Forests and Wildlife of the Government of India has recognized this in the
Preamble of the CRZ Notification, 2011 by stating that coastal stretches
need to be protected “… with a view to ensure livelihood security to the
fisher communities…” It requires that any development activity needs to
be done in a “… sustainable manner based on scientific principles taking
into account the dangers of natural hazards in the coastal areas…”
54. The MCZMA itself, in its 114th Minutes of Meeting dated 2
and 3 November 2016 has stated that TCB III should be constructed
in a manner which does not affect the navigational routes of local
fishermen. This shows that the MCZMA believes, and is aware, that
navigational routes of the Project Affected Fishermen are likely to be
impacted.
55. Further, Respondent Nos. 1 and 2 in a communication to
various authorities of the State Government recognizes that projects
implemented in the maritime area or along the sea coast would impact
the livelihood of local fishermen in the proximity of the project.
56. Both of these documents show that even the State
Government authorities are of the view that maritime projects like the
TCB III are likely to impact the livelihood of fishermen communities
in the vicinity of the project.
57. Further, we agree with the Amicus Curiae’s submission that
destruction of mangroves for TCB III will disturb the ecological
balance in Thane Creek. The vital role that mangroves play in
maintaining ecological balance and sustaining biodiversity is well
documented. The Thane Creek Flamengo Sanctuary Management
Plan and The Preliminary Report on Biodiversity of Thane Creek,
which are discussed above also bear out that the destruction of
mangroves often results, inter alia, in loss of biodiversity, and reduced
fish catch, which in turn would impact livelihood of the Project
Affected Fishermen. The judgment in Bombay Environmental Action
Group v. State of Maharashtra (supra) of this Court, elucidates the
importance of mangroves on the ecology. The judgment states, at
“In the instant case it has been established that
58. Being satisfied that there is likely to be some impact, we
prefer to leave the exercise of determining the extent of the impact
with more precision to a body that has the wherewithal to make such a
determination.
customary rights are being impacted, we also hold that they are
entitled to be compensated for their loss, subject to what is stated
below.
60. As of today, no state-wide compensation policy exists which
provides guidance on how to constitute a committee to look into fine print
of a compensation policy. Which brings us to the next issue.”
13. Our Order and Judgment of 12 th August 2021, therefore, holds that the
TCB-III is likely to affect the Petitioner’s members (defined as the Project Affected
Persons) and that they are entitled to be compensated for such loss. What was left
open for the compensation committee to determine was the precise extent of such
loss and quantum of compensation.
14. We will now consider the question of disbursement of ad hoc
compensation especially keeping in mind that the Order and Judgment dated 12 th
August 2021 was more than seven months ago and one of the objects of the said
Order was to ensure that persons who are affected receive the benefit of
compensation.
14.1 As stated above, in our order of 12 August 2021 we held that TCB-III is
likely to adversely affect the customary rights of Petitioner’s members and therefore
they are entitled to be compensated. These issues were never contested before us
until this belated stage, more than seven months since our order.
14.2 When the matter came up on 1st December 2021, we were informed
that CMFRI has been engaged to study the detailed impact of TCB-III on the
livelihood of the curtained fisherfolk. We accordingly directed CMFRI to be
represented before us to apprise us of the steps taken by them in this regard.
14.3 On 16th February 2022 we were informed that CMFRI’s entire exercise
would take at least one year to be completed. Despite six months having passed since
our order of 12 August 2021, we were informed that it will take at least a year to
finally decided the issue of compensation. As the fisherfolk and their families cannot
be expected to starve till the authorities decide the quantum of compensation, we
directed CMFRI to submit an interim report on the quantum of interim
compensation required to be paid to these fisherfolk. On that day, the advocates for
MSRDC on instructions made a statement that upon CMFRI recommending the
quantum of interim compensation, MSRDC would disburse the same to eligible
fishermen, which statement was accepted. The responsible officer from CMFRI was
directed to appear before this Court on the next occasion.
14.4 In the Affidavit dated 22nd February 2022 filed before us, CMFRI inter
alia stated that it is not competent to render assistance for determining
compensation. CMFRI can only assist any agency or institute such as the Tata
Institute of Social, which may be entrusted with the responsibility for determining
compensation with technical data.
15. Thus, seven months later there is still no clarity as to how the final
compensation will be quantified or by whom. We cannot expect these fisherfolk to
wait one more year without any livelihood or compensation. We find merit in the
submissions of Shri Zaman Ali and Shri Jagtiani that in all likelihood the final
compensation will exceed the present interim compensation of Rs. 1 lakh per family.
If, for example, the compensation rate or formula as per the NGT Order is taken into
consideration, the NGT took, on an ad-hoc basis, the loss to be for a period of three
years at Rs. 1,94,666/- per family per year. The total compensation per family
awarded was nearly 6 lakhs. Given that the Compensation Committee in its Draft
Policy (which itself will have to be considered by the State Government cabinet in
terms of our Order dated 16th February 2022) has recommended the NGT approach
and that the project itself will take more than 3 years to complete, it is very likely that
the final compensation amount will exceed Rs. 1 lakh per family. We are also of the
view that if the ad hoc compensation is paid to the Petitioner Society and not to
individual fisherfolk there is more accountability. In the event of the final
compensation being less than this ad hoc amount or if in the final report for payment
of compensation concludes that compensation is not payable to some members of the
Petitioner, then it would be the Petitioner Society’s responsibility through it officer
bearers to ensure that the excess amounts of ad hoc compensation are returned to
16. In light of this we find it reasonable to order that interim compensation
of Rs. 1 lakh per family should be paid to the Petitioner’s members.
17. We accordingly direct the Registrar, Judicial I, of this Court to pay the
sum of Rs. 10 crores deposited by MSRDC to the Petitioner within two weeks from
today, who shall distribute it to its members in the sum of Rs. 1 Lakh per family. The
Petitioner shall place on record all details of such monies distributed. We also note
the undertaking of the Petitioner Society through its office bearers to ensure that the
amount of ad hoc compensation that may be determined to be in excess of what is to
be paid by MSRDC will be brought back in to Court if so determined by Court in this
18. Since this is only a distribution towards ad hoc compensation, we are
also of the view that MSRDC must either with the assistance of CMFRI or any other
agency proceed to determine the final compensation payable to the Project Affected
Persons within three months from today. The ad hoc compensation is not a substitute
for the final compensation.
19. All concerned to act on a digitally authenticated copy of this order.
|
On his last working day as a Judge at the Bombay High Court, a bench led by Justice Shahrukh Kathawalla directed disbursal of ad-hoc compensation of Rs. 1 lakh to each of the 953 fisherfolk families being affected by an infrastructure project in Thane. "As the fisherfolk and their families cannot be expected to starve till the authorities decide the quantum of compensation…"...
On his last working day as a Judge at the Bombay High Court, a bench led by Justice Shahrukh Kathawalla directed disbursal of ad-hoc compensation of Rs. 1 lakh to each of the 953 fisherfolk families being affected by an infrastructure project in Thane.
"As the fisherfolk and their families cannot be expected to starve till the authorities decide the quantum of compensation…" the bench observed in their order.
It noted that despite six months having passed since the court's order to compensate the fisherfolk for the loss of their fishing livelihood due to an under-construction bridge, the compensation amount was not decided.
"We cannot expect these fisherfolk to wait one more year without any livelihood or compensation," the bench said directing MSRDC to determine the final compensation payable with the help of an agency within three months.
The court ordered that the amount of Rs. 10 crore deposited by Maharashtra State Road Development Corporation Limited (MSRDC), should be transferred to petitioner Mariyayi Machhimaar Sahkari Sansthya Maryadit, and through them to individual fisherfolk.
The Trans Creek Bridge (TCB-III) is a proposed six-lane bridge on the Sion-Panvel Highway. It is being constructed as an addition to the existing Thane Creek Bridge, near Vashi, Maharashtra. "The documents, therefore, establish with sufficient clarity that the Project Affected Fishermen have a customary right to fish for a living in Thane creek," the court had said in its August 12, 2021 order, adding that they were entitled to compensation.
Fisherfolk re-approached the HC in the present plea after they received no compensation. Last month the HC ordered MSRDC to deposit Rs. 10 crore in the HC.
However, MSRDC represented by Senior Advocate Milind Sathe, had opposed the disbursal of compensation on the ground that the impact of the TCB-III project on the livelihood of fisherfolk has not yet been ascertained. It is not known if the project will have any impact on the Koli community at all.
Sathe argued that money should not be disbursed till the Central Marine Fisheries Research Institute (CMFRI), who has been engaged to study the detailed impact of TCB-III on the livelihood of fisherfolk, submits its report.
CMFRI submitted that they would take at least another year to ascertain the impact of the project and they were not equipped to decide compensation.
The bench observed that it had already held in its August 12, 2021 order that, prima facie, the TCB-III project is likely to affect the fisherfolk and that they are entitled to be compensated for such loss. At the time they failed to advance the argument that the project would not affect them.
Therefore, the compensation committee was to only determine the precise extent of such loss and quantum of compensation.
Advocate Zaman Ali who appeared for the fisherfolk said they were deserving of interim compensation. Senior Advocate Sharan Jagtiani, appointed as amicus curiae by the court, further submitted that MSRDC's concerns of excess compensation were misplaced.
He pointed to the State's Draft Compensation Policy dated November 29, 2021, which adopts the approach of the National Green Tribunal. According to the NGT's calculation in the matter of Ramdas Janardan Kohli on February 27, 2015, compensation for one family was pegged at Rs. 6 lakh for three years.
The court said it found merit in Jagtiani's and Ali's submissions that in all likelihood the final compensation will exceed the present interim compensation of Rs. 1 lakh per family.
"…it is very likely that the final compensation amount will exceed Rs. 1 lakh per family," the court observed.
The court said they were ordering the amount to be disbursed through the fisherfolk society so that there is more accountability. It entrusted the responsibility of the society to reimburse MSRDC in case some fisherfolk are found ineligible for compensation. The amount would have to be returned to the court as the compensation is going through the funds MSRDC deposited in court.
"We accordingly direct the Registrar, Judicial I, of this Court to pay the sum of Rs. 10 crores deposited by MSRDC to the Petitioner within two weeks from today, who shall distribute it to its members in the sum of Rs. 1 Lakh per family."
The Judge Who Heard Cases Till 3.30am : Justice SJ Kathawalla Of Bombay HC Retires
Case Title: Mariyayi Machhimaar Sahkari Sansthya Maryadit Versus Department of Fisheries and others
|
1. As per our previous order dated 25th February 2022, we had directed
MSRDC (Respondent No.8) to deposit a sum of Rs. 10 crores (i.e. Rs. 1 Lakh per
affected family comprising the Petitioner Society) to be available for distribution as
ad-hoc interim compensation. On that day, Shri Radhesyam Mopalwar, Managing
Director, MSRDC who was present before us, undertook to deposit this sum of Rs.
10 crores with the Registrar, Judicial I, of this Court. MSRDC has accordingly
deposited this sum with this Court. The matter was placed today to hear the parties
on disbursement of this amount to the affected fisherfolk families comprising the
2. Shri. Zaman Ali, learned Advocate for the Petitioner, submitted that
despite over 7 months having passed since our detailed order dated 12 th August 2021
directing compensation to be paid to the Petitioner for the loss of their fishing
livelihood, no compensation whatsoever has been paid. In light of this, the learned
counsel for the Petitioner submits that the entire amount of Rs. 10 crores deposited
in Court should be paid out to the Petitioner Society, as per the suggestion made by
the Learned Amicus at the previous hearing. The Petitioner Society, he submits, will
distribute this money to its individual members and keep detailed accounts of all such
disbursements, which shall be placed before this Court.
3. Shri. Milind Sathe, learned Senior Advocate for MSRDC (Respondent
No. 8) opposed any disbursement being made to the Petitioner or its members at this
stage on the ground that the impact of the TCB-III project on the livelihood of
fisherfolk has not yet been ascertained. Shri Sathe submitted that there has not been
any determination of whether TCB-III project will have any impact at all on the
livelihood of fisherfolk. He said that this exercise will have to be carried out by a
specialized agency and that until the impact of the TCB-III project on the Petitioner
Society (and its members being the Koli fisherfolk community) is assessed, there can
be no distribution of compensation be it ad hoc or final. Therefore, he submits that
no disbursement should be made till the Central Marine Fisheries Research Institute
(CMFRI), who has been engaged to study the detailed impact of TCB-III on the
livelihood of fisherfolk, submits its report. MSRDC’s apprehension is that that
should the final compensation amount be less than interim compensation of Rs. 1
lakh per family, then MSRDC will be put to hardship in recovering any excess
amounts from the Petitioner’s 900-odd members.
4. According to Shri. Sharan Jagtiani, Learned Senior Advocate and
Amicus Curiae, MSRDC’s submission that that there has been no determination of
whether TCB-III project will have any impact at all on the livelihood of the Petitioner
fisherfolk is incorrect. Shri. Jagtiani relies on our Order and Judgment dated 12 th
August, 2021, more particularly paragraphs 1, 3, 46 to 49 and 51 to 58, to submit that
there is in fact a finding, at least prima facie, of the TCB-III project’s adverse impact
on the livelihood of fisherfolk who are defined in the above Order and Judgment as
Project Affected Persons because of the ongoing construction of TCB-III. At the time
when the matter was being argued this position was not contested by the
Respondents on this aspect as such.
5. Further, Shri Jagtiani submitted that MSRDC’s concern about
recovery of excess compensation is based on a highly unlikely scenario that the final
compensation will be less than the interim compensation. He points to the Draft
Compensation Policy dated 29 November 2021 which adopts the approach of the
National Green Tribunal in its order dated 27 February 2015 (in the matter of
Ramdas Janardan Kohli) in respect of quantifying compensation. The NGT found
that there was a loss of the customary right to fishing and awarded ad-hoc
compensation in the following manner. The NGT presumed: (i) loss of livelihood
would be for a period of three years; (ii) a family consists of 4 members who would be
earning Rs. 200 per person per day (i.e Rs. 800 per family per day) which annually
amounts to Rs. 2,92,000/- per family; (iii) due to mere subsistence 1/3 of this
amount was reduced and the final figure of compensation was Rs. 1,94,666/- per
family per year. The total compensation per family for a period of 3 years awarded
was Rs. 5,83,998/-. Given that this Court has already found that TCB-III is likely to
affect the customary rights of fisherfolk vide order dated 12 th August 2021 and that
the state’s draft compensation policy has recommended the NGT approach for
quantifying compensation, the final compensation amount will almost certainly
exceed Rs. 1 lakh per family. If the final policy is based on other formula’s such as that
of the Mumbai Trans Harbour Link then the compensation would be even more.
Therefore, Shri Jagtiani submits that MSRDC’s concern of recovering any excess
compensation amount paid to the Petitioner’s members is not a realistic concern.
6. Having heard the parties, we are unable to accept the contention of
Shri. Sathe, learned Senior Advocate appearing for MSRDC, that there has not been
any determination of whether TCB-III project will have any impact at all on the
livelihood of fisherfolk. As rightly pointed out by Shri. Jagtiani, Amicus Curiae, we
have in our order dated 12th August 2021 held that the TCB-III project is likely to
have an adverse impact on the customary right of the Petitioner’s members to fish for
a living. In fact, the entire subject matter of Issue No. (ii) in our order dated 12 th
August 2021 was a consideration of this question: whether TCB III is likely to
detrimentally impact customary right of the Petitioner’s members to fish for a living.
We have also determined, in answering Issue No. (i) that the Petitioner has
established that they have a customary right to carry on the activity of fishing in the
Thane Creek. The issues that fell for determination before us in our Order of 12 th
August 2021 were as follows:
(i) Whether the Petitioner can prove that the Project Affected
Fishermen (as defined in paragraph 1) have a customary right to fish for a
(ii) Whether TCB III is likely to detrimentally impact the practice of
(iii) Whether a state-wide policy for all categories of persons whose
customary rights are affected by infrastructure projects is required? If yes, what is
the framework for such a policy that can be recommended to the appropriate
(iv) If the answer to Issue (i), Issue (ii) and Issue (iii) is yes, what should be
the contours of a policy compensating those affected by TCB III? ”
7. In paragraph no. 1, we defined Project Affected Fishermen as the
members of the Petitioner Society:
“1. The Petitioner is a society registered under the Maharashtra
Cooperative Societies Act, 1960. The Petitioner states that it comprises of
members from the traditional fishermen community known as Koli
community, from Koliwadas such as Vashigaon, Juhugaon,
Koparkhairane, Ghansoli, and Diva (“Project Affected Fishermen”). The
Petitioner states that it was formed in 2001, and is actively engaged in raising
welfare concerns on behalf of fishermen from Koliwadas located in and around
8. In paragraph 3, we described the TCB-III project as:
“TCB III is a proposed six-lane bridge on the Sion-Panvel Highway. It is being
constructed as an addition to the existing Thane Creek Bridge, near Vashi,
Maharashtra. The Thane Creek Bridge is built across Thane Creek,
connecting the city of Mumbai to the main land at Navi Mumbai. It is one of
the four entry points into Mumbai, the other three being the Airoli Bridge,
Mulund Check Naka and Dahisar Check Naka. According to Respondent
No.8, Thane Creek Bridge I (“TCB I”) was constructed in 1973 and Thane
Creek Bridge II (“TCB II”) was built and opened to traffic in 1997…”
9. After analyzing the various documents placed on record by the
Petitioner, in respect to issue (i), we concluded in paragraph 49 that:
49. The documents, therefore, establish with sufficient clarity that
the Project Affected Fishermen have a customary right to fish for a
living in Thane creek. Most importantly, the Affidavits in Reply of
Respondent No. 1 also appears to accept this position.
10. Having found that the Petitioner’s members (Project Affected
Fishermen) have established their customary right to fish for a living in the Thane
creek, we proceeded to consider the question of whether TCB III is likely to
detrimentally impact the practice of such customary rights in issue (ii).
11. It is pertinent to note that regarding this issue no (ii), none of the
Respondents even contended before us that the TCB-III would not have any impact
at all on the ecology and the customary rights of fisherfolk. The Respondents
“SUBMISSIONS ON ISSUE (ii) – Whether TCB III is likely to detrimentally
affect the practice of customary rights?
19. Respondent No. 8 has in its Affidavit not denied the possible
impact that TCB III will have during the construction phase and
thereafter, on the mangroves, biodiversity, fish catch etc.
20. However, Respondent No. 8 submitted that the navigational
channels for fishing activities will not be impacted, as TCB III is only in
the nature of expansion of TCB II. It is planned parallel to the existing
TCB I and TCB II and is sandwiched between TCB II and the railway
bridge next to it. For this reason, Respondent No.8 submits that the
addition of TCB III will have no material effect on the navigational
channels.
21. Shri Patel for Respondent Nos. 1 and 2 submitted that TCB III
is likely to impact the fisheries and livelihood of the Project Affected
Fishermen, because, during the construction period, movement in the
inter-tidal fishing areas will be curtailed and mangroves, mudflats,
and creeklets in Thane Creek will to some extent be destroyed.”
12. Our findings were as follows:
51. We have analyzed the submissions of the various parties. On an
appreciation of the material before us, we are of the view that TCB III
is likely to impact the Project Affected Fishermen’s customary right to
fish for a living, and therefore answer Issue (ii) in the affirmative.
52. The Court only needs to satisfy itself that there will be some
or a likely impact. If it is so satisfied, which it is, then that is enough
for us to hold that the customary rights to fish for a livelihood are
being impacted. The extent of the impact may be considered in greater
depth by the committee to be constituted, as discussed later in this
judgment.
53. The livelihood of fishermen is dependent on a healthy
environment and balanced ecology. The Department of Environment,
Forests and Wildlife of the Government of India has recognized this in the
Preamble of the CRZ Notification, 2011 by stating that coastal stretches
need to be protected “… with a view to ensure livelihood security to the
fisher communities…” It requires that any development activity needs to
be done in a “… sustainable manner based on scientific principles taking
into account the dangers of natural hazards in the coastal areas…”
54. The MCZMA itself, in its 114th Minutes of Meeting dated 2
and 3 November 2016 has stated that TCB III should be constructed
in a manner which does not affect the navigational routes of local
fishermen. This shows that the MCZMA believes, and is aware, that
navigational routes of the Project Affected Fishermen are likely to be
impacted.
55. Further, Respondent Nos. 1 and 2 in a communication to
various authorities of the State Government recognizes that projects
implemented in the maritime area or along the sea coast would impact
the livelihood of local fishermen in the proximity of the project.
56. Both of these documents show that even the State
Government authorities are of the view that maritime projects like the
TCB III are likely to impact the livelihood of fishermen communities
in the vicinity of the project.
57. Further, we agree with the Amicus Curiae’s submission that
destruction of mangroves for TCB III will disturb the ecological
balance in Thane Creek. The vital role that mangroves play in
maintaining ecological balance and sustaining biodiversity is well
documented. The Thane Creek Flamengo Sanctuary Management
Plan and The Preliminary Report on Biodiversity of Thane Creek,
which are discussed above also bear out that the destruction of
mangroves often results, inter alia, in loss of biodiversity, and reduced
fish catch, which in turn would impact livelihood of the Project
Affected Fishermen. The judgment in Bombay Environmental Action
Group v. State of Maharashtra (supra) of this Court, elucidates the
importance of mangroves on the ecology. The judgment states, at
“In the instant case it has been established that
58. Being satisfied that there is likely to be some impact, we
prefer to leave the exercise of determining the extent of the impact
with more precision to a body that has the wherewithal to make such a
determination.
customary rights are being impacted, we also hold that they are
entitled to be compensated for their loss, subject to what is stated
below.
60. As of today, no state-wide compensation policy exists which
provides guidance on how to constitute a committee to look into fine print
of a compensation policy. Which brings us to the next issue.”
13. Our Order and Judgment of 12 th August 2021, therefore, holds that the
TCB-III is likely to affect the Petitioner’s members (defined as the Project Affected
Persons) and that they are entitled to be compensated for such loss. What was left
open for the compensation committee to determine was the precise extent of such
loss and quantum of compensation.
14. We will now consider the question of disbursement of ad hoc
compensation especially keeping in mind that the Order and Judgment dated 12 th
August 2021 was more than seven months ago and one of the objects of the said
Order was to ensure that persons who are affected receive the benefit of
compensation.
14.1 As stated above, in our order of 12 August 2021 we held that TCB-III is
likely to adversely affect the customary rights of Petitioner’s members and therefore
they are entitled to be compensated. These issues were never contested before us
until this belated stage, more than seven months since our order.
14.2 When the matter came up on 1st December 2021, we were informed
that CMFRI has been engaged to study the detailed impact of TCB-III on the
livelihood of the curtained fisherfolk. We accordingly directed CMFRI to be
represented before us to apprise us of the steps taken by them in this regard.
14.3 On 16th February 2022 we were informed that CMFRI’s entire exercise
would take at least one year to be completed. Despite six months having passed since
our order of 12 August 2021, we were informed that it will take at least a year to
finally decided the issue of compensation. As the fisherfolk and their families cannot
be expected to starve till the authorities decide the quantum of compensation, we
directed CMFRI to submit an interim report on the quantum of interim
compensation required to be paid to these fisherfolk. On that day, the advocates for
MSRDC on instructions made a statement that upon CMFRI recommending the
quantum of interim compensation, MSRDC would disburse the same to eligible
fishermen, which statement was accepted. The responsible officer from CMFRI was
directed to appear before this Court on the next occasion.
14.4 In the Affidavit dated 22nd February 2022 filed before us, CMFRI inter
alia stated that it is not competent to render assistance for determining
compensation. CMFRI can only assist any agency or institute such as the Tata
Institute of Social, which may be entrusted with the responsibility for determining
compensation with technical data.
15. Thus, seven months later there is still no clarity as to how the final
compensation will be quantified or by whom. We cannot expect these fisherfolk to
wait one more year without any livelihood or compensation. We find merit in the
submissions of Shri Zaman Ali and Shri Jagtiani that in all likelihood the final
compensation will exceed the present interim compensation of Rs. 1 lakh per family.
If, for example, the compensation rate or formula as per the NGT Order is taken into
consideration, the NGT took, on an ad-hoc basis, the loss to be for a period of three
years at Rs. 1,94,666/- per family per year. The total compensation per family
awarded was nearly 6 lakhs. Given that the Compensation Committee in its Draft
Policy (which itself will have to be considered by the State Government cabinet in
terms of our Order dated 16th February 2022) has recommended the NGT approach
and that the project itself will take more than 3 years to complete, it is very likely that
the final compensation amount will exceed Rs. 1 lakh per family. We are also of the
view that if the ad hoc compensation is paid to the Petitioner Society and not to
individual fisherfolk there is more accountability. In the event of the final
compensation being less than this ad hoc amount or if in the final report for payment
of compensation concludes that compensation is not payable to some members of the
Petitioner, then it would be the Petitioner Society’s responsibility through it officer
bearers to ensure that the excess amounts of ad hoc compensation are returned to
16. In light of this we find it reasonable to order that interim compensation
of Rs. 1 lakh per family should be paid to the Petitioner’s members.
17. We accordingly direct the Registrar, Judicial I, of this Court to pay the
sum of Rs. 10 crores deposited by MSRDC to the Petitioner within two weeks from
today, who shall distribute it to its members in the sum of Rs. 1 Lakh per family. The
Petitioner shall place on record all details of such monies distributed. We also note
the undertaking of the Petitioner Society through its office bearers to ensure that the
amount of ad hoc compensation that may be determined to be in excess of what is to
be paid by MSRDC will be brought back in to Court if so determined by Court in this
18. Since this is only a distribution towards ad hoc compensation, we are
also of the view that MSRDC must either with the assistance of CMFRI or any other
agency proceed to determine the final compensation payable to the Project Affected
Persons within three months from today. The ad hoc compensation is not a substitute
for the final compensation.
19. All concerned to act on a digitally authenticated copy of this order.
|
1. As per our previous order dated 25th February 2022, we had directed
MSRDC (Respondent No.8) to deposit a sum of Rs. 10 crores (i.e. Rs. 1 Lakh per
affected family comprising the Petitioner Society) to be available for distribution as
ad-hoc interim compensation. On that day, Shri Radhesyam Mopalwar, Managing
Director, MSRDC who was present before us, undertook to deposit this sum of Rs.
10 crores with the Registrar, Judicial I, of this Court. MSRDC has accordingly
deposited this sum with this Court. The matter was placed today to hear the parties
on disbursement of this amount to the affected fisherfolk families comprising the
2. Shri. Zaman Ali, learned Advocate for the Petitioner, submitted that
despite over 7 months having passed since our detailed order dated 12 th August 2021
directing compensation to be paid to the Petitioner for the loss of their fishing
livelihood, no compensation whatsoever has been paid. In light of this, the learned
counsel for the Petitioner submits that the entire amount of Rs. 10 crores deposited
in Court should be paid out to the Petitioner Society, as per the suggestion made by
the Learned Amicus at the previous hearing. The Petitioner Society, he submits, will
distribute this money to its individual members and keep detailed accounts of all such
disbursements, which shall be placed before this Court.
3. Shri. Milind Sathe, learned Senior Advocate for MSRDC (Respondent
No. 8) opposed any disbursement being made to the Petitioner or its members at this
stage on the ground that the impact of the TCB-III project on the livelihood of
fisherfolk has not yet been ascertained. Shri Sathe submitted that there has not been
any determination of whether TCB-III project will have any impact at all on the
livelihood of fisherfolk. He said that this exercise will have to be carried out by a
specialized agency and that until the impact of the TCB-III project on the Petitioner
Society (and its members being the Koli fisherfolk community) is assessed, there can
be no distribution of compensation be it ad hoc or final. Therefore, he submits that
no disbursement should be made till the Central Marine Fisheries Research Institute
(CMFRI), who has been engaged to study the detailed impact of TCB-III on the
livelihood of fisherfolk, submits its report. MSRDC’s apprehension is that that
should the final compensation amount be less than interim compensation of Rs. 1
lakh per family, then MSRDC will be put to hardship in recovering any excess
amounts from the Petitioner’s 900-odd members.
4. According to Shri. Sharan Jagtiani, Learned Senior Advocate and
Amicus Curiae, MSRDC’s submission that that there has been no determination of
whether TCB-III project will have any impact at all on the livelihood of the Petitioner
fisherfolk is incorrect. Shri. Jagtiani relies on our Order and Judgment dated 12 th
August, 2021, more particularly paragraphs 1, 3, 46 to 49 and 51 to 58, to submit that
there is in fact a finding, at least prima facie, of the TCB-III project’s adverse impact
on the livelihood of fisherfolk who are defined in the above Order and Judgment as
Project Affected Persons because of the ongoing construction of TCB-III. At the time
when the matter was being argued this position was not contested by the
Respondents on this aspect as such.
5. Further, Shri Jagtiani submitted that MSRDC’s concern about
recovery of excess compensation is based on a highly unlikely scenario that the final
compensation will be less than the interim compensation. He points to the Draft
Compensation Policy dated 29 November 2021 which adopts the approach of the
National Green Tribunal in its order dated 27 February 2015 (in the matter of
Ramdas Janardan Kohli) in respect of quantifying compensation. The NGT found
that there was a loss of the customary right to fishing and awarded ad-hoc
compensation in the following manner. The NGT presumed: (i) loss of livelihood
would be for a period of three years; (ii) a family consists of 4 members who would be
earning Rs. 200 per person per day (i.e Rs. 800 per family per day) which annually
amounts to Rs. 2,92,000/- per family; (iii) due to mere subsistence 1/3 of this
amount was reduced and the final figure of compensation was Rs. 1,94,666/- per
family per year. The total compensation per family for a period of 3 years awarded
was Rs. 5,83,998/-. Given that this Court has already found that TCB-III is likely to
affect the customary rights of fisherfolk vide order dated 12 th August 2021 and that
the state’s draft compensation policy has recommended the NGT approach for
quantifying compensation, the final compensation amount will almost certainly
exceed Rs. 1 lakh per family. If the final policy is based on other formula’s such as that
of the Mumbai Trans Harbour Link then the compensation would be even more.
Therefore, Shri Jagtiani submits that MSRDC’s concern of recovering any excess
compensation amount paid to the Petitioner’s members is not a realistic concern.
6. Having heard the parties, we are unable to accept the contention of
Shri. Sathe, learned Senior Advocate appearing for MSRDC, that there has not been
any determination of whether TCB-III project will have any impact at all on the
livelihood of fisherfolk. As rightly pointed out by Shri. Jagtiani, Amicus Curiae, we
have in our order dated 12th August 2021 held that the TCB-III project is likely to
have an adverse impact on the customary right of the Petitioner’s members to fish for
a living. In fact, the entire subject matter of Issue No. (ii) in our order dated 12 th
August 2021 was a consideration of this question: whether TCB III is likely to
detrimentally impact customary right of the Petitioner’s members to fish for a living.
We have also determined, in answering Issue No. (i) that the Petitioner has
established that they have a customary right to carry on the activity of fishing in the
Thane Creek. The issues that fell for determination before us in our Order of 12 th
August 2021 were as follows:
(i) Whether the Petitioner can prove that the Project Affected
Fishermen (as defined in paragraph 1) have a customary right to fish for a
(ii) Whether TCB III is likely to detrimentally impact the practice of
(iii) Whether a state-wide policy for all categories of persons whose
customary rights are affected by infrastructure projects is required? If yes, what is
the framework for such a policy that can be recommended to the appropriate
(iv) If the answer to Issue (i), Issue (ii) and Issue (iii) is yes, what should be
the contours of a policy compensating those affected by TCB III? ”
7. In paragraph no. 1, we defined Project Affected Fishermen as the
members of the Petitioner Society:
“1. The Petitioner is a society registered under the Maharashtra
Cooperative Societies Act, 1960. The Petitioner states that it comprises of
members from the traditional fishermen community known as Koli
community, from Koliwadas such as Vashigaon, Juhugaon,
Koparkhairane, Ghansoli, and Diva (“Project Affected Fishermen”). The
Petitioner states that it was formed in 2001, and is actively engaged in raising
welfare concerns on behalf of fishermen from Koliwadas located in and around
8. In paragraph 3, we described the TCB-III project as:
“TCB III is a proposed six-lane bridge on the Sion-Panvel Highway. It is being
constructed as an addition to the existing Thane Creek Bridge, near Vashi,
Maharashtra. The Thane Creek Bridge is built across Thane Creek,
connecting the city of Mumbai to the main land at Navi Mumbai. It is one of
the four entry points into Mumbai, the other three being the Airoli Bridge,
Mulund Check Naka and Dahisar Check Naka. According to Respondent
No.8, Thane Creek Bridge I (“TCB I”) was constructed in 1973 and Thane
Creek Bridge II (“TCB II”) was built and opened to traffic in 1997…”
9. After analyzing the various documents placed on record by the
Petitioner, in respect to issue (i), we concluded in paragraph 49 that:
49. The documents, therefore, establish with sufficient clarity that
the Project Affected Fishermen have a customary right to fish for a
living in Thane creek. Most importantly, the Affidavits in Reply of
Respondent No. 1 also appears to accept this position.
10. Having found that the Petitioner’s members (Project Affected
Fishermen) have established their customary right to fish for a living in the Thane
creek, we proceeded to consider the question of whether TCB III is likely to
detrimentally impact the practice of such customary rights in issue (ii).
11. It is pertinent to note that regarding this issue no (ii), none of the
Respondents even contended before us that the TCB-III would not have any impact
at all on the ecology and the customary rights of fisherfolk. The Respondents
“SUBMISSIONS ON ISSUE (ii) – Whether TCB III is likely to detrimentally
affect the practice of customary rights?
19. Respondent No. 8 has in its Affidavit not denied the possible
impact that TCB III will have during the construction phase and
thereafter, on the mangroves, biodiversity, fish catch etc.
20. However, Respondent No. 8 submitted that the navigational
channels for fishing activities will not be impacted, as TCB III is only in
the nature of expansion of TCB II. It is planned parallel to the existing
TCB I and TCB II and is sandwiched between TCB II and the railway
bridge next to it. For this reason, Respondent No.8 submits that the
addition of TCB III will have no material effect on the navigational
channels.
21. Shri Patel for Respondent Nos. 1 and 2 submitted that TCB III
is likely to impact the fisheries and livelihood of the Project Affected
Fishermen, because, during the construction period, movement in the
inter-tidal fishing areas will be curtailed and mangroves, mudflats,
and creeklets in Thane Creek will to some extent be destroyed.”
12. Our findings were as follows:
51. We have analyzed the submissions of the various parties. On an
appreciation of the material before us, we are of the view that TCB III
is likely to impact the Project Affected Fishermen’s customary right to
fish for a living, and therefore answer Issue (ii) in the affirmative.
52. The Court only needs to satisfy itself that there will be some
or a likely impact. If it is so satisfied, which it is, then that is enough
for us to hold that the customary rights to fish for a livelihood are
being impacted. The extent of the impact may be considered in greater
depth by the committee to be constituted, as discussed later in this
judgment.
53. The livelihood of fishermen is dependent on a healthy
environment and balanced ecology. The Department of Environment,
Forests and Wildlife of the Government of India has recognized this in the
Preamble of the CRZ Notification, 2011 by stating that coastal stretches
need to be protected “… with a view to ensure livelihood security to the
fisher communities…” It requires that any development activity needs to
be done in a “… sustainable manner based on scientific principles taking
into account the dangers of natural hazards in the coastal areas…”
54. The MCZMA itself, in its 114th Minutes of Meeting dated 2
and 3 November 2016 has stated that TCB III should be constructed
in a manner which does not affect the navigational routes of local
fishermen. This shows that the MCZMA believes, and is aware, that
navigational routes of the Project Affected Fishermen are likely to be
impacted.
55. Further, Respondent Nos. 1 and 2 in a communication to
various authorities of the State Government recognizes that projects
implemented in the maritime area or along the sea coast would impact
the livelihood of local fishermen in the proximity of the project.
56. Both of these documents show that even the State
Government authorities are of the view that maritime projects like the
TCB III are likely to impact the livelihood of fishermen communities
in the vicinity of the project.
57. Further, we agree with the Amicus Curiae’s submission that
destruction of mangroves for TCB III will disturb the ecological
balance in Thane Creek. The vital role that mangroves play in
maintaining ecological balance and sustaining biodiversity is well
documented. The Thane Creek Flamengo Sanctuary Management
Plan and The Preliminary Report on Biodiversity of Thane Creek,
which are discussed above also bear out that the destruction of
mangroves often results, inter alia, in loss of biodiversity, and reduced
fish catch, which in turn would impact livelihood of the Project
Affected Fishermen. The judgment in Bombay Environmental Action
Group v. State of Maharashtra (supra) of this Court, elucidates the
importance of mangroves on the ecology. The judgment states, at
“In the instant case it has been established that
58. Being satisfied that there is likely to be some impact, we
prefer to leave the exercise of determining the extent of the impact
with more precision to a body that has the wherewithal to make such a
determination.
customary rights are being impacted, we also hold that they are
entitled to be compensated for their loss, subject to what is stated
below.
60. As of today, no state-wide compensation policy exists which
provides guidance on how to constitute a committee to look into fine print
of a compensation policy. Which brings us to the next issue.”
13. Our Order and Judgment of 12 th August 2021, therefore, holds that the
TCB-III is likely to affect the Petitioner’s members (defined as the Project Affected
Persons) and that they are entitled to be compensated for such loss. What was left
open for the compensation committee to determine was the precise extent of such
loss and quantum of compensation.
14. We will now consider the question of disbursement of ad hoc
compensation especially keeping in mind that the Order and Judgment dated 12 th
August 2021 was more than seven months ago and one of the objects of the said
Order was to ensure that persons who are affected receive the benefit of
compensation.
14.1 As stated above, in our order of 12 August 2021 we held that TCB-III is
likely to adversely affect the customary rights of Petitioner’s members and therefore
they are entitled to be compensated. These issues were never contested before us
until this belated stage, more than seven months since our order.
14.2 When the matter came up on 1st December 2021, we were informed
that CMFRI has been engaged to study the detailed impact of TCB-III on the
livelihood of the curtained fisherfolk. We accordingly directed CMFRI to be
represented before us to apprise us of the steps taken by them in this regard.
14.3 On 16th February 2022 we were informed that CMFRI’s entire exercise
would take at least one year to be completed. Despite six months having passed since
our order of 12 August 2021, we were informed that it will take at least a year to
finally decided the issue of compensation. As the fisherfolk and their families cannot
be expected to starve till the authorities decide the quantum of compensation, we
directed CMFRI to submit an interim report on the quantum of interim
compensation required to be paid to these fisherfolk. On that day, the advocates for
MSRDC on instructions made a statement that upon CMFRI recommending the
quantum of interim compensation, MSRDC would disburse the same to eligible
fishermen, which statement was accepted. The responsible officer from CMFRI was
directed to appear before this Court on the next occasion.
14.4 In the Affidavit dated 22nd February 2022 filed before us, CMFRI inter
alia stated that it is not competent to render assistance for determining
compensation. CMFRI can only assist any agency or institute such as the Tata
Institute of Social, which may be entrusted with the responsibility for determining
compensation with technical data.
15. Thus, seven months later there is still no clarity as to how the final
compensation will be quantified or by whom. We cannot expect these fisherfolk to
wait one more year without any livelihood or compensation. We find merit in the
submissions of Shri Zaman Ali and Shri Jagtiani that in all likelihood the final
compensation will exceed the present interim compensation of Rs. 1 lakh per family.
If, for example, the compensation rate or formula as per the NGT Order is taken into
consideration, the NGT took, on an ad-hoc basis, the loss to be for a period of three
years at Rs. 1,94,666/- per family per year. The total compensation per family
awarded was nearly 6 lakhs. Given that the Compensation Committee in its Draft
Policy (which itself will have to be considered by the State Government cabinet in
terms of our Order dated 16th February 2022) has recommended the NGT approach
and that the project itself will take more than 3 years to complete, it is very likely that
the final compensation amount will exceed Rs. 1 lakh per family. We are also of the
view that if the ad hoc compensation is paid to the Petitioner Society and not to
individual fisherfolk there is more accountability. In the event of the final
compensation being less than this ad hoc amount or if in the final report for payment
of compensation concludes that compensation is not payable to some members of the
Petitioner, then it would be the Petitioner Society’s responsibility through it officer
bearers to ensure that the excess amounts of ad hoc compensation are returned to
16. In light of this we find it reasonable to order that interim compensation
of Rs. 1 lakh per family should be paid to the Petitioner’s members.
17. We accordingly direct the Registrar, Judicial I, of this Court to pay the
sum of Rs. 10 crores deposited by MSRDC to the Petitioner within two weeks from
today, who shall distribute it to its members in the sum of Rs. 1 Lakh per family. The
Petitioner shall place on record all details of such monies distributed. We also note
the undertaking of the Petitioner Society through its office bearers to ensure that the
amount of ad hoc compensation that may be determined to be in excess of what is to
be paid by MSRDC will be brought back in to Court if so determined by Court in this
18. Since this is only a distribution towards ad hoc compensation, we are
also of the view that MSRDC must either with the assistance of CMFRI or any other
agency proceed to determine the final compensation payable to the Project Affected
Persons within three months from today. The ad hoc compensation is not a substitute
for the final compensation.
19. All concerned to act on a digitally authenticated copy of this order.
|
On his last working day as a Judge at the Bombay High Court, a bench led by Justice Shahrukh Kathawalla directed disbursal of ad-hoc compensation of Rs. 1 lakh to each of the 953 fisherfolk families being affected by an infrastructure project in Thane. "As the fisherfolk and their families cannot be expected to starve till the authorities decide the quantum of compensation…"...
On his last working day as a Judge at the Bombay High Court, a bench led by Justice Shahrukh Kathawalla directed disbursal of ad-hoc compensation of Rs. 1 lakh to each of the 953 fisherfolk families being affected by an infrastructure project in Thane.
"As the fisherfolk and their families cannot be expected to starve till the authorities decide the quantum of compensation…" the bench observed in their order.
It noted that despite six months having passed since the court's order to compensate the fisherfolk for the loss of their fishing livelihood due to an under-construction bridge, the compensation amount was not decided.
"We cannot expect these fisherfolk to wait one more year without any livelihood or compensation," the bench said directing MSRDC to determine the final compensation payable with the help of an agency within three months.
The court ordered that the amount of Rs. 10 crore deposited by Maharashtra State Road Development Corporation Limited (MSRDC), should be transferred to petitioner Mariyayi Machhimaar Sahkari Sansthya Maryadit, and through them to individual fisherfolk.
The Trans Creek Bridge (TCB-III) is a proposed six-lane bridge on the Sion-Panvel Highway. It is being constructed as an addition to the existing Thane Creek Bridge, near Vashi, Maharashtra. "The documents, therefore, establish with sufficient clarity that the Project Affected Fishermen have a customary right to fish for a living in Thane creek," the court had said in its August 12, 2021 order, adding that they were entitled to compensation.
Fisherfolk re-approached the HC in the present plea after they received no compensation. Last month the HC ordered MSRDC to deposit Rs. 10 crore in the HC.
However, MSRDC represented by Senior Advocate Milind Sathe, had opposed the disbursal of compensation on the ground that the impact of the TCB-III project on the livelihood of fisherfolk has not yet been ascertained. It is not known if the project will have any impact on the Koli community at all.
Sathe argued that money should not be disbursed till the Central Marine Fisheries Research Institute (CMFRI), who has been engaged to study the detailed impact of TCB-III on the livelihood of fisherfolk, submits its report.
CMFRI submitted that they would take at least another year to ascertain the impact of the project and they were not equipped to decide compensation.
The bench observed that it had already held in its August 12, 2021 order that, prima facie, the TCB-III project is likely to affect the fisherfolk and that they are entitled to be compensated for such loss. At the time they failed to advance the argument that the project would not affect them.
Therefore, the compensation committee was to only determine the precise extent of such loss and quantum of compensation.
Advocate Zaman Ali who appeared for the fisherfolk said they were deserving of interim compensation. Senior Advocate Sharan Jagtiani, appointed as amicus curiae by the court, further submitted that MSRDC's concerns of excess compensation were misplaced.
He pointed to the State's Draft Compensation Policy dated November 29, 2021, which adopts the approach of the National Green Tribunal. According to the NGT's calculation in the matter of Ramdas Janardan Kohli on February 27, 2015, compensation for one family was pegged at Rs. 6 lakh for three years.
The court said it found merit in Jagtiani's and Ali's submissions that in all likelihood the final compensation will exceed the present interim compensation of Rs. 1 lakh per family.
"…it is very likely that the final compensation amount will exceed Rs. 1 lakh per family," the court observed.
The court said they were ordering the amount to be disbursed through the fisherfolk society so that there is more accountability. It entrusted the responsibility of the society to reimburse MSRDC in case some fisherfolk are found ineligible for compensation. The amount would have to be returned to the court as the compensation is going through the funds MSRDC deposited in court.
"We accordingly direct the Registrar, Judicial I, of this Court to pay the sum of Rs. 10 crores deposited by MSRDC to the Petitioner within two weeks from today, who shall distribute it to its members in the sum of Rs. 1 Lakh per family."
The Judge Who Heard Cases Till 3.30am : Justice SJ Kathawalla Of Bombay HC Retires
Case Title: Mariyayi Machhimaar Sahkari Sansthya Maryadit Versus Department of Fisheries and others
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On his last working day as a Judge at the Bombay High Court, a bench led by Justice Shahrukh Kathawalla directed disbursal of ad-hoc compensation of Rs. 1 lakh to each of the 953 fisherfolk families being affected by an infrastructure project in Thane. " As the fisherfolk and their families cannot be expected to starve till the authorities decide the quantum of compensation…"...
On his last working day as a Judge at the Bombay High Court, a bench led by Justice Shahrukh Kathawalla directed disbursal of ad-hoc compensation of Rs. 1 lakh to each of the 953 fisherfolk families being affected by an infrastructure project in Thane. It noted that despite six months having passed since the court's order to compensate the fisherfolk for the loss of their fishing livelihood due to an under-construction bridge, the compensation amount was not decided. 10 crore deposited by Maharashtra State Road Development Corporation Limited (MSRDC), should be transferred to petitioner Mariyayi Machhimaar Sahkari Sansthya Maryadit, and through them to individual fisherfolk. The Trans Creek Bridge (TCB-III) is a proposed six-lane bridge on the Sion-Panvel Highway. It is being constructed as an addition to the existing Thane Creek Bridge, near Vashi, Maharashtra. " The documents, therefore, establish with sufficient clarity that the Project Affected Fishermen have a customary right to fish for a living in Thane creek," the court had said in its August 12, 2021 order, adding that they were entitled to compensation. Fisherfolk re-approached the HC in the present plea after they received no compensation. Last month the HC ordered MSRDC to deposit Rs. However, MSRDC represented by Senior Advocate Milind Sathe, had opposed the disbursal of compensation on the ground that the impact of the TCB-III project on the livelihood of fisherfolk has not yet been ascertained. It is not known if the project will have any impact on the Koli community at all. CMFRI submitted that they would take at least another year to ascertain the impact of the project and they were not equipped to decide compensation. The bench observed that it had already held in its August 12, 2021 order that, prima facie, the TCB-III project is likely to affect the fisherfolk and that they are entitled to be compensated for such loss. At the time they failed to advance the argument that the project would not affect them. Therefore, the compensation committee was to only determine the precise extent of such loss and quantum of compensation. Advocate Zaman Ali who appeared for the fisherfolk said they were deserving of interim compensation. Senior Advocate Sharan Jagtiani, appointed as amicus curiae by the court, further submitted that MSRDC's concerns of excess compensation were misplaced. He pointed to the State's Draft Compensation Policy dated November 29, 2021, which adopts the approach of the National Green Tribunal. According to the NGT's calculation in the matter of Ramdas Janardan Kohli on February 27, 2015, compensation for one family was pegged at Rs. "…it is very likely that the final compensation amount will exceed Rs. The court said they were ordering the amount to be disbursed through the fisherfolk society so that there is more accountability. It entrusted the responsibility of the society to reimburse MSRDC in case some fisherfolk are found ineligible for compensation. The amount would have to be returned to the court as the compensation is going through the funds MSRDC deposited in court. "We accordingly direct the Registrar, Judicial I, of this Court to pay the sum of Rs. 10 crores deposited by MSRDC to the Petitioner within two weeks from today, who shall distribute it to its members in the sum of Rs.
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1. This appeal is directed against the judgment dated 10.08.2021
rendered by the learned Single Judge in W.P.(C) 7343/2020. Before the
learned Single Judge, the respondent (who we are told expired after the
impugned judgment was rendered, but before the institution of the appeal)
had assailed the communication dated 12.02.2020 issued by the appellant
i.e., Union of India [hereafter referred to as “UOI”], whereby a request for
grant of pension under the Swatantrata Sainik Samman Pension Scheme,
1980 [hereafter referred to as “1980 Scheme”] was rejected, based on the
provisions of para 5.2.5 of the guidelines issued by the UOI on 06.08.2014
[hereafter referred to as “2014 Guidelines”].
1.1. For the sake of convenience, the deceased respondent would be
referred to as Ms Indira Kumari, unless the context requires otherwise.
1.2. In short, the reason furnished for declining Ms Indira Kumari’s
request for grant of pension was that a “widowed/divorced daughter” was
not eligible for pension under the 1980 Scheme.
2. The learned Single Judge was not impressed with this reasoning as,
according to him, the issue was no longer res integra in view of the
judgement delivered by a Division Bench of the Punjab and Haryana High
Court in Khajani Devi vs. Union of India and Others, 2016 SCC OnLine
2.1 The learned Single Judge also took note of the fact that not only the
Special Leave Petition (SLP), but also a review petition preferred by UOI,
against the said judgement, was dismissed on 27.09.2019 and 19.01.2021,
respectively.
2.2. Besides this, it is important to note that Khajani Devi concerned the
case of a divorced daughter. In the said case, the Division Bench of the
Punjab and Haryana High Court saw no good reason to differentiate between
an “unmarried” daughter, who, admittedly, is an eligible beneficiary under
the 1980 Scheme and a “divorced daughter”.
3. Besides in Khajani Devi’s case, the learned Single Judge also took
note of the judgments rendered by two Single Judges of the Punjab and
Haryana High Court and the Calcutta High Court.
3.1. The learned Single Judge of the Punjab & Haryana High Court via the
judgment dated 02.05.2019, passed in C.W.P. No.8008 of 2017, titled Smt.
Kamlesh vs Union of India and Anr. followed the Division Bench’s
judgment rendered in Khajani Devi’s case and extended the benefit to a
widowed daughter.
3.2. Insofar as the learned Single Judge of the Calcutta High Court is
concerned, in his judgment, rendered in Sonali Hatua Giri vs. Union of
India and Ors., 2021 SCC Online Cal 1644, para 5.2.5 of the 2014
Guidelines was declared ultra vires; on the ground that it violated Article 14
of the Constitution. This judgment had declared that the expression
“unmarried” in para 5.2.5 of the 2014 Guidelines would include
widowed/divorced daughters, provided they fulfilled the other condition i.e.,
of not having any independent source of income.
4. It must also be stated that the learned Single Judge in the impugned
judgement also noticed that contra view taken by a Single Judge of
Himachal Pradesh High Court in judgement dated 18.07.2019, rendered in
CWP No.1504/2019, titled Tulsi Devi v Union of India and Anr.
4.1. Having noticed the said judgment, the learned Single Judge, after
having regard to the fact that an SLP was pending qua the same in the
Supreme Court (a fact recorded in the judgment of the Calcutta High Court
in Sonali Hatua Giri’s case), concurred with the view taken by the Punjab
& Haryana High Court and Calcutta High Court in Khajani Devi’s case and
Sonali Hatua Giri’s case and thus, allowed the prayer made in the writ
petition, via the impugned judgement.
5. Consequently, the impugned communication dated 12.02.2020 issued
by the UOI declining Ms Indira Kumari’s request for granting pension under
the 1980 Scheme was “set aside” with a direction to the UOI to consider the
grant of pension, provided other conditions contained in the 1980 Scheme
stood satisfied. For this purpose, the UOI was accorded eight weeks from
the date of the judgment.
6. Before we proceed further, it would be relevant to take note of the
backdrop in which Ms Indira Kumari (now represented by her legal
representative i.e., her daughter, Ms Kolli Uday Kumari), approached the
learned Single Judge by way of a writ action.
7. Ms Indira Kumari’s father, one Mr K. Appa Rao had applied for grant
of freedom fighters’ pension under the 1980 Scheme. Mr Rao had claimed
that he was involved in the freedom struggle between 1941-42. However,
on 05.01.1996, Mr Rao’s application was rejected on the ground that his
claim of having participated in the freedom struggle could not be
substantiated.
7.1. UOI, subsequently, reversed its view and accordingly, on 15.12.1997,
took a decision to accord pension under the 1980 Scheme to Mr Rao.
8. As noticed above, on 06.08.2014, the UOI via Ministry of Home
Affairs [hereafter referred to as, “MHA”] issued an Office Memorandum
[hereafter referred to as, “OM”] putting into place revised policy guidelines
with the object of closing the gaps that subsisted in the 1980 Scheme. The
revised guidelines i.e., the 2014 Guidelines alluded to the fact that the
designated banks were dispensing pension to married daughters, who were
otherwise not eligible under the 1980 Scheme.
9. The aforesaid was followed by an OM dated 30.12.2015 issued by the
UOI, reiterating the twin conditions provided in the 2014 Guidelines
concerning grant of dependent pension to widow/widower/unmarried
daughter/mother or father of the deceased freedom fighter. While doing so,
it was reasserted that in ascertaining whether or not the dependent had
independent means of livelihood, recourse should be taken to provisions of
para 6.1.2. of the 2014 Guidelines; which, broadly, provided that the eligible
dependent should not have a subsisting source of income which exceeded
Rs.20,000/- per month or Rs.2,40,000/- per annum.
10. The record reveals that Mr Rao, on 18.07.2019, had submitted a
sworn affidavit authorizing Ms Indira Kumari, during her lifetime, to receive
benefits under the 1980 Scheme. Unfortunately, nearly four months later, on
01.11.2019, Mr Rao passed away.
11. This resulted in an application being filed on 11.11.2019 by Ms Indira
Kumari for grant of pension under the 1980 Scheme upon demise of Mr
Rao, i.e., her father.
12. The concerned official at the designated bank i.e., Bank of Baroda
forwarded Ms Indira Kumari’s application to the MHA under the cover of
the letter dated 17.12.2019. This communication was followed by a
reminder dated 20.01.2020.
13. As noticed above, the UOI via MHA rejected Ms Indira Kumari’s
request on 12.02.2020.
14. Being aggrieved, Ms Indira Kumari, as adverted to hereinabove, filed
a writ action on 18.09.2020, whereby she assailed UOI/MHA’s
communication dated 12.02.2020.
15. As noticed above, the impugned judgment was rendered on
10.08.2021 by the learned Single Judge.
16. Sadly, before Ms Indira Kumari could reap the benefits of her labour,
17. The UOI instituted the instant appeal on 15.11.2021. Interestingly,
when the appeal came up for hearing for the first time on 15.12.2021, an
eminently fair stand was taken on behalf of the UOI, which was that the
benefit of the 1980 Scheme would be extended to Ms Indira Kumari. Based
on the stand taken on behalf of the UOI, the appeal and the pending
applications were closed.
18. However, it appears that the UOI has had a change of heart and thus,
moved a review petition on 11.01.2022. Notice in the review petition was
issued on 15.02.2022. While the review petition was pending, an application
was filed by the legal representative of Ms Indira Kumari i.e., her daughter
Ms Kolli Uday Kumari, seeking impleadment, which was allowed on
19. After hearing arguments in the appeal and review petition, judgment
was reserved in the matter on 09.09.2022.
Submissions of Counsels:
20. Given this backdrop, arguments were advanced on behalf of the UOI
by Mr Harish Vaidyanathan Shankar, while the submissions were advanced
on behalf of the deceased respondent by Mr Mahesh Kumar Tiwari.
21. Mr Shankar’s submission can be, broadly, paraphrased as follows:
(i) First, the learned Single Judge erred in putting at par the 1980 Scheme
with a “pension scheme”, whereas the benefits extended under the 1980
Scheme are a measure of “token of respect” accorded by the nation for the
sacrifices made and thus, do not have the attributes of a typical pension
scheme.
(ii) Second, para 3 of the 1980 Scheme defines, as to who is to be treated
as “eligible dependents”. Amongst others, eligible dependent, as per para 3
of the 1980 Scheme is an unmarried daughter. Consequently, widowed and
divorced daughters stand excluded, an aspect which is clarified, expressly, in
para 5.2.5 of the 2014 Guidelines.
(iii) Third, allowing benefits to widowed daughters would result in
opening the “flood gates” and ultimately, burden the exchequer.
(iv) Fourth, pension available under the 1980 Scheme cannot be equated
with pension accorded under regimes put in place by Central/State
Governments, which are interlinked to services rendered by the pensioner in
his or her capacity of an employee. On the other hand, the pension benefit
extended under the 1980 Scheme is “just a token of respect” which is
accorded to a freedom fighter and is “non-transferable”. It, thus, cannot be
extended to anyone else, such as ineligible legal representatives, and
certainly not for their lifetime.
(v) Fifth, the benefit under the 1980 Scheme cannot be extended on
grounds of sympathy. Policy parameters cannot be relaxed based on
sympathy and hardship.
(vi) Sixth, the assertion made in the writ petition that Ms Indira Kumari, at
the relevant point in time, was a dependent was incorrect as even at that
point in time, she was living with her daughter. This becomes apparent upon
cross-referencing the averments made paragraph 3 and Ground E of the writ
petition preferred by the petitioner with paragraph 8 of the impleadment
application i.e., CM No.23322/2022 preferred by Ms Uday Kumari.
Furthermore, Ms Indira Kumari, at the relevant point in time, had concealed
the fact that she had legal heirs, as is evident upon perusal of paragraphs 7
and 9 of CM No. 23322/2022.
(vii) Seventh, the dismissal of the SLP preferred by the UOI against the
judgment of the Division Bench of Punjab & Haryana High court in Khajani
Devi’s case does not constitute a precedent. The UOI had also preferred a
curative petition, which is pending adjudication in the Supreme Court.
Moreover, insofar as the judgment of the learned Single Judge in Smt.
Kamlesh’s case is concerned, the operation of the same has been stayed by
the Division Bench of the Punjab & Haryana High Court via order dated
(viii) In support of his submission, Mr Shankar placed reliance upon the
following judgments:
(a) State of Orissa vs K. Srinivas Rao, (2001) 4 SCC 743.
(b) Judgment dated 11.02.2022, rendered in Civil Appeal
No.987/2020, titled Government of India and Ors. Vs. Sita
Kant Dubashish and Anr.
22. Mr Tiwari, on the other hand, has made the following submissions:
(i) At the point in time when Ms Indira Kumari preferred an application for
grant of pension under the 1980 Scheme, she had, not only lost her father
i.e., Mr Rao, but had also lost her husband, Mr Kolli Lakshmana Rao and
her mother, i.e., Ms Koppala Sundari Mani. The deceased respondent’s
husband passed away on 26.10.2000, while her mother, expired on
16.02.2009. Besides these tragedies, the respondent had also lost her sister
i.e., Ms Chandrakala Kolli on 07.01.2013.
(ii) The application for grant of benefits under the 1980 Scheme was
lodged after the death of the respondent’s father, Mr Rao on 01.11.2019.
Prior to his death, Mr Rao had signed an affidavit dated 18.07.2019
authorizing Ms Indira Kumari to receive benefits under the 1980 Scheme.
(iii) Ms Indira Kumari, since her birth, was differently abled, which is
evident from a perusal of the certificate dated 15.06.1992, which sets forth
the fact that insofar as her mental capacity was concerned, she suffered from
a 50% disability. Likewise, the certificate issued concerning persons with
disability [hereafter referred to as, “PWD”], notes that Ms Indira Kumari
suffered from a speech and hearing impairment in the range of 78-80%.
(iv) Pursuant to Mr Rao being granted benefits under the 1980 Scheme, Ms
Indira Kumari became eligible and was also accorded benefits under the
(v) The rejection of her application via UOI’s communication dated
12.02.2020 is legally unsustainable as it is contrary to the ratio of the
judgment of the Division Bench of the Punjab & Haryana High Court in
Khajani Devi’s case, which received the imprimatur of the Supreme Court
with the dismissal of the SLP on 27.09.2019 and the review petition on
(vi) The decision of the UOI dated 12.02.2020 is also contrary to the
judgment rendered by two Single Judges of the Punjab & Haryana High
Court and the Calcutta High Court, in the matters of Smt. Kamlesh and
Sonali Hatua Giri. In Sonali Hatua Giri’s case, the Calcutta High Court, in
fact, has struck down para 5.2.5 of the 2014 Guidelines.
(vii) The judgment rendered by a Division Bench of the Himachal Pradesh
High Court in Tulsi Devi’s case did not notice the judgment rendered by the
Division Bench of Punjab & Haryana High Court in Khajani Devi’s case
and the orders rendered by the Supreme Court in the appeal and review
petition preferred by the UOI. Pertinently, Tulsi Devi’s case did not involve
a challenge to the provisions of para 5.2.5 of the 2014 Guidelines and hence
is distinguishable.
23. Having heard the counsel for the parties and perused the record, what
has emerged is that there is no contestation concerning the following facts
and circumstances:
(i) Firstly, Mr Rao’s claim to freedom fighters’ pension under the 1980
Scheme was accepted on 15.12.1997.
(ii) Secondly, the UOI via MHA issued the 2014 Guidelines, which
includes para 5.2.5, based on which, Ms Indira Kumari’s application for
grant of pension under the 1980 Scheme was declined, on the ground that
since she fell in the category of a widowed-daughter, she was not eligible for
benefits available under the 1980 Scheme.
(iii) Thirdly, Ms Indira Kumari had been afflicted with a mental disability
since birth and that she had a speech and hearing impairment ranging
between 78-80%.
(iv) Fourthly, she did not have an independent source of income, as per
parameters provided in para 6.1.2 of the 2014 Guidelines, and reiterated in
the OM dated 30.12.2015.
24. Given this backdrop, one needs to unravel as to whether or not a
widowed-daughter could be excluded from the benefits of the 1980 Scheme.
Therefore, it would be useful, at this juncture, to briefly advert to the history
of the 1980 Scheme framed by the Central Government for according
24.1. The record seems to suggest that in 1969, “Ex-Andaman Political
Prisoners Pension Scheme” [hereafter referred to as the “1969 Scheme”]
was framed. Under the 1969 Scheme, grant of pension was confined to those
freedom fighters who, at the relevant time, had been incarcerated in the
Cellular Jail, located in Port Blair (Andaman Islands) for at least five years.
24.2. On the occasion of 25th Anniversary of Independence, a central
scheme for grant of pension was introduced by the Government of India
[hereafter referred to as, “GOI”] which brought within its ambit not only the
freedom fighters, but also their family members, in cases where the freedom
fighter/martyr was no longer alive. This scheme kicked in on 15.08.1972
[hereafter referred to as, “1972 Scheme”]. Notably, the 1972 Scheme had
incorporated an annual income ceiling of Rs.5000/- as an eligibility criteria
for grant of pension.
24.3. However, with the formulation of the 1980 Scheme, with effect from
01.08.1980, the benefit of pension was extended to all freedom fighters. In
effect, the annual ceiling limit of Rs.5000/- provided in the 1972 Scheme
was removed. Therefore, since 01.08.1980, pension is granted to the
freedom fighter during her or his lifetime and upon her or his death, to her or
his eligible dependent(s). As to who is an eligible dependent is provided in
para 3 of the 1980 Scheme which reads as follows:
For the purpose of grant of Samman pension, family includes
(if the freedom fighter is not alive) mother, father,
widower/widow if he/she has not since remarried,
unmarried daughters.
Not more than one eligible dependent can be granted pension
and in the event of availability of more than one dependent
the sequence of eligibility will be widow/widower, unmarried
24.4. The above extract would show that the unmarried daughters fall
within the category of eligible dependents.
24.5. In the context of unmarried daughters, a provision is made in para 12
of the 1980 Scheme, which provides the period during which pension would
be granted to such dependents:
Except in the case of unmarried daughters, the pension is for the life-time
of the recipient. In the case of unmarried daughters, pension ceases
immediately after they are married or become otherwise independent. In
the case of death of a pensioner his/her heirs though otherwise eligible for
pension will not automatically succeed to such a pension. They shall have
to apply afresh with proof of the pensioner and their applications will be
considered in terms of the Pension Scheme.”
24.6. A perusal of para 12 of the 1980 Scheme would show that unmarried
daughters would not be able to draw pension once they get married or
become independent.
24.7. The 2014 Guidelines, it appears, were framed on account of
“confusion amongst bankers”, which led to the pension granted under the
1980 Scheme being put at par with pension accorded to employees of the
Central Government. MHA, it appears, came across cases where banks had
dispersed pension to married daughters. MHA, therefore, had felt it was
necessary to clarify certain aspects of the 1980 Scheme, which led to the
issuance of the 2014 Guidelines. In this context, it becomes necessary to
refer to certain paras of the 2014 Guidelines, which, in our view, are
relevant for adjudication of the case:
“5.2.2 The dependent pension shall be paid from the date of
application by the spouse/daughter and not from the date of
death of the pensioner.
5.2.3 The spouse/daughter must fulfil twin conditions of being
“unmarried” and “having no independent source of
income”. They have to submit two certificates (As per
Annexure-VI & Annexure-VII) to the Bank every year.
5.2.5 Widowed/divorced daughter is not eligible for samman
pension.
5.3.2 In case of death of one of the widows, the daughter of the
deceased widow is not eligible for the pension till the death
of other living widow. Dependent unmarried daughters
come into the picture only after the demise of both the
widows of freedom fighter.
6. Twin conditions for dependent pension to spouse or
daughter(s):- Two important conditions for the dependent
pension to spouse or daughter(s) must be met. Firstly, they
should not have independent sources of income and
secondly they should not have remarried.
6.1.2 The banks must ensure that a dependent pension is not
sanctioned to a spouse or a daughter of a freedom fighter
(i) The spouse/daughter is already employed in a Central
or a State Government, Central/State PSU or local
body.
(ii) In case the spouse/daughter is working in a private
sector or having his/her own business/activity then
income from such job/activity exceeds Rs.20,000/- per
month.
(iii) The spouse/daughter should not be receiving a
pension/salary on account of his or her own job or by
virtue of the previous employment of the deceased
freedom fighter.
As a thumb Rule, if a spouse/daughter is already receiving
one salary/pension (excluding the State Freedom Fighters’
pension), either due to his/her own job or deceased
husband’s/father’s/mother’s previous job, then such
spouse/daughter should not be sanctioned Central Freedom
Whether both husband and wife are drawing central
freedom fighters’ pension individually the Samman Pension
should not be transferred in the name of the spouse
consequent on death of either of them as the surviving
spouse is already getting his/her own central samman
pension.
There may be cases where a dependent is denied pension
because she is having a job or her pension is rightfully
stopped by the Bank the day she gets a job. However in
future, at a subsequent stage, if she resigns on her own or
loses the job due to any reason, even then she is not entitled
to the family pension.
6.2. Ascertaining the marital status:-
6.2.1 Dependent pension is transferred to the widow of the
Pensioner/daughter, who are unmarried. If a wife/daughter
of the deceased pensioner gets re-married then the pension
has to be stopped.
6.2.2 However, in case the husband of a deceased woman
freedom fighter re-marries then the family pension
continues in such a case. In nutshell, the re-marriage
clause is not applicable in case of a husband, who is getting
dependent pension on account of his deceased wife who
was a freedom fighter.
6.2.4 The unmarried daughter must get the Certificate
(Annexure-VI) countersigned by the local Tehsildar of the
District or any Revenue Officer Senior to the Tehsildar.
She must submit such Certificate twice a year, May and
25. Thus, a quick read of paragraphs 3 and 12 of the 1980 Scheme and the
aforementioned paragraphs of the 2014 Guidelines would show that,
undoubtedly, an unmarried daughter falls in the category of eligible
dependents, and hence, is entitled to pension upon the expiry of the freedom
fighter.
26. However, insofar as the spouse or daughter is concerned, two
conditions are required to be fulfilled. First, the spouse or daughter should
be unmarried [See paras 5.2.3 and 6 of the 2014 Guidelines]. Second, the
spouse or daughter should not have an independent source of income; what
would constitute parameters of independent source of income are, as noted
above, set forth in 6.1.2 of the 2014 Guidelines.
27. Inexplicably, while para 3 of the 1980 Scheme provides that a
widow/widower (if he or she has not since remarried), unmarried daughters,
mother and father in the said sequence, would be eligible for grant of
pension if the freedom fighter was not alive, para 6.2.1. of the 2014
Guidelines, inter alia, excludes from the category of dependent person, a
widow of the deceased freedom fighter in case she remarries, but does not
extend this exclusion to a widower. This inexplicable provision is engrafted
in para 6.2.2 of the 2014 Guidelines.
27.1. In other words, if a freedom fighter was a woman, and if she was to
pass away, then, even if the husband was to remarry, he could still avail the
pension under the 1980 Scheme. There is a distinct possibility of para 6.2.2
of the 2014 Guidelines being declared violative of Article 14 of the
constitution, if it were to be challenged. We need not dwell further on this
aspect of the matter as it is not the remit of the instant writ action.
27.2. Moving further, a plain reading of para 6.2.1 would show that, as far
as the daughter of the freedom fighter is concerned, she gets excluded from
the category of an eligible dependent only if she remarries. Para 6.2.1, thus,
is aligned to para 3 of the 1980 Scheme and other paras of 1980 Scheme;
something which cannot be said for para 5.2.5.
28. To our minds, the para 5.2.5 of the 2014 Guidelines cannot go beyond
what is provided in the parent document i.e., the 1980 Scheme. As noted
above, para 5.2.5. is also inconsistent with other paras of the 2014
Guidelines, including para 6.2.1.
29. As pointed out hereinabove, the exclusion of a widow from the
category of eligible dependents, once she remarries (which is not an
exclusionary criteria in the case of a widower), is also not in consonance
with para 3 of the 1980 Scheme, where no such caveat has been put in place.
Therefore, if the 1980 Scheme is the grund norm for identifying eligible
dependents, all that we have to examine in this case is, as to whether or not a
widowed daughter falls within the ambit and scope of unmarried daughter.
30. The expression “unmarried” adverts to a person who is not married1.
It includes a woman who is single i.e., who was married but divorced and
even a woman who is widowed.
31. Therefore, in our view, the 1980 Scheme did not contemplate
exclusion of widowed daughters, as is sought to be contended on behalf of
UOI. The 2014 Guidelines were framed to clarify the 1980 Scheme and not
amend it.
31.1. As alluded to hereinabove, para 5.2.5 of the 2014 Guidelines is
intrinsically inconsistent with the remaining provisions of both 2014
Guidelines as also the provisions of the 1980 Scheme.
32. Besides this, it has to be borne in mind that the Division Bench of the
Punjab and Haryana High Court in Khajani Devi’s case, in a somewhat
similar situation, in our view, correctly ruled that the expression “unmarried
daughter” included a divorced daughter. In this regard, the Division Bench
of the Punjab and Haryana High Court made the following observations:
“5. The underlying object in the clause of the Scheme listing eligible
dependents is that only one be granted the pension. Therefore, the
authorities have to construe the admissibility of benefit from that angle. It
is not the case that the daughters are excluded altogether. An unmarried
daughter finds mention in the list of eligible dependents. It would, thus, be
a travesty to exclude a divorced daughter. There would be no rationality
to the reason that the unmarried daughter can be included in the list of
eligible dependents and a divorced daughter would stand excluded,
particularly when she is the sole eligible dependent and thus, qualifies for
the benefit, which is concededly made admissible only to one dependent.
Even otherwise, we are of the opinion that a beneficial Scheme such as the
one in hand should not be fettered or constructed by a rigorous
interpretation which tends to deprive the claimants of the benefit to result
in virtual frustration or negation of the laudable motive of the Scheme
itself. We also notice that the Ministry of Defence has issued instructions
dated 14.12.2012 (on record as Annexure P8) which included a divorced
daughter in the category of eligible dependents for grant of
liberalized/special family pension beyond 25 years. We may extract the
"2. The above matter is considered by the Government and it
has been decided in consultation with Department of P&PW
that unmarried/widowed/divorced daughter shall also be
eligible for grant of liberalised/special family pension
beyond 25 years of age subject to fulfillment of other
prescribed conditions as hitherto fore."
6. Both the liberalized/special family pension and Swatantarta Sainik
Samman Pension Scheme are intended to honour the valour of the 3 of
4 uniformed people who laid down their lives or suffered for the cause of
the country. We would, thus, not place any demeaning interpretation on
the Scheme to deprive the unsung heroes of the country of benefits meant
to ensure a life of dignity to their dependents.
33. As is evident upon the perusal of the aforesaid extract culled from the
judgement in Khajani Devi’s case, the court adverted to Ministry of
Defence’s instructions dated 14.12.2012, which extended the benefits under
the liberalized/special family pension beyond 25 years to a divorced
daughter. The court, in our opinion, once again, correctly observed that if
the intention was to honour those who laid down their lives or had suffered
for the cause of the country, whether in uniform or otherwise, the expression
eligible dependent should include a divorced daughter.
34. The Supreme Court, while dismissing the SLP preferred by the UOI
in Khajani Devi’s case, did not simply dismiss it in limine. The court, after
hearing the counsel for the contesting parties, via the order dated 27.09.2019
dismissed the appeal preferred by the UOI. The said order, being brief is
“Delay condoned.
We have heard learned counsel for the parties. We are of the
view that the impugned order adopts a progressive and socially
constructive approach to give benefits to daughter who was
divorced treating her at parity with the un-married daughter.
We fully agree with this view.
No ground for interference is made out. The special leave
petition is accordingly dismissed.
Pending application shall also stand disposed of.”
[ Emphasis is ours.]
34.1. To our minds, a plain reading of the order of the Supreme Court
would show that the dismissal of the SLP was on merits and not in limine. It
appears this facet of the order dismissing the SLP in Khajani Devi’s case,
was not brought to the notice of the Calcutta High Court in Sonali Hatua
Giri’s case.
35. We see no reason not to extend the benefit of the 1980 Scheme to a
widowed/divorced daughter. We respectfully agree with the view enunciated
by the learned Single Judge of the Punjab and Haryana High Court in Smt.
Kamlesh’s case, as well as the view expressed by the learned Single Judge
of the Calcutta High Court in Sonali Hatua Giri’s case.
36. Although it was pointed out to us that the Division Bench of the
Punjab and Haryana High Court had stayed the operation of the judgment of
the learned Single Judge in Smt. Kamlesh’s case, nothing is placed before us
which would show that an appeal has been preferred against the judgment of
the learned Single Judge of the Calcutta High Court in Sonali Hatua Giri’s
case.
37. We notice that insofar as the judgment of the Division Bench of the
Himachal Pradesh High Court in the matter of Tulsi Devi is concerned, it
does not advert to the judgment of the Division Bench of the Punjab and
Haryana High Court in Khajani Devi’s case or for that matter, the
judgement of the learned Single Judge of Punjab and Haryana High Court in
Smt. Kamlesh’s case. It appears these judgements were not brought to the
notice of the Court.
38. What is not in dispute is that although an SLP has been preferred in
Tulsi Devi’s case, the same is pending adjudication before the Supreme
39. Thus, at the moment, the only clear view that we have is that of the
Supreme Court in Khajani Devi’s case. The ratio of this judgement is
binding on all courts including this court.
40. Thus, for the foregoing reasons and the view expressed by the
Supreme Court Khajani Devi’s case, we are not inclined to interfere with the
judgment of the learned Single Judge.
41. However, before we conclude, we may emphasize that our decision in
the instant matter is not based on a concession given by the counsel for the
UOI, but is based on the merits of the case. Therefore, we inclined to allow
the review petition and recall our order dated 15.12.2021, only to save Mr
Shankar from any further embarrassment. It is so ordered.
42. Furthermore, we are, as indicated above, inclined to dismiss the appeal
preferred by the UOI.
43. Since the legal representative of Ms Indira Kumari has been brought on
record, she would receive pension (if otherwise, deceased Ms Indira Kumari
fulfilled other conditions provided in the 1980 Scheme) from the date of the
application made in that behalf by her mother, Ms Indira Kumari, till the
date of her death, which, we are told, occurred on 02.10.2021.
44. The UOI will ensure that the monetary benefit is extended to the legal
representative of the deceased respondent Ms Indira Kumari, if otherwise
there is no impediment under the 1980 Scheme, within the next six weeks.
45. Costs will follow the result in the appeal.
JANUARY 20th, 2023 / pmc
|
The Delhi High Court has said that a widowed or divorced daughter is entitled to the benefit under freedom fighter pension scheme of 1980, noting that the scheme does not contemplate their exclusion.
A division bench of Justice Rajiv Shakdher and Justice Talwant Singh observed that a “quick read” of the 1980 Scheme and 2014 Guidelines framed under it would show that an unmarried daughter falls in the category of eligible dependents and hence, is entitled to pension upon the expiry of the freedom fighter.
“The expression “unmarried” adverts to a person who is not married. It includes a woman who is single i.e., who was married but divorced and even a woman who is widowed,” the court said.
The bench also noted that para 6.2.1 of the 2014 guidelines would show that the daughter of a freedom fighter gets excluded from the category of an eligible dependent if she remarries.
Para 6.2.1 states that the dependent pension is transferred to the widow of the pensioner or daughter, who is unmarried. It adds that where a wife or daughter of the deceased pensioner gets re-married, then the pension has to be stopped.
Para 3 of the Scheme defines “eligible dependents” who include spouse or unmarried and unemployed daughters or mother or father.
The bench observed that the exclusion of a widow from the category of eligible dependents, - once she remarries, is also not in consonance with para 3 of the 1980 Scheme, where no such caveat has been put in place.
“Therefore, in our view, the 1980 Scheme did not contemplate exclusion of widowed daughters, as is sought to be contended on behalf of UOI. The 2014 Guidelines were framed to clarify the 1980 Scheme and not amend it,” the court said.
The bench also said that there is a “distinct possibility” of 2014 guidelines “being declared violative of Article 14 of Constitution of India if it were to be challenged” as they only exclude a widow of deceased freedom fighter in case she remarries, from the category of dependent person, but does not extend the exclusion to a widower.
“In other words, if a freedom fighter was a woman, and if she was to pass away, then, even if the husband was to remarry, he could still avail the pension under the 1980 Scheme. There is a distinct possibility of para 6.2.2 of the 2014 Guidelines being declared violative of Article 14 of the constitution, if it were to be challenged,” it said.
The court noted that the “inexplicable provision” is engrafted in para 6.2.2 of the 2014 Guidelines. The provision states that where the husband of a deceased woman freedom fighter re-marries, the family pension continues in such a case. It adds that the re-marriage clause is not applicable in case of a husband, who is getting dependent pension on account of his deceased wife who was a freedom fighter.
The court made the observations while hearing a review plea filed by the Central Government in an appeal against order passed by the single judge on August 10, 2021.
The single judge had quashed the communication dated February 12, 2020 issued by the Central Government declining the request of one Indira Kumari for grant of pension under the 1980 Scheme. The government was also directed to consider the grant of pension, provided other conditions contained in the Scheme stood satisfied.
Kumari passed away on October 2, 2021. The Central Government instituted the appeal on November 15, 2021. On the first day of hearing, a stand was taken on behalf of the government stating that the benefit of the Scheme would be extended to Kumari.
However, the government moved a review petition on January 11 last year. An application was also filed by Kumari’s daughter, being her legal representative.
Dismissing the appeal of the Central Government, the division bench ordered that Kumari’s daughter would receive pension from the date of the application made by her, till the date of her death which occurred on October 2, 2021.
“The UOI will ensure that the monetary benefit is extended to the legal representative of the deceased respondent Ms Indira Kumari, if otherwise there is no impediment under the 1980 Scheme, within the next six weeks,” the court directed.
The court referred to the order of a Division Bench of the Punjab and Haryana High Court in Khajani Devi’ Devi v. Union of India and Others (2016) wherein it was ruled that the expression “unmarried daughter” includes a divorced daughter.
It also noted that the Supreme Court dismissed the SLP preferred by the Central Government against the ruling of Khajani Devi on merits.
“We see no reason not to extend the benefit of the 1980 Scheme to a widowed/divorced daughter. We respectfully agree with the view enunciated by the learned Single Judge of the Punjab and Haryana High Court in Smt. Kamlesh’s case, as well as the view expressed by the learned Single Judge of the Calcutta High Court in Sonali Hatua Giri’s case,” the court said.
The court also noted that an SLP is pending before the Supreme Court in the case of Tulsi Devi v. Union of India and Anr against a 2019 judgment of division bench of Himachal Pradesh High Court.
“Thus, at the moment, the only clear view that we have is that of the Supreme Court in Khajani Devi’s case. The ratio of this judgement is binding on all courts including this court. Thus, for the foregoing reasons and the view expressed by the Supreme Court Khajani Devi’s case, we are not inclined to interfere with the judgment of the learned Single Judge,” the court said.
Title: UNION OF INDIA v. KOLLI UDAY KUMARI
|
1. This appeal is directed against the judgment dated 10.08.2021
rendered by the learned Single Judge in W.P.(C) 7343/2020. Before the
learned Single Judge, the respondent (who we are told expired after the
impugned judgment was rendered, but before the institution of the appeal)
had assailed the communication dated 12.02.2020 issued by the appellant
i.e., Union of India [hereafter referred to as “UOI”], whereby a request for
grant of pension under the Swatantrata Sainik Samman Pension Scheme,
1980 [hereafter referred to as “1980 Scheme”] was rejected, based on the
provisions of para 5.2.5 of the guidelines issued by the UOI on 06.08.2014
[hereafter referred to as “2014 Guidelines”].
1.1. For the sake of convenience, the deceased respondent would be
referred to as Ms Indira Kumari, unless the context requires otherwise.
1.2. In short, the reason furnished for declining Ms Indira Kumari’s
request for grant of pension was that a “widowed/divorced daughter” was
not eligible for pension under the 1980 Scheme.
2. The learned Single Judge was not impressed with this reasoning as,
according to him, the issue was no longer res integra in view of the
judgement delivered by a Division Bench of the Punjab and Haryana High
Court in Khajani Devi vs. Union of India and Others, 2016 SCC OnLine
2.1 The learned Single Judge also took note of the fact that not only the
Special Leave Petition (SLP), but also a review petition preferred by UOI,
against the said judgement, was dismissed on 27.09.2019 and 19.01.2021,
respectively.
2.2. Besides this, it is important to note that Khajani Devi concerned the
case of a divorced daughter. In the said case, the Division Bench of the
Punjab and Haryana High Court saw no good reason to differentiate between
an “unmarried” daughter, who, admittedly, is an eligible beneficiary under
the 1980 Scheme and a “divorced daughter”.
3. Besides in Khajani Devi’s case, the learned Single Judge also took
note of the judgments rendered by two Single Judges of the Punjab and
Haryana High Court and the Calcutta High Court.
3.1. The learned Single Judge of the Punjab & Haryana High Court via the
judgment dated 02.05.2019, passed in C.W.P. No.8008 of 2017, titled Smt.
Kamlesh vs Union of India and Anr. followed the Division Bench’s
judgment rendered in Khajani Devi’s case and extended the benefit to a
widowed daughter.
3.2. Insofar as the learned Single Judge of the Calcutta High Court is
concerned, in his judgment, rendered in Sonali Hatua Giri vs. Union of
India and Ors., 2021 SCC Online Cal 1644, para 5.2.5 of the 2014
Guidelines was declared ultra vires; on the ground that it violated Article 14
of the Constitution. This judgment had declared that the expression
“unmarried” in para 5.2.5 of the 2014 Guidelines would include
widowed/divorced daughters, provided they fulfilled the other condition i.e.,
of not having any independent source of income.
4. It must also be stated that the learned Single Judge in the impugned
judgement also noticed that contra view taken by a Single Judge of
Himachal Pradesh High Court in judgement dated 18.07.2019, rendered in
CWP No.1504/2019, titled Tulsi Devi v Union of India and Anr.
4.1. Having noticed the said judgment, the learned Single Judge, after
having regard to the fact that an SLP was pending qua the same in the
Supreme Court (a fact recorded in the judgment of the Calcutta High Court
in Sonali Hatua Giri’s case), concurred with the view taken by the Punjab
& Haryana High Court and Calcutta High Court in Khajani Devi’s case and
Sonali Hatua Giri’s case and thus, allowed the prayer made in the writ
petition, via the impugned judgement.
5. Consequently, the impugned communication dated 12.02.2020 issued
by the UOI declining Ms Indira Kumari’s request for granting pension under
the 1980 Scheme was “set aside” with a direction to the UOI to consider the
grant of pension, provided other conditions contained in the 1980 Scheme
stood satisfied. For this purpose, the UOI was accorded eight weeks from
the date of the judgment.
6. Before we proceed further, it would be relevant to take note of the
backdrop in which Ms Indira Kumari (now represented by her legal
representative i.e., her daughter, Ms Kolli Uday Kumari), approached the
learned Single Judge by way of a writ action.
7. Ms Indira Kumari’s father, one Mr K. Appa Rao had applied for grant
of freedom fighters’ pension under the 1980 Scheme. Mr Rao had claimed
that he was involved in the freedom struggle between 1941-42. However,
on 05.01.1996, Mr Rao’s application was rejected on the ground that his
claim of having participated in the freedom struggle could not be
substantiated.
7.1. UOI, subsequently, reversed its view and accordingly, on 15.12.1997,
took a decision to accord pension under the 1980 Scheme to Mr Rao.
8. As noticed above, on 06.08.2014, the UOI via Ministry of Home
Affairs [hereafter referred to as, “MHA”] issued an Office Memorandum
[hereafter referred to as, “OM”] putting into place revised policy guidelines
with the object of closing the gaps that subsisted in the 1980 Scheme. The
revised guidelines i.e., the 2014 Guidelines alluded to the fact that the
designated banks were dispensing pension to married daughters, who were
otherwise not eligible under the 1980 Scheme.
9. The aforesaid was followed by an OM dated 30.12.2015 issued by the
UOI, reiterating the twin conditions provided in the 2014 Guidelines
concerning grant of dependent pension to widow/widower/unmarried
daughter/mother or father of the deceased freedom fighter. While doing so,
it was reasserted that in ascertaining whether or not the dependent had
independent means of livelihood, recourse should be taken to provisions of
para 6.1.2. of the 2014 Guidelines; which, broadly, provided that the eligible
dependent should not have a subsisting source of income which exceeded
Rs.20,000/- per month or Rs.2,40,000/- per annum.
10. The record reveals that Mr Rao, on 18.07.2019, had submitted a
sworn affidavit authorizing Ms Indira Kumari, during her lifetime, to receive
benefits under the 1980 Scheme. Unfortunately, nearly four months later, on
01.11.2019, Mr Rao passed away.
11. This resulted in an application being filed on 11.11.2019 by Ms Indira
Kumari for grant of pension under the 1980 Scheme upon demise of Mr
Rao, i.e., her father.
12. The concerned official at the designated bank i.e., Bank of Baroda
forwarded Ms Indira Kumari’s application to the MHA under the cover of
the letter dated 17.12.2019. This communication was followed by a
reminder dated 20.01.2020.
13. As noticed above, the UOI via MHA rejected Ms Indira Kumari’s
request on 12.02.2020.
14. Being aggrieved, Ms Indira Kumari, as adverted to hereinabove, filed
a writ action on 18.09.2020, whereby she assailed UOI/MHA’s
communication dated 12.02.2020.
15. As noticed above, the impugned judgment was rendered on
10.08.2021 by the learned Single Judge.
16. Sadly, before Ms Indira Kumari could reap the benefits of her labour,
17. The UOI instituted the instant appeal on 15.11.2021. Interestingly,
when the appeal came up for hearing for the first time on 15.12.2021, an
eminently fair stand was taken on behalf of the UOI, which was that the
benefit of the 1980 Scheme would be extended to Ms Indira Kumari. Based
on the stand taken on behalf of the UOI, the appeal and the pending
applications were closed.
18. However, it appears that the UOI has had a change of heart and thus,
moved a review petition on 11.01.2022. Notice in the review petition was
issued on 15.02.2022. While the review petition was pending, an application
was filed by the legal representative of Ms Indira Kumari i.e., her daughter
Ms Kolli Uday Kumari, seeking impleadment, which was allowed on
19. After hearing arguments in the appeal and review petition, judgment
was reserved in the matter on 09.09.2022.
Submissions of Counsels:
20. Given this backdrop, arguments were advanced on behalf of the UOI
by Mr Harish Vaidyanathan Shankar, while the submissions were advanced
on behalf of the deceased respondent by Mr Mahesh Kumar Tiwari.
21. Mr Shankar’s submission can be, broadly, paraphrased as follows:
(i) First, the learned Single Judge erred in putting at par the 1980 Scheme
with a “pension scheme”, whereas the benefits extended under the 1980
Scheme are a measure of “token of respect” accorded by the nation for the
sacrifices made and thus, do not have the attributes of a typical pension
scheme.
(ii) Second, para 3 of the 1980 Scheme defines, as to who is to be treated
as “eligible dependents”. Amongst others, eligible dependent, as per para 3
of the 1980 Scheme is an unmarried daughter. Consequently, widowed and
divorced daughters stand excluded, an aspect which is clarified, expressly, in
para 5.2.5 of the 2014 Guidelines.
(iii) Third, allowing benefits to widowed daughters would result in
opening the “flood gates” and ultimately, burden the exchequer.
(iv) Fourth, pension available under the 1980 Scheme cannot be equated
with pension accorded under regimes put in place by Central/State
Governments, which are interlinked to services rendered by the pensioner in
his or her capacity of an employee. On the other hand, the pension benefit
extended under the 1980 Scheme is “just a token of respect” which is
accorded to a freedom fighter and is “non-transferable”. It, thus, cannot be
extended to anyone else, such as ineligible legal representatives, and
certainly not for their lifetime.
(v) Fifth, the benefit under the 1980 Scheme cannot be extended on
grounds of sympathy. Policy parameters cannot be relaxed based on
sympathy and hardship.
(vi) Sixth, the assertion made in the writ petition that Ms Indira Kumari, at
the relevant point in time, was a dependent was incorrect as even at that
point in time, she was living with her daughter. This becomes apparent upon
cross-referencing the averments made paragraph 3 and Ground E of the writ
petition preferred by the petitioner with paragraph 8 of the impleadment
application i.e., CM No.23322/2022 preferred by Ms Uday Kumari.
Furthermore, Ms Indira Kumari, at the relevant point in time, had concealed
the fact that she had legal heirs, as is evident upon perusal of paragraphs 7
and 9 of CM No. 23322/2022.
(vii) Seventh, the dismissal of the SLP preferred by the UOI against the
judgment of the Division Bench of Punjab & Haryana High court in Khajani
Devi’s case does not constitute a precedent. The UOI had also preferred a
curative petition, which is pending adjudication in the Supreme Court.
Moreover, insofar as the judgment of the learned Single Judge in Smt.
Kamlesh’s case is concerned, the operation of the same has been stayed by
the Division Bench of the Punjab & Haryana High Court via order dated
(viii) In support of his submission, Mr Shankar placed reliance upon the
following judgments:
(a) State of Orissa vs K. Srinivas Rao, (2001) 4 SCC 743.
(b) Judgment dated 11.02.2022, rendered in Civil Appeal
No.987/2020, titled Government of India and Ors. Vs. Sita
Kant Dubashish and Anr.
22. Mr Tiwari, on the other hand, has made the following submissions:
(i) At the point in time when Ms Indira Kumari preferred an application for
grant of pension under the 1980 Scheme, she had, not only lost her father
i.e., Mr Rao, but had also lost her husband, Mr Kolli Lakshmana Rao and
her mother, i.e., Ms Koppala Sundari Mani. The deceased respondent’s
husband passed away on 26.10.2000, while her mother, expired on
16.02.2009. Besides these tragedies, the respondent had also lost her sister
i.e., Ms Chandrakala Kolli on 07.01.2013.
(ii) The application for grant of benefits under the 1980 Scheme was
lodged after the death of the respondent’s father, Mr Rao on 01.11.2019.
Prior to his death, Mr Rao had signed an affidavit dated 18.07.2019
authorizing Ms Indira Kumari to receive benefits under the 1980 Scheme.
(iii) Ms Indira Kumari, since her birth, was differently abled, which is
evident from a perusal of the certificate dated 15.06.1992, which sets forth
the fact that insofar as her mental capacity was concerned, she suffered from
a 50% disability. Likewise, the certificate issued concerning persons with
disability [hereafter referred to as, “PWD”], notes that Ms Indira Kumari
suffered from a speech and hearing impairment in the range of 78-80%.
(iv) Pursuant to Mr Rao being granted benefits under the 1980 Scheme, Ms
Indira Kumari became eligible and was also accorded benefits under the
(v) The rejection of her application via UOI’s communication dated
12.02.2020 is legally unsustainable as it is contrary to the ratio of the
judgment of the Division Bench of the Punjab & Haryana High Court in
Khajani Devi’s case, which received the imprimatur of the Supreme Court
with the dismissal of the SLP on 27.09.2019 and the review petition on
(vi) The decision of the UOI dated 12.02.2020 is also contrary to the
judgment rendered by two Single Judges of the Punjab & Haryana High
Court and the Calcutta High Court, in the matters of Smt. Kamlesh and
Sonali Hatua Giri. In Sonali Hatua Giri’s case, the Calcutta High Court, in
fact, has struck down para 5.2.5 of the 2014 Guidelines.
(vii) The judgment rendered by a Division Bench of the Himachal Pradesh
High Court in Tulsi Devi’s case did not notice the judgment rendered by the
Division Bench of Punjab & Haryana High Court in Khajani Devi’s case
and the orders rendered by the Supreme Court in the appeal and review
petition preferred by the UOI. Pertinently, Tulsi Devi’s case did not involve
a challenge to the provisions of para 5.2.5 of the 2014 Guidelines and hence
is distinguishable.
23. Having heard the counsel for the parties and perused the record, what
has emerged is that there is no contestation concerning the following facts
and circumstances:
(i) Firstly, Mr Rao’s claim to freedom fighters’ pension under the 1980
Scheme was accepted on 15.12.1997.
(ii) Secondly, the UOI via MHA issued the 2014 Guidelines, which
includes para 5.2.5, based on which, Ms Indira Kumari’s application for
grant of pension under the 1980 Scheme was declined, on the ground that
since she fell in the category of a widowed-daughter, she was not eligible for
benefits available under the 1980 Scheme.
(iii) Thirdly, Ms Indira Kumari had been afflicted with a mental disability
since birth and that she had a speech and hearing impairment ranging
between 78-80%.
(iv) Fourthly, she did not have an independent source of income, as per
parameters provided in para 6.1.2 of the 2014 Guidelines, and reiterated in
the OM dated 30.12.2015.
24. Given this backdrop, one needs to unravel as to whether or not a
widowed-daughter could be excluded from the benefits of the 1980 Scheme.
Therefore, it would be useful, at this juncture, to briefly advert to the history
of the 1980 Scheme framed by the Central Government for according
24.1. The record seems to suggest that in 1969, “Ex-Andaman Political
Prisoners Pension Scheme” [hereafter referred to as the “1969 Scheme”]
was framed. Under the 1969 Scheme, grant of pension was confined to those
freedom fighters who, at the relevant time, had been incarcerated in the
Cellular Jail, located in Port Blair (Andaman Islands) for at least five years.
24.2. On the occasion of 25th Anniversary of Independence, a central
scheme for grant of pension was introduced by the Government of India
[hereafter referred to as, “GOI”] which brought within its ambit not only the
freedom fighters, but also their family members, in cases where the freedom
fighter/martyr was no longer alive. This scheme kicked in on 15.08.1972
[hereafter referred to as, “1972 Scheme”]. Notably, the 1972 Scheme had
incorporated an annual income ceiling of Rs.5000/- as an eligibility criteria
for grant of pension.
24.3. However, with the formulation of the 1980 Scheme, with effect from
01.08.1980, the benefit of pension was extended to all freedom fighters. In
effect, the annual ceiling limit of Rs.5000/- provided in the 1972 Scheme
was removed. Therefore, since 01.08.1980, pension is granted to the
freedom fighter during her or his lifetime and upon her or his death, to her or
his eligible dependent(s). As to who is an eligible dependent is provided in
para 3 of the 1980 Scheme which reads as follows:
For the purpose of grant of Samman pension, family includes
(if the freedom fighter is not alive) mother, father,
widower/widow if he/she has not since remarried,
unmarried daughters.
Not more than one eligible dependent can be granted pension
and in the event of availability of more than one dependent
the sequence of eligibility will be widow/widower, unmarried
24.4. The above extract would show that the unmarried daughters fall
within the category of eligible dependents.
24.5. In the context of unmarried daughters, a provision is made in para 12
of the 1980 Scheme, which provides the period during which pension would
be granted to such dependents:
Except in the case of unmarried daughters, the pension is for the life-time
of the recipient. In the case of unmarried daughters, pension ceases
immediately after they are married or become otherwise independent. In
the case of death of a pensioner his/her heirs though otherwise eligible for
pension will not automatically succeed to such a pension. They shall have
to apply afresh with proof of the pensioner and their applications will be
considered in terms of the Pension Scheme.”
24.6. A perusal of para 12 of the 1980 Scheme would show that unmarried
daughters would not be able to draw pension once they get married or
become independent.
24.7. The 2014 Guidelines, it appears, were framed on account of
“confusion amongst bankers”, which led to the pension granted under the
1980 Scheme being put at par with pension accorded to employees of the
Central Government. MHA, it appears, came across cases where banks had
dispersed pension to married daughters. MHA, therefore, had felt it was
necessary to clarify certain aspects of the 1980 Scheme, which led to the
issuance of the 2014 Guidelines. In this context, it becomes necessary to
refer to certain paras of the 2014 Guidelines, which, in our view, are
relevant for adjudication of the case:
“5.2.2 The dependent pension shall be paid from the date of
application by the spouse/daughter and not from the date of
death of the pensioner.
5.2.3 The spouse/daughter must fulfil twin conditions of being
“unmarried” and “having no independent source of
income”. They have to submit two certificates (As per
Annexure-VI & Annexure-VII) to the Bank every year.
5.2.5 Widowed/divorced daughter is not eligible for samman
pension.
5.3.2 In case of death of one of the widows, the daughter of the
deceased widow is not eligible for the pension till the death
of other living widow. Dependent unmarried daughters
come into the picture only after the demise of both the
widows of freedom fighter.
6. Twin conditions for dependent pension to spouse or
daughter(s):- Two important conditions for the dependent
pension to spouse or daughter(s) must be met. Firstly, they
should not have independent sources of income and
secondly they should not have remarried.
6.1.2 The banks must ensure that a dependent pension is not
sanctioned to a spouse or a daughter of a freedom fighter
(i) The spouse/daughter is already employed in a Central
or a State Government, Central/State PSU or local
body.
(ii) In case the spouse/daughter is working in a private
sector or having his/her own business/activity then
income from such job/activity exceeds Rs.20,000/- per
month.
(iii) The spouse/daughter should not be receiving a
pension/salary on account of his or her own job or by
virtue of the previous employment of the deceased
freedom fighter.
As a thumb Rule, if a spouse/daughter is already receiving
one salary/pension (excluding the State Freedom Fighters’
pension), either due to his/her own job or deceased
husband’s/father’s/mother’s previous job, then such
spouse/daughter should not be sanctioned Central Freedom
Whether both husband and wife are drawing central
freedom fighters’ pension individually the Samman Pension
should not be transferred in the name of the spouse
consequent on death of either of them as the surviving
spouse is already getting his/her own central samman
pension.
There may be cases where a dependent is denied pension
because she is having a job or her pension is rightfully
stopped by the Bank the day she gets a job. However in
future, at a subsequent stage, if she resigns on her own or
loses the job due to any reason, even then she is not entitled
to the family pension.
6.2. Ascertaining the marital status:-
6.2.1 Dependent pension is transferred to the widow of the
Pensioner/daughter, who are unmarried. If a wife/daughter
of the deceased pensioner gets re-married then the pension
has to be stopped.
6.2.2 However, in case the husband of a deceased woman
freedom fighter re-marries then the family pension
continues in such a case. In nutshell, the re-marriage
clause is not applicable in case of a husband, who is getting
dependent pension on account of his deceased wife who
was a freedom fighter.
6.2.4 The unmarried daughter must get the Certificate
(Annexure-VI) countersigned by the local Tehsildar of the
District or any Revenue Officer Senior to the Tehsildar.
She must submit such Certificate twice a year, May and
25. Thus, a quick read of paragraphs 3 and 12 of the 1980 Scheme and the
aforementioned paragraphs of the 2014 Guidelines would show that,
undoubtedly, an unmarried daughter falls in the category of eligible
dependents, and hence, is entitled to pension upon the expiry of the freedom
fighter.
26. However, insofar as the spouse or daughter is concerned, two
conditions are required to be fulfilled. First, the spouse or daughter should
be unmarried [See paras 5.2.3 and 6 of the 2014 Guidelines]. Second, the
spouse or daughter should not have an independent source of income; what
would constitute parameters of independent source of income are, as noted
above, set forth in 6.1.2 of the 2014 Guidelines.
27. Inexplicably, while para 3 of the 1980 Scheme provides that a
widow/widower (if he or she has not since remarried), unmarried daughters,
mother and father in the said sequence, would be eligible for grant of
pension if the freedom fighter was not alive, para 6.2.1. of the 2014
Guidelines, inter alia, excludes from the category of dependent person, a
widow of the deceased freedom fighter in case she remarries, but does not
extend this exclusion to a widower. This inexplicable provision is engrafted
in para 6.2.2 of the 2014 Guidelines.
27.1. In other words, if a freedom fighter was a woman, and if she was to
pass away, then, even if the husband was to remarry, he could still avail the
pension under the 1980 Scheme. There is a distinct possibility of para 6.2.2
of the 2014 Guidelines being declared violative of Article 14 of the
constitution, if it were to be challenged. We need not dwell further on this
aspect of the matter as it is not the remit of the instant writ action.
27.2. Moving further, a plain reading of para 6.2.1 would show that, as far
as the daughter of the freedom fighter is concerned, she gets excluded from
the category of an eligible dependent only if she remarries. Para 6.2.1, thus,
is aligned to para 3 of the 1980 Scheme and other paras of 1980 Scheme;
something which cannot be said for para 5.2.5.
28. To our minds, the para 5.2.5 of the 2014 Guidelines cannot go beyond
what is provided in the parent document i.e., the 1980 Scheme. As noted
above, para 5.2.5. is also inconsistent with other paras of the 2014
Guidelines, including para 6.2.1.
29. As pointed out hereinabove, the exclusion of a widow from the
category of eligible dependents, once she remarries (which is not an
exclusionary criteria in the case of a widower), is also not in consonance
with para 3 of the 1980 Scheme, where no such caveat has been put in place.
Therefore, if the 1980 Scheme is the grund norm for identifying eligible
dependents, all that we have to examine in this case is, as to whether or not a
widowed daughter falls within the ambit and scope of unmarried daughter.
30. The expression “unmarried” adverts to a person who is not married1.
It includes a woman who is single i.e., who was married but divorced and
even a woman who is widowed.
31. Therefore, in our view, the 1980 Scheme did not contemplate
exclusion of widowed daughters, as is sought to be contended on behalf of
UOI. The 2014 Guidelines were framed to clarify the 1980 Scheme and not
amend it.
31.1. As alluded to hereinabove, para 5.2.5 of the 2014 Guidelines is
intrinsically inconsistent with the remaining provisions of both 2014
Guidelines as also the provisions of the 1980 Scheme.
32. Besides this, it has to be borne in mind that the Division Bench of the
Punjab and Haryana High Court in Khajani Devi’s case, in a somewhat
similar situation, in our view, correctly ruled that the expression “unmarried
daughter” included a divorced daughter. In this regard, the Division Bench
of the Punjab and Haryana High Court made the following observations:
“5. The underlying object in the clause of the Scheme listing eligible
dependents is that only one be granted the pension. Therefore, the
authorities have to construe the admissibility of benefit from that angle. It
is not the case that the daughters are excluded altogether. An unmarried
daughter finds mention in the list of eligible dependents. It would, thus, be
a travesty to exclude a divorced daughter. There would be no rationality
to the reason that the unmarried daughter can be included in the list of
eligible dependents and a divorced daughter would stand excluded,
particularly when she is the sole eligible dependent and thus, qualifies for
the benefit, which is concededly made admissible only to one dependent.
Even otherwise, we are of the opinion that a beneficial Scheme such as the
one in hand should not be fettered or constructed by a rigorous
interpretation which tends to deprive the claimants of the benefit to result
in virtual frustration or negation of the laudable motive of the Scheme
itself. We also notice that the Ministry of Defence has issued instructions
dated 14.12.2012 (on record as Annexure P8) which included a divorced
daughter in the category of eligible dependents for grant of
liberalized/special family pension beyond 25 years. We may extract the
"2. The above matter is considered by the Government and it
has been decided in consultation with Department of P&PW
that unmarried/widowed/divorced daughter shall also be
eligible for grant of liberalised/special family pension
beyond 25 years of age subject to fulfillment of other
prescribed conditions as hitherto fore."
6. Both the liberalized/special family pension and Swatantarta Sainik
Samman Pension Scheme are intended to honour the valour of the 3 of
4 uniformed people who laid down their lives or suffered for the cause of
the country. We would, thus, not place any demeaning interpretation on
the Scheme to deprive the unsung heroes of the country of benefits meant
to ensure a life of dignity to their dependents.
33. As is evident upon the perusal of the aforesaid extract culled from the
judgement in Khajani Devi’s case, the court adverted to Ministry of
Defence’s instructions dated 14.12.2012, which extended the benefits under
the liberalized/special family pension beyond 25 years to a divorced
daughter. The court, in our opinion, once again, correctly observed that if
the intention was to honour those who laid down their lives or had suffered
for the cause of the country, whether in uniform or otherwise, the expression
eligible dependent should include a divorced daughter.
34. The Supreme Court, while dismissing the SLP preferred by the UOI
in Khajani Devi’s case, did not simply dismiss it in limine. The court, after
hearing the counsel for the contesting parties, via the order dated 27.09.2019
dismissed the appeal preferred by the UOI. The said order, being brief is
“Delay condoned.
We have heard learned counsel for the parties. We are of the
view that the impugned order adopts a progressive and socially
constructive approach to give benefits to daughter who was
divorced treating her at parity with the un-married daughter.
We fully agree with this view.
No ground for interference is made out. The special leave
petition is accordingly dismissed.
Pending application shall also stand disposed of.”
[ Emphasis is ours.]
34.1. To our minds, a plain reading of the order of the Supreme Court
would show that the dismissal of the SLP was on merits and not in limine. It
appears this facet of the order dismissing the SLP in Khajani Devi’s case,
was not brought to the notice of the Calcutta High Court in Sonali Hatua
Giri’s case.
35. We see no reason not to extend the benefit of the 1980 Scheme to a
widowed/divorced daughter. We respectfully agree with the view enunciated
by the learned Single Judge of the Punjab and Haryana High Court in Smt.
Kamlesh’s case, as well as the view expressed by the learned Single Judge
of the Calcutta High Court in Sonali Hatua Giri’s case.
36. Although it was pointed out to us that the Division Bench of the
Punjab and Haryana High Court had stayed the operation of the judgment of
the learned Single Judge in Smt. Kamlesh’s case, nothing is placed before us
which would show that an appeal has been preferred against the judgment of
the learned Single Judge of the Calcutta High Court in Sonali Hatua Giri’s
case.
37. We notice that insofar as the judgment of the Division Bench of the
Himachal Pradesh High Court in the matter of Tulsi Devi is concerned, it
does not advert to the judgment of the Division Bench of the Punjab and
Haryana High Court in Khajani Devi’s case or for that matter, the
judgement of the learned Single Judge of Punjab and Haryana High Court in
Smt. Kamlesh’s case. It appears these judgements were not brought to the
notice of the Court.
38. What is not in dispute is that although an SLP has been preferred in
Tulsi Devi’s case, the same is pending adjudication before the Supreme
39. Thus, at the moment, the only clear view that we have is that of the
Supreme Court in Khajani Devi’s case. The ratio of this judgement is
binding on all courts including this court.
40. Thus, for the foregoing reasons and the view expressed by the
Supreme Court Khajani Devi’s case, we are not inclined to interfere with the
judgment of the learned Single Judge.
41. However, before we conclude, we may emphasize that our decision in
the instant matter is not based on a concession given by the counsel for the
UOI, but is based on the merits of the case. Therefore, we inclined to allow
the review petition and recall our order dated 15.12.2021, only to save Mr
Shankar from any further embarrassment. It is so ordered.
42. Furthermore, we are, as indicated above, inclined to dismiss the appeal
preferred by the UOI.
43. Since the legal representative of Ms Indira Kumari has been brought on
record, she would receive pension (if otherwise, deceased Ms Indira Kumari
fulfilled other conditions provided in the 1980 Scheme) from the date of the
application made in that behalf by her mother, Ms Indira Kumari, till the
date of her death, which, we are told, occurred on 02.10.2021.
44. The UOI will ensure that the monetary benefit is extended to the legal
representative of the deceased respondent Ms Indira Kumari, if otherwise
there is no impediment under the 1980 Scheme, within the next six weeks.
45. Costs will follow the result in the appeal.
JANUARY 20th, 2023 / pmc
|
This appeal is directed against the judgment dated 10.08.2021
rendered by the learned Single Judge in W.P.(C) 7343/2020. Before the
learned Single Judge, the respondent (who we are told expired after the
impugned judgment was rendered, but before the institution of the appeal)
had assailed the communication dated 12.02.2020 issued by the appellant
i.e., Union of India [hereafter referred to as “UOI”], whereby a request for
grant of pension under the Swatantrata Sainik Samman Pension Scheme,
1980 [hereafter referred to as “1980 Scheme”] was rejected, based on the
provisions of para 5.2.5 of the guidelines issued by the UOI on 06.08.2014
[hereafter referred to as “2014 Guidelines”]. For the sake of convenience, the deceased respondent would be
referred to as Ms Indira Kumari, unless the context requires otherwise. In short, the reason furnished for declining Ms Indira Kumari’s
request for grant of pension was that a “widowed/divorced daughter” was
not eligible for pension under the 1980 Scheme. Besides this, it is important to note that Khajani Devi concerned the
case of a divorced daughter. Besides in Khajani Devi’s case, the learned Single Judge also took
note of the judgments rendered by two Single Judges of the Punjab and
Haryana High Court and the Calcutta High Court. followed the Division Bench’s
judgment rendered in Khajani Devi’s case and extended the benefit to a
widowed daughter. Insofar as the learned Single Judge of the Calcutta High Court is
concerned, in his judgment, rendered in Sonali Hatua Giri vs. Union of
India and Ors., 2021 SCC Online Cal 1644, para 5.2.5 of the 2014
Guidelines was declared ultra vires; on the ground that it violated Article 14
of the Constitution. It must also be stated that the learned Single Judge in the impugned
judgement also noticed that contra view taken by a Single Judge of
Himachal Pradesh High Court in judgement dated 18.07.2019, rendered in
CWP No.1504/2019, titled Tulsi Devi v Union of India and Anr. Having noticed the said judgment, the learned Single Judge, after
having regard to the fact that an SLP was pending qua the same in the
Supreme Court (a fact recorded in the judgment of the Calcutta High Court
in Sonali Hatua Giri’s case), concurred with the view taken by the Punjab
& Haryana High Court and Calcutta High Court in Khajani Devi’s case and
Sonali Hatua Giri’s case and thus, allowed the prayer made in the writ
petition, via the impugned judgement. Before we proceed further, it would be relevant to take note of the
backdrop in which Ms Indira Kumari (now represented by her legal
representative i.e., her daughter, Ms Kolli Uday Kumari), approached the
learned Single Judge by way of a writ action. Mr Rao had claimed
that he was involved in the freedom struggle between 1941-42. UOI, subsequently, reversed its view and accordingly, on 15.12.1997,
took a decision to accord pension under the 1980 Scheme to Mr Rao. While doing so,
it was reasserted that in ascertaining whether or not the dependent had
independent means of livelihood, recourse should be taken to provisions of
para 6.1.2. The record reveals that Mr Rao, on 18.07.2019, had submitted a
sworn affidavit authorizing Ms Indira Kumari, during her lifetime, to receive
benefits under the 1980 Scheme. Unfortunately, nearly four months later, on
01.11.2019, Mr Rao passed away. This resulted in an application being filed on 11.11.2019 by Ms Indira
Kumari for grant of pension under the 1980 Scheme upon demise of Mr
Rao, i.e., her father. This communication was followed by a
reminder dated 20.01.2020. As noticed above, the UOI via MHA rejected Ms Indira Kumari’s
request on 12.02.2020. As noticed above, the impugned judgment was rendered on
10.08.2021 by the learned Single Judge. Sadly, before Ms Indira Kumari could reap the benefits of her labour,
17. The UOI instituted the instant appeal on 15.11.2021. Interestingly,
when the appeal came up for hearing for the first time on 15.12.2021, an
eminently fair stand was taken on behalf of the UOI, which was that the
benefit of the 1980 Scheme would be extended to Ms Indira Kumari. Based
on the stand taken on behalf of the UOI, the appeal and the pending
applications were closed. Notice in the review petition was
issued on 15.02.2022. After hearing arguments in the appeal and review petition, judgment
was reserved in the matter on 09.09.2022. Given this backdrop, arguments were advanced on behalf of the UOI
by Mr Harish Vaidyanathan Shankar, while the submissions were advanced
on behalf of the deceased respondent by Mr Mahesh Kumar Tiwari. (ii) Second, para 3 of the 1980 Scheme defines, as to who is to be treated
as “eligible dependents”. Consequently, widowed and
divorced daughters stand excluded, an aspect which is clarified, expressly, in
para 5.2.5 of the 2014 Guidelines. (iv) Fourth, pension available under the 1980 Scheme cannot be equated
with pension accorded under regimes put in place by Central/State
Governments, which are interlinked to services rendered by the pensioner in
his or her capacity of an employee. It, thus, cannot be
extended to anyone else, such as ineligible legal representatives, and
certainly not for their lifetime. (v) Fifth, the benefit under the 1980 Scheme cannot be extended on
grounds of sympathy. Policy parameters cannot be relaxed based on
sympathy and hardship. (vii) Seventh, the dismissal of the SLP preferred by the UOI against the
judgment of the Division Bench of Punjab & Haryana High court in Khajani
Devi’s case does not constitute a precedent. Moreover, insofar as the judgment of the learned Single Judge in Smt. The deceased respondent’s
husband passed away on 26.10.2000, while her mother, expired on
16.02.2009. Besides these tragedies, the respondent had also lost her sister
i.e., Ms Chandrakala Kolli on 07.01.2013. Pertinently, Tulsi Devi’s case did not involve
a challenge to the provisions of para 5.2.5 of the 2014 Guidelines and hence
is distinguishable. (ii) Secondly, the UOI via MHA issued the 2014 Guidelines, which
includes para 5.2.5, based on which, Ms Indira Kumari’s application for
grant of pension under the 1980 Scheme was declined, on the ground that
since she fell in the category of a widowed-daughter, she was not eligible for
benefits available under the 1980 Scheme. (iii) Thirdly, Ms Indira Kumari had been afflicted with a mental disability
since birth and that she had a speech and hearing impairment ranging
between 78-80%. Given this backdrop, one needs to unravel as to whether or not a
widowed-daughter could be excluded from the benefits of the 1980 Scheme. Therefore, it would be useful, at this juncture, to briefly advert to the history
of the 1980 Scheme framed by the Central Government for according
24.1. This scheme kicked in on 15.08.1972
[hereafter referred to as, “1972 Scheme”]. Notably, the 1972 Scheme had
incorporated an annual income ceiling of Rs.5000/- as an eligibility criteria
for grant of pension. Therefore, since 01.08.1980, pension is granted to the
freedom fighter during her or his lifetime and upon her or his death, to her or
his eligible dependent(s). Not more than one eligible dependent can be granted pension
and in the event of availability of more than one dependent
the sequence of eligibility will be widow/widower, unmarried
24.4. The above extract would show that the unmarried daughters fall
within the category of eligible dependents. In the context of unmarried daughters, a provision is made in para 12
of the 1980 Scheme, which provides the period during which pension would
be granted to such dependents:
Except in the case of unmarried daughters, the pension is for the life-time
of the recipient. In the case of unmarried daughters, pension ceases
immediately after they are married or become otherwise independent. In
the case of death of a pensioner his/her heirs though otherwise eligible for
pension will not automatically succeed to such a pension. A perusal of para 12 of the 1980 Scheme would show that unmarried
daughters would not be able to draw pension once they get married or
become independent. MHA, it appears, came across cases where banks had
dispersed pension to married daughters. 5.2.3 The spouse/daughter must fulfil twin conditions of being
“unmarried” and “having no independent source of
income”. They have to submit two certificates (As per
Annexure-VI & Annexure-VII) to the Bank every year. 5.2.5 Widowed/divorced daughter is not eligible for samman
pension. 5.3.2 In case of death of one of the widows, the daughter of the
deceased widow is not eligible for the pension till the death
of other living widow. Twin conditions for dependent pension to spouse or
daughter(s):- Two important conditions for the dependent
pension to spouse or daughter(s) must be met. Firstly, they
should not have independent sources of income and
secondly they should not have remarried. 6.1.2 The banks must ensure that a dependent pension is not
sanctioned to a spouse or a daughter of a freedom fighter
(i) The spouse/daughter is already employed in a Central
or a State Government, Central/State PSU or local
body. (ii) In case the spouse/daughter is working in a private
sector or having his/her own business/activity then
income from such job/activity exceeds Rs.20,000/- per
month. (iii) The spouse/daughter should not be receiving a
pension/salary on account of his or her own job or by
virtue of the previous employment of the deceased
freedom fighter. There may be cases where a dependent is denied pension
because she is having a job or her pension is rightfully
stopped by the Bank the day she gets a job. Ascertaining the marital status:-
6.2.1 Dependent pension is transferred to the widow of the
Pensioner/daughter, who are unmarried. If a wife/daughter
of the deceased pensioner gets re-married then the pension
has to be stopped. 6.2.2 However, in case the husband of a deceased woman
freedom fighter re-marries then the family pension
continues in such a case. In nutshell, the re-marriage
clause is not applicable in case of a husband, who is getting
dependent pension on account of his deceased wife who
was a freedom fighter. She must submit such Certificate twice a year, May and
25. However, insofar as the spouse or daughter is concerned, two
conditions are required to be fulfilled. First, the spouse or daughter should
be unmarried [See paras 5.2.3 and 6 of the 2014 Guidelines]. Moving further, a plain reading of para 6.2.1 would show that, as far
as the daughter of the freedom fighter is concerned, she gets excluded from
the category of an eligible dependent only if she remarries. Para 6.2.1, thus,
is aligned to para 3 of the 1980 Scheme and other paras of 1980 Scheme;
something which cannot be said for para 5.2.5. To our minds, the para 5.2.5 of the 2014 Guidelines cannot go beyond
what is provided in the parent document i.e., the 1980 Scheme. is also inconsistent with other paras of the 2014
Guidelines, including para 6.2.1. The expression “unmarried” adverts to a person who is not married1. It includes a woman who is single i.e., who was married but divorced and
even a woman who is widowed. Therefore, in our view, the 1980 Scheme did not contemplate
exclusion of widowed daughters, as is sought to be contended on behalf of
UOI. The 2014 Guidelines were framed to clarify the 1980 Scheme and not
amend it. Therefore, the
authorities have to construe the admissibility of benefit from that angle. It
is not the case that the daughters are excluded altogether. An unmarried
daughter finds mention in the list of eligible dependents. It would, thus, be
a travesty to exclude a divorced daughter. Even otherwise, we are of the opinion that a beneficial Scheme such as the
one in hand should not be fettered or constructed by a rigorous
interpretation which tends to deprive the claimants of the benefit to result
in virtual frustration or negation of the laudable motive of the Scheme
itself. Both the liberalized/special family pension and Swatantarta Sainik
Samman Pension Scheme are intended to honour the valour of the 3 of
4 uniformed people who laid down their lives or suffered for the cause of
the country. The Supreme Court, while dismissing the SLP preferred by the UOI
in Khajani Devi’s case, did not simply dismiss it in limine. The said order, being brief is
“Delay condoned. We have heard learned counsel for the parties. We are of the
view that the impugned order adopts a progressive and socially
constructive approach to give benefits to daughter who was
divorced treating her at parity with the un-married daughter. The special leave
petition is accordingly dismissed. Pending application shall also stand disposed of.” It
appears this facet of the order dismissing the SLP in Khajani Devi’s case,
was not brought to the notice of the Calcutta High Court in Sonali Hatua
Giri’s case. We see no reason not to extend the benefit of the 1980 Scheme to a
widowed/divorced daughter. The ratio of this judgement is
binding on all courts including this court. However, before we conclude, we may emphasize that our decision in
the instant matter is not based on a concession given by the counsel for the
UOI, but is based on the merits of the case. Therefore, we inclined to allow
the review petition and recall our order dated 15.12.2021, only to save Mr
Shankar from any further embarrassment. Furthermore, we are, as indicated above, inclined to dismiss the appeal
preferred by the UOI. Costs will follow the result in the appeal.
|
The Delhi High Court has said that a widowed or divorced daughter is entitled to the benefit under freedom fighter pension scheme of 1980, noting that the scheme does not contemplate their exclusion.
A division bench of Justice Rajiv Shakdher and Justice Talwant Singh observed that a “quick read” of the 1980 Scheme and 2014 Guidelines framed under it would show that an unmarried daughter falls in the category of eligible dependents and hence, is entitled to pension upon the expiry of the freedom fighter.
“The expression “unmarried” adverts to a person who is not married. It includes a woman who is single i.e., who was married but divorced and even a woman who is widowed,” the court said.
The bench also noted that para 6.2.1 of the 2014 guidelines would show that the daughter of a freedom fighter gets excluded from the category of an eligible dependent if she remarries.
Para 6.2.1 states that the dependent pension is transferred to the widow of the pensioner or daughter, who is unmarried. It adds that where a wife or daughter of the deceased pensioner gets re-married, then the pension has to be stopped.
Para 3 of the Scheme defines “eligible dependents” who include spouse or unmarried and unemployed daughters or mother or father.
The bench observed that the exclusion of a widow from the category of eligible dependents, - once she remarries, is also not in consonance with para 3 of the 1980 Scheme, where no such caveat has been put in place.
“Therefore, in our view, the 1980 Scheme did not contemplate exclusion of widowed daughters, as is sought to be contended on behalf of UOI. The 2014 Guidelines were framed to clarify the 1980 Scheme and not amend it,” the court said.
The bench also said that there is a “distinct possibility” of 2014 guidelines “being declared violative of Article 14 of Constitution of India if it were to be challenged” as they only exclude a widow of deceased freedom fighter in case she remarries, from the category of dependent person, but does not extend the exclusion to a widower.
“In other words, if a freedom fighter was a woman, and if she was to pass away, then, even if the husband was to remarry, he could still avail the pension under the 1980 Scheme. There is a distinct possibility of para 6.2.2 of the 2014 Guidelines being declared violative of Article 14 of the constitution, if it were to be challenged,” it said.
The court noted that the “inexplicable provision” is engrafted in para 6.2.2 of the 2014 Guidelines. The provision states that where the husband of a deceased woman freedom fighter re-marries, the family pension continues in such a case. It adds that the re-marriage clause is not applicable in case of a husband, who is getting dependent pension on account of his deceased wife who was a freedom fighter.
The court made the observations while hearing a review plea filed by the Central Government in an appeal against order passed by the single judge on August 10, 2021.
The single judge had quashed the communication dated February 12, 2020 issued by the Central Government declining the request of one Indira Kumari for grant of pension under the 1980 Scheme. The government was also directed to consider the grant of pension, provided other conditions contained in the Scheme stood satisfied.
Kumari passed away on October 2, 2021. The Central Government instituted the appeal on November 15, 2021. On the first day of hearing, a stand was taken on behalf of the government stating that the benefit of the Scheme would be extended to Kumari.
However, the government moved a review petition on January 11 last year. An application was also filed by Kumari’s daughter, being her legal representative.
Dismissing the appeal of the Central Government, the division bench ordered that Kumari’s daughter would receive pension from the date of the application made by her, till the date of her death which occurred on October 2, 2021.
“The UOI will ensure that the monetary benefit is extended to the legal representative of the deceased respondent Ms Indira Kumari, if otherwise there is no impediment under the 1980 Scheme, within the next six weeks,” the court directed.
The court referred to the order of a Division Bench of the Punjab and Haryana High Court in Khajani Devi’ Devi v. Union of India and Others (2016) wherein it was ruled that the expression “unmarried daughter” includes a divorced daughter.
It also noted that the Supreme Court dismissed the SLP preferred by the Central Government against the ruling of Khajani Devi on merits.
“We see no reason not to extend the benefit of the 1980 Scheme to a widowed/divorced daughter. We respectfully agree with the view enunciated by the learned Single Judge of the Punjab and Haryana High Court in Smt. Kamlesh’s case, as well as the view expressed by the learned Single Judge of the Calcutta High Court in Sonali Hatua Giri’s case,” the court said.
The court also noted that an SLP is pending before the Supreme Court in the case of Tulsi Devi v. Union of India and Anr against a 2019 judgment of division bench of Himachal Pradesh High Court.
“Thus, at the moment, the only clear view that we have is that of the Supreme Court in Khajani Devi’s case. The ratio of this judgement is binding on all courts including this court. Thus, for the foregoing reasons and the view expressed by the Supreme Court Khajani Devi’s case, we are not inclined to interfere with the judgment of the learned Single Judge,” the court said.
Title: UNION OF INDIA v. KOLLI UDAY KUMARI
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The Delhi High Court has said that a widowed or divorced daughter is entitled to the benefit under freedom fighter pension scheme of 1980, noting that the scheme does not contemplate their exclusion. A division bench of Justice Rajiv Shakdher and Justice Talwant Singh observed that a “quick read” of the 1980 Scheme and 2014 Guidelines framed under it would show that an unmarried daughter falls in the category of eligible dependents and hence, is entitled to pension upon the expiry of the freedom fighter. “The expression “unmarried” adverts to a person who is not married. It includes a woman who is single i.e., who was married but divorced and even a woman who is widowed,” the court said. The bench also noted that para 6.2.1 of the 2014 guidelines would show that the daughter of a freedom fighter gets excluded from the category of an eligible dependent if she remarries. Para 6.2.1 states that the dependent pension is transferred to the widow of the pensioner or daughter, who is unmarried. It adds that where a wife or daughter of the deceased pensioner gets re-married, then the pension has to be stopped. Para 3 of the Scheme defines “eligible dependents” who include spouse or unmarried and unemployed daughters or mother or father. The bench observed that the exclusion of a widow from the category of eligible dependents, - once she remarries, is also not in consonance with para 3 of the 1980 Scheme, where no such caveat has been put in place. “Therefore, in our view, the 1980 Scheme did not contemplate exclusion of widowed daughters, as is sought to be contended on behalf of UOI. The 2014 Guidelines were framed to clarify the 1980 Scheme and not amend it,” the court said. There is a distinct possibility of para 6.2.2 of the 2014 Guidelines being declared violative of Article 14 of the constitution, if it were to be challenged,” it said. The court noted that the “inexplicable provision” is engrafted in para 6.2.2 of the 2014 Guidelines. It adds that the re-marriage clause is not applicable in case of a husband, who is getting dependent pension on account of his deceased wife who was a freedom fighter. The court made the observations while hearing a review plea filed by the Central Government in an appeal against order passed by the single judge on August 10, 2021. The government was also directed to consider the grant of pension, provided other conditions contained in the Scheme stood satisfied. The Central Government instituted the appeal on November 15, 2021. However, the government moved a review petition on January 11 last year. An application was also filed by Kumari’s daughter, being her legal representative. Dismissing the appeal of the Central Government, the division bench ordered that Kumari’s daughter would receive pension from the date of the application made by her, till the date of her death which occurred on October 2, 2021. It also noted that the Supreme Court dismissed the SLP preferred by the Central Government against the ruling of Khajani Devi on merits. “We see no reason not to extend the benefit of the 1980 Scheme to a widowed/divorced daughter. We respectfully agree with the view enunciated by the learned Single Judge of the Punjab and Haryana High Court in Smt. Kamlesh’s case, as well as the view expressed by the learned Single Judge of the Calcutta High Court in Sonali Hatua Giri’s case,” the court said. The ratio of this judgement is binding on all courts including this court. Thus, for the foregoing reasons and the view expressed by the Supreme Court Khajani Devi’s case, we are not inclined to interfere with the judgment of the learned Single Judge,” the court said. Title: UNION OF INDIA v. KOLLI UDAY KUMARI
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Case :- TRANSFER APPLICATION (CIVIL) No. - 528 of
Counsel for Applicant :- Pavan Kumar
1. This is an application seeking transfer of Original Suit
No.925 of 2020, Mohd. Sarfaraz vs. Mohd. Abid and
others, from the Court of Civil Judge (Jr. Division),
Nagina, District - Bijnore to any other Court of competent
jurisdiction in the Judgeship of Bijnore.
2. The applicant has sought transfer on the ground of
allegations against the Presiding Officer in the Court of
Civil Judge (Jr. Division). The learned District Judge was
moved in the first instance, who after perusal of the
material on record did not find any merit and rejected the
applicant's plea seeking transfer, vide order dated
3.8.2022. The applicant has now moved to this Court for
the same relief.
3. The allegation against the Presiding Officer in the Trial
Court is that learned Judge is under the influence of
respondent nos.2 to 4. On 23.9.2021, Shubham Jain, the
Parokar of respondent nos.2 to 4 visited the Trial Judge
and the learned counsel representing respondent nos.2 to
4 also visited the Judge for 15 minutes in his chamber. At
that time, the Parokar of respondent nos.2 to 4, to wit,
Shubham Jain was standing outside the Chamber of the
learned Judge. It is further stated in paragraph 15 that no
written statement has been filed by the defendants till
date. There is no possibility of the trial of suit being
concluded in the near future.
4. Heard Mr. Pavan Kumar, learned counsel for the
applicant at length in support of this application.
5. The allegations that have been levelled against the
Presiding Officer in the Trial Court are reflective of the
current trend in the society where the general public have
developed the mind set to overawe Judges by
complaining and maligning them on baseless allegations.
The allegations disclosed on affidavit in the present
transfer application are so frivolous that they are only
stated to be rejected. Such tendencies are required to be
put down with a heavy hand.
6. In the circumstances, this application is dismissed with
the costs of Rs.10,000/- which the applicant shall deposit
in the account of District Services Legal Authority, Bijnore
within 15 days hence. In case, the cost is not deposited,
the District Magistrate, Bijnore shall recover the costs as
arrears of land revenue and cause them to be deposited
in the account of the Secretary, District Legal Services
Authority, Bijnore forthwith.
7. Let this order be communicated to the Civil Judge
(Junior Division) Nagina, District - Bijnore through the
learned District Judge, Bijnore, the learned District Judge,
Bijnore, the Secretary, District Legal Services Authority,
Bijnore and the District Magistrate, Bijnore by the
Registrar (Compliance) by 31.8.2022.
Location: High Court of Judicature at
|
While dismissing a plea filed seeking transfer of a civil case to another court, the Allahabad High Court recently remarked that a mindset has developed among the general public to overawe Judges by complaining and maligning them on baseless allegations.The petitioner, Mohd. Sarfaraz had sought the transfer of the case from the Court of Civil Judge (Jr. Division), Nagina, District - Bijnore...
While dismissing a plea filed seeking transfer of a civil case to another court, the Allahabad High Court recently remarked that a mindset has developed among the general public to overawe Judges by complaining and maligning them on baseless allegations.
The petitioner, Mohd. Sarfaraz had sought the transfer of the case from the Court of Civil Judge (Jr. Division), Nagina, District - Bijnore to any other Court of competent jurisdiction in the Judgeship of Bijnore by leveling allegations against the Presiding Officer, Civil Judge (Jr. Division).
When the District Judge rejected the application filed by the petitioner, he had moved to the High Court. It was his allegation that the presiding Judge was working under the influence of respondents nos.2 to 4.
To substantiate his claim, the petitioner submitted that on September 23, 2021, the Parokar of respondents nos.2 to 4 and their counsel had met the Judge in his chamber for 15 minutes. It was further stated that no written statement had been filed by the defendants to date and that there was no possibility of the trial of the suit being concluded in the near future.
Taking into account the allegations leveled against the presiding judge, the bench of Justice J. J. Munir, at the outset, observed thus:
"The allegations that have been levelled against the Presiding Officer in the Trial Court are reflective of the current trend in the society where the general public has developed the mindset to overawe Judges by complaining and maligning them on baseless allegations. The allegations disclosed on affidavit in the present transfer application are so frivolous that they are only stated to be rejected."
In view of this, stressing that such tendencies are required to be put down with a heavy hand, the Court dismissed the application with the costs of Rs.10,000/- which the applicant was directed to deposit in the account of District Services Legal Authority, Bijnore within 15 days hence.
"In case, the cost is not deposited, the District Magistrate, Bijnore shall recover the costs as arrears of land revenue and cause them to be deposited in the account of the Secretary, District Legal Services Authority, Bijnore forthwith," the Court further ordered.
Case title - Mohd. Sarfaraz v. Mohd. Abid And 3 Others [TRANSFER APPLICATION (CIVIL) No. - 528 of 2022]
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Case :- TRANSFER APPLICATION (CIVIL) No. - 528 of
Counsel for Applicant :- Pavan Kumar
1. This is an application seeking transfer of Original Suit
No.925 of 2020, Mohd. Sarfaraz vs. Mohd. Abid and
others, from the Court of Civil Judge (Jr. Division),
Nagina, District - Bijnore to any other Court of competent
jurisdiction in the Judgeship of Bijnore.
2. The applicant has sought transfer on the ground of
allegations against the Presiding Officer in the Court of
Civil Judge (Jr. Division). The learned District Judge was
moved in the first instance, who after perusal of the
material on record did not find any merit and rejected the
applicant's plea seeking transfer, vide order dated
3.8.2022. The applicant has now moved to this Court for
the same relief.
3. The allegation against the Presiding Officer in the Trial
Court is that learned Judge is under the influence of
respondent nos.2 to 4. On 23.9.2021, Shubham Jain, the
Parokar of respondent nos.2 to 4 visited the Trial Judge
and the learned counsel representing respondent nos.2 to
4 also visited the Judge for 15 minutes in his chamber. At
that time, the Parokar of respondent nos.2 to 4, to wit,
Shubham Jain was standing outside the Chamber of the
learned Judge. It is further stated in paragraph 15 that no
written statement has been filed by the defendants till
date. There is no possibility of the trial of suit being
concluded in the near future.
4. Heard Mr. Pavan Kumar, learned counsel for the
applicant at length in support of this application.
5. The allegations that have been levelled against the
Presiding Officer in the Trial Court are reflective of the
current trend in the society where the general public have
developed the mind set to overawe Judges by
complaining and maligning them on baseless allegations.
The allegations disclosed on affidavit in the present
transfer application are so frivolous that they are only
stated to be rejected. Such tendencies are required to be
put down with a heavy hand.
6. In the circumstances, this application is dismissed with
the costs of Rs.10,000/- which the applicant shall deposit
in the account of District Services Legal Authority, Bijnore
within 15 days hence. In case, the cost is not deposited,
the District Magistrate, Bijnore shall recover the costs as
arrears of land revenue and cause them to be deposited
in the account of the Secretary, District Legal Services
Authority, Bijnore forthwith.
7. Let this order be communicated to the Civil Judge
(Junior Division) Nagina, District - Bijnore through the
learned District Judge, Bijnore, the learned District Judge,
Bijnore, the Secretary, District Legal Services Authority,
Bijnore and the District Magistrate, Bijnore by the
Registrar (Compliance) by 31.8.2022.
Location: High Court of Judicature at
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Case :- TRANSFER APPLICATION (CIVIL) No. - 528 of
Counsel for Applicant :- Pavan Kumar
1. This is an application seeking transfer of Original Suit
No.925 of 2020, Mohd. Sarfaraz vs. Mohd. Abid and
others, from the Court of Civil Judge (Jr. Division),
Nagina, District - Bijnore to any other Court of competent
jurisdiction in the Judgeship of Bijnore.
2. The applicant has sought transfer on the ground of
allegations against the Presiding Officer in the Court of
Civil Judge (Jr. Division). The learned District Judge was
moved in the first instance, who after perusal of the
material on record did not find any merit and rejected the
applicant's plea seeking transfer, vide order dated
3.8.2022. The applicant has now moved to this Court for
the same relief.
3. The allegation against the Presiding Officer in the Trial
Court is that learned Judge is under the influence of
respondent nos.2 to 4. On 23.9.2021, Shubham Jain, the
Parokar of respondent nos.2 to 4 visited the Trial Judge
and the learned counsel representing respondent nos.2 to
4 also visited the Judge for 15 minutes in his chamber. At
that time, the Parokar of respondent nos.2 to 4, to wit,
Shubham Jain was standing outside the Chamber of the
learned Judge. It is further stated in paragraph 15 that no
written statement has been filed by the defendants till
date. There is no possibility of the trial of suit being
concluded in the near future.
4. Heard Mr. Pavan Kumar, learned counsel for the
applicant at length in support of this application.
5. The allegations that have been levelled against the
Presiding Officer in the Trial Court are reflective of the
current trend in the society where the general public have
developed the mind set to overawe Judges by
complaining and maligning them on baseless allegations.
The allegations disclosed on affidavit in the present
transfer application are so frivolous that they are only
stated to be rejected. Such tendencies are required to be
put down with a heavy hand.
6. In the circumstances, this application is dismissed with
the costs of Rs.10,000/- which the applicant shall deposit
in the account of District Services Legal Authority, Bijnore
within 15 days hence. In case, the cost is not deposited,
the District Magistrate, Bijnore shall recover the costs as
arrears of land revenue and cause them to be deposited
in the account of the Secretary, District Legal Services
Authority, Bijnore forthwith.
7. Let this order be communicated to the Civil Judge
(Junior Division) Nagina, District - Bijnore through the
learned District Judge, Bijnore, the learned District Judge,
Bijnore, the Secretary, District Legal Services Authority,
Bijnore and the District Magistrate, Bijnore by the
Registrar (Compliance) by 31.8.2022.
Location: High Court of Judicature at
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While dismissing a plea filed seeking transfer of a civil case to another court, the Allahabad High Court recently remarked that a mindset has developed among the general public to overawe Judges by complaining and maligning them on baseless allegations.The petitioner, Mohd. Sarfaraz had sought the transfer of the case from the Court of Civil Judge (Jr. Division), Nagina, District - Bijnore...
While dismissing a plea filed seeking transfer of a civil case to another court, the Allahabad High Court recently remarked that a mindset has developed among the general public to overawe Judges by complaining and maligning them on baseless allegations.
The petitioner, Mohd. Sarfaraz had sought the transfer of the case from the Court of Civil Judge (Jr. Division), Nagina, District - Bijnore to any other Court of competent jurisdiction in the Judgeship of Bijnore by leveling allegations against the Presiding Officer, Civil Judge (Jr. Division).
When the District Judge rejected the application filed by the petitioner, he had moved to the High Court. It was his allegation that the presiding Judge was working under the influence of respondents nos.2 to 4.
To substantiate his claim, the petitioner submitted that on September 23, 2021, the Parokar of respondents nos.2 to 4 and their counsel had met the Judge in his chamber for 15 minutes. It was further stated that no written statement had been filed by the defendants to date and that there was no possibility of the trial of the suit being concluded in the near future.
Taking into account the allegations leveled against the presiding judge, the bench of Justice J. J. Munir, at the outset, observed thus:
"The allegations that have been levelled against the Presiding Officer in the Trial Court are reflective of the current trend in the society where the general public has developed the mindset to overawe Judges by complaining and maligning them on baseless allegations. The allegations disclosed on affidavit in the present transfer application are so frivolous that they are only stated to be rejected."
In view of this, stressing that such tendencies are required to be put down with a heavy hand, the Court dismissed the application with the costs of Rs.10,000/- which the applicant was directed to deposit in the account of District Services Legal Authority, Bijnore within 15 days hence.
"In case, the cost is not deposited, the District Magistrate, Bijnore shall recover the costs as arrears of land revenue and cause them to be deposited in the account of the Secretary, District Legal Services Authority, Bijnore forthwith," the Court further ordered.
Case title - Mohd. Sarfaraz v. Mohd. Abid And 3 Others [TRANSFER APPLICATION (CIVIL) No. - 528 of 2022]
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While dismissing a plea filed seeking transfer of a civil case to another court, the Allahabad High Court recently remarked that a mindset has developed among the general public to overawe Judges by complaining and maligning them on baseless allegations.The petitioner, Mohd. Sarfaraz had sought the transfer of the case from the Court of Civil Judge (Jr. Division), Nagina, District - Bijnore...
While dismissing a plea filed seeking transfer of a civil case to another court, the Allahabad High Court recently remarked that a mindset has developed among the general public to overawe Judges by complaining and maligning them on baseless allegations.
The petitioner, Mohd. Sarfaraz had sought the transfer of the case from the Court of Civil Judge (Jr. Division), Nagina, District - Bijnore to any other Court of competent jurisdiction in the Judgeship of Bijnore by leveling allegations against the Presiding Officer, Civil Judge (Jr. Division).
When the District Judge rejected the application filed by the petitioner, he had moved to the High Court. It was his allegation that the presiding Judge was working under the influence of respondents nos.2 to 4.
To substantiate his claim, the petitioner submitted that on September 23, 2021, the Parokar of respondents nos.2 to 4 and their counsel had met the Judge in his chamber for 15 minutes. It was further stated that no written statement had been filed by the defendants to date and that there was no possibility of the trial of the suit being concluded in the near future.
Taking into account the allegations leveled against the presiding judge, the bench of Justice J. J. Munir, at the outset, observed thus:
"The allegations that have been levelled against the Presiding Officer in the Trial Court are reflective of the current trend in the society where the general public has developed the mindset to overawe Judges by complaining and maligning them on baseless allegations. The allegations disclosed on affidavit in the present transfer application are so frivolous that they are only stated to be rejected."
In view of this, stressing that such tendencies are required to be put down with a heavy hand, the Court dismissed the application with the costs of Rs.10,000/- which the applicant was directed to deposit in the account of District Services Legal Authority, Bijnore within 15 days hence.
"In case, the cost is not deposited, the District Magistrate, Bijnore shall recover the costs as arrears of land revenue and cause them to be deposited in the account of the Secretary, District Legal Services Authority, Bijnore forthwith," the Court further ordered.
Case title - Mohd. Sarfaraz v. Mohd. Abid And 3 Others [TRANSFER APPLICATION (CIVIL) No. - 528 of 2022]
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1. The petitioner, who is a serving officer of the Delhi Higher Judicial
Services, and is currently posted as the Additional District Judge- 02 South
District Saket Courts New Delhi, has approached this Court being aggrieved
by the refusal of the respondent nos. 1 to 3 in reimbursing in full the
expenses incurred by him for his medical treatment, while he was admitted
at the respondent no.5/hospital, between 22.04.2021 to 07.06.2021, on
account of Covid-19.
2. Learned senior counsel for the petitioner submits that the respondent
nos.1 to 3 do not dispute the fact that the petitioner was undergoing
treatment for Covid-19 at the respondent no.5/hospital during the said
period. It is also undisputed that since at that stage, there were no hospital
beds available for his treatment in an empanelled hospital in the NCT of
Delhi, the petitioner due his dropping levels of oxygen , had to be rushed to
the nearest hospital, being the respondent no.5/hospital, where he remained
on ventilator for a period of three weeks. The petitioner, who was in a
helpless state at that stage, had no other option but to pay the entire amount
of Rs. 24,02,380/- as demanded by respondent no.5, against appropriate
receipts. The respondent nos.1 to 3, have however, on the basis of the
recommendations made by the Technical Standing Committee constituted
by the respondent nos. 1 and 2, reimbursed only a sum of Rs.7,08,500/-. The
respondent nos. 1 to 3 have refused to pay the balance sum of Rs.16,93,880/-
to the petitioner on the ground that this amount was charged by the
respondent no.5 by ignoring the rates prescribed under the circular dated
20.06.2020 issued by the Government of NCT of Delhi
(GNCTD)/respondent no.1, fixing the charges leviable for treatment of
patients suffering from Covid-19.
3. He submits that the petitioner cannot be faulted or penalised for the
respondent no.5 charging amounts higher than what was prescribed by the
respondent nos.1 to 3 and in case, the respondent no.5 has acted in violation
of the circular dated 20.06.2020, it is for the respondent nos.1 to 3 to take
action against the respondent no.5, and make recoveries, if any, from the
said respondent. In support of his plea, that once it is admitted that the entire
sum of Rs.24,02,380/- was spent by the petitioner for his medical treatment,
which he was compelled to take from respondent no.5 on account of the
grave threat to his life, and would therefore be entitled to reimbursement of
the entire amount, he places reliance on the decisions of this Court in Sqn.
Commander Randeep Kumar Rana vs. Union of India, (2004) SCC Online
Del 333 and B.R. Goel and Ors. Vs. Union of India and Ors., 2006 (92)
4. On the other hand, Mrs.Ahlawat, learned counsel for respondent nos.1
to 3, while not really disputing any of the aforesaid facts, submits that the
respondent no.5 should be directed to explain before this Court as to why it
has not abided by the circular dated 20.06.2020 issued by the respondent
no.1. She further submits that the said respondent, who has charged the
petitioner way above the rates prescribed in the circular dated 20.06.2020,
should be directed to refund the excessive amounts charged from the
petitioner.
5. Having considered the submissions of learned counsel for the parties,
and perused the record, I find that the respondent nos. 1 to 3 are not really
disputing that the petitioner was in compelling circumstances, and in a grave
medical emergency forced to take treatment from respondent no.5, and has
paid a sum of Rs.24,04,380/- for his treatment between 22.04.2021 to
07.06.2021. The only justification sought to be given for respondent nos. 1
to 3, for not reimbursing the entire amount to the petitioner, is that the
respondent no.5 had not abided by the circular dated 20.06.2020 issued by
the GNCTD. In the light of this stand taken by respondent nos. 1to 3, it is
evident that the parties are ad idem on the factual position and, therefore, no
counter affidavit is called for. The writ petition, is accordingly, taken up for
disposal today itself.
6. Having noted the only defence taken by the respondents for not
reimbursing the entire amounts to the petitioner, who has not only battled
with the deadly Covid-19 after remaining on ventilator for over three
weeks, but has also been struggling to seek reimbursement of the amount
spent by him in a grave medical emergency. Undoubtedly, respondent nos.1
to 3 are justified in urging that the respondent no.5 had charged much
beyond what was prescribed in the circular dated 20.06.2020 issued by the
GNCTD, and it is only because of the said over charging that the petitioner
had to incur much higher expenses than what have been reimbursed to him
by the respondent nos. 1 to 3. However, the fact remains that during April
and May, 2021, when the residents of Delhi were not only struggling to get
hospital beds, but there was also a huge shortage of oxygen, the petitioner,
had no other option but to take treatment at respondent no.5, and has
thankfully survived. One shudders to think what fate the petitioner would
have met if he had not, at that point, been treated at respondent no.5
hospital.
7. The petitioner, who had to spend his hard-earned savings, while
undergoing treatment to save his life, cannot be simply told that, since
respondent no.5 has failed to abide by the circular dated 20.06.2020 issued
by the GNCTD, he should seek refund from the said hospital which saved
his life. This Court does not deem it appropriate or necessary to delve into
the validity of the circular dated 20.06.2020, in the present petition, where
an officer of Delhi Higher Judicial Service is seeking simpliciter
reimbursement of the amount for the bona fide expenses incurred by him for
treatment at the respondent no.5 hospital for Covid-19, when the city was
engulfed with the second wave of the pandemic. I am, therefore, unable to
accept Mrs.Ahlawat’s plea that the respondent no.5 should be directed to
explain its stand in the present writ petition regarding its action of charging
amounts higher than the ones prescribed in the circular dated 20.06.2020, or
should be directed to refund the amount of Rs. 16,93,880/-.
8. In this regard, reference may be made to the decision of this Court in
Sqn. Commander Randeep Kumar Rana (supra), wherein the Division
Bench while dealing with a case, where the hospital had charged over and
above package rates, held that the employer was under an obligation to pay
to the government employee, and could make appropriate recoveries in
accordance with law, from the hospital which had overcharged him. The
relevant extract reads as under:
“5. We have given our careful considerations to the arguments
advanced by learned counsel for both the parties. It is not denied that
the treatment taken at Escorts Hospital was pursuant to the
recommendation made by the Safdarjung Hospital which is a
Government hospital. Naturally, when a small child is to be treated
for Ventrical Septal Defect involving open heart surgery, a specialised
hospital and its services are required. Therefore, once the respondent
themselves have recommended the treatment to be taken by the
Escorts Hospital, they cannot deny the full reimbursement on the
basis that the charges incurred by the petitioner over and above the
package rate which the respondent has agreed with the said hospital
cannot be reimbursed. At page 12 of the paper-book there is a letter
conveying permission by the respondent to the petitioner to undertake
specialised treatment from recognised private diagnostic centre.
There is another letter of the respondent at pages 22-23 of the paper-
book in which it has been admitted that Escorts Heart Institute and
Research Centre was also one of the hospitals which the petitioner
was entitled for treatment. Now we come to the plea which has been
taken by the respondent in the counter affidavit. It has been contended
in para 11 of the counter affidavit that it is the duty of the citizens to
see and ensure that such recognised hospital do not charge excess of
the package rates. How a citizen can ensure that a hospital does not
charge over and above the package rate? The power to lay down
guidelines is with the respondent. A citizen is a mere spectator to what
State authority do and decide. If the hospital has charged over and
above the package rate, the respondent is under an obligation to pay
to such charges as the petitioner has incurred over package rates at
the first instance and if in law state can recover from the hospital
concerned, they may do so but they cannot deny their liability to pay
to the Government employee who is entitled for medical
reimbursement.”
9. In the light of the aforesaid, I have no hesitation in holding that the
respondent nos.1 to 3 ought to forthwith reimburse the petitioner by paying
him the differential amount of Rs.16,93,880/-, and if permissible, recover
the same from the respondent no.5. It is however made clear that this Court
has not expressed any opinion on the validity of the circular dated
20.06.2020 and therefore, it will be open for the respondent nos.1 to 3 to
pursue its remedy as per law, against respondent no.5, including taking
penal action, and recovery of any amount which it perceives has been
charged in excess.
10. The writ petition is, accordingly, allowed by directing the respondent
nos.1 to 3 to pay within four weeks the balance amount of Rs.16,93,880/- as
noted in the communication dated 02.05.2022 (Annexure P-13) issued by
the respondent no.3 to the petitioner.
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The Delhi High Court on Tuesday directed the Delhi Government to pay over Rs. 16 lakhs to a senior judicial officer, who is an Additional District Judge in Saket Courts, as reimbursement for the expenses incurred by him for his COVID-19 treatment last year.
ADJ Dinesh Kumar was admitted in the city's PSRI Hospital between April 22 to June 7, 2021 after contracting COVID-19 during the second wave. He remained there on a ventilator for three weeks. While he had to pay Rs. 24,02,380 to the hospital, the government reimbursed only Rs.7,08,500 on the ground that the hospital had ignored the charges fixed by it for treatment of patients suffering from COVID-19.
Justice Rekha Palli said undoubtedly the authorities are justified in urging that the hospital had charged much beyond what was prescribed in the circular dated 20.06.2020 issued by the GNCTD, and it is only because of the said over charging that the petitioner had to incur much higher expenses than what have been reimbursed to him.
"However, the fact remains that during April and May, 2021, when the residents of Delhi were not only struggling to get hospital beds, but there was also a huge shortage of oxygen, the petitioner had no other option but to take treatment at respondent no.5, and has thankfully survived. One shudders to think what fate the petitioner would have met if he had not, at that point, been treated at respondent no.5 hospital," said the court.
Allowing the plea, the court observed that the judge, who had to spend his hard-earned savings for COVID-19 treatment to save his life, cannot be simply told that he should seek refund from the hospital since it failed to abide by the Delhi government's circular.
"This Court does not deem it appropriate or necessary to delve into the validity of the circular dated 20.06.2020, in the present petition, where an officer of Delhi Higher Judicial Service is seeking simpliciter reimbursement of the amount for the bona fide expenses incurred by him for treatment at the respondent no.5 hospital for Covid-19, when the city was engulfed with the second wave of the pandemic," said the court.
Justice Palli however rejected Delhi Government's submission that the hospital should be directed to explain its stand regarding its action of charging higher amounts than the ones prescribed in the circular or that it should be directed to refund the balance amount.
Referring to the high court's ruling in Sqn. Commander Randeep Kumar Rana vs. Union of India, the court said a division bench while dealing with a case, has held the employer was under an obligation to pay to the government employee, and could make appropriate recoveries in accordance with law, from the hospital which had overcharged him.
"In the light of the aforesaid, I have no hesitation in holding that the respondent nos.1 to 3 ought to forthwith reimburse the petitioner by paying him the differential amount of Rs.16,93,880/-, and if permissible, recover the same from the respondent no.5," the court said.
However, Justice Palli clarified that the court has not expressed any opinion on the validity of the circular and said it will be open for the authorities to pursue legal remedy against the hospital "including taking penal action" and "recovery of any amount charged in excess."
"The writ petition is, accordingly, allowed by directing the respondent nos.1 to 3 to pay within four weeks the balance amount of Rs.16,93,880/- as noted in the communication dated 02.05.2022 issued by the respondent no.3 to the petitioner," the court said.
Senior Advocate J.P. Sengh, representing Kumar, earlier argued there were no hospital beds available for his treatment in any of the empanelled hospitals of the government and due to his dropping levels of oxygen, he had to be rushed to the nearest hospital.
"The petitioner, who was in a helpless state at that stage, had no other option but to pay the entire amount of Rs. 24,02,380/- as demanded by respondent no.5, against appropriate receipts," Sengh submitted.
Sengh argued that the judicial officer cannot be faulted or penalised for the act of the hospital charging amounts higher than what was prescribed by the authorities. He submitted that it was for the concerned authorities to take action against the hospital in case it had acted in violation of the circular in question.
On the other hand, the Delhi Government submitted that the hospital should be directed to explain as to why it had not abided by the Delhi Government's circular. "The said respondent, who has charged the petitioner way above the rates prescribed in the circular dated 20.06.2020, should be directed to refund the excessive amounts charged from the petitioner," advocate Avnish Ahlawat submitted.
Title: DINESH KUMAR v. GOVERNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI & ORS.
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1. The petitioner, who is a serving officer of the Delhi Higher Judicial
Services, and is currently posted as the Additional District Judge- 02 South
District Saket Courts New Delhi, has approached this Court being aggrieved
by the refusal of the respondent nos. 1 to 3 in reimbursing in full the
expenses incurred by him for his medical treatment, while he was admitted
at the respondent no.5/hospital, between 22.04.2021 to 07.06.2021, on
account of Covid-19.
2. Learned senior counsel for the petitioner submits that the respondent
nos.1 to 3 do not dispute the fact that the petitioner was undergoing
treatment for Covid-19 at the respondent no.5/hospital during the said
period. It is also undisputed that since at that stage, there were no hospital
beds available for his treatment in an empanelled hospital in the NCT of
Delhi, the petitioner due his dropping levels of oxygen , had to be rushed to
the nearest hospital, being the respondent no.5/hospital, where he remained
on ventilator for a period of three weeks. The petitioner, who was in a
helpless state at that stage, had no other option but to pay the entire amount
of Rs. 24,02,380/- as demanded by respondent no.5, against appropriate
receipts. The respondent nos.1 to 3, have however, on the basis of the
recommendations made by the Technical Standing Committee constituted
by the respondent nos. 1 and 2, reimbursed only a sum of Rs.7,08,500/-. The
respondent nos. 1 to 3 have refused to pay the balance sum of Rs.16,93,880/-
to the petitioner on the ground that this amount was charged by the
respondent no.5 by ignoring the rates prescribed under the circular dated
20.06.2020 issued by the Government of NCT of Delhi
(GNCTD)/respondent no.1, fixing the charges leviable for treatment of
patients suffering from Covid-19.
3. He submits that the petitioner cannot be faulted or penalised for the
respondent no.5 charging amounts higher than what was prescribed by the
respondent nos.1 to 3 and in case, the respondent no.5 has acted in violation
of the circular dated 20.06.2020, it is for the respondent nos.1 to 3 to take
action against the respondent no.5, and make recoveries, if any, from the
said respondent. In support of his plea, that once it is admitted that the entire
sum of Rs.24,02,380/- was spent by the petitioner for his medical treatment,
which he was compelled to take from respondent no.5 on account of the
grave threat to his life, and would therefore be entitled to reimbursement of
the entire amount, he places reliance on the decisions of this Court in Sqn.
Commander Randeep Kumar Rana vs. Union of India, (2004) SCC Online
Del 333 and B.R. Goel and Ors. Vs. Union of India and Ors., 2006 (92)
4. On the other hand, Mrs.Ahlawat, learned counsel for respondent nos.1
to 3, while not really disputing any of the aforesaid facts, submits that the
respondent no.5 should be directed to explain before this Court as to why it
has not abided by the circular dated 20.06.2020 issued by the respondent
no.1. She further submits that the said respondent, who has charged the
petitioner way above the rates prescribed in the circular dated 20.06.2020,
should be directed to refund the excessive amounts charged from the
petitioner.
5. Having considered the submissions of learned counsel for the parties,
and perused the record, I find that the respondent nos. 1 to 3 are not really
disputing that the petitioner was in compelling circumstances, and in a grave
medical emergency forced to take treatment from respondent no.5, and has
paid a sum of Rs.24,04,380/- for his treatment between 22.04.2021 to
07.06.2021. The only justification sought to be given for respondent nos. 1
to 3, for not reimbursing the entire amount to the petitioner, is that the
respondent no.5 had not abided by the circular dated 20.06.2020 issued by
the GNCTD. In the light of this stand taken by respondent nos. 1to 3, it is
evident that the parties are ad idem on the factual position and, therefore, no
counter affidavit is called for. The writ petition, is accordingly, taken up for
disposal today itself.
6. Having noted the only defence taken by the respondents for not
reimbursing the entire amounts to the petitioner, who has not only battled
with the deadly Covid-19 after remaining on ventilator for over three
weeks, but has also been struggling to seek reimbursement of the amount
spent by him in a grave medical emergency. Undoubtedly, respondent nos.1
to 3 are justified in urging that the respondent no.5 had charged much
beyond what was prescribed in the circular dated 20.06.2020 issued by the
GNCTD, and it is only because of the said over charging that the petitioner
had to incur much higher expenses than what have been reimbursed to him
by the respondent nos. 1 to 3. However, the fact remains that during April
and May, 2021, when the residents of Delhi were not only struggling to get
hospital beds, but there was also a huge shortage of oxygen, the petitioner,
had no other option but to take treatment at respondent no.5, and has
thankfully survived. One shudders to think what fate the petitioner would
have met if he had not, at that point, been treated at respondent no.5
hospital.
7. The petitioner, who had to spend his hard-earned savings, while
undergoing treatment to save his life, cannot be simply told that, since
respondent no.5 has failed to abide by the circular dated 20.06.2020 issued
by the GNCTD, he should seek refund from the said hospital which saved
his life. This Court does not deem it appropriate or necessary to delve into
the validity of the circular dated 20.06.2020, in the present petition, where
an officer of Delhi Higher Judicial Service is seeking simpliciter
reimbursement of the amount for the bona fide expenses incurred by him for
treatment at the respondent no.5 hospital for Covid-19, when the city was
engulfed with the second wave of the pandemic. I am, therefore, unable to
accept Mrs.Ahlawat’s plea that the respondent no.5 should be directed to
explain its stand in the present writ petition regarding its action of charging
amounts higher than the ones prescribed in the circular dated 20.06.2020, or
should be directed to refund the amount of Rs. 16,93,880/-.
8. In this regard, reference may be made to the decision of this Court in
Sqn. Commander Randeep Kumar Rana (supra), wherein the Division
Bench while dealing with a case, where the hospital had charged over and
above package rates, held that the employer was under an obligation to pay
to the government employee, and could make appropriate recoveries in
accordance with law, from the hospital which had overcharged him. The
relevant extract reads as under:
“5. We have given our careful considerations to the arguments
advanced by learned counsel for both the parties. It is not denied that
the treatment taken at Escorts Hospital was pursuant to the
recommendation made by the Safdarjung Hospital which is a
Government hospital. Naturally, when a small child is to be treated
for Ventrical Septal Defect involving open heart surgery, a specialised
hospital and its services are required. Therefore, once the respondent
themselves have recommended the treatment to be taken by the
Escorts Hospital, they cannot deny the full reimbursement on the
basis that the charges incurred by the petitioner over and above the
package rate which the respondent has agreed with the said hospital
cannot be reimbursed. At page 12 of the paper-book there is a letter
conveying permission by the respondent to the petitioner to undertake
specialised treatment from recognised private diagnostic centre.
There is another letter of the respondent at pages 22-23 of the paper-
book in which it has been admitted that Escorts Heart Institute and
Research Centre was also one of the hospitals which the petitioner
was entitled for treatment. Now we come to the plea which has been
taken by the respondent in the counter affidavit. It has been contended
in para 11 of the counter affidavit that it is the duty of the citizens to
see and ensure that such recognised hospital do not charge excess of
the package rates. How a citizen can ensure that a hospital does not
charge over and above the package rate? The power to lay down
guidelines is with the respondent. A citizen is a mere spectator to what
State authority do and decide. If the hospital has charged over and
above the package rate, the respondent is under an obligation to pay
to such charges as the petitioner has incurred over package rates at
the first instance and if in law state can recover from the hospital
concerned, they may do so but they cannot deny their liability to pay
to the Government employee who is entitled for medical
reimbursement.”
9. In the light of the aforesaid, I have no hesitation in holding that the
respondent nos.1 to 3 ought to forthwith reimburse the petitioner by paying
him the differential amount of Rs.16,93,880/-, and if permissible, recover
the same from the respondent no.5. It is however made clear that this Court
has not expressed any opinion on the validity of the circular dated
20.06.2020 and therefore, it will be open for the respondent nos.1 to 3 to
pursue its remedy as per law, against respondent no.5, including taking
penal action, and recovery of any amount which it perceives has been
charged in excess.
10. The writ petition is, accordingly, allowed by directing the respondent
nos.1 to 3 to pay within four weeks the balance amount of Rs.16,93,880/- as
noted in the communication dated 02.05.2022 (Annexure P-13) issued by
the respondent no.3 to the petitioner.
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1. The petitioner, who is a serving officer of the Delhi Higher Judicial
Services, and is currently posted as the Additional District Judge- 02 South
District Saket Courts New Delhi, has approached this Court being aggrieved
by the refusal of the respondent nos. 1 to 3 in reimbursing in full the
expenses incurred by him for his medical treatment, while he was admitted
at the respondent no.5/hospital, between 22.04.2021 to 07.06.2021, on
account of Covid-19.
2. Learned senior counsel for the petitioner submits that the respondent
nos.1 to 3 do not dispute the fact that the petitioner was undergoing
treatment for Covid-19 at the respondent no.5/hospital during the said
period. It is also undisputed that since at that stage, there were no hospital
beds available for his treatment in an empanelled hospital in the NCT of
Delhi, the petitioner due his dropping levels of oxygen , had to be rushed to
the nearest hospital, being the respondent no.5/hospital, where he remained
on ventilator for a period of three weeks. The petitioner, who was in a
helpless state at that stage, had no other option but to pay the entire amount
of Rs. 24,02,380/- as demanded by respondent no.5, against appropriate
receipts. The respondent nos.1 to 3, have however, on the basis of the
recommendations made by the Technical Standing Committee constituted
by the respondent nos. 1 and 2, reimbursed only a sum of Rs.7,08,500/-. The
respondent nos. 1 to 3 have refused to pay the balance sum of Rs.16,93,880/-
to the petitioner on the ground that this amount was charged by the
respondent no.5 by ignoring the rates prescribed under the circular dated
20.06.2020 issued by the Government of NCT of Delhi
(GNCTD)/respondent no.1, fixing the charges leviable for treatment of
patients suffering from Covid-19.
3. He submits that the petitioner cannot be faulted or penalised for the
respondent no.5 charging amounts higher than what was prescribed by the
respondent nos.1 to 3 and in case, the respondent no.5 has acted in violation
of the circular dated 20.06.2020, it is for the respondent nos.1 to 3 to take
action against the respondent no.5, and make recoveries, if any, from the
said respondent. In support of his plea, that once it is admitted that the entire
sum of Rs.24,02,380/- was spent by the petitioner for his medical treatment,
which he was compelled to take from respondent no.5 on account of the
grave threat to his life, and would therefore be entitled to reimbursement of
the entire amount, he places reliance on the decisions of this Court in Sqn.
Commander Randeep Kumar Rana vs. Union of India, (2004) SCC Online
Del 333 and B.R. Goel and Ors. Vs. Union of India and Ors., 2006 (92)
4. On the other hand, Mrs.Ahlawat, learned counsel for respondent nos.1
to 3, while not really disputing any of the aforesaid facts, submits that the
respondent no.5 should be directed to explain before this Court as to why it
has not abided by the circular dated 20.06.2020 issued by the respondent
no.1. She further submits that the said respondent, who has charged the
petitioner way above the rates prescribed in the circular dated 20.06.2020,
should be directed to refund the excessive amounts charged from the
petitioner.
5. Having considered the submissions of learned counsel for the parties,
and perused the record, I find that the respondent nos. 1 to 3 are not really
disputing that the petitioner was in compelling circumstances, and in a grave
medical emergency forced to take treatment from respondent no.5, and has
paid a sum of Rs.24,04,380/- for his treatment between 22.04.2021 to
07.06.2021. The only justification sought to be given for respondent nos. 1
to 3, for not reimbursing the entire amount to the petitioner, is that the
respondent no.5 had not abided by the circular dated 20.06.2020 issued by
the GNCTD. In the light of this stand taken by respondent nos. 1to 3, it is
evident that the parties are ad idem on the factual position and, therefore, no
counter affidavit is called for. The writ petition, is accordingly, taken up for
disposal today itself.
6. Having noted the only defence taken by the respondents for not
reimbursing the entire amounts to the petitioner, who has not only battled
with the deadly Covid-19 after remaining on ventilator for over three
weeks, but has also been struggling to seek reimbursement of the amount
spent by him in a grave medical emergency. Undoubtedly, respondent nos.1
to 3 are justified in urging that the respondent no.5 had charged much
beyond what was prescribed in the circular dated 20.06.2020 issued by the
GNCTD, and it is only because of the said over charging that the petitioner
had to incur much higher expenses than what have been reimbursed to him
by the respondent nos. 1 to 3. However, the fact remains that during April
and May, 2021, when the residents of Delhi were not only struggling to get
hospital beds, but there was also a huge shortage of oxygen, the petitioner,
had no other option but to take treatment at respondent no.5, and has
thankfully survived. One shudders to think what fate the petitioner would
have met if he had not, at that point, been treated at respondent no.5
hospital.
7. The petitioner, who had to spend his hard-earned savings, while
undergoing treatment to save his life, cannot be simply told that, since
respondent no.5 has failed to abide by the circular dated 20.06.2020 issued
by the GNCTD, he should seek refund from the said hospital which saved
his life. This Court does not deem it appropriate or necessary to delve into
the validity of the circular dated 20.06.2020, in the present petition, where
an officer of Delhi Higher Judicial Service is seeking simpliciter
reimbursement of the amount for the bona fide expenses incurred by him for
treatment at the respondent no.5 hospital for Covid-19, when the city was
engulfed with the second wave of the pandemic. I am, therefore, unable to
accept Mrs.Ahlawat’s plea that the respondent no.5 should be directed to
explain its stand in the present writ petition regarding its action of charging
amounts higher than the ones prescribed in the circular dated 20.06.2020, or
should be directed to refund the amount of Rs. 16,93,880/-.
8. In this regard, reference may be made to the decision of this Court in
Sqn. Commander Randeep Kumar Rana (supra), wherein the Division
Bench while dealing with a case, where the hospital had charged over and
above package rates, held that the employer was under an obligation to pay
to the government employee, and could make appropriate recoveries in
accordance with law, from the hospital which had overcharged him. The
relevant extract reads as under:
“5. We have given our careful considerations to the arguments
advanced by learned counsel for both the parties. It is not denied that
the treatment taken at Escorts Hospital was pursuant to the
recommendation made by the Safdarjung Hospital which is a
Government hospital. Naturally, when a small child is to be treated
for Ventrical Septal Defect involving open heart surgery, a specialised
hospital and its services are required. Therefore, once the respondent
themselves have recommended the treatment to be taken by the
Escorts Hospital, they cannot deny the full reimbursement on the
basis that the charges incurred by the petitioner over and above the
package rate which the respondent has agreed with the said hospital
cannot be reimbursed. At page 12 of the paper-book there is a letter
conveying permission by the respondent to the petitioner to undertake
specialised treatment from recognised private diagnostic centre.
There is another letter of the respondent at pages 22-23 of the paper-
book in which it has been admitted that Escorts Heart Institute and
Research Centre was also one of the hospitals which the petitioner
was entitled for treatment. Now we come to the plea which has been
taken by the respondent in the counter affidavit. It has been contended
in para 11 of the counter affidavit that it is the duty of the citizens to
see and ensure that such recognised hospital do not charge excess of
the package rates. How a citizen can ensure that a hospital does not
charge over and above the package rate? The power to lay down
guidelines is with the respondent. A citizen is a mere spectator to what
State authority do and decide. If the hospital has charged over and
above the package rate, the respondent is under an obligation to pay
to such charges as the petitioner has incurred over package rates at
the first instance and if in law state can recover from the hospital
concerned, they may do so but they cannot deny their liability to pay
to the Government employee who is entitled for medical
reimbursement.”
9. In the light of the aforesaid, I have no hesitation in holding that the
respondent nos.1 to 3 ought to forthwith reimburse the petitioner by paying
him the differential amount of Rs.16,93,880/-, and if permissible, recover
the same from the respondent no.5. It is however made clear that this Court
has not expressed any opinion on the validity of the circular dated
20.06.2020 and therefore, it will be open for the respondent nos.1 to 3 to
pursue its remedy as per law, against respondent no.5, including taking
penal action, and recovery of any amount which it perceives has been
charged in excess.
10. The writ petition is, accordingly, allowed by directing the respondent
nos.1 to 3 to pay within four weeks the balance amount of Rs.16,93,880/- as
noted in the communication dated 02.05.2022 (Annexure P-13) issued by
the respondent no.3 to the petitioner.
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The Delhi High Court on Tuesday directed the Delhi Government to pay over Rs. 16 lakhs to a senior judicial officer, who is an Additional District Judge in Saket Courts, as reimbursement for the expenses incurred by him for his COVID-19 treatment last year.
ADJ Dinesh Kumar was admitted in the city's PSRI Hospital between April 22 to June 7, 2021 after contracting COVID-19 during the second wave. He remained there on a ventilator for three weeks. While he had to pay Rs. 24,02,380 to the hospital, the government reimbursed only Rs.7,08,500 on the ground that the hospital had ignored the charges fixed by it for treatment of patients suffering from COVID-19.
Justice Rekha Palli said undoubtedly the authorities are justified in urging that the hospital had charged much beyond what was prescribed in the circular dated 20.06.2020 issued by the GNCTD, and it is only because of the said over charging that the petitioner had to incur much higher expenses than what have been reimbursed to him.
"However, the fact remains that during April and May, 2021, when the residents of Delhi were not only struggling to get hospital beds, but there was also a huge shortage of oxygen, the petitioner had no other option but to take treatment at respondent no.5, and has thankfully survived. One shudders to think what fate the petitioner would have met if he had not, at that point, been treated at respondent no.5 hospital," said the court.
Allowing the plea, the court observed that the judge, who had to spend his hard-earned savings for COVID-19 treatment to save his life, cannot be simply told that he should seek refund from the hospital since it failed to abide by the Delhi government's circular.
"This Court does not deem it appropriate or necessary to delve into the validity of the circular dated 20.06.2020, in the present petition, where an officer of Delhi Higher Judicial Service is seeking simpliciter reimbursement of the amount for the bona fide expenses incurred by him for treatment at the respondent no.5 hospital for Covid-19, when the city was engulfed with the second wave of the pandemic," said the court.
Justice Palli however rejected Delhi Government's submission that the hospital should be directed to explain its stand regarding its action of charging higher amounts than the ones prescribed in the circular or that it should be directed to refund the balance amount.
Referring to the high court's ruling in Sqn. Commander Randeep Kumar Rana vs. Union of India, the court said a division bench while dealing with a case, has held the employer was under an obligation to pay to the government employee, and could make appropriate recoveries in accordance with law, from the hospital which had overcharged him.
"In the light of the aforesaid, I have no hesitation in holding that the respondent nos.1 to 3 ought to forthwith reimburse the petitioner by paying him the differential amount of Rs.16,93,880/-, and if permissible, recover the same from the respondent no.5," the court said.
However, Justice Palli clarified that the court has not expressed any opinion on the validity of the circular and said it will be open for the authorities to pursue legal remedy against the hospital "including taking penal action" and "recovery of any amount charged in excess."
"The writ petition is, accordingly, allowed by directing the respondent nos.1 to 3 to pay within four weeks the balance amount of Rs.16,93,880/- as noted in the communication dated 02.05.2022 issued by the respondent no.3 to the petitioner," the court said.
Senior Advocate J.P. Sengh, representing Kumar, earlier argued there were no hospital beds available for his treatment in any of the empanelled hospitals of the government and due to his dropping levels of oxygen, he had to be rushed to the nearest hospital.
"The petitioner, who was in a helpless state at that stage, had no other option but to pay the entire amount of Rs. 24,02,380/- as demanded by respondent no.5, against appropriate receipts," Sengh submitted.
Sengh argued that the judicial officer cannot be faulted or penalised for the act of the hospital charging amounts higher than what was prescribed by the authorities. He submitted that it was for the concerned authorities to take action against the hospital in case it had acted in violation of the circular in question.
On the other hand, the Delhi Government submitted that the hospital should be directed to explain as to why it had not abided by the Delhi Government's circular. "The said respondent, who has charged the petitioner way above the rates prescribed in the circular dated 20.06.2020, should be directed to refund the excessive amounts charged from the petitioner," advocate Avnish Ahlawat submitted.
Title: DINESH KUMAR v. GOVERNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI & ORS.
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The Delhi High Court on Tuesday directed the Delhi Government to pay over Rs. 16 lakhs to a senior judicial officer, who is an Additional District Judge in Saket Courts, as reimbursement for the expenses incurred by him for his COVID-19 treatment last year. ADJ Dinesh Kumar was admitted in the city's PSRI Hospital between April 22 to June 7, 2021 after contracting COVID-19 during the second wave. He remained there on a ventilator for three weeks. 24,02,380 to the hospital, the government reimbursed only Rs.7,08,500 on the ground that the hospital had ignored the charges fixed by it for treatment of patients suffering from COVID-19. "However, the fact remains that during April and May, 2021, when the residents of Delhi were not only struggling to get hospital beds, but there was also a huge shortage of oxygen, the petitioner had no other option but to take treatment at respondent no.5, and has thankfully survived. One shudders to think what fate the petitioner would have met if he had not, at that point, been treated at respondent no.5 hospital," said the court. Allowing the plea, the court observed that the judge, who had to spend his hard-earned savings for COVID-19 treatment to save his life, cannot be simply told that he should seek refund from the hospital since it failed to abide by the Delhi government's circular. "This Court does not deem it appropriate or necessary to delve into the validity of the circular dated 20.06.2020, in the present petition, where an officer of Delhi Higher Judicial Service is seeking simpliciter reimbursement of the amount for the bona fide expenses incurred by him for treatment at the respondent no.5 hospital for Covid-19, when the city was engulfed with the second wave of the pandemic," said the court. Justice Palli however rejected Delhi Government's submission that the hospital should be directed to explain its stand regarding its action of charging higher amounts than the ones prescribed in the circular or that it should be directed to refund the balance amount. Referring to the high court's ruling in Sqn. However, Justice Palli clarified that the court has not expressed any opinion on the validity of the circular and said it will be open for the authorities to pursue legal remedy against the hospital "including taking penal action" and "recovery of any amount charged in excess." "The writ petition is, accordingly, allowed by directing the respondent nos.1 to 3 to pay within four weeks the balance amount of Rs.16,93,880/- as noted in the communication dated 02.05.2022 issued by the respondent no.3 to the petitioner," the court said. Senior Advocate J.P. Sengh, representing Kumar, earlier argued there were no hospital beds available for his treatment in any of the empanelled hospitals of the government and due to his dropping levels of oxygen, he had to be rushed to the nearest hospital. "The petitioner, who was in a helpless state at that stage, had no other option but to pay the entire amount of Rs. 24,02,380/- as demanded by respondent no.5, against appropriate receipts," Sengh submitted. Sengh argued that the judicial officer cannot be faulted or penalised for the act of the hospital charging amounts higher than what was prescribed by the authorities. He submitted that it was for the concerned authorities to take action against the hospital in case it had acted in violation of the circular in question. On the other hand, the Delhi Government submitted that the hospital should be directed to explain as to why it had not abided by the Delhi Government's circular. " Title: DINESH KUMAR v. GOVERNMENT OF NATIONAL CAPITAL TERRITORY OF DELHI & ORS.
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Through: Mr. Rahul Tyagi, ASC for State with
1. Exemption allowed, subject to all just exceptions.
2. Applications stand disposed of.
3. This is a petition seeking setting aside of the impugned judgment
dated 19.11.2022 passed by learned Sessions Court in Crl. Rev. 23/2020 and
to restore the order dated 06.01.2020 passed by the learned ACMM.
4. In the present case, the learned ACMM vide order dated 06.01.2020
on an application u/s 156(3) Cr.P.C. filed by the petitioner was pleased to
disregard the action taken report (“ATR”) and direct registration of the FIR.
5. The said order was challenged by the respondents herein in a revision
petition before Additional Sessions Judge who firstly discussed the legal
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 1 of 7
position and held that the revision petition is maintainable.
6. Secondly, the learned Sessions Court was of the view that once the
action taken report opined that no cognizable offence is made out and the
matter is civil in nature, for the learned ACMM to disagree with the opinion
of the inquiry officer and order registration of FIR would require reasons.
7. The Sessions Court was of the view that the order of 06.01.2020 was
devoid of reasons and hence the Sessions Court was pleased to set aside the
order dated 06.01.2020 and remand the matter to ACMM to hear afresh and
take a reasoned decision.
8. This order of the Sessions Court has been challenged by the
petitioner.
9. It is stated by Mr. Dwivedi, learned counsel that the order directing
registration of FIR is an interlocutory order and has relied upon judgment of
Gujarat High Court in “Parmar Rameshchandra Ganpatray & Ors. vs. State
of Gujarat & Ors.” in Spl. Criminal Appl. No. 5789/2016 and more
particularly para 45 and 50 which read as under:
“45. The moot question is if a revision application against
mere registration of F.I.R. by the police is not maintainable
whether such revision would be held maintainable when the
Magistrate only directs registration of FIR. In the opinion of
this Court, the answer is an emphatic No. Exercise of revisory
power conferred by the Court under Section 397 read with
Section 401 of the Code would occasion when there is an order
passed by the competent court, which is not interlocutory in
nature, however, the said power cannot be exercised to quash
the FIR or investigation because such power can be exercised
only by the High Court under Section 482 of the Code or under
Article 226/227 of the Constitution of India. If the revision
application is considered to be maintainable before the
Sessions Court against an order passed by the Magistrate
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 2 of 7
under Section 156(3) and if such revision is allowed it would
have effect of quashing the FIR, therefore, if the Sessions Court
has no such powers otherwise, it cannot do so by entertaining a
revision against an order passed by the Magistrate under
Section 156(3) of the Code. [See: Amor Nath vs. State of
50. In view of the aforesaid discussion, I hold that the order
under Section 156(3) of the Code of Criminal Procedure, 1973
is an "interlocutory order" and the revision under Section 397
read with Section 401 of the Cr.P.C. would not lie. At the same
time, an order of the Magistrate rejecting an application under
Section 156(3) of the Code for the registration of a case by the
police and for investigation is not an "interlocutory order".
Such an order is amenable to the remedy of a criminal revision
under Sections 397 read with 401 of the Cr.P.C.”
10. He also relied on the judgment of Allahabad High Court viz., “Father
Thomas vs. State of U.P. & Ors.” in CRL.REV. No. 1581/2001, 1640/2001,
1656/2001, 1658/2001, 1727/2001, 1731/2001 and more particularly para 46
and 54 which read as under:
“46. As the direction for investigation passed by the
Magistrate under Section 156(3) is purely interlocutory in
nature, and involves no substantial rights of the parties, we are
of the view that the bar under Section 397(2) Code of Criminal
Procedure to the entertainment of a criminal revision can also
not be circumvented by moving an application under Section
482 Code of Criminal Procedure. As observed in State v.
Navjot Sandhu, MANU/SC/0396/2003: (2003) 6 SCC 641, in
54. As on the basis of the aforesaid reasoning we have already
held the order under Section 156(3) Code of Criminal
Procedure not to be amenable to challenge in a criminal
revision or an application under Section 482 Code of Criminal
Procedure it is not necessary for this Court to go into the
further question whether the said order is administrative in
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 3 of 7
nature as urged by Sri G.S. Chaturvedi and the learned
Government Advocate or judicial in nature as contended by Sri
D.S. Mishra and Sri Dileep Gupta. Following the decision of
the Apex Court in Asit Bhattacharjee v. Hanuman Prasad Ojha
and Ors., MANU/SC/7676/2007: (2007) 5 SCC 786, we are
also not inclined to express any opinion on this issue, and leave
the question open for decision in a subsequent proceeding
where an answer to this question may become necessary.”
11. I am unable to agree with the two judgments.
12. The Delhi High Court in “Nishu Wadhwa vs. Siddharth Wadhwa &
Anr.” in W.P.(CRL) 1253/2016 on 10.01.2017 observed as under:
“13. The issue that since the accused has not been
summoned as an accused and has no right to file a revision
petition is alien, while deciding an application under Section
156(3) Cr.P.C. The said issue crops up when the Magistrate
entertains the complaint and on taking cognizance proceeds
as a complaint case. In case directions are issued for
registration of FIR immediately, on registration of FIR, the
person against whom allegations are made in the FIR
attains the status of an accused. His rights in so far as the
Police can summon him for investigation, arrest him without
warrants for allegations of cognizable offences are duly
affected. In a situation where the fundamental right of
freedom and liberty of a person is affected, it cannot be held
that he has no right to be heard at that stage. Thus to hold
that since directions only have been issued under Section
156(3) Cr.P.C. and no cognizance has been taken thus no
revision would lie would be an erroneous reading of the
decisions of the Supreme Court. Therefore, an order
dismissing or allowing an application under Section 156
(3) Cr.P.C. is not an interlocutory order and a revision
petition against the same is maintainable.”
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 4 of 7
13. I am of the view that the registration of FIR affects the fundamental
right and freedom of the accused person. He can be summoned for
investigation, arrested without warrants for allegations of cognizable
offences. Therefore, an order directing registration of FIR u/s 156(3) Cr.P.C.
is not an interlocutory order and the revision petition against the same would
be maintainable as the accused has a valuable right to be heard.
14. It is further stated by Mr. Dwivedi that only brief reasons are required
for registration of an FIR which was done, which has been given by the
learned MM.
15. The operative portion of the order dated 06.01.2020 reads as under:
“Per contra, as per the ATR, it is denied that any cognizable
offence is made out. It is stated that the collaboration
agreement has not been fabricated as alleged and full & final
payment of Rs. 85,00,000/- is acknowledged by receipt dated
06.01.2013 and another undated receipt.
The complainant has denied his signature on the undated
receipt and fabricated pages of collaboration agreement. It is
conceded by the IO that verification of transfer of RS. 40. 00
Lacs through cheques to the account of the Complajnant per
the undated receipt was not verified.
In these facts and circumstances, this Court deems it
appropriate to order registration of FIR under relevant
Sections as commission of cognizable offences are made out
and complainant is not equipped to collect evidence by himself.
SHO concerned is directed to register the same and file
compliance report, within a week. He shall investigate/get the
matter investigated, as per law.”
16. In “Harpal Singh Arora and Ors. vs. State and Anr.” 2008 (103) DRJ
282 this Court formulated the relevant question which reads as under:
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 5 of 7
“(b) Is a Magistrate, when approached thereafter by a
complainant with a complaint under Section 190 read with
Section 200 CrPC along with an application under Section 156
(3) Cr.PC seeking a direction for investigation by the police,
bound to deal with the said report before disposing of the
application under Section 156 (3) CrPC and proceeding with
the complaint under Section 200 CrPC?
16. Considering the fact that the learned MM called for the
report of the CAW Cell, which is fairly detailed, the proper
course of action before ordering an investigation under Section
156 (3) would have been to examine that report before deciding
to issue a direction for investigation. When the police in the
CAW Cell has come to conclusion that no cognizable offence is
made out, the Magistrate cannot brush aside that conclusion
lightly. Although that the said conclusion of the CAW Cell is
not binding on the Magistrate at that stage, since his order is a
judicial one he must give reasons, however brief, why he is
inclined to order investigation notwithstanding the said report.
Question (b) is answered accordingly.”
17. In „Arvindbhai Ravjibhai Patel vs. Dhirubhai Sambhubhai‟ 1998(1)
Crimes 351, the Gujarat High Court took exception to the growing tendency
of asking the police to investigate cases u/s 156(3) of the Code and advised
Magistrate not to pass orders mechanically. It was held:-
“Magistrates should act under Section 156 (3) of the Code only
in those cases where the assistance of the police is essentially
required and the Magistrate is of the considered view that the
complainant on his own may not be in a position to collect and
produce evidence in support of the accusation”.
18. I am of the view that the ATR has not been considered by the learned
19. The MM directed that “in these facts and circumstances this Court
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 6 of 7
deems it appropriate to order registration of FIR…” This order is not
showing application of mind as to why and how the ATR has been
considered and the reasons as to why the learned MM has not agreed with
the opinion expressed by the IO that no cognizable offence has been made
out. This aspect has been correctly analysed by the learned Sessions Court in
its revisional jurisdiction.
20. In this view of the matter, I find no merit in the petition and the same
is dismissed.
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 7 of 7
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The Delhi High Court has observed that a revision petition filed against an order directing registration of FIR is maintainable as such an order is not an interlocutory order. The accused has a valuable right to be heard, said the court.
Justice Jasmeet Singh said the registration of FIR affects the fundamental right and freedom of an accused. The person can be summoned for investigation, arrested without warrants for allegations of cognizable offences, the court observed.
“Therefore, an order directing registration of FIR u/s 156(3) Cr.P.C. is not an interlocutory order and the revision petition against the same would be maintainable as the accused has a valuable right to be heard,” Justice Singh said.
The court made the observations while dismissing a plea moved by Ravinder Lal Airi seeking to restore an order passed by ACMM court on January 1, 2020 directing registration of FIR on his application under Section 156(3) CrPC.
Airi challenged an order passed by the Sessions Court which held that the revision petition against ACMM order was maintainable and remanded the matter back to ACMM court to hear it afresh and take a reasoned decision.
The petitioner’s counsel submitted that the order directing registration of FIR is an interlocutory order.
Reliance was placed on the judgment of Gujarat High Court in Parmar Rameshchandra Ganpatray & Ors. v. State of Gujarat & Ors. wherein it was held that an order of the Magistrate rejecting an application for registration of a case is not an "interlocutory order" and such an order is amenable to the remedy of criminal revision.
The counsel also relied on the judgment passed by Allahabad High Court in Father Thomas v. State of U.P. & Ors. wherein it was observed that the direction for investigation passed by the Magistrate is purely interlocutory in nature and the bar under Section 397(2) CrPC to entertain a criminal revision cannot be circumvented.
Disagreeing with the two judgments, Justice Singh referred to a ruling of a co-ordinate bench in Nishu Wadhwa v. Siddharth Wadhwa & Anr. which held that an order dismissing or allowing an application under Section 156 (3) Cr.P.C. is not an interlocutory order and a revision petition against the same is maintainable.
The court said the ATR was not considered by the ACMM. The order passed by the magistrate does not reflect "application of mind as to why and how the ATR has been considered and the reasons as to why the learned MM has not agreed with the opinion expressed by the IO that no cognizable offence has been made out."
“This aspect has been correctly analysed by the learned Sessions Court in its revisional jurisdiction. In this view of the matter, I find no merit in the petition and the same is dismissed,” the court said.
Advocate Dhruv Dwivedi appeared for the petitioner. ASC Rahul Tyagi represented State.
Title: RAVINDER LAL AIRI v. S.SHALU CONSTRUCTION PVT. LTD AND ORS.
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Through: Mr. Rahul Tyagi, ASC for State with
1. Exemption allowed, subject to all just exceptions.
2. Applications stand disposed of.
3. This is a petition seeking setting aside of the impugned judgment
dated 19.11.2022 passed by learned Sessions Court in Crl. Rev. 23/2020 and
to restore the order dated 06.01.2020 passed by the learned ACMM.
4. In the present case, the learned ACMM vide order dated 06.01.2020
on an application u/s 156(3) Cr.P.C. filed by the petitioner was pleased to
disregard the action taken report (“ATR”) and direct registration of the FIR.
5. The said order was challenged by the respondents herein in a revision
petition before Additional Sessions Judge who firstly discussed the legal
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 1 of 7
position and held that the revision petition is maintainable.
6. Secondly, the learned Sessions Court was of the view that once the
action taken report opined that no cognizable offence is made out and the
matter is civil in nature, for the learned ACMM to disagree with the opinion
of the inquiry officer and order registration of FIR would require reasons.
7. The Sessions Court was of the view that the order of 06.01.2020 was
devoid of reasons and hence the Sessions Court was pleased to set aside the
order dated 06.01.2020 and remand the matter to ACMM to hear afresh and
take a reasoned decision.
8. This order of the Sessions Court has been challenged by the
petitioner.
9. It is stated by Mr. Dwivedi, learned counsel that the order directing
registration of FIR is an interlocutory order and has relied upon judgment of
Gujarat High Court in “Parmar Rameshchandra Ganpatray & Ors. vs. State
of Gujarat & Ors.” in Spl. Criminal Appl. No. 5789/2016 and more
particularly para 45 and 50 which read as under:
“45. The moot question is if a revision application against
mere registration of F.I.R. by the police is not maintainable
whether such revision would be held maintainable when the
Magistrate only directs registration of FIR. In the opinion of
this Court, the answer is an emphatic No. Exercise of revisory
power conferred by the Court under Section 397 read with
Section 401 of the Code would occasion when there is an order
passed by the competent court, which is not interlocutory in
nature, however, the said power cannot be exercised to quash
the FIR or investigation because such power can be exercised
only by the High Court under Section 482 of the Code or under
Article 226/227 of the Constitution of India. If the revision
application is considered to be maintainable before the
Sessions Court against an order passed by the Magistrate
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 2 of 7
under Section 156(3) and if such revision is allowed it would
have effect of quashing the FIR, therefore, if the Sessions Court
has no such powers otherwise, it cannot do so by entertaining a
revision against an order passed by the Magistrate under
Section 156(3) of the Code. [See: Amor Nath vs. State of
50. In view of the aforesaid discussion, I hold that the order
under Section 156(3) of the Code of Criminal Procedure, 1973
is an "interlocutory order" and the revision under Section 397
read with Section 401 of the Cr.P.C. would not lie. At the same
time, an order of the Magistrate rejecting an application under
Section 156(3) of the Code for the registration of a case by the
police and for investigation is not an "interlocutory order".
Such an order is amenable to the remedy of a criminal revision
under Sections 397 read with 401 of the Cr.P.C.”
10. He also relied on the judgment of Allahabad High Court viz., “Father
Thomas vs. State of U.P. & Ors.” in CRL.REV. No. 1581/2001, 1640/2001,
1656/2001, 1658/2001, 1727/2001, 1731/2001 and more particularly para 46
and 54 which read as under:
“46. As the direction for investigation passed by the
Magistrate under Section 156(3) is purely interlocutory in
nature, and involves no substantial rights of the parties, we are
of the view that the bar under Section 397(2) Code of Criminal
Procedure to the entertainment of a criminal revision can also
not be circumvented by moving an application under Section
482 Code of Criminal Procedure. As observed in State v.
Navjot Sandhu, MANU/SC/0396/2003: (2003) 6 SCC 641, in
54. As on the basis of the aforesaid reasoning we have already
held the order under Section 156(3) Code of Criminal
Procedure not to be amenable to challenge in a criminal
revision or an application under Section 482 Code of Criminal
Procedure it is not necessary for this Court to go into the
further question whether the said order is administrative in
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 3 of 7
nature as urged by Sri G.S. Chaturvedi and the learned
Government Advocate or judicial in nature as contended by Sri
D.S. Mishra and Sri Dileep Gupta. Following the decision of
the Apex Court in Asit Bhattacharjee v. Hanuman Prasad Ojha
and Ors., MANU/SC/7676/2007: (2007) 5 SCC 786, we are
also not inclined to express any opinion on this issue, and leave
the question open for decision in a subsequent proceeding
where an answer to this question may become necessary.”
11. I am unable to agree with the two judgments.
12. The Delhi High Court in “Nishu Wadhwa vs. Siddharth Wadhwa &
Anr.” in W.P.(CRL) 1253/2016 on 10.01.2017 observed as under:
“13. The issue that since the accused has not been
summoned as an accused and has no right to file a revision
petition is alien, while deciding an application under Section
156(3) Cr.P.C. The said issue crops up when the Magistrate
entertains the complaint and on taking cognizance proceeds
as a complaint case. In case directions are issued for
registration of FIR immediately, on registration of FIR, the
person against whom allegations are made in the FIR
attains the status of an accused. His rights in so far as the
Police can summon him for investigation, arrest him without
warrants for allegations of cognizable offences are duly
affected. In a situation where the fundamental right of
freedom and liberty of a person is affected, it cannot be held
that he has no right to be heard at that stage. Thus to hold
that since directions only have been issued under Section
156(3) Cr.P.C. and no cognizance has been taken thus no
revision would lie would be an erroneous reading of the
decisions of the Supreme Court. Therefore, an order
dismissing or allowing an application under Section 156
(3) Cr.P.C. is not an interlocutory order and a revision
petition against the same is maintainable.”
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 4 of 7
13. I am of the view that the registration of FIR affects the fundamental
right and freedom of the accused person. He can be summoned for
investigation, arrested without warrants for allegations of cognizable
offences. Therefore, an order directing registration of FIR u/s 156(3) Cr.P.C.
is not an interlocutory order and the revision petition against the same would
be maintainable as the accused has a valuable right to be heard.
14. It is further stated by Mr. Dwivedi that only brief reasons are required
for registration of an FIR which was done, which has been given by the
learned MM.
15. The operative portion of the order dated 06.01.2020 reads as under:
“Per contra, as per the ATR, it is denied that any cognizable
offence is made out. It is stated that the collaboration
agreement has not been fabricated as alleged and full & final
payment of Rs. 85,00,000/- is acknowledged by receipt dated
06.01.2013 and another undated receipt.
The complainant has denied his signature on the undated
receipt and fabricated pages of collaboration agreement. It is
conceded by the IO that verification of transfer of RS. 40. 00
Lacs through cheques to the account of the Complajnant per
the undated receipt was not verified.
In these facts and circumstances, this Court deems it
appropriate to order registration of FIR under relevant
Sections as commission of cognizable offences are made out
and complainant is not equipped to collect evidence by himself.
SHO concerned is directed to register the same and file
compliance report, within a week. He shall investigate/get the
matter investigated, as per law.”
16. In “Harpal Singh Arora and Ors. vs. State and Anr.” 2008 (103) DRJ
282 this Court formulated the relevant question which reads as under:
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 5 of 7
“(b) Is a Magistrate, when approached thereafter by a
complainant with a complaint under Section 190 read with
Section 200 CrPC along with an application under Section 156
(3) Cr.PC seeking a direction for investigation by the police,
bound to deal with the said report before disposing of the
application under Section 156 (3) CrPC and proceeding with
the complaint under Section 200 CrPC?
16. Considering the fact that the learned MM called for the
report of the CAW Cell, which is fairly detailed, the proper
course of action before ordering an investigation under Section
156 (3) would have been to examine that report before deciding
to issue a direction for investigation. When the police in the
CAW Cell has come to conclusion that no cognizable offence is
made out, the Magistrate cannot brush aside that conclusion
lightly. Although that the said conclusion of the CAW Cell is
not binding on the Magistrate at that stage, since his order is a
judicial one he must give reasons, however brief, why he is
inclined to order investigation notwithstanding the said report.
Question (b) is answered accordingly.”
17. In „Arvindbhai Ravjibhai Patel vs. Dhirubhai Sambhubhai‟ 1998(1)
Crimes 351, the Gujarat High Court took exception to the growing tendency
of asking the police to investigate cases u/s 156(3) of the Code and advised
Magistrate not to pass orders mechanically. It was held:-
“Magistrates should act under Section 156 (3) of the Code only
in those cases where the assistance of the police is essentially
required and the Magistrate is of the considered view that the
complainant on his own may not be in a position to collect and
produce evidence in support of the accusation”.
18. I am of the view that the ATR has not been considered by the learned
19. The MM directed that “in these facts and circumstances this Court
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 6 of 7
deems it appropriate to order registration of FIR…” This order is not
showing application of mind as to why and how the ATR has been
considered and the reasons as to why the learned MM has not agreed with
the opinion expressed by the IO that no cognizable offence has been made
out. This aspect has been correctly analysed by the learned Sessions Court in
its revisional jurisdiction.
20. In this view of the matter, I find no merit in the petition and the same
is dismissed.
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 7 of 7
|
Through: Mr. Rahul Tyagi, ASC for State with
1. Exemption allowed, subject to all just exceptions.
2. Applications stand disposed of.
3. This is a petition seeking setting aside of the impugned judgment
dated 19.11.2022 passed by learned Sessions Court in Crl. Rev. 23/2020 and
to restore the order dated 06.01.2020 passed by the learned ACMM.
4. In the present case, the learned ACMM vide order dated 06.01.2020
on an application u/s 156(3) Cr.P.C. filed by the petitioner was pleased to
disregard the action taken report (“ATR”) and direct registration of the FIR.
5. The said order was challenged by the respondents herein in a revision
petition before Additional Sessions Judge who firstly discussed the legal
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 1 of 7
position and held that the revision petition is maintainable.
6. Secondly, the learned Sessions Court was of the view that once the
action taken report opined that no cognizable offence is made out and the
matter is civil in nature, for the learned ACMM to disagree with the opinion
of the inquiry officer and order registration of FIR would require reasons.
7. The Sessions Court was of the view that the order of 06.01.2020 was
devoid of reasons and hence the Sessions Court was pleased to set aside the
order dated 06.01.2020 and remand the matter to ACMM to hear afresh and
take a reasoned decision.
8. This order of the Sessions Court has been challenged by the
petitioner.
9. It is stated by Mr. Dwivedi, learned counsel that the order directing
registration of FIR is an interlocutory order and has relied upon judgment of
Gujarat High Court in “Parmar Rameshchandra Ganpatray & Ors. vs. State
of Gujarat & Ors.” in Spl. Criminal Appl. No. 5789/2016 and more
particularly para 45 and 50 which read as under:
“45. The moot question is if a revision application against
mere registration of F.I.R. by the police is not maintainable
whether such revision would be held maintainable when the
Magistrate only directs registration of FIR. In the opinion of
this Court, the answer is an emphatic No. Exercise of revisory
power conferred by the Court under Section 397 read with
Section 401 of the Code would occasion when there is an order
passed by the competent court, which is not interlocutory in
nature, however, the said power cannot be exercised to quash
the FIR or investigation because such power can be exercised
only by the High Court under Section 482 of the Code or under
Article 226/227 of the Constitution of India. If the revision
application is considered to be maintainable before the
Sessions Court against an order passed by the Magistrate
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 2 of 7
under Section 156(3) and if such revision is allowed it would
have effect of quashing the FIR, therefore, if the Sessions Court
has no such powers otherwise, it cannot do so by entertaining a
revision against an order passed by the Magistrate under
Section 156(3) of the Code. [See: Amor Nath vs. State of
50. In view of the aforesaid discussion, I hold that the order
under Section 156(3) of the Code of Criminal Procedure, 1973
is an "interlocutory order" and the revision under Section 397
read with Section 401 of the Cr.P.C. would not lie. At the same
time, an order of the Magistrate rejecting an application under
Section 156(3) of the Code for the registration of a case by the
police and for investigation is not an "interlocutory order".
Such an order is amenable to the remedy of a criminal revision
under Sections 397 read with 401 of the Cr.P.C.”
10. He also relied on the judgment of Allahabad High Court viz., “Father
Thomas vs. State of U.P. & Ors.” in CRL.REV. No. 1581/2001, 1640/2001,
1656/2001, 1658/2001, 1727/2001, 1731/2001 and more particularly para 46
and 54 which read as under:
“46. As the direction for investigation passed by the
Magistrate under Section 156(3) is purely interlocutory in
nature, and involves no substantial rights of the parties, we are
of the view that the bar under Section 397(2) Code of Criminal
Procedure to the entertainment of a criminal revision can also
not be circumvented by moving an application under Section
482 Code of Criminal Procedure. As observed in State v.
Navjot Sandhu, MANU/SC/0396/2003: (2003) 6 SCC 641, in
54. As on the basis of the aforesaid reasoning we have already
held the order under Section 156(3) Code of Criminal
Procedure not to be amenable to challenge in a criminal
revision or an application under Section 482 Code of Criminal
Procedure it is not necessary for this Court to go into the
further question whether the said order is administrative in
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 3 of 7
nature as urged by Sri G.S. Chaturvedi and the learned
Government Advocate or judicial in nature as contended by Sri
D.S. Mishra and Sri Dileep Gupta. Following the decision of
the Apex Court in Asit Bhattacharjee v. Hanuman Prasad Ojha
and Ors., MANU/SC/7676/2007: (2007) 5 SCC 786, we are
also not inclined to express any opinion on this issue, and leave
the question open for decision in a subsequent proceeding
where an answer to this question may become necessary.”
11. I am unable to agree with the two judgments.
12. The Delhi High Court in “Nishu Wadhwa vs. Siddharth Wadhwa &
Anr.” in W.P.(CRL) 1253/2016 on 10.01.2017 observed as under:
“13. The issue that since the accused has not been
summoned as an accused and has no right to file a revision
petition is alien, while deciding an application under Section
156(3) Cr.P.C. The said issue crops up when the Magistrate
entertains the complaint and on taking cognizance proceeds
as a complaint case. In case directions are issued for
registration of FIR immediately, on registration of FIR, the
person against whom allegations are made in the FIR
attains the status of an accused. His rights in so far as the
Police can summon him for investigation, arrest him without
warrants for allegations of cognizable offences are duly
affected. In a situation where the fundamental right of
freedom and liberty of a person is affected, it cannot be held
that he has no right to be heard at that stage. Thus to hold
that since directions only have been issued under Section
156(3) Cr.P.C. and no cognizance has been taken thus no
revision would lie would be an erroneous reading of the
decisions of the Supreme Court. Therefore, an order
dismissing or allowing an application under Section 156
(3) Cr.P.C. is not an interlocutory order and a revision
petition against the same is maintainable.”
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 4 of 7
13. I am of the view that the registration of FIR affects the fundamental
right and freedom of the accused person. He can be summoned for
investigation, arrested without warrants for allegations of cognizable
offences. Therefore, an order directing registration of FIR u/s 156(3) Cr.P.C.
is not an interlocutory order and the revision petition against the same would
be maintainable as the accused has a valuable right to be heard.
14. It is further stated by Mr. Dwivedi that only brief reasons are required
for registration of an FIR which was done, which has been given by the
learned MM.
15. The operative portion of the order dated 06.01.2020 reads as under:
“Per contra, as per the ATR, it is denied that any cognizable
offence is made out. It is stated that the collaboration
agreement has not been fabricated as alleged and full & final
payment of Rs. 85,00,000/- is acknowledged by receipt dated
06.01.2013 and another undated receipt.
The complainant has denied his signature on the undated
receipt and fabricated pages of collaboration agreement. It is
conceded by the IO that verification of transfer of RS. 40. 00
Lacs through cheques to the account of the Complajnant per
the undated receipt was not verified.
In these facts and circumstances, this Court deems it
appropriate to order registration of FIR under relevant
Sections as commission of cognizable offences are made out
and complainant is not equipped to collect evidence by himself.
SHO concerned is directed to register the same and file
compliance report, within a week. He shall investigate/get the
matter investigated, as per law.”
16. In “Harpal Singh Arora and Ors. vs. State and Anr.” 2008 (103) DRJ
282 this Court formulated the relevant question which reads as under:
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 5 of 7
“(b) Is a Magistrate, when approached thereafter by a
complainant with a complaint under Section 190 read with
Section 200 CrPC along with an application under Section 156
(3) Cr.PC seeking a direction for investigation by the police,
bound to deal with the said report before disposing of the
application under Section 156 (3) CrPC and proceeding with
the complaint under Section 200 CrPC?
16. Considering the fact that the learned MM called for the
report of the CAW Cell, which is fairly detailed, the proper
course of action before ordering an investigation under Section
156 (3) would have been to examine that report before deciding
to issue a direction for investigation. When the police in the
CAW Cell has come to conclusion that no cognizable offence is
made out, the Magistrate cannot brush aside that conclusion
lightly. Although that the said conclusion of the CAW Cell is
not binding on the Magistrate at that stage, since his order is a
judicial one he must give reasons, however brief, why he is
inclined to order investigation notwithstanding the said report.
Question (b) is answered accordingly.”
17. In „Arvindbhai Ravjibhai Patel vs. Dhirubhai Sambhubhai‟ 1998(1)
Crimes 351, the Gujarat High Court took exception to the growing tendency
of asking the police to investigate cases u/s 156(3) of the Code and advised
Magistrate not to pass orders mechanically. It was held:-
“Magistrates should act under Section 156 (3) of the Code only
in those cases where the assistance of the police is essentially
required and the Magistrate is of the considered view that the
complainant on his own may not be in a position to collect and
produce evidence in support of the accusation”.
18. I am of the view that the ATR has not been considered by the learned
19. The MM directed that “in these facts and circumstances this Court
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 6 of 7
deems it appropriate to order registration of FIR…” This order is not
showing application of mind as to why and how the ATR has been
considered and the reasons as to why the learned MM has not agreed with
the opinion expressed by the IO that no cognizable offence has been made
out. This aspect has been correctly analysed by the learned Sessions Court in
its revisional jurisdiction.
20. In this view of the matter, I find no merit in the petition and the same
is dismissed.
Digitally Signed byAMIT W.P.(CRL) 209/2023 Page 7 of 7
|
The Delhi High Court has observed that a revision petition filed against an order directing registration of FIR is maintainable as such an order is not an interlocutory order. The accused has a valuable right to be heard, said the court.
Justice Jasmeet Singh said the registration of FIR affects the fundamental right and freedom of an accused. The person can be summoned for investigation, arrested without warrants for allegations of cognizable offences, the court observed.
“Therefore, an order directing registration of FIR u/s 156(3) Cr.P.C. is not an interlocutory order and the revision petition against the same would be maintainable as the accused has a valuable right to be heard,” Justice Singh said.
The court made the observations while dismissing a plea moved by Ravinder Lal Airi seeking to restore an order passed by ACMM court on January 1, 2020 directing registration of FIR on his application under Section 156(3) CrPC.
Airi challenged an order passed by the Sessions Court which held that the revision petition against ACMM order was maintainable and remanded the matter back to ACMM court to hear it afresh and take a reasoned decision.
The petitioner’s counsel submitted that the order directing registration of FIR is an interlocutory order.
Reliance was placed on the judgment of Gujarat High Court in Parmar Rameshchandra Ganpatray & Ors. v. State of Gujarat & Ors. wherein it was held that an order of the Magistrate rejecting an application for registration of a case is not an "interlocutory order" and such an order is amenable to the remedy of criminal revision.
The counsel also relied on the judgment passed by Allahabad High Court in Father Thomas v. State of U.P. & Ors. wherein it was observed that the direction for investigation passed by the Magistrate is purely interlocutory in nature and the bar under Section 397(2) CrPC to entertain a criminal revision cannot be circumvented.
Disagreeing with the two judgments, Justice Singh referred to a ruling of a co-ordinate bench in Nishu Wadhwa v. Siddharth Wadhwa & Anr. which held that an order dismissing or allowing an application under Section 156 (3) Cr.P.C. is not an interlocutory order and a revision petition against the same is maintainable.
The court said the ATR was not considered by the ACMM. The order passed by the magistrate does not reflect "application of mind as to why and how the ATR has been considered and the reasons as to why the learned MM has not agreed with the opinion expressed by the IO that no cognizable offence has been made out."
“This aspect has been correctly analysed by the learned Sessions Court in its revisional jurisdiction. In this view of the matter, I find no merit in the petition and the same is dismissed,” the court said.
Advocate Dhruv Dwivedi appeared for the petitioner. ASC Rahul Tyagi represented State.
Title: RAVINDER LAL AIRI v. S.SHALU CONSTRUCTION PVT. LTD AND ORS.
|
The Delhi High Court has observed that a revision petition filed against an order directing registration of FIR is maintainable as such an order is not an interlocutory order. The accused has a valuable right to be heard, said the court.
Justice Jasmeet Singh said the registration of FIR affects the fundamental right and freedom of an accused. The person can be summoned for investigation, arrested without warrants for allegations of cognizable offences, the court observed.
“Therefore, an order directing registration of FIR u/s 156(3) Cr.P.C. is not an interlocutory order and the revision petition against the same would be maintainable as the accused has a valuable right to be heard,” Justice Singh said.
The court made the observations while dismissing a plea moved by Ravinder Lal Airi seeking to restore an order passed by ACMM court on January 1, 2020 directing registration of FIR on his application under Section 156(3) CrPC.
Airi challenged an order passed by the Sessions Court which held that the revision petition against ACMM order was maintainable and remanded the matter back to ACMM court to hear it afresh and take a reasoned decision.
The petitioner’s counsel submitted that the order directing registration of FIR is an interlocutory order.
Reliance was placed on the judgment of Gujarat High Court in Parmar Rameshchandra Ganpatray & Ors. v. State of Gujarat & Ors. wherein it was held that an order of the Magistrate rejecting an application for registration of a case is not an "interlocutory order" and such an order is amenable to the remedy of criminal revision.
The counsel also relied on the judgment passed by Allahabad High Court in Father Thomas v. State of U.P. & Ors. wherein it was observed that the direction for investigation passed by the Magistrate is purely interlocutory in nature and the bar under Section 397(2) CrPC to entertain a criminal revision cannot be circumvented.
Disagreeing with the two judgments, Justice Singh referred to a ruling of a co-ordinate bench in Nishu Wadhwa v. Siddharth Wadhwa & Anr. which held that an order dismissing or allowing an application under Section 156 (3) Cr.P.C. is not an interlocutory order and a revision petition against the same is maintainable.
The court said the ATR was not considered by the ACMM. The order passed by the magistrate does not reflect "application of mind as to why and how the ATR has been considered and the reasons as to why the learned MM has not agreed with the opinion expressed by the IO that no cognizable offence has been made out."
“This aspect has been correctly analysed by the learned Sessions Court in its revisional jurisdiction. In this view of the matter, I find no merit in the petition and the same is dismissed,” the court said.
Advocate Dhruv Dwivedi appeared for the petitioner. ASC Rahul Tyagi represented State.
Title: RAVINDER LAL AIRI v. S.SHALU CONSTRUCTION PVT. LTD AND ORS.
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The State of Maharashtra & Anr. … Respondents
Mr. Rahul Kadam for the applicant.
Mr. R.M. Pethe, APP for respondent no.1/State
Ms. Anjali Patil for respondent no.2.
Mr. Ashish Kumar i/by ALJ & Partners for respondent
no.3.
1. The applicant is challenging order dated 27th November,
2021 passed by the learned Metropolitan Magistrate, 64 th Court
Esplanade, Mumbai passed on an Application filed below Exhibit 7
in Criminal Case No.347/PW/2018.
2. The applicant who has been informant filed an application
for intervention before the learned Magistrate. The applicant
sought audience before the decision in discharge application filed
by the accused. The said application has been contested by the
accused No.2 by filing reply stating that the applicant has no right
to file such application.
3. The learned Magistrate rejected the application holding that
the applicant has not sought permission under sections 301 and
302 of the Code of Criminal Procedure,1973.
4. On perusal of the application, the applicant in paragraph 6
and 7 stated as under :-
“6. The applicant states that if the discharge application is
heard and decided without giving audience to the first
informant/victim, the same would cause serious prejudice to
the rights of the first informant/victim.
7. Even otherwise, if the discharge application comes to
be allowed, it would virtually be the end of the prosecution
and the same would amount to quashing of the entire
offense. Therefore, in such a situation, it is mandatory to
give audience to the informant/victim as per law laid down
by the Supreme Court and by the Bombay High Court.”
5. On perusal of clauses 6 and 7, in my opinion, the said
averments constitute seeking permission under Section 302 of the
Code of Criminal Procedure Code, 1973.
6. The reliance placed on judgment of Single Judge of the High
Court in Criminal Writ Petition No. 3705 of 2018 (Prakash
C. Sheth v. The State of Maharashtra & Anr.) decided on 14th
February 2020 is concerned, in my opinion, the learned
Magistrate ought to have allowed the application relying on the
observation made by this Court in the case of Prakash Sheth
(supra). This Court in the case of Prakash Sheth (supra) has
held that the first informant is entitled for hearing in Revision
Application claiming discharge by the accused. The said judgment
has been distinguished by the learned Magistrate holding that at
the stage of revision the first informant is entitled to be heard.
7. In my opinion, the interpretation adopted by the learned
Magistrate is misplaced. If the judgment of the learned Single
Judge of this Court is considered as a whole, it is clear that locus
of the first informant has been considered by this Court and has
held that the person being first informant is entitled to the
opportunity of hearing.
8. Therefore, in my opinion, the learned Magistrate ought to
have allowed the application for intervention filed by the
applicant. Hence, following order:
The application dated 29th February 2020 filed by the
applicant below Exhibit 7 in Criminal Case No.347/PW/2018 is
allowed.
9. Rule. Rule made is absolute in above terms. No costs.
|
The Bombay High Court has reiterated that a first informant has a right to audience in the discharge application filed by the accused before the Court.
To observe thus, the bench of Justice Amit Borkar relied upon the High Court's 2020 ruling in the case of Prakash C. Sheth vs The State Of Maharashtra And Anr, wherein it was held that the first informant is entitled to hearing in Revision Application claiming discharge by the accused.
The case in brief
In this case, the applicant (informant) filed an application before the Magistrate's court (Metropolitan Magistrate, 64th Court Esplanade, Mumbai) seeking an audience in the discharge application filed by the accused. The said application was contested by the accused No.2 by arguing that the applicant has no right to file such an application.
The Magistrate rejected the application holding that the applicant had not sought the required permission from the Court under sections 301 (Appearance by Public Prosecutors) and 302 (Permission to conduct the prosecution) of the Code of Criminal Procedure,1973.
Pursuant to this, the applicant/informant challenged the order of the Magistrate before the High Court by way of filing the instant criminal revision application.
Having heard the parties, the Court perused the application filed by the applicant/informant and noted that the averments made therein constituted seeking permission under Section 302 of the Code of Criminal Procedure Code, 1973.
The Court also noted that the Magistrate court had distinguished the ruling in the case of Prakash C. Sheth (supra) by holding that it is at the stage of revision that the first informant is entitled to be heard.
However, the Court rejected this interpretation of the Court and further, referring to HC's judgment in the case of Prakash C. Sheth (supra), it noted that the Magistrate ought to have allowed the application filed by the informant.
"If the judgment of the learned Single Judge of this Court is considered as a whole, it is clear that locus of the first informant has been considered by this Court and has held that the person being the first informant is entitled to the opportunity of hearing. 8. Therefore, in my opinion, the learned Magistrate ought to have allowed the application for intervention filed by the applicant," the Court remarked as it allowed the application.
Case title - Prakash C. Sheth v. The State of Maharashtra & Anr. [CRIMINAL REVISION APPLICATION NO.60 OF 2022]
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The State of Maharashtra & Anr. … Respondents
Mr. Rahul Kadam for the applicant.
Mr. R.M. Pethe, APP for respondent no.1/State
Ms. Anjali Patil for respondent no.2.
Mr. Ashish Kumar i/by ALJ & Partners for respondent
no.3.
1. The applicant is challenging order dated 27th November,
2021 passed by the learned Metropolitan Magistrate, 64 th Court
Esplanade, Mumbai passed on an Application filed below Exhibit 7
in Criminal Case No.347/PW/2018.
2. The applicant who has been informant filed an application
for intervention before the learned Magistrate. The applicant
sought audience before the decision in discharge application filed
by the accused. The said application has been contested by the
accused No.2 by filing reply stating that the applicant has no right
to file such application.
3. The learned Magistrate rejected the application holding that
the applicant has not sought permission under sections 301 and
302 of the Code of Criminal Procedure,1973.
4. On perusal of the application, the applicant in paragraph 6
and 7 stated as under :-
“6. The applicant states that if the discharge application is
heard and decided without giving audience to the first
informant/victim, the same would cause serious prejudice to
the rights of the first informant/victim.
7. Even otherwise, if the discharge application comes to
be allowed, it would virtually be the end of the prosecution
and the same would amount to quashing of the entire
offense. Therefore, in such a situation, it is mandatory to
give audience to the informant/victim as per law laid down
by the Supreme Court and by the Bombay High Court.”
5. On perusal of clauses 6 and 7, in my opinion, the said
averments constitute seeking permission under Section 302 of the
Code of Criminal Procedure Code, 1973.
6. The reliance placed on judgment of Single Judge of the High
Court in Criminal Writ Petition No. 3705 of 2018 (Prakash
C. Sheth v. The State of Maharashtra & Anr.) decided on 14th
February 2020 is concerned, in my opinion, the learned
Magistrate ought to have allowed the application relying on the
observation made by this Court in the case of Prakash Sheth
(supra). This Court in the case of Prakash Sheth (supra) has
held that the first informant is entitled for hearing in Revision
Application claiming discharge by the accused. The said judgment
has been distinguished by the learned Magistrate holding that at
the stage of revision the first informant is entitled to be heard.
7. In my opinion, the interpretation adopted by the learned
Magistrate is misplaced. If the judgment of the learned Single
Judge of this Court is considered as a whole, it is clear that locus
of the first informant has been considered by this Court and has
held that the person being first informant is entitled to the
opportunity of hearing.
8. Therefore, in my opinion, the learned Magistrate ought to
have allowed the application for intervention filed by the
applicant. Hence, following order:
The application dated 29th February 2020 filed by the
applicant below Exhibit 7 in Criminal Case No.347/PW/2018 is
allowed.
9. Rule. Rule made is absolute in above terms. No costs.
|
The State of Maharashtra & Anr. … Respondents
Mr. Rahul Kadam for the applicant.
Mr. R.M. Pethe, APP for respondent no.1/State
Ms. Anjali Patil for respondent no.2.
Mr. Ashish Kumar i/by ALJ & Partners for respondent
no.3.
1. The applicant is challenging order dated 27th November,
2021 passed by the learned Metropolitan Magistrate, 64 th Court
Esplanade, Mumbai passed on an Application filed below Exhibit 7
in Criminal Case No.347/PW/2018.
2. The applicant who has been informant filed an application
for intervention before the learned Magistrate. The applicant
sought audience before the decision in discharge application filed
by the accused. The said application has been contested by the
accused No.2 by filing reply stating that the applicant has no right
to file such application.
3. The learned Magistrate rejected the application holding that
the applicant has not sought permission under sections 301 and
302 of the Code of Criminal Procedure,1973.
4. On perusal of the application, the applicant in paragraph 6
and 7 stated as under :-
“6. The applicant states that if the discharge application is
heard and decided without giving audience to the first
informant/victim, the same would cause serious prejudice to
the rights of the first informant/victim.
7. Even otherwise, if the discharge application comes to
be allowed, it would virtually be the end of the prosecution
and the same would amount to quashing of the entire
offense. Therefore, in such a situation, it is mandatory to
give audience to the informant/victim as per law laid down
by the Supreme Court and by the Bombay High Court.”
5. On perusal of clauses 6 and 7, in my opinion, the said
averments constitute seeking permission under Section 302 of the
Code of Criminal Procedure Code, 1973.
6. The reliance placed on judgment of Single Judge of the High
Court in Criminal Writ Petition No. 3705 of 2018 (Prakash
C. Sheth v. The State of Maharashtra & Anr.) decided on 14th
February 2020 is concerned, in my opinion, the learned
Magistrate ought to have allowed the application relying on the
observation made by this Court in the case of Prakash Sheth
(supra). This Court in the case of Prakash Sheth (supra) has
held that the first informant is entitled for hearing in Revision
Application claiming discharge by the accused. The said judgment
has been distinguished by the learned Magistrate holding that at
the stage of revision the first informant is entitled to be heard.
7. In my opinion, the interpretation adopted by the learned
Magistrate is misplaced. If the judgment of the learned Single
Judge of this Court is considered as a whole, it is clear that locus
of the first informant has been considered by this Court and has
held that the person being first informant is entitled to the
opportunity of hearing.
8. Therefore, in my opinion, the learned Magistrate ought to
have allowed the application for intervention filed by the
applicant. Hence, following order:
The application dated 29th February 2020 filed by the
applicant below Exhibit 7 in Criminal Case No.347/PW/2018 is
allowed.
9. Rule. Rule made is absolute in above terms. No costs.
|
The Bombay High Court has reiterated that a first informant has a right to audience in the discharge application filed by the accused before the Court.
To observe thus, the bench of Justice Amit Borkar relied upon the High Court's 2020 ruling in the case of Prakash C. Sheth vs The State Of Maharashtra And Anr, wherein it was held that the first informant is entitled to hearing in Revision Application claiming discharge by the accused.
The case in brief
In this case, the applicant (informant) filed an application before the Magistrate's court (Metropolitan Magistrate, 64th Court Esplanade, Mumbai) seeking an audience in the discharge application filed by the accused. The said application was contested by the accused No.2 by arguing that the applicant has no right to file such an application.
The Magistrate rejected the application holding that the applicant had not sought the required permission from the Court under sections 301 (Appearance by Public Prosecutors) and 302 (Permission to conduct the prosecution) of the Code of Criminal Procedure,1973.
Pursuant to this, the applicant/informant challenged the order of the Magistrate before the High Court by way of filing the instant criminal revision application.
Having heard the parties, the Court perused the application filed by the applicant/informant and noted that the averments made therein constituted seeking permission under Section 302 of the Code of Criminal Procedure Code, 1973.
The Court also noted that the Magistrate court had distinguished the ruling in the case of Prakash C. Sheth (supra) by holding that it is at the stage of revision that the first informant is entitled to be heard.
However, the Court rejected this interpretation of the Court and further, referring to HC's judgment in the case of Prakash C. Sheth (supra), it noted that the Magistrate ought to have allowed the application filed by the informant.
"If the judgment of the learned Single Judge of this Court is considered as a whole, it is clear that locus of the first informant has been considered by this Court and has held that the person being the first informant is entitled to the opportunity of hearing. 8. Therefore, in my opinion, the learned Magistrate ought to have allowed the application for intervention filed by the applicant," the Court remarked as it allowed the application.
Case title - Prakash C. Sheth v. The State of Maharashtra & Anr. [CRIMINAL REVISION APPLICATION NO.60 OF 2022]
|
The Bombay High Court has reiterated that a first informant has a right to audience in the discharge application filed by the accused before the Court.
To observe thus, the bench of Justice Amit Borkar relied upon the High Court's 2020 ruling in the case of Prakash C. Sheth vs The State Of Maharashtra And Anr, wherein it was held that the first informant is entitled to hearing in Revision Application claiming discharge by the accused.
The case in brief
In this case, the applicant (informant) filed an application before the Magistrate's court (Metropolitan Magistrate, 64th Court Esplanade, Mumbai) seeking an audience in the discharge application filed by the accused. The said application was contested by the accused No.2 by arguing that the applicant has no right to file such an application.
The Magistrate rejected the application holding that the applicant had not sought the required permission from the Court under sections 301 (Appearance by Public Prosecutors) and 302 (Permission to conduct the prosecution) of the Code of Criminal Procedure,1973.
Pursuant to this, the applicant/informant challenged the order of the Magistrate before the High Court by way of filing the instant criminal revision application.
Having heard the parties, the Court perused the application filed by the applicant/informant and noted that the averments made therein constituted seeking permission under Section 302 of the Code of Criminal Procedure Code, 1973.
The Court also noted that the Magistrate court had distinguished the ruling in the case of Prakash C. Sheth (supra) by holding that it is at the stage of revision that the first informant is entitled to be heard.
However, the Court rejected this interpretation of the Court and further, referring to HC's judgment in the case of Prakash C. Sheth (supra), it noted that the Magistrate ought to have allowed the application filed by the informant.
"If the judgment of the learned Single Judge of this Court is considered as a whole, it is clear that locus of the first informant has been considered by this Court and has held that the person being the first informant is entitled to the opportunity of hearing. 8. Therefore, in my opinion, the learned Magistrate ought to have allowed the application for intervention filed by the applicant," the Court remarked as it allowed the application.
Case title - Prakash C. Sheth v. The State of Maharashtra & Anr. [CRIMINAL REVISION APPLICATION NO.60 OF 2022]
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vil Appeal No. 3 108 of 1989.
From the Judgment and Order dated 27.1.86 of the Punjab and Haryana High Court in R.S.A. No. 1510 of 1977.
Harbans Lal and Ashok K. Mahajan for the Appellant.
Jitender Sharma for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
We grant leave in the Special Leave Peri 612 tion and proceed to dispose of the appeal on the merits after hearing both sides.
The appellant is the successor in interest of the mort gagor of the suit property.
The suit property was mortgaged on 22.5.
In the normal course the suit for redemption should have been filed on or before 22.5.
1946, the limita tion for such a suit being 60 years under the Limitation Act, 1908.
The appellant, however, filed the suit for re demption only on 28.12.
He sought to meet the plea of limitation by urging that the son of the original mortgagee, while selling the property on 1.11.19 13, had specifically acknowledged the right of the mortgagor to redeem the property.
It was claimed that this acknowledgment constitut ed a fresh starting point for computing the period of limi tation.
If the plea of the mortgagor were right and the Limita tion Act, 1908, had continued to be operative, the suit for redemption could have been filed on or before the 1st of November, 1973.
However, in the meantime the replaced the of 1908.
The period of limitation for a suit for redemption was reduced under the new Act to 30 years.
Section 30 of the Act, however, provid ed as follows: section 30.
Provision for suits, etc., for which the prescribed period is shorter than the period prescribed by the Indian Limitation Act, 1908.
Notwithstanding anything contained in this Act (a) any suit for which the period of limita tion is shorter than the period of limitation prescribed by the Indian Limitation Act, 1908, may be instituted within a period of seven years next after the commencement of this Act or within the period prescribed for such suit by the Indian Limitation Act, 1908, whichever period expires earlier: By virtue of this provision, the suit for redemption could have been filed, if the appellant 's plea that the sale deed dated 1.11.1913 constituted a fresh starting point for computation of the period of limitation is accepted, on or before the 1st of January, 1971, having regard to the fact that the came into force on 1.1.1964.
613 The first question for consideration in this appeal is whether the sale deed of 1.11.19 13 contained an acknowl edgement by the original mortgagee of a subsisting right of redemption on the part of the mortgagor as on the date of the sale deed viz. 1.11.19 13.
The sale deed contained the following recitals: "Now I of my own accord have sold all my mortgagee rights along with the original mortgage consideration and interest which according to the terms of the aforesaid mort gage deed has accrued and is payable to the instant vendor . .
The rights and interest regarding recovery of original mort gage money and interest according to mortgage deeds executed by Jangi Khan original mortga gor deceased and redemption of the mortgaged land which hence to fore vested in the instant vendor stand vested in the purchaser . . (underlining by us) On behalf of the appellants it is submitted that the words extracted above clearly contained a specific acknowl edgement by the mortgagee of a subsisting right of redemp tion in the mortgagor.
On the other hand.
for the respond ents, it is contended and this contention was accepted by the High Court that the recitals mentioned above do not serve as an acknowledgment.
The High Court observed: "The mortgagee Mool Raj gave the description of the mortgage only with a view to showing his status but nowhere did he acknowledge his liability for redemption of the mortgage.
According to the recital in the deed, whatever rights as a mortgagee he had in the suit land were transferred to the vendee.
There was nothing more than this.
The right of the mortgagor to redeem the land, and his liabili ty to redeem the same, was nowhere acknowl edged.
" The respondents strongly rely on this finding and also rely on the decision of this court in Tilak Ram vs Nathu, AIR 1967 S.C. 935.
We are of the opinion that the High Court erred in accepting the above contention.
It is true, as pointed out in Tilak Ram vs Nathu, that the period of limitation cannot be extended by a mere passing recital regarding the factum of the mortgage but that the statement on which the plea of an acknowledgement is based must relate to a subsisting liability.
The words used must indicate the jural relation ship between 614 the parties and it must appear that such a statement is made with the intention of admitting such jural relation ship.
But, in our opinion, the recitals in the sale deed on 1.11.1913 fulfil_ the above requirements.
The fact of Nanak Chand having obtained a mortgage with possession had already been recited in an earlier part of the sale deed.
The pass sages in the sale deed, which have been extracted by us above, contain two specific recitals.
The first is that "the original consideration and interest under had accrued and Was payable to the instant vendor.
" These words acknowledge that the mortgage had not been redeemed and that the mort gage moneys remained outstanding to the mortgagee From the mortgagor as on the ' date of the sale deed.
The second recital is even more specific.
It says that what stands transferred to the purchaser is not only the fight of the mortgagee for recovering the principal amounts and interest according to the mortgage deed (which, as earlier stated, still remained outstanding) but also "the rights and inter est" regarding the redemption of the mortgaged land.
These words are, of course, a little inappropriate because the right of redemption is in the mortgagor and not in the mortgagee.
But, read as a whole, the second sentence we have quoted here from the sale deed clearly manifests an inten tion on the part of the mortgagee to acknowledge that his right to recover the moneys under the mortgage deed as well as his liability to have the property redeemed by the mort gagor in the event of his paying off the moneys due under the instrument both stand vested in the purchaser.
We are of the opinion that it is not correct to treat the recitals in the document as a mere narration of the previous mortgage that had been created on the property.
The words spell out a clear intention that the moneys due under the mortgage still remained unpaid and also that the mortgagor had a subsisting right of redemption which he could enforce against the mortgagee.
In this view of the matter the contention on behalf of the appellant that the recitals in the document of 1.11.1913 constituted an acknowledgement of liability for redemption within the meaning of section 19 of the Limita tion Act deserves to be accepted.
On behalf of the respondents it is submitted that, even if the above position is accepted, the suit should have been filed on or before 1.4.1971 but that it was actually insti tuted only on 18.4.1973.
Our attention is drawn to the cause title of the suit in the trial court where the suit is described as Case Civil Suit No. 204 of 1973 and the date of institution is set out as 28.12.1968/18.4.1973.
It is sub mitted that perhaps the suit had been flied on 28.12.1968 with defects and that the defects had been rectified subse quently so that the suit can be properly said to have been instituted only on 18.4.1973.
It has been numbered 615 only as a suit of 1973.
It is, therefore, contended that in any event the suit was barred by limitation being beyond 1.4.1971.
This contention is without force.
This point does not appear to have been specifically taken either in the trial court or in the first appellate court.
On the other hand in the trial court the plaintiff had adverted to the provisions of the Limitation Act and the position that the suit should have been filed within 7 years of the applica tion of the new Act and urged that the suit was within time.
This contention was accepted by the trial court.
It could not have been so accepted if the suit had in fact been instituted Only in 1973 as at present submitted.
That apart the High Court in the course of its judgment has pointed out that the present suit had been filed on 28th of December, 1968.
In this state of the record we have to proceed on the basis that the suit had been filed on 28th of December, 1968, and, therefore hold, for the reasons stated earlier, it had been filed in time.
For the reasons above mentioned, we set aside the order of the High Court confirming the order of the Additional District Judge and restore the decree for redemption passed by the trial court.
We would only like to clarify that there were two mortgage deeds the redemption of which had been sought by the plaintiff in the suit.
We are concerned in this appeal only with the property mortgaged under the deed of mortgage dated 22.5.1986 by Jangi Khan in favour of Nanak Chand and sold on 1.11.1913 by Mool Raj, son of Nanak Chand, to the predecessor in interest of the present respondent.
The concurrent findings of the three courts in respect of the other mortgage are not, in any way, disturbed by our judgment.
The appeal, therefore, stands allowed and the appellant will be entitled to his costs.
R.S.S. Appeal allowed.
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The appellant is the successor in interest of the mort gagor of the suit property.
The suit property was mortgaged on 22.5.1886.
In the normal course the suit for redemption should have been filed on or before 22.5.1946, the limita tion for such a suit being 60 years under the Limitation Act, 1906.
The appellant, however, filed the suit for re demption only on 28.12.1968.
The defence to the plea of limitation urged was that the son of the original mortgagee, while selling the property on 1.11.
1913, had specifically acknowledged the right of the mortgagor to redeem the property.
It was claimed that this acknowledgment constitut ed a fresh starting point for computing the period of limi tation.
The Trial Court accepted the plea and granted decree for redemption.
The Additional District Judge however ac cepted the appeal of the respondents.
The High Court, in appeal, confirmed the order of the Additional District Judge and held that the sale deed had nowhere acknowledged the right of the mortgagor to redeem the land.
Before this Court, it was contended on behalf of the appellant that the recital in the sale deed clearly con tained a specific acknowledgment by the mortgagee of a subsisting right of redemption in the mortgagor.
On the other hand, it was contended that the said recital did not serve as an acknowledgment.
It was further urged by the respondents that even otherwise the suit should have been filed within 7 years of the coming into force of the Limita tion Act, 1963, i.e., on or before 1.4.1971, and that it was actually instituted only on 18.4.1973.
Allowing the appeal, setting aside the orders of the Additional District Judge and the High Court, and restoring the decree for redemption passed by the Trial Court, this Court, 611 HELD: (1) The period of limitation cannot be extended by a mere passing recital regarding the factum of the mortgage but the statement on which the plea of an acknowledgment is based must relate to a subsisting liability.
The words used must indicate the jural relationship between the parties and it must appear that such a statement is made with the inten tion of admitting such jural relationship.
[613G 6 14A] Tilak Ram vs Nathu, AIR 1967 S.C. 935, referred to.
(2) In the instant case, it is not correct to treat the recitals in the document as a mere narration of the previous mortgage that had been created on the property.
The words spell out a clear intention that the moneys due under the mortgage still remained unpaid and also that the mortgagor had a subsisting right of redemption which he could enforce against the mortgagee.
[614E F] (3) In the Trial Court the plaintiff appellant had adverted to the provisions of the and the position that the suit should have been filed within 7 years of the application of the new Act, and had urged that the suit was within time.
The Trial Court had accepted the contention of the plaintiff appellant on this point.
It could not have been so accepted if the suit had in fact been instituted only in 1973.
In the cause title of the suit in the Trial Court the date of institution is set out as 28.12.1968/18.4.1973.
This position does not appear to have been specifically challenged either in the Trial Court or in the first Appellate Court.
The High Court in its judgment has pointed out that the suit had been filed on 28th of December, 1968.
In this state of the record, this Court has to proceed on the basis that the suit had been filed on 28th of December, 1968 and therefore to hold that the suit had been filed in time.
[615B C]
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vil Appeal No. 3 108 of 1989.
From the Judgment and Order dated 27.1.86 of the Punjab and Haryana High Court in R.S.A. No. 1510 of 1977.
Harbans Lal and Ashok K. Mahajan for the Appellant.
Jitender Sharma for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
We grant leave in the Special Leave Peri 612 tion and proceed to dispose of the appeal on the merits after hearing both sides.
The appellant is the successor in interest of the mort gagor of the suit property.
The suit property was mortgaged on 22.5.
In the normal course the suit for redemption should have been filed on or before 22.5.
1946, the limita tion for such a suit being 60 years under the Limitation Act, 1908.
The appellant, however, filed the suit for re demption only on 28.12.
He sought to meet the plea of limitation by urging that the son of the original mortgagee, while selling the property on 1.11.19 13, had specifically acknowledged the right of the mortgagor to redeem the property.
It was claimed that this acknowledgment constitut ed a fresh starting point for computing the period of limi tation.
If the plea of the mortgagor were right and the Limita tion Act, 1908, had continued to be operative, the suit for redemption could have been filed on or before the 1st of November, 1973.
However, in the meantime the replaced the of 1908.
The period of limitation for a suit for redemption was reduced under the new Act to 30 years.
Section 30 of the Act, however, provid ed as follows: section 30.
Provision for suits, etc., for which the prescribed period is shorter than the period prescribed by the Indian Limitation Act, 1908.
Notwithstanding anything contained in this Act (a) any suit for which the period of limita tion is shorter than the period of limitation prescribed by the Indian Limitation Act, 1908, may be instituted within a period of seven years next after the commencement of this Act or within the period prescribed for such suit by the Indian Limitation Act, 1908, whichever period expires earlier: By virtue of this provision, the suit for redemption could have been filed, if the appellant 's plea that the sale deed dated 1.11.1913 constituted a fresh starting point for computation of the period of limitation is accepted, on or before the 1st of January, 1971, having regard to the fact that the came into force on 1.1.1964.
613 The first question for consideration in this appeal is whether the sale deed of 1.11.19 13 contained an acknowl edgement by the original mortgagee of a subsisting right of redemption on the part of the mortgagor as on the date of the sale deed viz. 1.11.19 13.
The sale deed contained the following recitals: "Now I of my own accord have sold all my mortgagee rights along with the original mortgage consideration and interest which according to the terms of the aforesaid mort gage deed has accrued and is payable to the instant vendor . .
The rights and interest regarding recovery of original mort gage money and interest according to mortgage deeds executed by Jangi Khan original mortga gor deceased and redemption of the mortgaged land which hence to fore vested in the instant vendor stand vested in the purchaser . . (underlining by us) On behalf of the appellants it is submitted that the words extracted above clearly contained a specific acknowl edgement by the mortgagee of a subsisting right of redemp tion in the mortgagor.
On the other hand.
for the respond ents, it is contended and this contention was accepted by the High Court that the recitals mentioned above do not serve as an acknowledgment.
The High Court observed: "The mortgagee Mool Raj gave the description of the mortgage only with a view to showing his status but nowhere did he acknowledge his liability for redemption of the mortgage.
According to the recital in the deed, whatever rights as a mortgagee he had in the suit land were transferred to the vendee.
There was nothing more than this.
The right of the mortgagor to redeem the land, and his liabili ty to redeem the same, was nowhere acknowl edged.
" The respondents strongly rely on this finding and also rely on the decision of this court in Tilak Ram vs Nathu, AIR 1967 S.C. 935.
We are of the opinion that the High Court erred in accepting the above contention.
It is true, as pointed out in Tilak Ram vs Nathu, that the period of limitation cannot be extended by a mere passing recital regarding the factum of the mortgage but that the statement on which the plea of an acknowledgement is based must relate to a subsisting liability.
The words used must indicate the jural relation ship between 614 the parties and it must appear that such a statement is made with the intention of admitting such jural relation ship.
But, in our opinion, the recitals in the sale deed on 1.11.1913 fulfil_ the above requirements.
The fact of Nanak Chand having obtained a mortgage with possession had already been recited in an earlier part of the sale deed.
The pass sages in the sale deed, which have been extracted by us above, contain two specific recitals.
The first is that "the original consideration and interest under had accrued and Was payable to the instant vendor.
" These words acknowledge that the mortgage had not been redeemed and that the mort gage moneys remained outstanding to the mortgagee From the mortgagor as on the ' date of the sale deed.
The second recital is even more specific.
It says that what stands transferred to the purchaser is not only the fight of the mortgagee for recovering the principal amounts and interest according to the mortgage deed (which, as earlier stated, still remained outstanding) but also "the rights and inter est" regarding the redemption of the mortgaged land.
These words are, of course, a little inappropriate because the right of redemption is in the mortgagor and not in the mortgagee.
But, read as a whole, the second sentence we have quoted here from the sale deed clearly manifests an inten tion on the part of the mortgagee to acknowledge that his right to recover the moneys under the mortgage deed as well as his liability to have the property redeemed by the mort gagor in the event of his paying off the moneys due under the instrument both stand vested in the purchaser.
We are of the opinion that it is not correct to treat the recitals in the document as a mere narration of the previous mortgage that had been created on the property.
The words spell out a clear intention that the moneys due under the mortgage still remained unpaid and also that the mortgagor had a subsisting right of redemption which he could enforce against the mortgagee.
In this view of the matter the contention on behalf of the appellant that the recitals in the document of 1.11.1913 constituted an acknowledgement of liability for redemption within the meaning of section 19 of the Limita tion Act deserves to be accepted.
On behalf of the respondents it is submitted that, even if the above position is accepted, the suit should have been filed on or before 1.4.1971 but that it was actually insti tuted only on 18.4.1973.
Our attention is drawn to the cause title of the suit in the trial court where the suit is described as Case Civil Suit No. 204 of 1973 and the date of institution is set out as 28.12.1968/18.4.1973.
It is sub mitted that perhaps the suit had been flied on 28.12.1968 with defects and that the defects had been rectified subse quently so that the suit can be properly said to have been instituted only on 18.4.1973.
It has been numbered 615 only as a suit of 1973.
It is, therefore, contended that in any event the suit was barred by limitation being beyond 1.4.1971.
This contention is without force.
This point does not appear to have been specifically taken either in the trial court or in the first appellate court.
On the other hand in the trial court the plaintiff had adverted to the provisions of the Limitation Act and the position that the suit should have been filed within 7 years of the applica tion of the new Act and urged that the suit was within time.
This contention was accepted by the trial court.
It could not have been so accepted if the suit had in fact been instituted Only in 1973 as at present submitted.
That apart the High Court in the course of its judgment has pointed out that the present suit had been filed on 28th of December, 1968.
In this state of the record we have to proceed on the basis that the suit had been filed on 28th of December, 1968, and, therefore hold, for the reasons stated earlier, it had been filed in time.
For the reasons above mentioned, we set aside the order of the High Court confirming the order of the Additional District Judge and restore the decree for redemption passed by the trial court.
We would only like to clarify that there were two mortgage deeds the redemption of which had been sought by the plaintiff in the suit.
We are concerned in this appeal only with the property mortgaged under the deed of mortgage dated 22.5.1986 by Jangi Khan in favour of Nanak Chand and sold on 1.11.1913 by Mool Raj, son of Nanak Chand, to the predecessor in interest of the present respondent.
The concurrent findings of the three courts in respect of the other mortgage are not, in any way, disturbed by our judgment.
The appeal, therefore, stands allowed and the appellant will be entitled to his costs.
R.S.S. Appeal allowed.
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vil Appeal No. 3 108 of 1989.
From the Judgment and Order dated 27.1.86 of the Punjab and Haryana High Court in R.S.A. No. 1510 of 1977.
Harbans Lal and Ashok K. Mahajan for the Appellant.
Jitender Sharma for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
We grant leave in the Special Leave Peri 612 tion and proceed to dispose of the appeal on the merits after hearing both sides.
The appellant is the successor in interest of the mort gagor of the suit property.
The suit property was mortgaged on 22.5.
In the normal course the suit for redemption should have been filed on or before 22.5.
1946, the limita tion for such a suit being 60 years under the Limitation Act, 1908.
The appellant, however, filed the suit for re demption only on 28.12.
He sought to meet the plea of limitation by urging that the son of the original mortgagee, while selling the property on 1.11.19 13, had specifically acknowledged the right of the mortgagor to redeem the property.
It was claimed that this acknowledgment constitut ed a fresh starting point for computing the period of limi tation.
If the plea of the mortgagor were right and the Limita tion Act, 1908, had continued to be operative, the suit for redemption could have been filed on or before the 1st of November, 1973.
However, in the meantime the replaced the of 1908.
The period of limitation for a suit for redemption was reduced under the new Act to 30 years.
Section 30 of the Act, however, provid ed as follows: section 30.
Provision for suits, etc., for which the prescribed period is shorter than the period prescribed by the Indian Limitation Act, 1908.
Notwithstanding anything contained in this Act (a) any suit for which the period of limita tion is shorter than the period of limitation prescribed by the Indian Limitation Act, 1908, may be instituted within a period of seven years next after the commencement of this Act or within the period prescribed for such suit by the Indian Limitation Act, 1908, whichever period expires earlier: By virtue of this provision, the suit for redemption could have been filed, if the appellant 's plea that the sale deed dated 1.11.1913 constituted a fresh starting point for computation of the period of limitation is accepted, on or before the 1st of January, 1971, having regard to the fact that the came into force on 1.1.1964.
613 The first question for consideration in this appeal is whether the sale deed of 1.11.19 13 contained an acknowl edgement by the original mortgagee of a subsisting right of redemption on the part of the mortgagor as on the date of the sale deed viz. 1.11.19 13.
The sale deed contained the following recitals: "Now I of my own accord have sold all my mortgagee rights along with the original mortgage consideration and interest which according to the terms of the aforesaid mort gage deed has accrued and is payable to the instant vendor . .
The rights and interest regarding recovery of original mort gage money and interest according to mortgage deeds executed by Jangi Khan original mortga gor deceased and redemption of the mortgaged land which hence to fore vested in the instant vendor stand vested in the purchaser . . (underlining by us) On behalf of the appellants it is submitted that the words extracted above clearly contained a specific acknowl edgement by the mortgagee of a subsisting right of redemp tion in the mortgagor.
On the other hand.
for the respond ents, it is contended and this contention was accepted by the High Court that the recitals mentioned above do not serve as an acknowledgment.
The High Court observed: "The mortgagee Mool Raj gave the description of the mortgage only with a view to showing his status but nowhere did he acknowledge his liability for redemption of the mortgage.
According to the recital in the deed, whatever rights as a mortgagee he had in the suit land were transferred to the vendee.
There was nothing more than this.
The right of the mortgagor to redeem the land, and his liabili ty to redeem the same, was nowhere acknowl edged.
" The respondents strongly rely on this finding and also rely on the decision of this court in Tilak Ram vs Nathu, AIR 1967 S.C. 935.
We are of the opinion that the High Court erred in accepting the above contention.
It is true, as pointed out in Tilak Ram vs Nathu, that the period of limitation cannot be extended by a mere passing recital regarding the factum of the mortgage but that the statement on which the plea of an acknowledgement is based must relate to a subsisting liability.
The words used must indicate the jural relation ship between 614 the parties and it must appear that such a statement is made with the intention of admitting such jural relation ship.
But, in our opinion, the recitals in the sale deed on 1.11.1913 fulfil_ the above requirements.
The fact of Nanak Chand having obtained a mortgage with possession had already been recited in an earlier part of the sale deed.
The pass sages in the sale deed, which have been extracted by us above, contain two specific recitals.
The first is that "the original consideration and interest under had accrued and Was payable to the instant vendor.
" These words acknowledge that the mortgage had not been redeemed and that the mort gage moneys remained outstanding to the mortgagee From the mortgagor as on the ' date of the sale deed.
The second recital is even more specific.
It says that what stands transferred to the purchaser is not only the fight of the mortgagee for recovering the principal amounts and interest according to the mortgage deed (which, as earlier stated, still remained outstanding) but also "the rights and inter est" regarding the redemption of the mortgaged land.
These words are, of course, a little inappropriate because the right of redemption is in the mortgagor and not in the mortgagee.
But, read as a whole, the second sentence we have quoted here from the sale deed clearly manifests an inten tion on the part of the mortgagee to acknowledge that his right to recover the moneys under the mortgage deed as well as his liability to have the property redeemed by the mort gagor in the event of his paying off the moneys due under the instrument both stand vested in the purchaser.
We are of the opinion that it is not correct to treat the recitals in the document as a mere narration of the previous mortgage that had been created on the property.
The words spell out a clear intention that the moneys due under the mortgage still remained unpaid and also that the mortgagor had a subsisting right of redemption which he could enforce against the mortgagee.
In this view of the matter the contention on behalf of the appellant that the recitals in the document of 1.11.1913 constituted an acknowledgement of liability for redemption within the meaning of section 19 of the Limita tion Act deserves to be accepted.
On behalf of the respondents it is submitted that, even if the above position is accepted, the suit should have been filed on or before 1.4.1971 but that it was actually insti tuted only on 18.4.1973.
Our attention is drawn to the cause title of the suit in the trial court where the suit is described as Case Civil Suit No. 204 of 1973 and the date of institution is set out as 28.12.1968/18.4.1973.
It is sub mitted that perhaps the suit had been flied on 28.12.1968 with defects and that the defects had been rectified subse quently so that the suit can be properly said to have been instituted only on 18.4.1973.
It has been numbered 615 only as a suit of 1973.
It is, therefore, contended that in any event the suit was barred by limitation being beyond 1.4.1971.
This contention is without force.
This point does not appear to have been specifically taken either in the trial court or in the first appellate court.
On the other hand in the trial court the plaintiff had adverted to the provisions of the Limitation Act and the position that the suit should have been filed within 7 years of the applica tion of the new Act and urged that the suit was within time.
This contention was accepted by the trial court.
It could not have been so accepted if the suit had in fact been instituted Only in 1973 as at present submitted.
That apart the High Court in the course of its judgment has pointed out that the present suit had been filed on 28th of December, 1968.
In this state of the record we have to proceed on the basis that the suit had been filed on 28th of December, 1968, and, therefore hold, for the reasons stated earlier, it had been filed in time.
For the reasons above mentioned, we set aside the order of the High Court confirming the order of the Additional District Judge and restore the decree for redemption passed by the trial court.
We would only like to clarify that there were two mortgage deeds the redemption of which had been sought by the plaintiff in the suit.
We are concerned in this appeal only with the property mortgaged under the deed of mortgage dated 22.5.1986 by Jangi Khan in favour of Nanak Chand and sold on 1.11.1913 by Mool Raj, son of Nanak Chand, to the predecessor in interest of the present respondent.
The concurrent findings of the three courts in respect of the other mortgage are not, in any way, disturbed by our judgment.
The appeal, therefore, stands allowed and the appellant will be entitled to his costs.
R.S.S. Appeal allowed.
|
The appellant is the successor in interest of the mort gagor of the suit property.
The suit property was mortgaged on 22.5.1886.
In the normal course the suit for redemption should have been filed on or before 22.5.1946, the limita tion for such a suit being 60 years under the Limitation Act, 1906.
The appellant, however, filed the suit for re demption only on 28.12.1968.
The defence to the plea of limitation urged was that the son of the original mortgagee, while selling the property on 1.11.
1913, had specifically acknowledged the right of the mortgagor to redeem the property.
It was claimed that this acknowledgment constitut ed a fresh starting point for computing the period of limi tation.
The Trial Court accepted the plea and granted decree for redemption.
The Additional District Judge however ac cepted the appeal of the respondents.
The High Court, in appeal, confirmed the order of the Additional District Judge and held that the sale deed had nowhere acknowledged the right of the mortgagor to redeem the land.
Before this Court, it was contended on behalf of the appellant that the recital in the sale deed clearly con tained a specific acknowledgment by the mortgagee of a subsisting right of redemption in the mortgagor.
On the other hand, it was contended that the said recital did not serve as an acknowledgment.
It was further urged by the respondents that even otherwise the suit should have been filed within 7 years of the coming into force of the Limita tion Act, 1963, i.e., on or before 1.4.1971, and that it was actually instituted only on 18.4.1973.
Allowing the appeal, setting aside the orders of the Additional District Judge and the High Court, and restoring the decree for redemption passed by the Trial Court, this Court, 611 HELD: (1) The period of limitation cannot be extended by a mere passing recital regarding the factum of the mortgage but the statement on which the plea of an acknowledgment is based must relate to a subsisting liability.
The words used must indicate the jural relationship between the parties and it must appear that such a statement is made with the inten tion of admitting such jural relationship.
[613G 6 14A] Tilak Ram vs Nathu, AIR 1967 S.C. 935, referred to.
(2) In the instant case, it is not correct to treat the recitals in the document as a mere narration of the previous mortgage that had been created on the property.
The words spell out a clear intention that the moneys due under the mortgage still remained unpaid and also that the mortgagor had a subsisting right of redemption which he could enforce against the mortgagee.
[614E F] (3) In the Trial Court the plaintiff appellant had adverted to the provisions of the and the position that the suit should have been filed within 7 years of the application of the new Act, and had urged that the suit was within time.
The Trial Court had accepted the contention of the plaintiff appellant on this point.
It could not have been so accepted if the suit had in fact been instituted only in 1973.
In the cause title of the suit in the Trial Court the date of institution is set out as 28.12.1968/18.4.1973.
This position does not appear to have been specifically challenged either in the Trial Court or in the first Appellate Court.
The High Court in its judgment has pointed out that the suit had been filed on 28th of December, 1968.
In this state of the record, this Court has to proceed on the basis that the suit had been filed on 28th of December, 1968 and therefore to hold that the suit had been filed in time.
[615B C]
|
The appellant is the successor in interest of the mort gagor of the suit property.
The suit property was mortgaged on 22.5.1886.
In the normal course the suit for redemption should have been filed on or before 22.5.1946, the limita tion for such a suit being 60 years under the Limitation Act, 1906.
The appellant, however, filed the suit for re demption only on 28.12.1968.
The defence to the plea of limitation urged was that the son of the original mortgagee, while selling the property on 1.11.
1913, had specifically acknowledged the right of the mortgagor to redeem the property.
It was claimed that this acknowledgment constitut ed a fresh starting point for computing the period of limi tation.
The Trial Court accepted the plea and granted decree for redemption.
The Additional District Judge however ac cepted the appeal of the respondents.
The High Court, in appeal, confirmed the order of the Additional District Judge and held that the sale deed had nowhere acknowledged the right of the mortgagor to redeem the land.
Before this Court, it was contended on behalf of the appellant that the recital in the sale deed clearly con tained a specific acknowledgment by the mortgagee of a subsisting right of redemption in the mortgagor.
On the other hand, it was contended that the said recital did not serve as an acknowledgment.
It was further urged by the respondents that even otherwise the suit should have been filed within 7 years of the coming into force of the Limita tion Act, 1963, i.e., on or before 1.4.1971, and that it was actually instituted only on 18.4.1973.
Allowing the appeal, setting aside the orders of the Additional District Judge and the High Court, and restoring the decree for redemption passed by the Trial Court, this Court, 611 HELD: (1) The period of limitation cannot be extended by a mere passing recital regarding the factum of the mortgage but the statement on which the plea of an acknowledgment is based must relate to a subsisting liability.
The words used must indicate the jural relationship between the parties and it must appear that such a statement is made with the inten tion of admitting such jural relationship.
[613G 6 14A] Tilak Ram vs Nathu, AIR 1967 S.C. 935, referred to.
(2) In the instant case, it is not correct to treat the recitals in the document as a mere narration of the previous mortgage that had been created on the property.
The words spell out a clear intention that the moneys due under the mortgage still remained unpaid and also that the mortgagor had a subsisting right of redemption which he could enforce against the mortgagee.
[614E F] (3) In the Trial Court the plaintiff appellant had adverted to the provisions of the and the position that the suit should have been filed within 7 years of the application of the new Act, and had urged that the suit was within time.
The Trial Court had accepted the contention of the plaintiff appellant on this point.
It could not have been so accepted if the suit had in fact been instituted only in 1973.
In the cause title of the suit in the Trial Court the date of institution is set out as 28.12.1968/18.4.1973.
This position does not appear to have been specifically challenged either in the Trial Court or in the first Appellate Court.
The High Court in its judgment has pointed out that the suit had been filed on 28th of December, 1968.
In this state of the record, this Court has to proceed on the basis that the suit had been filed on 28th of December, 1968 and therefore to hold that the suit had been filed in time.
[615B C]
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I.A. 8861/2022 (under Chapter XVA Rule 1 of the Delhi High Court
(Original Side) Rules, 2018 read with Section 151 of the CPC, by Plaintiffs)
1. Present application has been preferred on behalf of the Plaintiffs
under Chapter XVA Rule 1 of the Delhi High Court (Original Side) Rules,
2018 read with Section 151 CPC, 1908 for a summary judgment against the
3. Mr. Abhishek Saket, learned counsel accepts notice on behalf of the
Defendant and, on instructions, submits that Defendant has no objection to
the application being allowed and the suit being decreed.
4. Present suit was filed by the Plaintiffs against the Defendant seeking
to restrain the Defendant from infringing the Plaintiffs’ trademarks
‘HETTICH’ and the HETTICH logo , and and restraint
against passing off as well as for delivery up, damages, etc.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 1 of 7
5. It is averred by the Plaintiffs that the trade name and trademark
HETTICH owes its origin to its founding father, way back in the year 1888.
Plaintiffs are a part of diversified group of companies, having operations in
multiple countries across the world and engaged in manufacturing,
marketing and selling furniture, fittings, door hinges, runners, etc., which
has led to the said mark becoming distinctive of Plaintiffs’ products and
Plaintiffs’ immense goodwill and reputation has strongly vested in the
trademark HETTICH. Plaintiffs have multiple trademark registrations in the
trademarks in over 76 countries with the earliest registration in Germany
dating back to 1961.
6. The Defendant is a retail store engaged in sale of hardware products
including furniture fixtures and components. Plaintiffs learnt on 29.07.2014
that Defendant is engaged in selling counterfeit HETTICH products,
whereupon the present suit was filed.
7. On 01.09.2014, ex-parte ad interim injunction was granted by this
Court and a Local Commissioner was appointed, whose report bears
testimony to the fact that Defendant was in possession of counterfeit
products bearing the HETTICH trademarks.
8. Learned counsel for the Plaintiffs submits that in the written statement
filed by the Defendant, the only defence taken is that it has not engaged in
procuring or selling the counterfeit products but has sold those which were
available in the store believing them to be genuine products emanating from
the Plaintiffs. Since the Defendant has not sought to challenge the Plaintiffs’
exclusive rights over the HETTICH trademarks, it has no basis to resist a
decree of permanent injunction. In view of this, there remains no need to
record evidence to determine whether the Plaintiffs are the registered
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 2 of 7
proprietors of the HETTICH trademarks or whether the Plaintiffs are
entitled to a decree restraining the Defendant from selling counterfeit
products under the said trademark.
9. It is thus the contention of the learned counsel for the Plaintiffs that
the Defendant has no real prospect of defending the claims of infringement
and resisting a decree of permanent injunction against the Defendant and the
relief should be summarily decided in favour of the Plaintiffs.
10. I have heard the learned counsels for the parties and perused the
record.
11. Aptly encapsulated the case of Plaintiffs is that trademark and trade
name, ‘HETTICH’, owes its origin to Plaintiffs’ founding father, Mr. Karl-
Hettich, who had developed and mechanized the production of anchor
escapements for Black-Forest cuckoo clocks in the year 1888. This business
legacy was carried forward by Mr. August Hettich, who had developed a
production line for piano hinges in the year 1928. This led to the genesis of
the Plaintiffs’ business, which has expanded globally over the decades and
has become popular under the trade mark and trade name ‘HETTICH’.
12. Plaintiffs are part of a diversified group of companies, having
operations in multiple countries across the world and engaged in
manufacturing, marketing and selling furniture fittings like door hinges,
runners and drawers, hardware systems/items for modular kitchens,
residential and office segments, etc. Due to Plaintiffs’ immense success and
popularity across the globe, Plaintiffs are recognized as global leaders in
furniture fittings industry. Notably, each member of Plaintiffs’ group of
companies uses the mark ‘HETTICH’ as part of their corporate/trade name
and the trademark HETTICH is also extensively and prominently used on
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 3 of 7
and in association with, Plaintiffs’ furniture fittings. This has led to the mark
‘HETTICH’ becoming extremely distinctive of Plaintiffs’ products and
Plaintiffs’ immense goodwill and reputation has become strongly vested in
the trademark ‘HETTICH’. Due to long, continuous and extensive use of the
trademark HETTICH by the Plaintiffs in India, members of the public, on
coming across any product bearing identical or similar mark, are likely to be
confused into believing that the product emanates from the Plaintiffs or is
associated with them.
13. Apart from the common law rights vested in the Plaintiffs, Plaintiffs
and their group companies have also sought and secured multiple trademark
registrations for the trademark ‘HETTICH’ across the globe. The HETTICH
trademarks are registered in over 76 countries, with the earliest registration
in Germany dating back to 1961. In India, Plaintiff No. 1 is the registered
proprietor of the trademark HETTICH and its variants as mentioned in the
plaint.
14. Defendant in the present suit is a retail store, engaged in sale of
hardware products, including furniture fixtures and components. Plaintiffs
had appointed the Defendant as an authorized dealer in the early 2000s,
however, the business relationship was short-lived and on the date of the
filing of the suit and till date parties have not had any direct business
relationship.
15. On 29.07.2014, one of the employees of Plaintiff No. 2, on visiting
Defendant’s store noticed telescopic channels bearing Plaintiffs’ registered
mark ‘HETTICH’ which were being offered for sale, misrepresenting that
the product emanates from the Plaintiffs. As noted above, Defendant admits
selling the counterfeit products and the only defence put-forth is that it has
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 4 of 7
not procured or bought the counterfeit HETTICH products and is selling
genuine products emanating from the Plaintiffs. Further, Local
Commissioner’s report supports the stand of the Plaintiffs inasmuch as a unit
of counterfeit product was found in the premises of the Defendant, along
with invoices evidencing sales.
16. Learned counsel for the Defendant fairly and candidly states that
Defendant does not wish to contest the present application or the suit and is
willing to suffer an injunction. Even otherwise from the written statement
filed on behalf of the Defendant and the admission therein it is clear that
Defendant has no real prospect of defending the claims of infringement and
resisting a decree for permanent injunction.
17. Insofar as prayer for summary judgement is concerned, as per the
Commercial Courts Act, 2015 read with the Delhi High Court (Original
Side) Rules, 2018 and Rule 27 of the Delhi High Court Intellectual Property
Rights Division Rules, 2022, a summary judgement can be passed, if there is
no real prospect of the Defendant succeeding in the matter. In fact, under
Rule 27 of the IPD Rules even the filing of the application is not a sine qua
non. Rule 27 reads as under:-
In cases before the IPD, the Court may pass summary
judgment, without the requirement of filing a specific
application seeking summary judgment on principles akin to
those contained in Order XIIIA, Civil Procedure Code, 1908 as
applicable to commercial suits under the Commercial Courts
18. Practice Direction 9(h) of the Original Side Rules reads as follows:-
“9. In the case of commercial disputes, the Court may, inter-
alia, pass orders as it may think fit for the speedy disposal of
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 5 of 7
the suit or narrowing the controversy between the parties,
h) conduct a Case Management Hearing under Order XV-A
of the Code and as part of the said case management hearing-
ii. explore the possibility of deciding the dispute by a
summary judgment without a specific application for the said
purpose, on the basis of pleadings dispensing with the trial of
the suit on the questions of law or of facts on which the parties
19. I may also note that Order XV-A of CPC, as amended by the
Commercial Courts Act, 2015, permits the Court to conduct a case
management hearing even during the trial as is clear from perusal of Rules 5
and 6 thereof.
20. The legislative intent behind the provision of summary judgment is to
provide to a party a remedy to seek a decree, distinct from a judgment on
admission and one under Order XXXVII CPC. As held in various
judgments, the remedy of summary judgment is available where there is no
real prospect of the Defendant succeeding and there is no genuine issue for
trial. The test, therefore, is whether a fair and just determination of a dispute
is possible without trial and the necessary facts can be determined by
applying the legal principles rather than requiring the parties to incur
expenditure and spend time and resources to go through the rigours of a
trial. The standard is not really to see if the procedure for trial is exhaustive
and costly but to see if the Court has the confidence that the necessary facts
and the legal principles applied thereto would be enough to arrive at a just
decision.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 6 of 7
21. Considering that the Defendant is not contesting the suit and perusal
of the invoices and the report of the Local Commissioner confirms seizure
of goods which are counterfeit goods it is a fit case for this Court to pass a
summary judgement.
22. Accordingly, the present application is allowed and disposed of.
23. In view of the order passed in I.A. 8861/2022, the suit is decreed in
favour of the Plaintiffs and against the Defendant, in terms of para 32 of the
plaint.
24. Accordingly, Defendant, its partners or proprietors, its officers,
servants, agents and representatives, as the case may be, are permanently
restrained from selling any counterfeit product and/or any other related
goods under the trademark and trade name HETTICH and HETTICH Logo
or any other deceptively similar mark thereof, amounting to infringement of
Plaintiffs’ registered trademarks and passing off.
25. Order dated 01.09.2014 granting interim injunction is hereby
confirmed. The counterfeit goods handed over to the Defendant on
superdari by the Local Commissioner, shall be destroyed by the Defendant
as expeditiously as possible.
26. Registry is directed to draw up the Decree Sheet.
27. Suit is accordingly disposed of.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 7 of 7
|
The Delhi High Court has permanently restrained two manufacturers of the pharmaceutical products from manufacturing, selling, advertising and promoting the products using the trademark 'LOOZOUT', which was deceptively similar to the registered trademark 'LOOZ'.
Justice Jyoti Singh also restrained the manufacturers from manufacturing and selling products under any other mark which was identical or deceptively similar to 'LOOZ' or its variants so as to amount to infringement or passing off.
The suit was filed by Intas Pharmaceuticals Private Limited regarding trademark infringement by three defendants. While the suit was settled qua defendant no. 1, there was no appearance on behalf of the two manufacturers, who were defendant no. 2 and 3.
"Defendants No. 2 and 3 have chosen to stay away from the proceedings, despite service and thus there is no justification or reasonable explanation to adopt the infringing mark on the products manufactured by them," the Court noted.
The suit was accordingly decreed against the said manufacturers, Defendants No. 2 and 3, with costs of Rs. 2,00,000.
"Since the suit has been settled qua Defendant No.1 at an early stage of litigation, Plaintiff is entitled to refund of 50% of the Court Fees deposited by it, in accordance with provisions of Section 16A of the Court Fees Act, 1870 read with Section 89 CPC, 1908," the Court added.
The suit was accordingly disposed of.
Case Title: INTAS PHARMACEUTICALS PRIVATE LIMITED v. INTRA LIFE PRIVATE LIMITED & ORS.
|
I.A. 8861/2022 (under Chapter XVA Rule 1 of the Delhi High Court
(Original Side) Rules, 2018 read with Section 151 of the CPC, by Plaintiffs)
1. Present application has been preferred on behalf of the Plaintiffs
under Chapter XVA Rule 1 of the Delhi High Court (Original Side) Rules,
2018 read with Section 151 CPC, 1908 for a summary judgment against the
3. Mr. Abhishek Saket, learned counsel accepts notice on behalf of the
Defendant and, on instructions, submits that Defendant has no objection to
the application being allowed and the suit being decreed.
4. Present suit was filed by the Plaintiffs against the Defendant seeking
to restrain the Defendant from infringing the Plaintiffs’ trademarks
‘HETTICH’ and the HETTICH logo , and and restraint
against passing off as well as for delivery up, damages, etc.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 1 of 7
5. It is averred by the Plaintiffs that the trade name and trademark
HETTICH owes its origin to its founding father, way back in the year 1888.
Plaintiffs are a part of diversified group of companies, having operations in
multiple countries across the world and engaged in manufacturing,
marketing and selling furniture, fittings, door hinges, runners, etc., which
has led to the said mark becoming distinctive of Plaintiffs’ products and
Plaintiffs’ immense goodwill and reputation has strongly vested in the
trademark HETTICH. Plaintiffs have multiple trademark registrations in the
trademarks in over 76 countries with the earliest registration in Germany
dating back to 1961.
6. The Defendant is a retail store engaged in sale of hardware products
including furniture fixtures and components. Plaintiffs learnt on 29.07.2014
that Defendant is engaged in selling counterfeit HETTICH products,
whereupon the present suit was filed.
7. On 01.09.2014, ex-parte ad interim injunction was granted by this
Court and a Local Commissioner was appointed, whose report bears
testimony to the fact that Defendant was in possession of counterfeit
products bearing the HETTICH trademarks.
8. Learned counsel for the Plaintiffs submits that in the written statement
filed by the Defendant, the only defence taken is that it has not engaged in
procuring or selling the counterfeit products but has sold those which were
available in the store believing them to be genuine products emanating from
the Plaintiffs. Since the Defendant has not sought to challenge the Plaintiffs’
exclusive rights over the HETTICH trademarks, it has no basis to resist a
decree of permanent injunction. In view of this, there remains no need to
record evidence to determine whether the Plaintiffs are the registered
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 2 of 7
proprietors of the HETTICH trademarks or whether the Plaintiffs are
entitled to a decree restraining the Defendant from selling counterfeit
products under the said trademark.
9. It is thus the contention of the learned counsel for the Plaintiffs that
the Defendant has no real prospect of defending the claims of infringement
and resisting a decree of permanent injunction against the Defendant and the
relief should be summarily decided in favour of the Plaintiffs.
10. I have heard the learned counsels for the parties and perused the
record.
11. Aptly encapsulated the case of Plaintiffs is that trademark and trade
name, ‘HETTICH’, owes its origin to Plaintiffs’ founding father, Mr. Karl-
Hettich, who had developed and mechanized the production of anchor
escapements for Black-Forest cuckoo clocks in the year 1888. This business
legacy was carried forward by Mr. August Hettich, who had developed a
production line for piano hinges in the year 1928. This led to the genesis of
the Plaintiffs’ business, which has expanded globally over the decades and
has become popular under the trade mark and trade name ‘HETTICH’.
12. Plaintiffs are part of a diversified group of companies, having
operations in multiple countries across the world and engaged in
manufacturing, marketing and selling furniture fittings like door hinges,
runners and drawers, hardware systems/items for modular kitchens,
residential and office segments, etc. Due to Plaintiffs’ immense success and
popularity across the globe, Plaintiffs are recognized as global leaders in
furniture fittings industry. Notably, each member of Plaintiffs’ group of
companies uses the mark ‘HETTICH’ as part of their corporate/trade name
and the trademark HETTICH is also extensively and prominently used on
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 3 of 7
and in association with, Plaintiffs’ furniture fittings. This has led to the mark
‘HETTICH’ becoming extremely distinctive of Plaintiffs’ products and
Plaintiffs’ immense goodwill and reputation has become strongly vested in
the trademark ‘HETTICH’. Due to long, continuous and extensive use of the
trademark HETTICH by the Plaintiffs in India, members of the public, on
coming across any product bearing identical or similar mark, are likely to be
confused into believing that the product emanates from the Plaintiffs or is
associated with them.
13. Apart from the common law rights vested in the Plaintiffs, Plaintiffs
and their group companies have also sought and secured multiple trademark
registrations for the trademark ‘HETTICH’ across the globe. The HETTICH
trademarks are registered in over 76 countries, with the earliest registration
in Germany dating back to 1961. In India, Plaintiff No. 1 is the registered
proprietor of the trademark HETTICH and its variants as mentioned in the
plaint.
14. Defendant in the present suit is a retail store, engaged in sale of
hardware products, including furniture fixtures and components. Plaintiffs
had appointed the Defendant as an authorized dealer in the early 2000s,
however, the business relationship was short-lived and on the date of the
filing of the suit and till date parties have not had any direct business
relationship.
15. On 29.07.2014, one of the employees of Plaintiff No. 2, on visiting
Defendant’s store noticed telescopic channels bearing Plaintiffs’ registered
mark ‘HETTICH’ which were being offered for sale, misrepresenting that
the product emanates from the Plaintiffs. As noted above, Defendant admits
selling the counterfeit products and the only defence put-forth is that it has
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 4 of 7
not procured or bought the counterfeit HETTICH products and is selling
genuine products emanating from the Plaintiffs. Further, Local
Commissioner’s report supports the stand of the Plaintiffs inasmuch as a unit
of counterfeit product was found in the premises of the Defendant, along
with invoices evidencing sales.
16. Learned counsel for the Defendant fairly and candidly states that
Defendant does not wish to contest the present application or the suit and is
willing to suffer an injunction. Even otherwise from the written statement
filed on behalf of the Defendant and the admission therein it is clear that
Defendant has no real prospect of defending the claims of infringement and
resisting a decree for permanent injunction.
17. Insofar as prayer for summary judgement is concerned, as per the
Commercial Courts Act, 2015 read with the Delhi High Court (Original
Side) Rules, 2018 and Rule 27 of the Delhi High Court Intellectual Property
Rights Division Rules, 2022, a summary judgement can be passed, if there is
no real prospect of the Defendant succeeding in the matter. In fact, under
Rule 27 of the IPD Rules even the filing of the application is not a sine qua
non. Rule 27 reads as under:-
In cases before the IPD, the Court may pass summary
judgment, without the requirement of filing a specific
application seeking summary judgment on principles akin to
those contained in Order XIIIA, Civil Procedure Code, 1908 as
applicable to commercial suits under the Commercial Courts
18. Practice Direction 9(h) of the Original Side Rules reads as follows:-
“9. In the case of commercial disputes, the Court may, inter-
alia, pass orders as it may think fit for the speedy disposal of
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 5 of 7
the suit or narrowing the controversy between the parties,
h) conduct a Case Management Hearing under Order XV-A
of the Code and as part of the said case management hearing-
ii. explore the possibility of deciding the dispute by a
summary judgment without a specific application for the said
purpose, on the basis of pleadings dispensing with the trial of
the suit on the questions of law or of facts on which the parties
19. I may also note that Order XV-A of CPC, as amended by the
Commercial Courts Act, 2015, permits the Court to conduct a case
management hearing even during the trial as is clear from perusal of Rules 5
and 6 thereof.
20. The legislative intent behind the provision of summary judgment is to
provide to a party a remedy to seek a decree, distinct from a judgment on
admission and one under Order XXXVII CPC. As held in various
judgments, the remedy of summary judgment is available where there is no
real prospect of the Defendant succeeding and there is no genuine issue for
trial. The test, therefore, is whether a fair and just determination of a dispute
is possible without trial and the necessary facts can be determined by
applying the legal principles rather than requiring the parties to incur
expenditure and spend time and resources to go through the rigours of a
trial. The standard is not really to see if the procedure for trial is exhaustive
and costly but to see if the Court has the confidence that the necessary facts
and the legal principles applied thereto would be enough to arrive at a just
decision.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 6 of 7
21. Considering that the Defendant is not contesting the suit and perusal
of the invoices and the report of the Local Commissioner confirms seizure
of goods which are counterfeit goods it is a fit case for this Court to pass a
summary judgement.
22. Accordingly, the present application is allowed and disposed of.
23. In view of the order passed in I.A. 8861/2022, the suit is decreed in
favour of the Plaintiffs and against the Defendant, in terms of para 32 of the
plaint.
24. Accordingly, Defendant, its partners or proprietors, its officers,
servants, agents and representatives, as the case may be, are permanently
restrained from selling any counterfeit product and/or any other related
goods under the trademark and trade name HETTICH and HETTICH Logo
or any other deceptively similar mark thereof, amounting to infringement of
Plaintiffs’ registered trademarks and passing off.
25. Order dated 01.09.2014 granting interim injunction is hereby
confirmed. The counterfeit goods handed over to the Defendant on
superdari by the Local Commissioner, shall be destroyed by the Defendant
as expeditiously as possible.
26. Registry is directed to draw up the Decree Sheet.
27. Suit is accordingly disposed of.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 7 of 7
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I.A. 8861/2022 (under Chapter XVA Rule 1 of the Delhi High Court
(Original Side) Rules, 2018 read with Section 151 of the CPC, by Plaintiffs)
1. Present application has been preferred on behalf of the Plaintiffs
under Chapter XVA Rule 1 of the Delhi High Court (Original Side) Rules,
2018 read with Section 151 CPC, 1908 for a summary judgment against the
3. Mr. Abhishek Saket, learned counsel accepts notice on behalf of the
Defendant and, on instructions, submits that Defendant has no objection to
the application being allowed and the suit being decreed.
4. Present suit was filed by the Plaintiffs against the Defendant seeking
to restrain the Defendant from infringing the Plaintiffs’ trademarks
‘HETTICH’ and the HETTICH logo , and and restraint
against passing off as well as for delivery up, damages, etc.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 1 of 7
5. It is averred by the Plaintiffs that the trade name and trademark
HETTICH owes its origin to its founding father, way back in the year 1888.
Plaintiffs are a part of diversified group of companies, having operations in
multiple countries across the world and engaged in manufacturing,
marketing and selling furniture, fittings, door hinges, runners, etc., which
has led to the said mark becoming distinctive of Plaintiffs’ products and
Plaintiffs’ immense goodwill and reputation has strongly vested in the
trademark HETTICH. Plaintiffs have multiple trademark registrations in the
trademarks in over 76 countries with the earliest registration in Germany
dating back to 1961.
6. The Defendant is a retail store engaged in sale of hardware products
including furniture fixtures and components. Plaintiffs learnt on 29.07.2014
that Defendant is engaged in selling counterfeit HETTICH products,
whereupon the present suit was filed.
7. On 01.09.2014, ex-parte ad interim injunction was granted by this
Court and a Local Commissioner was appointed, whose report bears
testimony to the fact that Defendant was in possession of counterfeit
products bearing the HETTICH trademarks.
8. Learned counsel for the Plaintiffs submits that in the written statement
filed by the Defendant, the only defence taken is that it has not engaged in
procuring or selling the counterfeit products but has sold those which were
available in the store believing them to be genuine products emanating from
the Plaintiffs. Since the Defendant has not sought to challenge the Plaintiffs’
exclusive rights over the HETTICH trademarks, it has no basis to resist a
decree of permanent injunction. In view of this, there remains no need to
record evidence to determine whether the Plaintiffs are the registered
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 2 of 7
proprietors of the HETTICH trademarks or whether the Plaintiffs are
entitled to a decree restraining the Defendant from selling counterfeit
products under the said trademark.
9. It is thus the contention of the learned counsel for the Plaintiffs that
the Defendant has no real prospect of defending the claims of infringement
and resisting a decree of permanent injunction against the Defendant and the
relief should be summarily decided in favour of the Plaintiffs.
10. I have heard the learned counsels for the parties and perused the
record.
11. Aptly encapsulated the case of Plaintiffs is that trademark and trade
name, ‘HETTICH’, owes its origin to Plaintiffs’ founding father, Mr. Karl-
Hettich, who had developed and mechanized the production of anchor
escapements for Black-Forest cuckoo clocks in the year 1888. This business
legacy was carried forward by Mr. August Hettich, who had developed a
production line for piano hinges in the year 1928. This led to the genesis of
the Plaintiffs’ business, which has expanded globally over the decades and
has become popular under the trade mark and trade name ‘HETTICH’.
12. Plaintiffs are part of a diversified group of companies, having
operations in multiple countries across the world and engaged in
manufacturing, marketing and selling furniture fittings like door hinges,
runners and drawers, hardware systems/items for modular kitchens,
residential and office segments, etc. Due to Plaintiffs’ immense success and
popularity across the globe, Plaintiffs are recognized as global leaders in
furniture fittings industry. Notably, each member of Plaintiffs’ group of
companies uses the mark ‘HETTICH’ as part of their corporate/trade name
and the trademark HETTICH is also extensively and prominently used on
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 3 of 7
and in association with, Plaintiffs’ furniture fittings. This has led to the mark
‘HETTICH’ becoming extremely distinctive of Plaintiffs’ products and
Plaintiffs’ immense goodwill and reputation has become strongly vested in
the trademark ‘HETTICH’. Due to long, continuous and extensive use of the
trademark HETTICH by the Plaintiffs in India, members of the public, on
coming across any product bearing identical or similar mark, are likely to be
confused into believing that the product emanates from the Plaintiffs or is
associated with them.
13. Apart from the common law rights vested in the Plaintiffs, Plaintiffs
and their group companies have also sought and secured multiple trademark
registrations for the trademark ‘HETTICH’ across the globe. The HETTICH
trademarks are registered in over 76 countries, with the earliest registration
in Germany dating back to 1961. In India, Plaintiff No. 1 is the registered
proprietor of the trademark HETTICH and its variants as mentioned in the
plaint.
14. Defendant in the present suit is a retail store, engaged in sale of
hardware products, including furniture fixtures and components. Plaintiffs
had appointed the Defendant as an authorized dealer in the early 2000s,
however, the business relationship was short-lived and on the date of the
filing of the suit and till date parties have not had any direct business
relationship.
15. On 29.07.2014, one of the employees of Plaintiff No. 2, on visiting
Defendant’s store noticed telescopic channels bearing Plaintiffs’ registered
mark ‘HETTICH’ which were being offered for sale, misrepresenting that
the product emanates from the Plaintiffs. As noted above, Defendant admits
selling the counterfeit products and the only defence put-forth is that it has
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 4 of 7
not procured or bought the counterfeit HETTICH products and is selling
genuine products emanating from the Plaintiffs. Further, Local
Commissioner’s report supports the stand of the Plaintiffs inasmuch as a unit
of counterfeit product was found in the premises of the Defendant, along
with invoices evidencing sales.
16. Learned counsel for the Defendant fairly and candidly states that
Defendant does not wish to contest the present application or the suit and is
willing to suffer an injunction. Even otherwise from the written statement
filed on behalf of the Defendant and the admission therein it is clear that
Defendant has no real prospect of defending the claims of infringement and
resisting a decree for permanent injunction.
17. Insofar as prayer for summary judgement is concerned, as per the
Commercial Courts Act, 2015 read with the Delhi High Court (Original
Side) Rules, 2018 and Rule 27 of the Delhi High Court Intellectual Property
Rights Division Rules, 2022, a summary judgement can be passed, if there is
no real prospect of the Defendant succeeding in the matter. In fact, under
Rule 27 of the IPD Rules even the filing of the application is not a sine qua
non. Rule 27 reads as under:-
In cases before the IPD, the Court may pass summary
judgment, without the requirement of filing a specific
application seeking summary judgment on principles akin to
those contained in Order XIIIA, Civil Procedure Code, 1908 as
applicable to commercial suits under the Commercial Courts
18. Practice Direction 9(h) of the Original Side Rules reads as follows:-
“9. In the case of commercial disputes, the Court may, inter-
alia, pass orders as it may think fit for the speedy disposal of
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 5 of 7
the suit or narrowing the controversy between the parties,
h) conduct a Case Management Hearing under Order XV-A
of the Code and as part of the said case management hearing-
ii. explore the possibility of deciding the dispute by a
summary judgment without a specific application for the said
purpose, on the basis of pleadings dispensing with the trial of
the suit on the questions of law or of facts on which the parties
19. I may also note that Order XV-A of CPC, as amended by the
Commercial Courts Act, 2015, permits the Court to conduct a case
management hearing even during the trial as is clear from perusal of Rules 5
and 6 thereof.
20. The legislative intent behind the provision of summary judgment is to
provide to a party a remedy to seek a decree, distinct from a judgment on
admission and one under Order XXXVII CPC. As held in various
judgments, the remedy of summary judgment is available where there is no
real prospect of the Defendant succeeding and there is no genuine issue for
trial. The test, therefore, is whether a fair and just determination of a dispute
is possible without trial and the necessary facts can be determined by
applying the legal principles rather than requiring the parties to incur
expenditure and spend time and resources to go through the rigours of a
trial. The standard is not really to see if the procedure for trial is exhaustive
and costly but to see if the Court has the confidence that the necessary facts
and the legal principles applied thereto would be enough to arrive at a just
decision.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 6 of 7
21. Considering that the Defendant is not contesting the suit and perusal
of the invoices and the report of the Local Commissioner confirms seizure
of goods which are counterfeit goods it is a fit case for this Court to pass a
summary judgement.
22. Accordingly, the present application is allowed and disposed of.
23. In view of the order passed in I.A. 8861/2022, the suit is decreed in
favour of the Plaintiffs and against the Defendant, in terms of para 32 of the
plaint.
24. Accordingly, Defendant, its partners or proprietors, its officers,
servants, agents and representatives, as the case may be, are permanently
restrained from selling any counterfeit product and/or any other related
goods under the trademark and trade name HETTICH and HETTICH Logo
or any other deceptively similar mark thereof, amounting to infringement of
Plaintiffs’ registered trademarks and passing off.
25. Order dated 01.09.2014 granting interim injunction is hereby
confirmed. The counterfeit goods handed over to the Defendant on
superdari by the Local Commissioner, shall be destroyed by the Defendant
as expeditiously as possible.
26. Registry is directed to draw up the Decree Sheet.
27. Suit is accordingly disposed of.
Signed By:KAMAL KUMAR CS(COMM) 205/2018 Page 7 of 7
|
The Delhi High Court has permanently restrained two manufacturers of the pharmaceutical products from manufacturing, selling, advertising and promoting the products using the trademark 'LOOZOUT', which was deceptively similar to the registered trademark 'LOOZ'.
Justice Jyoti Singh also restrained the manufacturers from manufacturing and selling products under any other mark which was identical or deceptively similar to 'LOOZ' or its variants so as to amount to infringement or passing off.
The suit was filed by Intas Pharmaceuticals Private Limited regarding trademark infringement by three defendants. While the suit was settled qua defendant no. 1, there was no appearance on behalf of the two manufacturers, who were defendant no. 2 and 3.
"Defendants No. 2 and 3 have chosen to stay away from the proceedings, despite service and thus there is no justification or reasonable explanation to adopt the infringing mark on the products manufactured by them," the Court noted.
The suit was accordingly decreed against the said manufacturers, Defendants No. 2 and 3, with costs of Rs. 2,00,000.
"Since the suit has been settled qua Defendant No.1 at an early stage of litigation, Plaintiff is entitled to refund of 50% of the Court Fees deposited by it, in accordance with provisions of Section 16A of the Court Fees Act, 1870 read with Section 89 CPC, 1908," the Court added.
The suit was accordingly disposed of.
Case Title: INTAS PHARMACEUTICALS PRIVATE LIMITED v. INTRA LIFE PRIVATE LIMITED & ORS.
|
The Delhi High Court has permanently restrained two manufacturers of the pharmaceutical products from manufacturing, selling, advertising and promoting the products using the trademark 'LOOZOUT', which was deceptively similar to the registered trademark 'LOOZ'.
Justice Jyoti Singh also restrained the manufacturers from manufacturing and selling products under any other mark which was identical or deceptively similar to 'LOOZ' or its variants so as to amount to infringement or passing off.
The suit was filed by Intas Pharmaceuticals Private Limited regarding trademark infringement by three defendants. While the suit was settled qua defendant no. 1, there was no appearance on behalf of the two manufacturers, who were defendant no. 2 and 3.
"Defendants No. 2 and 3 have chosen to stay away from the proceedings, despite service and thus there is no justification or reasonable explanation to adopt the infringing mark on the products manufactured by them," the Court noted.
The suit was accordingly decreed against the said manufacturers, Defendants No. 2 and 3, with costs of Rs. 2,00,000.
"Since the suit has been settled qua Defendant No.1 at an early stage of litigation, Plaintiff is entitled to refund of 50% of the Court Fees deposited by it, in accordance with provisions of Section 16A of the Court Fees Act, 1870 read with Section 89 CPC, 1908," the Court added.
The suit was accordingly disposed of.
Case Title: INTAS PHARMACEUTICALS PRIVATE LIMITED v. INTRA LIFE PRIVATE LIMITED & ORS.
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The Writ Petition has been filed to direct the respondent-
State of Tamil Nadu to register a case under Section 302 of IPC against
the respondent No.6 and all other police personnel responsible for the
death of the petitioner's son Nithya @ Nithyaraj and to hand over the
investigation of the case in Cr.No.2 of 2017 on the file of the respondent
No.8, to the Central Bureau of Investigation and further directing the
respondent – State to award appropriate compensation to the petitioner
for the death of her son.
2. The learned counsel appearing for the petitioner submitted
that the son of the petitioner was a member of 'Friends of Police' attached
to K2, Ayanavaram Police Station, Chennai. While being so, on
11.01.2012 the police personnel of K7 ICF Police Station had taken the
petitioner's son (herein after called as “the deceased”) to the police
station. Next day i.e., on 12.01.2012, when the petitioner went to the
police station and enquired about him but she was not allowed to see her
son. The deceased was kept under police custody from 11.01.2012 to
14.01.2012 and he was produced before the learned Magistrate on
14.01.2012, in pursuant to the FIR registered in Crime No.24 of 2012 for
the offences under Sections 420 & 395 of IPC.
2.1. When the deceased was produced before the learned
Magistrate, the petitioner and her relatives had seen him and he was
sustained injuries all over his body. He was also threatened by the sixth
respondent herein that not to disclose anybody about the torture given by
the police personnel in the police station. Unfortunately, the learned
Magistrate also without even verifying the injuries sustained by the
deceased, ordered to remand him. The memo of arrest shows that the
deceased was arrested on 13.01.2012 and he was produced for remand
on 14.01.2012. Accordingly, he was remanded by the learned Magistrate
till 28.01.2012.
2.2. In fact, immediately the deceased informed that he suffered
pain and therefore he was taken to jail hospital and thereafter he was
referred to the Government Royapettah Hospital. He was not given proper
treatment and again he was sent to prison hospital. Due to bad condition
of the deceased, again he was taken to the Government Royapettah
Hospital, Chennai on 16.01.2012. Unfortunately, he died on the way to
hospital on 16.01.2012 itself. On the death of the deceased, FIR has been
registered in Crime No.112 of 2012 under Section 176 of Cr.P.C., on the
file of the Inspector of Police, M3 Puzhal Police Station.
2.3. Thereafter, the learned V Metropolitan Magistrate, Chennai,
conducted inquest on the dead body and found that the deceased died in
suspicious manner. Therefore, the Government of Tamil Nadu passed an
order transferring the investigation from the file of the Inspector of Police,
M3 Puzhal Police Station to the eighth respondent herein. Thereafter, the
eighth respondent registered a case in Crime No.2 of 2017 under Section
176 of Cr.P.C. Further the eighth respondent also kept the FIR without
investigating the same.
2.4. Therefore, the petitioner who is being the mother of the
deceased has filed this Writ Petition for direction directing the State of
Tamil Nadu to award interim compensation and also sought for alteration
of offence into Section 302 of IPC by transferring the investigation to
Central Bureau of Investigation. He further submitted that both custodial
torture and custodial death are gross violation of one's fundamental rights
under Article 21 of the Constitution of India. Therefore, the dependents
of the deceased are entitled for compensation. Therefore he prayed for
necessary directions from this Court.
3. The learned Government Advocate (Crl. Side) appearing for
the respondent police filed status report and submitted one Dinesh lodged
complaint that on 12.01.2012, while he was talking with her lover, the
deceased came there and threatened them and snatched the cell phone.
On that complaint, the six respondent registered a case in Crime No.24 of
2012 and searched for the deceased. Further on seeing the witnesses, the
deceased ran away and he scaled over a compound wall and jumped and
fell down in which he sustained injuries. With those injuries the deceased
escaped from the spot and took treatment in a hospital at Ayanavaram
and thereafter the complainant and his family members had brought him
to K7 ICF Police Station.
3.1. He further submitted that the head injury mentioned in the
post mortem certificate could be accidental and it could be caused due to
the impact of head over the blunt surface or object during fall or impact
of any blunted object over the right part of the head. The deceased was
remanded to judicial custody and brought to Central Prison, Puzhal on
14.01.2012. Since, he expressed heavy pain in his shoulders, the prison
hospital doctor refused to admit him and referred to Government
Royapettah Hospital, Chennai. Thereafter he was suspected nerve injury
and referred to take CT scan at Rajiv Gandhi Government General
3.2. On 15.01.2012, the deceased was admitted in Rajiv Gandhi
Government Hospital and CT Brain scan was taken. The Neuro Surgeon
opinion was obtained and it reveals that no abnormality detected and nil
active intervention needed. Therefore, he was discharged from the Rajiv
Gandhi Government Hospital and referred to Government Royapettah
Hospital, Chennai for further treatment. Again he was referred for taking
MRI spine scan on 15.01.2012 at 19.55 hours and thereafter, he was
admitted in the prison hospital about 21.10 hours. On 16.01.2012, the
deceased had difficulty in breathing and found it was abnormal and
therefore he was referred to Government Royapettah Hospital at 13.30
hours. It has been reported from the Government Royapettah Hospital at
2.30 p.m., that he was brought dead.
3.3. The learned Government Advocate further submitted that
post mortem was conducted and opined as the injuries in Sl.Nos.1-a to u
and 2 to 9 were found over the deceased body and injuries No.2 & 9
could be accidental. Injuries 1-d,e,t,g,i,j,k,m,n,o,p,r,s,t and u , 3 to 8
could be accidental or could have been inflicted by others. The injury
No.9 is sufficient to cause death in the ordinary course of nature and all
other injuries are not sufficient to cause death in the ordinary course of
nature. Hence it revealed that the death caused due to injury No.9.
3.4. The team of post mortem Doctors opined that the injury
Nos.2 & 9 might have occurred accidentally and opined that the above all
injuries were antemortem in nature occurred 3 to 4 days prior to death.
Since the head injury could be accidental, request was made to get second
opinion from the Director, Directorate of Medical Examination, Kilpauk,
chennai. By the second opinion dated 09.03.2022, it was opined that the
death caused due to thin film of red, subdural hemorrhage patchy areas of
diffuse subarachnoid hemorrhage over both cerebral and both cerebellar
hemispheres of the brain. This could be caused due to impact of head
over the blunt surface or any other object during fall or impact of any
blunted object over the right part of the head.
3.5. On perusal of all the documents and the enquiry conducted
from the doctors and police personnel, the offence has been altered from
Section 176 of Cr.P.C., to Sections 342, 343, 348, 324 & 304(ii) of IPC
on 15.07.2022. Accordingly, alteration report was filed before the learned
Judicial Magistrate-I, Tiruvallur, along with statements and the same is
pending. Hence, he prayed for dismissal of this petition.
4. Heard Mr.P.Pugalenthi, learned counsel appearing for the
petitioner and Mr.A.Gopinath, learned Government Advocate (Crl.Side)
appearing for the respondents 1 to 6 and 8.
5. The petitioner's son was arrested on 13.01.2012 in pursuant
to the Crime No.24 of 2012 registered for the offences under Section 420
r/w 392 of IPC. The said case was registered on receipt of the complaint
from one Dinesh, alleging that on 13.01.2012, the said Dinesh and his
lover were threatened by the deceased by stating that he is the member of
“friend of police” and snatched his cell phone. Immediately, within 24
hours, the deceased was produced before the learned Magistrate for his
remand.
6. In fact, before the learned Magistrate no complaint was
made by the deceased and no injury was found on him. Further in the
prison, he informed about his shoulder pain. Therefore, immediately he
was taken to jail hospital and make an entry in the prison records.
However, the Doctor refused to admit him inside the prison and referred
the deceased to the Government Royapettah Hospital for orthopedic
opinion. Thereafter he was admitted by the ICF police personal in the
Government Royapettah Hospital, Chennai. After examination, the
Orthopedic Surgeon suspected nerve injury and referred the deceased for
CT-brain scan at Rajiv Gandhi Government General Hospital, Chennai.
7. The Neuro Surgeon opined that no abnormality detected, nil
active intervention needed. Therefore, the deceased was discharged from
the hospital and referred to Government Royapettah Hospital for further
treatment. In fact on 15.01.2012, again the deceased was taken to MRI
scan on his spine. Thereafter he was again taken to prison and admitted
in the prison hospital. On 16.01.2012, he had difficulty in breathing and
therefore, again he was referred to the Government Royapettah Hospital,
for further treatment. However it was reported that the prisoner was
brought dead.
8. Thereafter Post mortem was conducted on 17.01.2012 and
the following injuries were found on the deceased body :-
“External injuries:-
c) 14.4X3-1.2 cm, oblique brown abrasion
on the front of lower third of right arm and on
the adjoining inner aspect of right elbow.
d) 1.7X0.4 cm on the inner aspect of upper
third of right forearm.
e) 1X.05 cm on the back of lower third of
f) 106 X 1 cm on the back of right elbow
g) 0.5 X0.3 cm and 0.6X0.5 cm on the front
h) 9 x 3-1.4 cm on the inner aspect of lower
i) 0.7 X0.2 cm on the outer aspect of right
j) 0.2X0.2 cm on the outer aspect of right
ankle.
k) 2.1X0.2 cm horizontal, brown abrasion
on the outer aspect of middle third of left arm.
l)27.6X3-1 cm oblique, curved brown
abrasion on the inner aspect of left elbow, front
of left elbow and the adjoining outer aspect of
back of lower third of left arm
m) 1.8 X0.2 cm on the front of upper third
n) 0.5 X0.1 cm on the front of upper part of
o) 0.5X0.2 cm on the lower part of outer
aspect of left knee.
p) 3.2X1-0.5cm on the front of upper end of
q) 8X3-08 cm on the inner aspect of lower
r) 4.3X1-0.4 cm on the outer of lower third
s) 3.4X0.2-0.1 cm on the outer aspect of
middle third of left leg
t) 1.4X05-03 cm on the upper part of left
side of the abdomen along the line a left nipple
with the surrounding 13.5 X9-3Xskin deep dark
red bruise on the upper part of left side of the
abdomen.
u)5X0.5-0.2 cm horizontal brown abrasion,
on the lower part of left lateral aspect of the
chest.
2. Oblique, brown, grazed abrasion over
an area of 11.5X8-3 cm on the outer aspect of
upper third of left leg
3. Dark red contusion 4X3cmX skin deep
on the middle third of back of left forearm
4. Dark red contusion 2 X 1.5 cm X skin
deep on the back upper third of left forearm
5. Dark red contusion 4X1cmXskin deep on
the front of left ankle.
6. Dark red contusion 3X2cmXskin deep on
the front of upper third of left leg
7. Dark red contusion 7X2.5-0.5cmX skin
deep on the back of right wrist.
8. Dark red contusion 3X1cmXskin deep on
the front of lower third of right forearm
9. On reflection of scalp : Dark red
contusion 8X6cmXskin deep on the right tempero
occipital region of the scalp; on further
dissection – underlying bones were intact. On
removal of the calvarium thin film a red subdural
hemorrhage and patchy areas of diffuse
subarachnoid hemorrhage over both cerebral
and both cerebellar hemispheres of the brain.”
The post mortem report also revealed that all the injuries are antemortem
in nature viz., 3 to 4 days prior to death. Further revealed that the injuries
2 & 9 could be accidental and injuries numbered 1-d,e,g,i,j,k,m,n,
o,p,r,s,t and u and injuries numbered 3,4,5,6,7 and 8 could be accidental
or could be inflicted by others. The injury No.9 is sufficient to cause
death in the ordinary course of nature.
9. However, the second opinion was sought from the Professor
and Head of the Department, Department of Forensic Medicine and
Toxicology, Government Kilpauk Medical College, Chennai, that how
could the dark red contusion measuring 8X6Xscalp deep in the right
tempero occipital region of the scalp as mentioned in the injury No.9 of
the post mortem be caused? The said Professor answered that this could
be caused due to the impact of the head over the blunt surface, object,
during fall or impact of any object or weapon over that part of the head.
10. Therefore, the eighth respondent enquired the police
personnel of K7, ICF Police Station and other witnesses and after
enquiry, he found that it is a case of 304(ii) of IPC and altered the offence
under Sections 342, 343, 348, 324 & 304(ii) of IPC. The said alteration
report also filed before the learned Judicial Magistrate-I, Tiruvallur. Thus,
it is clear that the deceased was taken to the police station on 11.01.2012
during the night hours and he was produced before the learned
Magistrate only on 14.01.2012. The police personnel at K7 ICF Police
Station alone are responsible for the injuries sustained by the deceased.
The deceased was brutally beaten by the accused persons and due to
which he sustained grievous injuries and died.
11. There is great responsibility on the police authority to ensure
that the citizen in its custody is not deprived of his right to life. His liberty
is in the very nature of things circumscribed by the very fact of his
confinement and therefore his interest in the limited liberty left to him is
rather precious. The wrong doer is accountable and the State is
responsible if the person in custody of the police is deprived of his life
except according tot he procedure establish by law.
12. In the case on hand, the deceased was tortured and subjected
to third decree treatment due to which he died. The Hon'ble Supreme
Court of India repeatedly held that when the death taken place inside the
police station, the accused persons should be punished for the offence
under Section 302 of IPC. When the eighth respondent found that there
are materials to attract the major offence under Section 304(ii) of IPC,
what is the reason why the eighth respondent failed to alter the offence
under Section 302 of IPC? The injuries sustained by the deceased are
very clear and from the Post Mortem report, the cause of death clearly
shows that the police personnel had beaten the deceased and had given
third decree treatment. Therefore, it cannot be said that the accused
persons had no intension to murder the deceased.
13. The Hon'ble Supreme Court of India held in the case Rudul
Sah Vs. State of Bihar & anr reported in AIR 1983 SC 1086 that, one of
telling ways in which the violation of that right can reasonable be
prevented and due compliance with the mandate of Atricle 21 secured is
to mulct its violators in the payment of monetary compensation. The right
of compensation is some palliative for the unlawful acts of
instrumentalities which act in the name of public interest and which
present for their protection the powers of the State as a shield. If
civilisation is not to perish in this country as it has perished in some
others, too well known to suffer mention, it is necessary to educate
ourselves into accepting that, respect for the right of individuals is the
true bastion of democracy. Therefore, the State must repair the damage
done by its officers to the petitioner's right. It may have recourse against
those officers.
14. In the case on hand, poor young man aged about 22 years is
killed and his mother, young wife and his 8 years old child are the
dependents of the deceased. Therefore, it is clear case of murder and all
the accused persons shall be punished for the offence under Section 302
of IPC. The dependents of the deceased are entitled atleast for interim
compensation, since the provision under Section 357 A of Cr.P.C., says
about the order to pay compensation which reads as follows :-
“357. Order to pay compensation. (1) When a
Court imposes a sentence of fine or a sentence
(including a sentence of death) of which fine forms a
part, the Court may, when passing judgment order
the whole or any part of the fine recovered to be
(a) in defraying the expenses properly
incurred in the prosecution;
compensation for any loss or injury caused by the
offence, when compensation is, in the opinion of the
Court, recoverable by such person in a Civil Court;
(c) when any person is convicted of any
offence for having caused the death of another
person or of having abetted the commission of such
an offence, in paying compensation to the persons
who are, under the Fatal Accidents Act, 1855 (13 of
1855), entitled to recover damages from the person
sentenced for the loss resulting to them from such
death; (d) when any person is convicted of any
offence which includes theft, criminal
misappropriation, criminal breach of trust, or
cheating, or of having dishonestly received or
retained, or of having voluntarily assisted in
disposing of, stolen property knowing or having
reason to believe the same to be stolen in
compensating any bona fide purchaser of such
property for the loss of the same if such property is
restored to the possession of the person entitled
thereto.
(2) If the fine is imposed in a case which is
subject to appeal, no such payment shall be made
before the period allowed for presenting the appeal
has elapsed, or if an appeal be presented, before the
decision of the appeal.
(3) When a Court imposes a sentence, of which
fine does not form a part, the Court may, when
passing judgment order the accused person to pay,
by way of compensation such amount as may be
specified in the order to the person who has suffered
any loss or injury by reason of the act for which the
accused person has been so sentenced.”
Accordingly, the compensation can be paid only on the conclusion of
trial. However, the dependents are entitled for interim compensation
when the prima facie case made out. Therefore, this Court has no
hesitation to award interim compensation payable by the State
Government to the dependents of the deceased.
15. Accordingly, this Court is inclined to pass the following
(i) The eighth respondent is directed to alter the offence into
302 of IPC as against the accused persons and proceed against them in
accordance with law and file final report within a period of eight weeks
from the date of receipt of a copy of this Order.
(ii) The Government of Tamil Nadu is directed to pay a sum of
Rs.5,00,000/- (Rupess five lakhs only) as interim compensation to the
dependents of the deceased within a period of four weeks from the date of
receipt of a copy of this Order.
(iii) The said compensation shall be recovered from the accused
persons in the manner known to law.
16. With the above directions, the Writ Petition stands allowed.
Consequently, connected miscellaneous petitions are closed. There shall
be no order as to costs.
4. The Deputy Commissioner of Police,
W.M.P.Nos.12462 of 2020 & 21089 of 2021
|
Great responsibility on Police to ensure that citizen in its custody is not deprived of right to life.The Madras High Court recently allowed a mother's plea to register a case for the offence of Murder against the police officials allegedly involved in the custodial death of her 22 year old son.It directed the CB-CID to alter the charge against the accused police officials and proceed against them for the offence of murder and file the final report within a period of eight weeks. The court...
The Madras High Court recently allowed a mother's plea to register a case for the offence of Murder against the police officials allegedly involved in the custodial death of her 22 year old son.
It directed the CB-CID to alter the charge against the accused police officials and proceed against them for the offence of murder and file the final report within a period of eight weeks.
The court also directed the Government of Tamil Nadu to pay a sum of Rs. 5 lakhs as interim compensation within a period of four weeks to the victim's family. The amount shall be recovered from the accused in accordance with law.
Justice GK Ilanthiraiyan observed that the Police has a responsibility to ensure that a citizen in its custody is not deprived of his right to life, except according to procedure established by law.
There is great responsibility on the police authority to ensure that the citizen in its custody is not deprived of his right to life. His liberty is in the very nature of things circumscribed by the very fact of his confinement and therefore his interest in the limited liberty left to him is rather precious. The wrong doer is accountable and the State is responsible if the person in custody of the police is deprived of his life except according tot he procedure establish by law.
The petitioner contended that her son, the deceased was taken to the police station on 11.01.2012. On the next day, though she went to the police station, she was not allowed to see her son. On 14.01.2012, he was brought before the Magistrate and was remanded till 28.01.2012. The petitioner submitted that when her son was produced before the Magistrate, they noticed that he had sustained injuries all over his body. He was also threatened by the police not to disclose the torture given by the police personnel. Further, the remand order was made without verifying the injuries, it is alleged.
After remand, her son informed that he suffered pain and therefore he was taken to jail hospital and thereafter he was referred to the Government Royapettah Hospital. He was not given proper treatment and again he was sent to the prison hospital. Due to the bad condition of the deceased, again he was taken to the Government Royapettah Hospital, Chennai on 16.01.2012. Unfortunately, he died on the way to the hospital on 16.01.2012 itself. The investigation was transferred to CB-CID where a case was registered under Section 176 CrPC. The petitioner further submitted that the FIR was kept without any investigation by the CB-CID.
The petitioner submitted that custodial torture and custodial death were a gross violation of one's fundamental rights under Article 21 of the Constitution. Thus, she sought for alteration of the offence into one under Section 302 of the IPC and also sought compensation.
Per contra, the Government advocate submitted that as per a complaint received from one Dinesh, a case was registered against the deceased. On seeing the witnesses, the deceased ran away and he scaled over a compound wall and jumped and fell down in which he sustained injuries. He also submitted that even as per the post-mortem report, all the injuries on the body of the deceased were antemortem and could have been accidental. Only one injury was sufficient to cause death in the ordinary cause of nature. The respondent relied on the second opinion of the Professor and Head of the Forensic Medicine and Toxicology Department at a Government Medical College in Chennai who submitted that the injury could be caused due to the impact of the head over the blunt surface, object, during fall or impact of any object or weapon over that part of the head.
It was further informed that after enquiring the police personnel, the CB-CID had altered the charges to one under Sections 342, 343, 348, 324 & 304(ii) of IPC. The alteration report was filed before the Judicial Magistrate also.
The court noted that the deceased was taken to the police station on 11.01.2012 during the night hours and he was produced before the learned Magistrate only on 14.01.2012. Thus, it held that officals at the Police Station alone are responsible for the injuries sustained by the deceased.
Reliance was placed on Supreme Court's decisions holding that when death takes place inside the police station, the accused persons should be punished for the offence under Section 302 of IPC. Thus, the court wondered that when sufficient materials were available to attract the major offence under Section 304(ii) of IPC, why did the CB-CID fail to alter the charge to one under Section 302 of the IPC?
Relying on the position laid down in the case of Rudul Sah Vs. State of Bihar & Anr the court held that the petitioner was also eligible for compensation. The court noted that compensation was a palliative for the unlawful acts of the instrumentalities.
"If civilisation is not to perish in this country as it has perished in some others, too well known to suffer mention, it is necessary to educate ourselves into accepting that, respect for the right of individuals is the true bastion of democracy. Therefore, the State must repair the damage done by its officers to the petitioner's right. It may have recourse against those officers."
The court noted that though compensation could be paid at the conclusion of trial, the dependents were still entitled for interim compensation when a prima facie case was made out as per the provisions of Section 357 A of CrPC. Thus, the court allowed the petition and ordered accordingly.
Case Title: S.Pongulali v. The State of Tamil Nadu and others
Case No: W.P.No.10249 of 2020
Counsel for the Petitioner: Mr.P.Pugalenthi
Counsel for the Respondent: Mr.A.Gopinath, Government Advocate (Crl. Side) (R1-R6 and R8)
|
The Writ Petition has been filed to direct the respondent-
State of Tamil Nadu to register a case under Section 302 of IPC against
the respondent No.6 and all other police personnel responsible for the
death of the petitioner's son Nithya @ Nithyaraj and to hand over the
investigation of the case in Cr.No.2 of 2017 on the file of the respondent
No.8, to the Central Bureau of Investigation and further directing the
respondent – State to award appropriate compensation to the petitioner
for the death of her son.
2. The learned counsel appearing for the petitioner submitted
that the son of the petitioner was a member of 'Friends of Police' attached
to K2, Ayanavaram Police Station, Chennai. While being so, on
11.01.2012 the police personnel of K7 ICF Police Station had taken the
petitioner's son (herein after called as “the deceased”) to the police
station. Next day i.e., on 12.01.2012, when the petitioner went to the
police station and enquired about him but she was not allowed to see her
son. The deceased was kept under police custody from 11.01.2012 to
14.01.2012 and he was produced before the learned Magistrate on
14.01.2012, in pursuant to the FIR registered in Crime No.24 of 2012 for
the offences under Sections 420 & 395 of IPC.
2.1. When the deceased was produced before the learned
Magistrate, the petitioner and her relatives had seen him and he was
sustained injuries all over his body. He was also threatened by the sixth
respondent herein that not to disclose anybody about the torture given by
the police personnel in the police station. Unfortunately, the learned
Magistrate also without even verifying the injuries sustained by the
deceased, ordered to remand him. The memo of arrest shows that the
deceased was arrested on 13.01.2012 and he was produced for remand
on 14.01.2012. Accordingly, he was remanded by the learned Magistrate
till 28.01.2012.
2.2. In fact, immediately the deceased informed that he suffered
pain and therefore he was taken to jail hospital and thereafter he was
referred to the Government Royapettah Hospital. He was not given proper
treatment and again he was sent to prison hospital. Due to bad condition
of the deceased, again he was taken to the Government Royapettah
Hospital, Chennai on 16.01.2012. Unfortunately, he died on the way to
hospital on 16.01.2012 itself. On the death of the deceased, FIR has been
registered in Crime No.112 of 2012 under Section 176 of Cr.P.C., on the
file of the Inspector of Police, M3 Puzhal Police Station.
2.3. Thereafter, the learned V Metropolitan Magistrate, Chennai,
conducted inquest on the dead body and found that the deceased died in
suspicious manner. Therefore, the Government of Tamil Nadu passed an
order transferring the investigation from the file of the Inspector of Police,
M3 Puzhal Police Station to the eighth respondent herein. Thereafter, the
eighth respondent registered a case in Crime No.2 of 2017 under Section
176 of Cr.P.C. Further the eighth respondent also kept the FIR without
investigating the same.
2.4. Therefore, the petitioner who is being the mother of the
deceased has filed this Writ Petition for direction directing the State of
Tamil Nadu to award interim compensation and also sought for alteration
of offence into Section 302 of IPC by transferring the investigation to
Central Bureau of Investigation. He further submitted that both custodial
torture and custodial death are gross violation of one's fundamental rights
under Article 21 of the Constitution of India. Therefore, the dependents
of the deceased are entitled for compensation. Therefore he prayed for
necessary directions from this Court.
3. The learned Government Advocate (Crl. Side) appearing for
the respondent police filed status report and submitted one Dinesh lodged
complaint that on 12.01.2012, while he was talking with her lover, the
deceased came there and threatened them and snatched the cell phone.
On that complaint, the six respondent registered a case in Crime No.24 of
2012 and searched for the deceased. Further on seeing the witnesses, the
deceased ran away and he scaled over a compound wall and jumped and
fell down in which he sustained injuries. With those injuries the deceased
escaped from the spot and took treatment in a hospital at Ayanavaram
and thereafter the complainant and his family members had brought him
to K7 ICF Police Station.
3.1. He further submitted that the head injury mentioned in the
post mortem certificate could be accidental and it could be caused due to
the impact of head over the blunt surface or object during fall or impact
of any blunted object over the right part of the head. The deceased was
remanded to judicial custody and brought to Central Prison, Puzhal on
14.01.2012. Since, he expressed heavy pain in his shoulders, the prison
hospital doctor refused to admit him and referred to Government
Royapettah Hospital, Chennai. Thereafter he was suspected nerve injury
and referred to take CT scan at Rajiv Gandhi Government General
3.2. On 15.01.2012, the deceased was admitted in Rajiv Gandhi
Government Hospital and CT Brain scan was taken. The Neuro Surgeon
opinion was obtained and it reveals that no abnormality detected and nil
active intervention needed. Therefore, he was discharged from the Rajiv
Gandhi Government Hospital and referred to Government Royapettah
Hospital, Chennai for further treatment. Again he was referred for taking
MRI spine scan on 15.01.2012 at 19.55 hours and thereafter, he was
admitted in the prison hospital about 21.10 hours. On 16.01.2012, the
deceased had difficulty in breathing and found it was abnormal and
therefore he was referred to Government Royapettah Hospital at 13.30
hours. It has been reported from the Government Royapettah Hospital at
2.30 p.m., that he was brought dead.
3.3. The learned Government Advocate further submitted that
post mortem was conducted and opined as the injuries in Sl.Nos.1-a to u
and 2 to 9 were found over the deceased body and injuries No.2 & 9
could be accidental. Injuries 1-d,e,t,g,i,j,k,m,n,o,p,r,s,t and u , 3 to 8
could be accidental or could have been inflicted by others. The injury
No.9 is sufficient to cause death in the ordinary course of nature and all
other injuries are not sufficient to cause death in the ordinary course of
nature. Hence it revealed that the death caused due to injury No.9.
3.4. The team of post mortem Doctors opined that the injury
Nos.2 & 9 might have occurred accidentally and opined that the above all
injuries were antemortem in nature occurred 3 to 4 days prior to death.
Since the head injury could be accidental, request was made to get second
opinion from the Director, Directorate of Medical Examination, Kilpauk,
chennai. By the second opinion dated 09.03.2022, it was opined that the
death caused due to thin film of red, subdural hemorrhage patchy areas of
diffuse subarachnoid hemorrhage over both cerebral and both cerebellar
hemispheres of the brain. This could be caused due to impact of head
over the blunt surface or any other object during fall or impact of any
blunted object over the right part of the head.
3.5. On perusal of all the documents and the enquiry conducted
from the doctors and police personnel, the offence has been altered from
Section 176 of Cr.P.C., to Sections 342, 343, 348, 324 & 304(ii) of IPC
on 15.07.2022. Accordingly, alteration report was filed before the learned
Judicial Magistrate-I, Tiruvallur, along with statements and the same is
pending. Hence, he prayed for dismissal of this petition.
4. Heard Mr.P.Pugalenthi, learned counsel appearing for the
petitioner and Mr.A.Gopinath, learned Government Advocate (Crl.Side)
appearing for the respondents 1 to 6 and 8.
5. The petitioner's son was arrested on 13.01.2012 in pursuant
to the Crime No.24 of 2012 registered for the offences under Section 420
r/w 392 of IPC. The said case was registered on receipt of the complaint
from one Dinesh, alleging that on 13.01.2012, the said Dinesh and his
lover were threatened by the deceased by stating that he is the member of
“friend of police” and snatched his cell phone. Immediately, within 24
hours, the deceased was produced before the learned Magistrate for his
remand.
6. In fact, before the learned Magistrate no complaint was
made by the deceased and no injury was found on him. Further in the
prison, he informed about his shoulder pain. Therefore, immediately he
was taken to jail hospital and make an entry in the prison records.
However, the Doctor refused to admit him inside the prison and referred
the deceased to the Government Royapettah Hospital for orthopedic
opinion. Thereafter he was admitted by the ICF police personal in the
Government Royapettah Hospital, Chennai. After examination, the
Orthopedic Surgeon suspected nerve injury and referred the deceased for
CT-brain scan at Rajiv Gandhi Government General Hospital, Chennai.
7. The Neuro Surgeon opined that no abnormality detected, nil
active intervention needed. Therefore, the deceased was discharged from
the hospital and referred to Government Royapettah Hospital for further
treatment. In fact on 15.01.2012, again the deceased was taken to MRI
scan on his spine. Thereafter he was again taken to prison and admitted
in the prison hospital. On 16.01.2012, he had difficulty in breathing and
therefore, again he was referred to the Government Royapettah Hospital,
for further treatment. However it was reported that the prisoner was
brought dead.
8. Thereafter Post mortem was conducted on 17.01.2012 and
the following injuries were found on the deceased body :-
“External injuries:-
c) 14.4X3-1.2 cm, oblique brown abrasion
on the front of lower third of right arm and on
the adjoining inner aspect of right elbow.
d) 1.7X0.4 cm on the inner aspect of upper
third of right forearm.
e) 1X.05 cm on the back of lower third of
f) 106 X 1 cm on the back of right elbow
g) 0.5 X0.3 cm and 0.6X0.5 cm on the front
h) 9 x 3-1.4 cm on the inner aspect of lower
i) 0.7 X0.2 cm on the outer aspect of right
j) 0.2X0.2 cm on the outer aspect of right
ankle.
k) 2.1X0.2 cm horizontal, brown abrasion
on the outer aspect of middle third of left arm.
l)27.6X3-1 cm oblique, curved brown
abrasion on the inner aspect of left elbow, front
of left elbow and the adjoining outer aspect of
back of lower third of left arm
m) 1.8 X0.2 cm on the front of upper third
n) 0.5 X0.1 cm on the front of upper part of
o) 0.5X0.2 cm on the lower part of outer
aspect of left knee.
p) 3.2X1-0.5cm on the front of upper end of
q) 8X3-08 cm on the inner aspect of lower
r) 4.3X1-0.4 cm on the outer of lower third
s) 3.4X0.2-0.1 cm on the outer aspect of
middle third of left leg
t) 1.4X05-03 cm on the upper part of left
side of the abdomen along the line a left nipple
with the surrounding 13.5 X9-3Xskin deep dark
red bruise on the upper part of left side of the
abdomen.
u)5X0.5-0.2 cm horizontal brown abrasion,
on the lower part of left lateral aspect of the
chest.
2. Oblique, brown, grazed abrasion over
an area of 11.5X8-3 cm on the outer aspect of
upper third of left leg
3. Dark red contusion 4X3cmX skin deep
on the middle third of back of left forearm
4. Dark red contusion 2 X 1.5 cm X skin
deep on the back upper third of left forearm
5. Dark red contusion 4X1cmXskin deep on
the front of left ankle.
6. Dark red contusion 3X2cmXskin deep on
the front of upper third of left leg
7. Dark red contusion 7X2.5-0.5cmX skin
deep on the back of right wrist.
8. Dark red contusion 3X1cmXskin deep on
the front of lower third of right forearm
9. On reflection of scalp : Dark red
contusion 8X6cmXskin deep on the right tempero
occipital region of the scalp; on further
dissection – underlying bones were intact. On
removal of the calvarium thin film a red subdural
hemorrhage and patchy areas of diffuse
subarachnoid hemorrhage over both cerebral
and both cerebellar hemispheres of the brain.”
The post mortem report also revealed that all the injuries are antemortem
in nature viz., 3 to 4 days prior to death. Further revealed that the injuries
2 & 9 could be accidental and injuries numbered 1-d,e,g,i,j,k,m,n,
o,p,r,s,t and u and injuries numbered 3,4,5,6,7 and 8 could be accidental
or could be inflicted by others. The injury No.9 is sufficient to cause
death in the ordinary course of nature.
9. However, the second opinion was sought from the Professor
and Head of the Department, Department of Forensic Medicine and
Toxicology, Government Kilpauk Medical College, Chennai, that how
could the dark red contusion measuring 8X6Xscalp deep in the right
tempero occipital region of the scalp as mentioned in the injury No.9 of
the post mortem be caused? The said Professor answered that this could
be caused due to the impact of the head over the blunt surface, object,
during fall or impact of any object or weapon over that part of the head.
10. Therefore, the eighth respondent enquired the police
personnel of K7, ICF Police Station and other witnesses and after
enquiry, he found that it is a case of 304(ii) of IPC and altered the offence
under Sections 342, 343, 348, 324 & 304(ii) of IPC. The said alteration
report also filed before the learned Judicial Magistrate-I, Tiruvallur. Thus,
it is clear that the deceased was taken to the police station on 11.01.2012
during the night hours and he was produced before the learned
Magistrate only on 14.01.2012. The police personnel at K7 ICF Police
Station alone are responsible for the injuries sustained by the deceased.
The deceased was brutally beaten by the accused persons and due to
which he sustained grievous injuries and died.
11. There is great responsibility on the police authority to ensure
that the citizen in its custody is not deprived of his right to life. His liberty
is in the very nature of things circumscribed by the very fact of his
confinement and therefore his interest in the limited liberty left to him is
rather precious. The wrong doer is accountable and the State is
responsible if the person in custody of the police is deprived of his life
except according tot he procedure establish by law.
12. In the case on hand, the deceased was tortured and subjected
to third decree treatment due to which he died. The Hon'ble Supreme
Court of India repeatedly held that when the death taken place inside the
police station, the accused persons should be punished for the offence
under Section 302 of IPC. When the eighth respondent found that there
are materials to attract the major offence under Section 304(ii) of IPC,
what is the reason why the eighth respondent failed to alter the offence
under Section 302 of IPC? The injuries sustained by the deceased are
very clear and from the Post Mortem report, the cause of death clearly
shows that the police personnel had beaten the deceased and had given
third decree treatment. Therefore, it cannot be said that the accused
persons had no intension to murder the deceased.
13. The Hon'ble Supreme Court of India held in the case Rudul
Sah Vs. State of Bihar & anr reported in AIR 1983 SC 1086 that, one of
telling ways in which the violation of that right can reasonable be
prevented and due compliance with the mandate of Atricle 21 secured is
to mulct its violators in the payment of monetary compensation. The right
of compensation is some palliative for the unlawful acts of
instrumentalities which act in the name of public interest and which
present for their protection the powers of the State as a shield. If
civilisation is not to perish in this country as it has perished in some
others, too well known to suffer mention, it is necessary to educate
ourselves into accepting that, respect for the right of individuals is the
true bastion of democracy. Therefore, the State must repair the damage
done by its officers to the petitioner's right. It may have recourse against
those officers.
14. In the case on hand, poor young man aged about 22 years is
killed and his mother, young wife and his 8 years old child are the
dependents of the deceased. Therefore, it is clear case of murder and all
the accused persons shall be punished for the offence under Section 302
of IPC. The dependents of the deceased are entitled atleast for interim
compensation, since the provision under Section 357 A of Cr.P.C., says
about the order to pay compensation which reads as follows :-
“357. Order to pay compensation. (1) When a
Court imposes a sentence of fine or a sentence
(including a sentence of death) of which fine forms a
part, the Court may, when passing judgment order
the whole or any part of the fine recovered to be
(a) in defraying the expenses properly
incurred in the prosecution;
compensation for any loss or injury caused by the
offence, when compensation is, in the opinion of the
Court, recoverable by such person in a Civil Court;
(c) when any person is convicted of any
offence for having caused the death of another
person or of having abetted the commission of such
an offence, in paying compensation to the persons
who are, under the Fatal Accidents Act, 1855 (13 of
1855), entitled to recover damages from the person
sentenced for the loss resulting to them from such
death; (d) when any person is convicted of any
offence which includes theft, criminal
misappropriation, criminal breach of trust, or
cheating, or of having dishonestly received or
retained, or of having voluntarily assisted in
disposing of, stolen property knowing or having
reason to believe the same to be stolen in
compensating any bona fide purchaser of such
property for the loss of the same if such property is
restored to the possession of the person entitled
thereto.
(2) If the fine is imposed in a case which is
subject to appeal, no such payment shall be made
before the period allowed for presenting the appeal
has elapsed, or if an appeal be presented, before the
decision of the appeal.
(3) When a Court imposes a sentence, of which
fine does not form a part, the Court may, when
passing judgment order the accused person to pay,
by way of compensation such amount as may be
specified in the order to the person who has suffered
any loss or injury by reason of the act for which the
accused person has been so sentenced.”
Accordingly, the compensation can be paid only on the conclusion of
trial. However, the dependents are entitled for interim compensation
when the prima facie case made out. Therefore, this Court has no
hesitation to award interim compensation payable by the State
Government to the dependents of the deceased.
15. Accordingly, this Court is inclined to pass the following
(i) The eighth respondent is directed to alter the offence into
302 of IPC as against the accused persons and proceed against them in
accordance with law and file final report within a period of eight weeks
from the date of receipt of a copy of this Order.
(ii) The Government of Tamil Nadu is directed to pay a sum of
Rs.5,00,000/- (Rupess five lakhs only) as interim compensation to the
dependents of the deceased within a period of four weeks from the date of
receipt of a copy of this Order.
(iii) The said compensation shall be recovered from the accused
persons in the manner known to law.
16. With the above directions, the Writ Petition stands allowed.
Consequently, connected miscellaneous petitions are closed. There shall
be no order as to costs.
4. The Deputy Commissioner of Police,
W.M.P.Nos.12462 of 2020 & 21089 of 2021
|
The Writ Petition has been filed to direct the respondent-
State of Tamil Nadu to register a case under Section 302 of IPC against
the respondent No.6 and all other police personnel responsible for the
death of the petitioner's son Nithya @ Nithyaraj and to hand over the
investigation of the case in Cr. No.2 of 2017 on the file of the respondent
No.8, to the Central Bureau of Investigation and further directing the
respondent – State to award appropriate compensation to the petitioner
for the death of her son. The learned counsel appearing for the petitioner submitted
that the son of the petitioner was a member of 'Friends of Police' attached
to K2, Ayanavaram Police Station, Chennai. While being so, on
11.01.2012 the police personnel of K7 ICF Police Station had taken the
petitioner's son (herein after called as “the deceased”) to the police
station. Next day i.e., on 12.01.2012, when the petitioner went to the
police station and enquired about him but she was not allowed to see her
son. When the deceased was produced before the learned
Magistrate, the petitioner and her relatives had seen him and he was
sustained injuries all over his body. He was also threatened by the sixth
respondent herein that not to disclose anybody about the torture given by
the police personnel in the police station. Unfortunately, the learned
Magistrate also without even verifying the injuries sustained by the
deceased, ordered to remand him. The memo of arrest shows that the
deceased was arrested on 13.01.2012 and he was produced for remand
on 14.01.2012. Accordingly, he was remanded by the learned Magistrate
till 28.01.2012. He was not given proper
treatment and again he was sent to prison hospital. Due to bad condition
of the deceased, again he was taken to the Government Royapettah
Hospital, Chennai on 16.01.2012. Unfortunately, he died on the way to
hospital on 16.01.2012 itself. P.C., on the
file of the Inspector of Police, M3 Puzhal Police Station. Thereafter, the learned V Metropolitan Magistrate, Chennai,
conducted inquest on the dead body and found that the deceased died in
suspicious manner. Therefore, the Government of Tamil Nadu passed an
order transferring the investigation from the file of the Inspector of Police,
M3 Puzhal Police Station to the eighth respondent herein. Thereafter, the
eighth respondent registered a case in Crime No.2 of 2017 under Section
176 of Cr. P.C. Further the eighth respondent also kept the FIR without
investigating the same. Therefore, the petitioner who is being the mother of the
deceased has filed this Writ Petition for direction directing the State of
Tamil Nadu to award interim compensation and also sought for alteration
of offence into Section 302 of IPC by transferring the investigation to
Central Bureau of Investigation. He further submitted that both custodial
torture and custodial death are gross violation of one's fundamental rights
under Article 21 of the Constitution of India. Therefore, the dependents
of the deceased are entitled for compensation. Therefore he prayed for
necessary directions from this Court. On that complaint, the six respondent registered a case in Crime No.24 of
2012 and searched for the deceased. Further on seeing the witnesses, the
deceased ran away and he scaled over a compound wall and jumped and
fell down in which he sustained injuries. He further submitted that the head injury mentioned in the
post mortem certificate could be accidental and it could be caused due to
the impact of head over the blunt surface or object during fall or impact
of any blunted object over the right part of the head. The deceased was
remanded to judicial custody and brought to Central Prison, Puzhal on
14.01.2012. Since, he expressed heavy pain in his shoulders, the prison
hospital doctor refused to admit him and referred to Government
Royapettah Hospital, Chennai. Thereafter he was suspected nerve injury
and referred to take CT scan at Rajiv Gandhi Government General
3.2. On 15.01.2012, the deceased was admitted in Rajiv Gandhi
Government Hospital and CT Brain scan was taken. The Neuro Surgeon
opinion was obtained and it reveals that no abnormality detected and nil
active intervention needed. Therefore, he was discharged from the Rajiv
Gandhi Government Hospital and referred to Government Royapettah
Hospital, Chennai for further treatment. Again he was referred for taking
MRI spine scan on 15.01.2012 at 19.55 hours and thereafter, he was
admitted in the prison hospital about 21.10 hours. The learned Government Advocate further submitted that
post mortem was conducted and opined as the injuries in Sl. Nos.1-a to u
and 2 to 9 were found over the deceased body and injuries No.2 & 9
could be accidental. Injuries 1-d,e,t,g,i,j,k,m,n,o,p,r,s,t and u , 3 to 8
could be accidental or could have been inflicted by others. The injury
No.9 is sufficient to cause death in the ordinary course of nature and all
other injuries are not sufficient to cause death in the ordinary course of
nature. Hence it revealed that the death caused due to injury No.9. The team of post mortem Doctors opined that the injury
Nos.2 & 9 might have occurred accidentally and opined that the above all
injuries were antemortem in nature occurred 3 to 4 days prior to death. Since the head injury could be accidental, request was made to get second
opinion from the Director, Directorate of Medical Examination, Kilpauk,
chennai. By the second opinion dated 09.03.2022, it was opined that the
death caused due to thin film of red, subdural hemorrhage patchy areas of
diffuse subarachnoid hemorrhage over both cerebral and both cerebellar
hemispheres of the brain. This could be caused due to impact of head
over the blunt surface or any other object during fall or impact of any
blunted object over the right part of the head. On perusal of all the documents and the enquiry conducted
from the doctors and police personnel, the offence has been altered from
Section 176 of Cr. P.C., to Sections 342, 343, 348, 324 & 304(ii) of IPC
on 15.07.2022. Hence, he prayed for dismissal of this petition. Heard Mr.P.Pugalenthi, learned counsel appearing for the
petitioner and Mr.A.Gopinath, learned Government Advocate (Crl. Side)
appearing for the respondents 1 to 6 and 8. The petitioner's son was arrested on 13.01.2012 in pursuant
to the Crime No.24 of 2012 registered for the offences under Section 420
r/w 392 of IPC. The said case was registered on receipt of the complaint
from one Dinesh, alleging that on 13.01.2012, the said Dinesh and his
lover were threatened by the deceased by stating that he is the member of
“friend of police” and snatched his cell phone. Immediately, within 24
hours, the deceased was produced before the learned Magistrate for his
remand. In fact, before the learned Magistrate no complaint was
made by the deceased and no injury was found on him. Further in the
prison, he informed about his shoulder pain. Therefore, immediately he
was taken to jail hospital and make an entry in the prison records. However, the Doctor refused to admit him inside the prison and referred
the deceased to the Government Royapettah Hospital for orthopedic
opinion. Thereafter he was admitted by the ICF police personal in the
Government Royapettah Hospital, Chennai. After examination, the
Orthopedic Surgeon suspected nerve injury and referred the deceased for
CT-brain scan at Rajiv Gandhi Government General Hospital, Chennai. The Neuro Surgeon opined that no abnormality detected, nil
active intervention needed. Therefore, the deceased was discharged from
the hospital and referred to Government Royapettah Hospital for further
treatment. In fact on 15.01.2012, again the deceased was taken to MRI
scan on his spine. Thereafter he was again taken to prison and admitted
in the prison hospital. On 16.01.2012, he had difficulty in breathing and
therefore, again he was referred to the Government Royapettah Hospital,
for further treatment. However it was reported that the prisoner was
brought dead. Thereafter Post mortem was conducted on 17.01.2012 and
the following injuries were found on the deceased body :-
“External injuries:-
c) 14.4X3-1.2 cm, oblique brown abrasion
on the front of lower third of right arm and on
the adjoining inner aspect of right elbow. d) 1.7X0.4 cm on the inner aspect of upper
third of right forearm. k) 2.1X0.2 cm horizontal, brown abrasion
on the outer aspect of middle third of left arm. p) 3.2X1-0.5cm on the front of upper end of
q) 8X3-08 cm on the inner aspect of lower
r) 4.3X1-0.4 cm on the outer of lower third
s) 3.4X0.2-0.1 cm on the outer aspect of
middle third of left leg
t) 1.4X05-03 cm on the upper part of left
side of the abdomen along the line a left nipple
with the surrounding 13.5 X9-3Xskin deep dark
red bruise on the upper part of left side of the
abdomen. u)5X0.5-0.2 cm horizontal brown abrasion,
on the lower part of left lateral aspect of the
chest. Oblique, brown, grazed abrasion over
an area of 11.5X8-3 cm on the outer aspect of
upper third of left leg
3. Dark red contusion 4X3cmX skin deep
on the middle third of back of left forearm
4. Dark red contusion 4X1cmXskin deep on
the front of left ankle. Dark red contusion 7X2.5-0.5cmX skin
deep on the back of right wrist. Dark red contusion 3X1cmXskin deep on
the front of lower third of right forearm
9. On reflection of scalp : Dark red
contusion 8X6cmXskin deep on the right tempero
occipital region of the scalp; on further
dissection – underlying bones were intact. On
removal of the calvarium thin film a red subdural
hemorrhage and patchy areas of diffuse
subarachnoid hemorrhage over both cerebral
and both cerebellar hemispheres of the brain.” The post mortem report also revealed that all the injuries are antemortem
in nature viz., Further revealed that the injuries
2 & 9 could be accidental and injuries numbered 1-d,e,g,i,j,k,m,n,
o,p,r,s,t and u and injuries numbered 3,4,5,6,7 and 8 could be accidental
or could be inflicted by others. The injury No.9 is sufficient to cause
death in the ordinary course of nature. Therefore, the eighth respondent enquired the police
personnel of K7, ICF Police Station and other witnesses and after
enquiry, he found that it is a case of 304(ii) of IPC and altered the offence
under Sections 342, 343, 348, 324 & 304(ii) of IPC. The said alteration
report also filed before the learned Judicial Magistrate-I, Tiruvallur. Thus,
it is clear that the deceased was taken to the police station on 11.01.2012
during the night hours and he was produced before the learned
Magistrate only on 14.01.2012. The police personnel at K7 ICF Police
Station alone are responsible for the injuries sustained by the deceased. The deceased was brutally beaten by the accused persons and due to
which he sustained grievous injuries and died. There is great responsibility on the police authority to ensure
that the citizen in its custody is not deprived of his right to life. His liberty
is in the very nature of things circumscribed by the very fact of his
confinement and therefore his interest in the limited liberty left to him is
rather precious. The wrong doer is accountable and the State is
responsible if the person in custody of the police is deprived of his life
except according tot he procedure establish by law. In the case on hand, the deceased was tortured and subjected
to third decree treatment due to which he died. When the eighth respondent found that there
are materials to attract the major offence under Section 304(ii) of IPC,
what is the reason why the eighth respondent failed to alter the offence
under Section 302 of IPC? The injuries sustained by the deceased are
very clear and from the Post Mortem report, the cause of death clearly
shows that the police personnel had beaten the deceased and had given
third decree treatment. Therefore, it cannot be said that the accused
persons had no intension to murder the deceased. The Hon'ble Supreme Court of India held in the case Rudul
Sah Vs. State of Bihar & anr reported in AIR 1983 SC 1086 that, one of
telling ways in which the violation of that right can reasonable be
prevented and due compliance with the mandate of Atricle 21 secured is
to mulct its violators in the payment of monetary compensation. The right
of compensation is some palliative for the unlawful acts of
instrumentalities which act in the name of public interest and which
present for their protection the powers of the State as a shield. If
civilisation is not to perish in this country as it has perished in some
others, too well known to suffer mention, it is necessary to educate
ourselves into accepting that, respect for the right of individuals is the
true bastion of democracy. Therefore, the State must repair the damage
done by its officers to the petitioner's right. It may have recourse against
those officers. In the case on hand, poor young man aged about 22 years is
killed and his mother, young wife and his 8 years old child are the
dependents of the deceased. Therefore, it is clear case of murder and all
the accused persons shall be punished for the offence under Section 302
of IPC. The dependents of the deceased are entitled atleast for interim
compensation, since the provision under Section 357 A of Cr. P.C., says
about the order to pay compensation which reads as follows :-
“357. (2) If the fine is imposed in a case which is
subject to appeal, no such payment shall be made
before the period allowed for presenting the appeal
has elapsed, or if an appeal be presented, before the
decision of the appeal. (3) When a Court imposes a sentence, of which
fine does not form a part, the Court may, when
passing judgment order the accused person to pay,
by way of compensation such amount as may be
specified in the order to the person who has suffered
any loss or injury by reason of the act for which the
accused person has been so sentenced.” Accordingly, the compensation can be paid only on the conclusion of
trial. However, the dependents are entitled for interim compensation
when the prima facie case made out. Therefore, this Court has no
hesitation to award interim compensation payable by the State
Government to the dependents of the deceased. (ii) The Government of Tamil Nadu is directed to pay a sum of
Rs.5,00,000/- (Rupess five lakhs only) as interim compensation to the
dependents of the deceased within a period of four weeks from the date of
receipt of a copy of this Order. (iii) The said compensation shall be recovered from the accused
persons in the manner known to law. With the above directions, the Writ Petition stands allowed. Consequently, connected miscellaneous petitions are closed. The Deputy Commissioner of Police,
W.M.P.Nos.12462 of 2020 & 21089 of 2021
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Great responsibility on Police to ensure that citizen in its custody is not deprived of right to life.The Madras High Court recently allowed a mother's plea to register a case for the offence of Murder against the police officials allegedly involved in the custodial death of her 22 year old son.It directed the CB-CID to alter the charge against the accused police officials and proceed against them for the offence of murder and file the final report within a period of eight weeks. The court...
The Madras High Court recently allowed a mother's plea to register a case for the offence of Murder against the police officials allegedly involved in the custodial death of her 22 year old son.
It directed the CB-CID to alter the charge against the accused police officials and proceed against them for the offence of murder and file the final report within a period of eight weeks.
The court also directed the Government of Tamil Nadu to pay a sum of Rs. 5 lakhs as interim compensation within a period of four weeks to the victim's family. The amount shall be recovered from the accused in accordance with law.
Justice GK Ilanthiraiyan observed that the Police has a responsibility to ensure that a citizen in its custody is not deprived of his right to life, except according to procedure established by law.
There is great responsibility on the police authority to ensure that the citizen in its custody is not deprived of his right to life. His liberty is in the very nature of things circumscribed by the very fact of his confinement and therefore his interest in the limited liberty left to him is rather precious. The wrong doer is accountable and the State is responsible if the person in custody of the police is deprived of his life except according tot he procedure establish by law.
The petitioner contended that her son, the deceased was taken to the police station on 11.01.2012. On the next day, though she went to the police station, she was not allowed to see her son. On 14.01.2012, he was brought before the Magistrate and was remanded till 28.01.2012. The petitioner submitted that when her son was produced before the Magistrate, they noticed that he had sustained injuries all over his body. He was also threatened by the police not to disclose the torture given by the police personnel. Further, the remand order was made without verifying the injuries, it is alleged.
After remand, her son informed that he suffered pain and therefore he was taken to jail hospital and thereafter he was referred to the Government Royapettah Hospital. He was not given proper treatment and again he was sent to the prison hospital. Due to the bad condition of the deceased, again he was taken to the Government Royapettah Hospital, Chennai on 16.01.2012. Unfortunately, he died on the way to the hospital on 16.01.2012 itself. The investigation was transferred to CB-CID where a case was registered under Section 176 CrPC. The petitioner further submitted that the FIR was kept without any investigation by the CB-CID.
The petitioner submitted that custodial torture and custodial death were a gross violation of one's fundamental rights under Article 21 of the Constitution. Thus, she sought for alteration of the offence into one under Section 302 of the IPC and also sought compensation.
Per contra, the Government advocate submitted that as per a complaint received from one Dinesh, a case was registered against the deceased. On seeing the witnesses, the deceased ran away and he scaled over a compound wall and jumped and fell down in which he sustained injuries. He also submitted that even as per the post-mortem report, all the injuries on the body of the deceased were antemortem and could have been accidental. Only one injury was sufficient to cause death in the ordinary cause of nature. The respondent relied on the second opinion of the Professor and Head of the Forensic Medicine and Toxicology Department at a Government Medical College in Chennai who submitted that the injury could be caused due to the impact of the head over the blunt surface, object, during fall or impact of any object or weapon over that part of the head.
It was further informed that after enquiring the police personnel, the CB-CID had altered the charges to one under Sections 342, 343, 348, 324 & 304(ii) of IPC. The alteration report was filed before the Judicial Magistrate also.
The court noted that the deceased was taken to the police station on 11.01.2012 during the night hours and he was produced before the learned Magistrate only on 14.01.2012. Thus, it held that officals at the Police Station alone are responsible for the injuries sustained by the deceased.
Reliance was placed on Supreme Court's decisions holding that when death takes place inside the police station, the accused persons should be punished for the offence under Section 302 of IPC. Thus, the court wondered that when sufficient materials were available to attract the major offence under Section 304(ii) of IPC, why did the CB-CID fail to alter the charge to one under Section 302 of the IPC?
Relying on the position laid down in the case of Rudul Sah Vs. State of Bihar & Anr the court held that the petitioner was also eligible for compensation. The court noted that compensation was a palliative for the unlawful acts of the instrumentalities.
"If civilisation is not to perish in this country as it has perished in some others, too well known to suffer mention, it is necessary to educate ourselves into accepting that, respect for the right of individuals is the true bastion of democracy. Therefore, the State must repair the damage done by its officers to the petitioner's right. It may have recourse against those officers."
The court noted that though compensation could be paid at the conclusion of trial, the dependents were still entitled for interim compensation when a prima facie case was made out as per the provisions of Section 357 A of CrPC. Thus, the court allowed the petition and ordered accordingly.
Case Title: S.Pongulali v. The State of Tamil Nadu and others
Case No: W.P.No.10249 of 2020
Counsel for the Petitioner: Mr.P.Pugalenthi
Counsel for the Respondent: Mr.A.Gopinath, Government Advocate (Crl. Side) (R1-R6 and R8)
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Great responsibility on Police to ensure that citizen in its custody is not deprived of right to life. It directed the CB-CID to alter the charge against the accused police officials and proceed against them for the offence of murder and file the final report within a period of eight weeks. The court...
The Madras High Court recently allowed a mother's plea to register a case for the offence of Murder against the police officials allegedly involved in the custodial death of her 22 year old son. The amount shall be recovered from the accused in accordance with law. Justice GK Ilanthiraiyan observed that the Police has a responsibility to ensure that a citizen in its custody is not deprived of his right to life, except according to procedure established by law. There is great responsibility on the police authority to ensure that the citizen in its custody is not deprived of his right to life. His liberty is in the very nature of things circumscribed by the very fact of his confinement and therefore his interest in the limited liberty left to him is rather precious. The wrong doer is accountable and the State is responsible if the person in custody of the police is deprived of his life except according tot he procedure establish by law. The petitioner contended that her son, the deceased was taken to the police station on 11.01.2012. On the next day, though she went to the police station, she was not allowed to see her son. On 14.01.2012, he was brought before the Magistrate and was remanded till 28.01.2012. The petitioner submitted that when her son was produced before the Magistrate, they noticed that he had sustained injuries all over his body. He was also threatened by the police not to disclose the torture given by the police personnel. Further, the remand order was made without verifying the injuries, it is alleged. After remand, her son informed that he suffered pain and therefore he was taken to jail hospital and thereafter he was referred to the Government Royapettah Hospital. He was not given proper treatment and again he was sent to the prison hospital. Unfortunately, he died on the way to the hospital on 16.01.2012 itself. The investigation was transferred to CB-CID where a case was registered under Section 176 CrPC. Thus, she sought for alteration of the offence into one under Section 302 of the IPC and also sought compensation. On seeing the witnesses, the deceased ran away and he scaled over a compound wall and jumped and fell down in which he sustained injuries. He also submitted that even as per the post-mortem report, all the injuries on the body of the deceased were antemortem and could have been accidental. Only one injury was sufficient to cause death in the ordinary cause of nature. The alteration report was filed before the Judicial Magistrate also. Reliance was placed on Supreme Court's decisions holding that when death takes place inside the police station, the accused persons should be punished for the offence under Section 302 of IPC. Thus, the court wondered that when sufficient materials were available to attract the major offence under Section 304(ii) of IPC, why did the CB-CID fail to alter the charge to one under Section 302 of the IPC? Relying on the position laid down in the case of Rudul Sah Vs. State of Bihar & Anr the court held that the petitioner was also eligible for compensation. The court noted that compensation was a palliative for the unlawful acts of the instrumentalities. Therefore, the State must repair the damage done by its officers to the petitioner's right. It may have recourse against those officers." Thus, the court allowed the petition and ordered accordingly.
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. Heard. Rule. Rule is made returnable forthwith.
Learned AGP Smt. R.P. Gour waives service for respondent no.1 and
learned advocate Mr. Subhash Chillarge waives service for respondent
nos.2 and 3. At the joint request of the parties, the matter is heard
finally at the stage of admission.
2. The petitioner challenges the judgment and order dated
05.11.2019 passed by the Maharashtra Administrative Tribunal,
Bench at Aurangabad in Original Application No.69 of 2018. In his
Original Application, the petitioner had challenged the order dated
24.01.2018 directing recovery of amount of Rs.2,58,711/- from his
retirement benefits. By the impugned judgment, the Tribunal has
dismissed the Original Application.
3. The petitioner was appointed as Technical Assistant in
the office of respondent no.3 on 16.02.1982, which post was
abolished and the petitioner came to be absorbed on the post of Civil
Engineering Assistant w.e.f. 01.01.1989. He had passed Sub Overseer
examination on 18.05.1985 and by order dated 03.08.2004, he was
promoted on the post of Sub Overseer by granting deemed date of
promotion as on 18.05.1985. On account of completion of 12 years
of service from the date of initial appointment of 16.02.1982, he was
granted financial upgradation under the Time Bound Promotion
scheme w.e.f. 01.10.1994. On completion of 24 years of service, he
was granted benefit of second Time Bound Promotion with effect
from 01.10.2006. Later, he was promoted to the post of Junior
Engineer, Class-II, Non Gazetted post by order dated 02.07.2007. On
attaining the age of superannuation, he retired from service on
31.08.2017. Upon submitting his pension papers, the Accountant
General, Mumbai formed an opinion that the petitioner’s services
from the date of initial appointment of 16.02.1982 could not be
counted for Time Bound Promotion and the same were required to be
counted from the date of his absorption as Civil Engineering Assistant
w.e.f. 01.01.1989. Accordingly, refixation of petitioner’s pay was done
and an amount of Rs.2,58,711/- was directed to be recovered.
4. In his original application, the petitioner did not dispute
the action of the respondents in re-fixing his pay. What was
challenged was only the recovery effected as a consequence of
re-fixation. The Tribunal proceeded to dismiss the original application
on the ground that since the petitioner was functioning on Class-II
post of Junior Engineer, he is not entitled to protection against
recovery by applying ratio of the Judgment of the Apex Court in
State of Punjab & Ors. Vs. Rafiq Masih (white Washer) and Others,
5. Mr. Sugdare, learned advocate appearing for the
petitioner would submit that even though the petitioner was
promoted on the post of Junior Engineer on 02.07.2007, the recovery
is in respect of the period when he was working on Class-III post. He
would submit that the recovery in respect of such a long period could
not have been effected after retirement of the petitioner. He relied
upon judgment of the Apex Court in The State of Maharashtra and
another Vs. Madhukar Antu Patil and another, Civil Appeal No.1985
of 2022 decided on 21.03.2022.
6. Per contra, Mr. Chillarge, learned advocate appearing for
respondent nos.2 and 3 opposes the petition and would submit that
the petitioner was erroneously granted the benefit of Time Bound
Promotion scheme. He would submit that in addition to Time Bound
Promotions, the petitioner was also granted regular promotion on the
post of Junior Engineer. He would therefore submit that the
respondents have rightly withdrawn the erroneous benefit of Time
Bound Promotion granted to the petitioner and have accordingly
refixed his pay. He would further submit that recovery is a natural
consequence of refixation of pay and the petitioner cannot be
permitted to retain the amount erroneously granted to him. He
would submit that being a Class-II Officer, the petitioner is not
entitled to the benefit of the judgment of the Apex Court in Rafiq
7. The learned AGP appearing for respondent no.1 has
supported the order passed by the Tribunal and has prayed for
dismissal of the petition.
8. The law regarding recovery of excess payment is now
well settled by the judgment of the Apex Court in Rafiq Masih
(supra). After considering the entire jurisprudence regarding the
subject of recovery of excess payment, the Apex Court has
summarised the situations as under:
“12. It is not possible to postulate all situations of
hardship, which would govern employees on the issue
of recovery, where payments have mistakenly been
made by the employer, in excess of their entitlement.
Be that as it may, based on the decisions referred to
herein above, we may, as a ready reference,
summarise the following few situations, wherein
recoveries by the employers, would be impermissible
(i) Recovery from employees belonging to Class-III
and Class-IV service (or Group 'C' and Group 'D'
service).
(ii) Recovery from retired employees, or employees
who are due to retire within one year, of the order of
recovery.
(iii) Recovery from employees, when the excess
payment has been made for a period in excess of five
years, before the order of recovery is issued.
(iv) Recovery in cases where an employee has
wrongfully been required to discharge duties of a
higher post, and has been paid accordingly, even
though he should have rightfully been required to
work against an inferior post.
(v) In any other case, where the Court arrives at the
conclusion, that recovery if made from the employee,
would be iniquitous or harsh or arbitrary to such an
extent, as would far outweigh the equitable balance of
the employer's right to recover.”
9. Upon perusal of the principles laid down by the Apex
Court in Rafiq Masih (supra), it is clear that the five situations
summarized by the Court in para - 12 of the Judgment are not
exhaustive. The Apex Court itself has made it clear that it is not
possible to postulate all the situations of hardships, which would
govern employees on the issue of recovery, where payments have
mistakenly been made by the employer in excess of their entitlement.
Thus, it cannot be stated that only in five situations summarized by
the Apex Court, the recovery would be bad. It would always be open
to the Courts to extend the benefit of protection from recovery in an
appropriate case which is not covered by any of the five situations
summarized in Rafiq Masih (supra).
10. Having considered the exposition of law laid down by
the Apex Court relating to recovery of excess payment in Rafiq Masih
(supra), we now proceed to consider applicability of the situations to
the present case.
11. We have gone through the affidavit-in-reply filed on
behalf of respondent no.1 before the Tribunal. We find that the exact
reason for re-fixation of pay of the petitioner was not disclosed in the
affidavit-in-reply. However, following averments were made in
para - 4 thereof.
“4. I say that as to contents of para No.6 (a), as
submitted herein above, initial appointment of the
applicant was on daily wages and on completion of
five years, he was brought on CRTE. As submitted by
the applicant, his services are to be reckoned from
12. Thus, from the averments made in para - 4 of the
affidavit-in-reply filed before the Tribunal, it appears that the
petitioner’s initial appointment w.e.f. 16.02.1982 was apparently on
daily wages, that too on work charged establishment. This fact can
be ascertained from para - 2 of the petition, wherein the petitioner
has averred as under:
“02. The petitioner states that he belongs to Other
Backward Class (O.B.C.). He was appointed as
Technical Assistant in the Office of the Respondent
No.3 on 16-02-1982. He continuously worked on the
work charged establishment till he came to be
absorbed on the post Civil Engineering Assistant w.e.f.
01-01-1989. The petitioner passed Sub Overseer
Examination on dated 18-05-1985, therefore, he was
promoted on the post of Sub Overseer and he was
granted ‘deemed date’ as on 18-05-1985. The
petitioner rendered more than 12 years continuous
service from the date of his appointment on
16-02-1982. He was found eligible for promotion but
for the want of vacancy he was given benefit of Time
Bound Promotion from 01-10-1994 on the post of
Junior Engineer. Thereafter, he completed 24 years
satisfactory service on the post of Technical Assistant,
therefore, his case was considered for grand of 2 nd
benefit (Second Time Bound Promotion).
Accordingly, benefit was extended to him w.e.f.
13. Thus, the petitioner came to be absorbed in regular
service only on 01.01.1989 as Civil Engineering Assistant. It appears
that for counting the service for grant of Time Bound Promotion, his
initial service on work charged establishment with effect from
16.02.1982 was counted and he was granted the first Time Bound
Promotion on 01.10.1994. This was clearly erroneous. The error was
continued while granting second Time Bound Promotion on
completion of 24 years of service w.e.f. 01.10.2006. It appears that
the respondents have corrected the dates of effecting Time Bound
Promotions by counting service of the petitioner from 01.01.1989.
Since the corrective action taken by the respondents was valid, the
petitioner chose not to challenge the same in his original application,
in which he made the following prayers:
“B. By order or directions by this Tribunal the
impugned order dated 24-01-2018 in Office Order
No.13 of 2018 issued by the respondent no.3
regarding recovery of an amount of Rs.2,58,711
(Rupees Two Lacks fifty Eight Thousand Seven
Hundred Eleven) be quashed and set aside.
C. By order or directions the respondent no.3 be
directed to pay the amount which is sought to be
recovered under office order no.13 of 2018 of
Rs.2,58,711/- to the applicant.”
14. However, after the Tribunal criticized the petitioner for
not having challenged refixation of pay, the petitioner has sought to
challenge refixation of pay and has sought the relief of restoration of
Time Bound Promotions as on 01.10.1994 and 01.10.2006 in the
present petition. The prayers in the present petition are as under :
“A. Writ Petition may pleased be allowed.
writ in like nature, impugned order No.13/2018 dated
24/01/2018 issued by the Respondent No.3 in respect
of recovery of Rs.2,58,711/- (revised amount of
Rs.2,62,837/-) (in words Rs. Two Lakh Sixty
Thousand Eight Hundred Thirty Seven only) be
quashed and set aside.
writ in like nature the impugned letter dated 6 th
September, 2017 issued by the Accountant General,
Mumbai please be quashed and set aside.
writ in like nature or orders or directions, the order
dated 05-11-2019 in O.A. No.69 of 2018 passed by the
Maharashtra Administrative Tribunal Bench at
Aurangabad be quashed and set aside.
writ in like nature the Respondent No.3 may be
directed to refix the pay of the petitioner by counting
his service from his initial date of appointment i.e.
16-02-1982, by restoring Time Bound Promotion as on
01-10-1994 and 01-10-2006 respectively.
F. Pending hearing and final disposal of this W.P.
the Respondent No.3 may be directed to refund the
recovered amount of Rs.2,58,711/- (revised amount of
Rs.2,62,837/-) (in words Rs. Two Lakh Sixty
15. We are afraid, in exercise of power of Superintendence
over the order passed by the Tribunal, we cannot permit the
petitioner to expand the scope of challenge in the present petition.
We, therefore, proceed to ignore prayer clause ‘E’ made in the present
petition.
16. In Madhukar Antu Patil (supra) relied upon by
Mr. Sugdare, the fact situation was somewhat similar. In that case,
the respondent therein was initially appointed on 11.05.1982 as
Technical Assistant on work charged basis and came to be absorbed
as Civil Engineering Assistant in the year 1989. He was erroneously
granted Time Bound Promotions by considering the date of his initial
appointment as 1982 and after his retirement, the error was sought
to be corrected. The Apex Court has held in para nos.3.1, 4 and 5 as
“3.1 At the outset, it is required to be noted and it
is not in dispute that respondent no.1 was initially
appointed on 11.05.1982 as a Technical Assistant on
work charge basis. It is also not in dispute that
thereafter he was absorbed in the year 1989 on the
newly created post of Civil Engineering Assistant,
which carried a different pay scale. Therefore, when
the contesting respondent was absorbed in the year
1989 on the newly created post of Civil Engineering
Assistant which carried a different pay scale, he shall
be entitled to the first TBP on completion of twelve
years of service from the date of his absorption in the
post of Civil Engineering Assistant. The services
rendered by the contesting respondent as Technical
Assistant on work charge basis from 11.05.1982 could
not have been considered for the grant of benefit of
first TBP. If the contesting respondent would have
been absorbed on the same post of Technical Assistant
on which he was serving on work charge basis, the
position may have been different. The benefit of TBP
scheme shall be applicable when an employee has
worked for twelve years in the same post and in the
same pay scale.
4. In the present case, as observed hereinabove,
his initial appointment in the year 1982 was in the
post of Technical Assistant on work charge basis,
which was altogether a different post than the newly
created post of Civil Engineering Assistant in which he
was absorbed in the year 1989, which carried a
different pay scale. Therefore, the department was
right in holding that the contesting respondent was
entitled to the first TBP on completion of twelve years
from the date of his absorption in the year 1989 in the
post of Civil Engineering Assistant. Therefore both, the
High Court as well as the Tribunal have erred in
observing that as the first TBP was granted on the
approval of the Government and the Finance
Department, subsequently the same cannot be
modified and/or withdrawn. Merely because the
benefit of the first TBP was granted after the approval
of the Department cannot be a ground to continue the
same, if ultimately it is found that the contesting
respondent was entitled to the first TBP on completion
of twelve years of service only from the year 1989.
Therefore both, the High Court as well as the Tribunal
have committed a grave error in quashing and setting
aside the revision of pay scale and the revision in
pension, which were on re-fixing the date of grant of
first TBP from the date of his absorption in the year
1989 as Civil Engineering Assistant.
5. However, at the same time, as the grant of
first TBP considering his initial period of appointment
of 1982 was not due to any misrepresentation by the
contesting respondent and on the contrary, the same
was granted on the approval of the Government and
the Finance Department and since the downward
revision of the pay scale was after the retirement of
the respondent, we are of the opinion that there shall
not be any recovery on re-fixation of the pay scale.
However, the respondent shall be entitled to the
pension on the basis of the re-fixation of the pay scale
on grant of first TBP from the year 1989, i.e., from the
date of his absorption as Civil Engineering Assistant.”
17. Thus, under similar circumstances, the Apex Court has
granted protection from recovery on re-fixation of pay scale in the
case of Madhukar Antu Patil (supra). Mr. Chillarge has sought to
distinguish the judgment in Madhukar Antu Patil (supra) by
contending that the respondent therein retired on the post of Civil
Engineering Assistant, which is a Class-III post, whereas the petitioner
in the instant petition retired on the post of Junior Engineer, which is
a Class-II Non-gazetted post. The question that therefore arises is,
whether we can extend the protection granted in the case of
Madhukar Antu Patil (supra) by following the judgment of the Apex
Court or whether we restrain ourselves from doing so only because
the petitioner does not fall in situation at serial no.(i) of the
Judgment in Rafiq Masih (supra) i.e. he is not Class-III or Class-IV
employee. This is a reason why we have attempted to summarize
situations expounded by the Apex Court in Rafiq Masih (supra) on
law relating to recovery of excess payment and have arrived at a
conclusion that in an appropriate and rare case, this Court would be
justified in extending the benefit of recovery even to Class-I or
Class-II Officers, if the situation so demands.
18. The recovery in the instant case has been effected after
retirement of the petitioner. Nothing had prevented the respondents
from correcting the mistake in grant of Time Bound Promotions to
the petitioner during his service career. The refixation appears to
have been done w.e.f. 01.10.1994 as the corrective action involved
withdrawal of benefit of first Time Bound Promotion granted w.e.f.
01.10.1994. Thus, the corrective action is taken after a period of 23
long years and consequently, the recovery also appears to be in
respect of 23 long years. Also, most of the period of recovery was
when the petitioner was occupying Class-III post. Admittedly, there
was no misrepresentation on the post of the petitioner in securing the
excess payment. We have two very strong reasons in the present case
for arriving at a conclusion that the recovery would be arbitrary, viz.
unduly long period of 23 years of recovery and retirement of the
petitioner. After weighing these two positive factors against the
negative factor of the petitioner retiring on Class-II Officer post, we
find that the former would outweigh the latter. Undeniably, the case
of the petitioner is similar to that of Madhukar Antu Patil (supra).
The only distinguishing factor is the petitioner retired on Class-II post
of Junior Engineer, whereas Madhukar Antu Patil (supra) retired on
Class-III post of Civil Engineering Assistant. We find that the Apex
Court in Madhukar Antu Patil (supra) without considering whether
he belonged to Class-II or Class-III post extended the protection of
recovery of excess payment. The protection is granted in the peculiar
facts and circumstances of the case. Since the two cases are similar,
we have no hesitation in following the judgment and applying the
ratio of the judgment in Madhukar Antu Patil (supra) to the present
case.
19. We are also not in agreement with the finding recorded
by the Tribunal that the petitioner ought to have challenged the order
of refixation of pay. It was always open to the petitioner to question
only the recovery and not his refixation. In fact, we find that the
petitioner has rightly not challenged refixation of his pay and he was
still entitled to challenge recovery of excess payment after his
retirement.
20. Before parting, we would clarify that applicability of
judgment of Rafiq Masih (supra) to the present case is on account of
peculiar facts of this case and the same shall not be construed to
mean that Class-I or Class-II Officer would be entitled to protection
from recovery as per Rafiq Masih (supra).
21. Consequently, we allow the present petition by quashing
and setting aside the impugned judgment and order of the Tribunal.
The order dated 24.01.2018 effecting recovery of Rs.2,58,711/- from
the pensionary benefits of the petitioner is also set aside. The
respondents are directed to refund the recovered amount to the
petitioner along with the interest thereon at the rate of 6% per
annum within a period of four weeks from the date of receipt of this
order.
22. Writ Petition is accordingly allowed. Rule is made
absolute.
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The Aurangabad bench of the Bombay High Court granted protection to a retired Junior Assistant (Class II officer) against recovery of excess salary and benefits erroneously paid to him by the Water Resources Department of the Government of Maharashtra during his service. "We have two very strong reasons in the present case for arriving at a conclusion that the recovery would...
The Aurangabad bench of the Bombay High Court granted protection to a retired Junior Assistant (Class II officer) against recovery of excess salary and benefits erroneously paid to him by the Water Resources Department of the Government of Maharashtra during his service.
"We have two very strong reasons in the present case for arriving at a conclusion that the recovery would be arbitrary, viz. unduly long period of 23 years of recovery and retirement of the petitioner", the court held.
A division bench of Justices Mangesh S. Patil and Sandeep V. Marne, passed the judgement in a writ petition challenging the Maharashtra Administrative Tribunal's (MAT) order upholding the recovery of excess benefits from petitioner's retirement benefits.
The petitioner was employed at the office of the Executive Engineer, Waghur Dam Division, Jalgaon as a Technical Assistant (daily wage) since 1982. He was absorbed into regular service as a Civil Engineering Assistant (Class III) in 1989. Subsequently, he obtained two time-bound promotions. On his retirement, the Accountant General, Mumbai realised that for the purpose of calculation of period of service, his initial appointment in 1982 was erroneously considered instead of his appointment in 1989.
The petitioner's pay was refixed and recovery of excess pay worth almost 2.6 lakhs was directed from his retirement benefits. The petitioner challenged this before the MAT which rejected his application. The petitioner then approached the High Court.
Advocate A. D. Sugdare for the petitioner submitted that even though petitioner was promoted to a Class II post, the recovery is in respect of his Class III post. The recovery for such a long period could not have been made after the retirement of the petitioner.
Advocate Subhash Chillarge for the respondents submitted that the respondents rightly withdrew the excess benefits and accordingly refixed the petitioner's pay. Recovery is a natural consequence of refixation and the petitioner cannot be permitted to retain the excess benefit erroneously given to him. Further, being a Class II officer, he is not protected under the Supreme Court judgement in State of Punjab v. Rafiq Masih.
The court referred to the Apex Court decision in Rafiq Masih regarding recovery of excess payment. It provides that inter alia, employees belonging to Class III and IV of service are protected from recovery of excess pay.
The court observed that the situations surmised in Rafiq Masih are not exhaustive. It is open to the courts to extend the benefit of protection from recovery in an appropriate case.
The court relied on the judgment in State of Maharashtra v. Madhukar Antu Patil which had granted protection from recovery on refixation of pay scale under similar circumstances. The court held that such protection will extend to the present case.
The court concluded that in an appropriate and rare case it is justified to extend the benefit of protection of recovery even to Class I or Class II officers.
The court observed that nothing prevented the respondents from correcting the mistake during the service of petitioner for about 23 years. Most of the period of recovery was when he was occupying a Class III post. Further, there is no mis-representation on the part of the petitioner in securing the excess payment.
The court weighed the two positive factors, namely, the retirement of the petitioner and the unduly long period of recovery outweigh the negative factor of petitioner retiring as a Class II officer.
The court also observed that the petitioner has rightly not challenged refixation of pay and he was still entitled to challenge recovery of excess payment after his retirement.
The court clarified that the applicability of judgement of Rafiq Masih is on the basis of the peculiar facts of the case and it does not mean that all Class I and Class II officers are protected from recovery of excess benefits.
The court set aside the judgement of the tribunal and the order effecting recovery of about 2.6 lakhs from the pensionary benefits of the petitioner. The court directed the respondents to refund the amount to the petitioner.
Case no. – Writ Petition No. 14526 of 2019
Case title – Ajabrao Rambhau Patil v. State of Maharashtra and Ors.
Also Read: Excess Payment Made To Employee Due To Erroneous Interpretation Of Rule Not Recoverable : Supreme Court
|
. Heard. Rule. Rule is made returnable forthwith.
Learned AGP Smt. R.P. Gour waives service for respondent no.1 and
learned advocate Mr. Subhash Chillarge waives service for respondent
nos.2 and 3. At the joint request of the parties, the matter is heard
finally at the stage of admission.
2. The petitioner challenges the judgment and order dated
05.11.2019 passed by the Maharashtra Administrative Tribunal,
Bench at Aurangabad in Original Application No.69 of 2018. In his
Original Application, the petitioner had challenged the order dated
24.01.2018 directing recovery of amount of Rs.2,58,711/- from his
retirement benefits. By the impugned judgment, the Tribunal has
dismissed the Original Application.
3. The petitioner was appointed as Technical Assistant in
the office of respondent no.3 on 16.02.1982, which post was
abolished and the petitioner came to be absorbed on the post of Civil
Engineering Assistant w.e.f. 01.01.1989. He had passed Sub Overseer
examination on 18.05.1985 and by order dated 03.08.2004, he was
promoted on the post of Sub Overseer by granting deemed date of
promotion as on 18.05.1985. On account of completion of 12 years
of service from the date of initial appointment of 16.02.1982, he was
granted financial upgradation under the Time Bound Promotion
scheme w.e.f. 01.10.1994. On completion of 24 years of service, he
was granted benefit of second Time Bound Promotion with effect
from 01.10.2006. Later, he was promoted to the post of Junior
Engineer, Class-II, Non Gazetted post by order dated 02.07.2007. On
attaining the age of superannuation, he retired from service on
31.08.2017. Upon submitting his pension papers, the Accountant
General, Mumbai formed an opinion that the petitioner’s services
from the date of initial appointment of 16.02.1982 could not be
counted for Time Bound Promotion and the same were required to be
counted from the date of his absorption as Civil Engineering Assistant
w.e.f. 01.01.1989. Accordingly, refixation of petitioner’s pay was done
and an amount of Rs.2,58,711/- was directed to be recovered.
4. In his original application, the petitioner did not dispute
the action of the respondents in re-fixing his pay. What was
challenged was only the recovery effected as a consequence of
re-fixation. The Tribunal proceeded to dismiss the original application
on the ground that since the petitioner was functioning on Class-II
post of Junior Engineer, he is not entitled to protection against
recovery by applying ratio of the Judgment of the Apex Court in
State of Punjab & Ors. Vs. Rafiq Masih (white Washer) and Others,
5. Mr. Sugdare, learned advocate appearing for the
petitioner would submit that even though the petitioner was
promoted on the post of Junior Engineer on 02.07.2007, the recovery
is in respect of the period when he was working on Class-III post. He
would submit that the recovery in respect of such a long period could
not have been effected after retirement of the petitioner. He relied
upon judgment of the Apex Court in The State of Maharashtra and
another Vs. Madhukar Antu Patil and another, Civil Appeal No.1985
of 2022 decided on 21.03.2022.
6. Per contra, Mr. Chillarge, learned advocate appearing for
respondent nos.2 and 3 opposes the petition and would submit that
the petitioner was erroneously granted the benefit of Time Bound
Promotion scheme. He would submit that in addition to Time Bound
Promotions, the petitioner was also granted regular promotion on the
post of Junior Engineer. He would therefore submit that the
respondents have rightly withdrawn the erroneous benefit of Time
Bound Promotion granted to the petitioner and have accordingly
refixed his pay. He would further submit that recovery is a natural
consequence of refixation of pay and the petitioner cannot be
permitted to retain the amount erroneously granted to him. He
would submit that being a Class-II Officer, the petitioner is not
entitled to the benefit of the judgment of the Apex Court in Rafiq
7. The learned AGP appearing for respondent no.1 has
supported the order passed by the Tribunal and has prayed for
dismissal of the petition.
8. The law regarding recovery of excess payment is now
well settled by the judgment of the Apex Court in Rafiq Masih
(supra). After considering the entire jurisprudence regarding the
subject of recovery of excess payment, the Apex Court has
summarised the situations as under:
“12. It is not possible to postulate all situations of
hardship, which would govern employees on the issue
of recovery, where payments have mistakenly been
made by the employer, in excess of their entitlement.
Be that as it may, based on the decisions referred to
herein above, we may, as a ready reference,
summarise the following few situations, wherein
recoveries by the employers, would be impermissible
(i) Recovery from employees belonging to Class-III
and Class-IV service (or Group 'C' and Group 'D'
service).
(ii) Recovery from retired employees, or employees
who are due to retire within one year, of the order of
recovery.
(iii) Recovery from employees, when the excess
payment has been made for a period in excess of five
years, before the order of recovery is issued.
(iv) Recovery in cases where an employee has
wrongfully been required to discharge duties of a
higher post, and has been paid accordingly, even
though he should have rightfully been required to
work against an inferior post.
(v) In any other case, where the Court arrives at the
conclusion, that recovery if made from the employee,
would be iniquitous or harsh or arbitrary to such an
extent, as would far outweigh the equitable balance of
the employer's right to recover.”
9. Upon perusal of the principles laid down by the Apex
Court in Rafiq Masih (supra), it is clear that the five situations
summarized by the Court in para - 12 of the Judgment are not
exhaustive. The Apex Court itself has made it clear that it is not
possible to postulate all the situations of hardships, which would
govern employees on the issue of recovery, where payments have
mistakenly been made by the employer in excess of their entitlement.
Thus, it cannot be stated that only in five situations summarized by
the Apex Court, the recovery would be bad. It would always be open
to the Courts to extend the benefit of protection from recovery in an
appropriate case which is not covered by any of the five situations
summarized in Rafiq Masih (supra).
10. Having considered the exposition of law laid down by
the Apex Court relating to recovery of excess payment in Rafiq Masih
(supra), we now proceed to consider applicability of the situations to
the present case.
11. We have gone through the affidavit-in-reply filed on
behalf of respondent no.1 before the Tribunal. We find that the exact
reason for re-fixation of pay of the petitioner was not disclosed in the
affidavit-in-reply. However, following averments were made in
para - 4 thereof.
“4. I say that as to contents of para No.6 (a), as
submitted herein above, initial appointment of the
applicant was on daily wages and on completion of
five years, he was brought on CRTE. As submitted by
the applicant, his services are to be reckoned from
12. Thus, from the averments made in para - 4 of the
affidavit-in-reply filed before the Tribunal, it appears that the
petitioner’s initial appointment w.e.f. 16.02.1982 was apparently on
daily wages, that too on work charged establishment. This fact can
be ascertained from para - 2 of the petition, wherein the petitioner
has averred as under:
“02. The petitioner states that he belongs to Other
Backward Class (O.B.C.). He was appointed as
Technical Assistant in the Office of the Respondent
No.3 on 16-02-1982. He continuously worked on the
work charged establishment till he came to be
absorbed on the post Civil Engineering Assistant w.e.f.
01-01-1989. The petitioner passed Sub Overseer
Examination on dated 18-05-1985, therefore, he was
promoted on the post of Sub Overseer and he was
granted ‘deemed date’ as on 18-05-1985. The
petitioner rendered more than 12 years continuous
service from the date of his appointment on
16-02-1982. He was found eligible for promotion but
for the want of vacancy he was given benefit of Time
Bound Promotion from 01-10-1994 on the post of
Junior Engineer. Thereafter, he completed 24 years
satisfactory service on the post of Technical Assistant,
therefore, his case was considered for grand of 2 nd
benefit (Second Time Bound Promotion).
Accordingly, benefit was extended to him w.e.f.
13. Thus, the petitioner came to be absorbed in regular
service only on 01.01.1989 as Civil Engineering Assistant. It appears
that for counting the service for grant of Time Bound Promotion, his
initial service on work charged establishment with effect from
16.02.1982 was counted and he was granted the first Time Bound
Promotion on 01.10.1994. This was clearly erroneous. The error was
continued while granting second Time Bound Promotion on
completion of 24 years of service w.e.f. 01.10.2006. It appears that
the respondents have corrected the dates of effecting Time Bound
Promotions by counting service of the petitioner from 01.01.1989.
Since the corrective action taken by the respondents was valid, the
petitioner chose not to challenge the same in his original application,
in which he made the following prayers:
“B. By order or directions by this Tribunal the
impugned order dated 24-01-2018 in Office Order
No.13 of 2018 issued by the respondent no.3
regarding recovery of an amount of Rs.2,58,711
(Rupees Two Lacks fifty Eight Thousand Seven
Hundred Eleven) be quashed and set aside.
C. By order or directions the respondent no.3 be
directed to pay the amount which is sought to be
recovered under office order no.13 of 2018 of
Rs.2,58,711/- to the applicant.”
14. However, after the Tribunal criticized the petitioner for
not having challenged refixation of pay, the petitioner has sought to
challenge refixation of pay and has sought the relief of restoration of
Time Bound Promotions as on 01.10.1994 and 01.10.2006 in the
present petition. The prayers in the present petition are as under :
“A. Writ Petition may pleased be allowed.
writ in like nature, impugned order No.13/2018 dated
24/01/2018 issued by the Respondent No.3 in respect
of recovery of Rs.2,58,711/- (revised amount of
Rs.2,62,837/-) (in words Rs. Two Lakh Sixty
Thousand Eight Hundred Thirty Seven only) be
quashed and set aside.
writ in like nature the impugned letter dated 6 th
September, 2017 issued by the Accountant General,
Mumbai please be quashed and set aside.
writ in like nature or orders or directions, the order
dated 05-11-2019 in O.A. No.69 of 2018 passed by the
Maharashtra Administrative Tribunal Bench at
Aurangabad be quashed and set aside.
writ in like nature the Respondent No.3 may be
directed to refix the pay of the petitioner by counting
his service from his initial date of appointment i.e.
16-02-1982, by restoring Time Bound Promotion as on
01-10-1994 and 01-10-2006 respectively.
F. Pending hearing and final disposal of this W.P.
the Respondent No.3 may be directed to refund the
recovered amount of Rs.2,58,711/- (revised amount of
Rs.2,62,837/-) (in words Rs. Two Lakh Sixty
15. We are afraid, in exercise of power of Superintendence
over the order passed by the Tribunal, we cannot permit the
petitioner to expand the scope of challenge in the present petition.
We, therefore, proceed to ignore prayer clause ‘E’ made in the present
petition.
16. In Madhukar Antu Patil (supra) relied upon by
Mr. Sugdare, the fact situation was somewhat similar. In that case,
the respondent therein was initially appointed on 11.05.1982 as
Technical Assistant on work charged basis and came to be absorbed
as Civil Engineering Assistant in the year 1989. He was erroneously
granted Time Bound Promotions by considering the date of his initial
appointment as 1982 and after his retirement, the error was sought
to be corrected. The Apex Court has held in para nos.3.1, 4 and 5 as
“3.1 At the outset, it is required to be noted and it
is not in dispute that respondent no.1 was initially
appointed on 11.05.1982 as a Technical Assistant on
work charge basis. It is also not in dispute that
thereafter he was absorbed in the year 1989 on the
newly created post of Civil Engineering Assistant,
which carried a different pay scale. Therefore, when
the contesting respondent was absorbed in the year
1989 on the newly created post of Civil Engineering
Assistant which carried a different pay scale, he shall
be entitled to the first TBP on completion of twelve
years of service from the date of his absorption in the
post of Civil Engineering Assistant. The services
rendered by the contesting respondent as Technical
Assistant on work charge basis from 11.05.1982 could
not have been considered for the grant of benefit of
first TBP. If the contesting respondent would have
been absorbed on the same post of Technical Assistant
on which he was serving on work charge basis, the
position may have been different. The benefit of TBP
scheme shall be applicable when an employee has
worked for twelve years in the same post and in the
same pay scale.
4. In the present case, as observed hereinabove,
his initial appointment in the year 1982 was in the
post of Technical Assistant on work charge basis,
which was altogether a different post than the newly
created post of Civil Engineering Assistant in which he
was absorbed in the year 1989, which carried a
different pay scale. Therefore, the department was
right in holding that the contesting respondent was
entitled to the first TBP on completion of twelve years
from the date of his absorption in the year 1989 in the
post of Civil Engineering Assistant. Therefore both, the
High Court as well as the Tribunal have erred in
observing that as the first TBP was granted on the
approval of the Government and the Finance
Department, subsequently the same cannot be
modified and/or withdrawn. Merely because the
benefit of the first TBP was granted after the approval
of the Department cannot be a ground to continue the
same, if ultimately it is found that the contesting
respondent was entitled to the first TBP on completion
of twelve years of service only from the year 1989.
Therefore both, the High Court as well as the Tribunal
have committed a grave error in quashing and setting
aside the revision of pay scale and the revision in
pension, which were on re-fixing the date of grant of
first TBP from the date of his absorption in the year
1989 as Civil Engineering Assistant.
5. However, at the same time, as the grant of
first TBP considering his initial period of appointment
of 1982 was not due to any misrepresentation by the
contesting respondent and on the contrary, the same
was granted on the approval of the Government and
the Finance Department and since the downward
revision of the pay scale was after the retirement of
the respondent, we are of the opinion that there shall
not be any recovery on re-fixation of the pay scale.
However, the respondent shall be entitled to the
pension on the basis of the re-fixation of the pay scale
on grant of first TBP from the year 1989, i.e., from the
date of his absorption as Civil Engineering Assistant.”
17. Thus, under similar circumstances, the Apex Court has
granted protection from recovery on re-fixation of pay scale in the
case of Madhukar Antu Patil (supra). Mr. Chillarge has sought to
distinguish the judgment in Madhukar Antu Patil (supra) by
contending that the respondent therein retired on the post of Civil
Engineering Assistant, which is a Class-III post, whereas the petitioner
in the instant petition retired on the post of Junior Engineer, which is
a Class-II Non-gazetted post. The question that therefore arises is,
whether we can extend the protection granted in the case of
Madhukar Antu Patil (supra) by following the judgment of the Apex
Court or whether we restrain ourselves from doing so only because
the petitioner does not fall in situation at serial no.(i) of the
Judgment in Rafiq Masih (supra) i.e. he is not Class-III or Class-IV
employee. This is a reason why we have attempted to summarize
situations expounded by the Apex Court in Rafiq Masih (supra) on
law relating to recovery of excess payment and have arrived at a
conclusion that in an appropriate and rare case, this Court would be
justified in extending the benefit of recovery even to Class-I or
Class-II Officers, if the situation so demands.
18. The recovery in the instant case has been effected after
retirement of the petitioner. Nothing had prevented the respondents
from correcting the mistake in grant of Time Bound Promotions to
the petitioner during his service career. The refixation appears to
have been done w.e.f. 01.10.1994 as the corrective action involved
withdrawal of benefit of first Time Bound Promotion granted w.e.f.
01.10.1994. Thus, the corrective action is taken after a period of 23
long years and consequently, the recovery also appears to be in
respect of 23 long years. Also, most of the period of recovery was
when the petitioner was occupying Class-III post. Admittedly, there
was no misrepresentation on the post of the petitioner in securing the
excess payment. We have two very strong reasons in the present case
for arriving at a conclusion that the recovery would be arbitrary, viz.
unduly long period of 23 years of recovery and retirement of the
petitioner. After weighing these two positive factors against the
negative factor of the petitioner retiring on Class-II Officer post, we
find that the former would outweigh the latter. Undeniably, the case
of the petitioner is similar to that of Madhukar Antu Patil (supra).
The only distinguishing factor is the petitioner retired on Class-II post
of Junior Engineer, whereas Madhukar Antu Patil (supra) retired on
Class-III post of Civil Engineering Assistant. We find that the Apex
Court in Madhukar Antu Patil (supra) without considering whether
he belonged to Class-II or Class-III post extended the protection of
recovery of excess payment. The protection is granted in the peculiar
facts and circumstances of the case. Since the two cases are similar,
we have no hesitation in following the judgment and applying the
ratio of the judgment in Madhukar Antu Patil (supra) to the present
case.
19. We are also not in agreement with the finding recorded
by the Tribunal that the petitioner ought to have challenged the order
of refixation of pay. It was always open to the petitioner to question
only the recovery and not his refixation. In fact, we find that the
petitioner has rightly not challenged refixation of his pay and he was
still entitled to challenge recovery of excess payment after his
retirement.
20. Before parting, we would clarify that applicability of
judgment of Rafiq Masih (supra) to the present case is on account of
peculiar facts of this case and the same shall not be construed to
mean that Class-I or Class-II Officer would be entitled to protection
from recovery as per Rafiq Masih (supra).
21. Consequently, we allow the present petition by quashing
and setting aside the impugned judgment and order of the Tribunal.
The order dated 24.01.2018 effecting recovery of Rs.2,58,711/- from
the pensionary benefits of the petitioner is also set aside. The
respondents are directed to refund the recovered amount to the
petitioner along with the interest thereon at the rate of 6% per
annum within a period of four weeks from the date of receipt of this
order.
22. Writ Petition is accordingly allowed. Rule is made
absolute.
|
R.P. Gour waives service for respondent no.1 and
learned advocate Mr. Subhash Chillarge waives service for respondent
nos.2 and 3. At the joint request of the parties, the matter is heard
finally at the stage of admission. The petitioner challenges the judgment and order dated
05.11.2019 passed by the Maharashtra Administrative Tribunal,
Bench at Aurangabad in Original Application No.69 of 2018. In his
Original Application, the petitioner had challenged the order dated
24.01.2018 directing recovery of amount of Rs.2,58,711/- from his
retirement benefits. By the impugned judgment, the Tribunal has
dismissed the Original Application. The petitioner was appointed as Technical Assistant in
the office of respondent no.3 on 16.02.1982, which post was
abolished and the petitioner came to be absorbed on the post of Civil
Engineering Assistant w.e.f. He had passed Sub Overseer
examination on 18.05.1985 and by order dated 03.08.2004, he was
promoted on the post of Sub Overseer by granting deemed date of
promotion as on 18.05.1985. On account of completion of 12 years
of service from the date of initial appointment of 16.02.1982, he was
granted financial upgradation under the Time Bound Promotion
scheme w.e.f. On completion of 24 years of service, he
was granted benefit of second Time Bound Promotion with effect
from 01.10.2006. Later, he was promoted to the post of Junior
Engineer, Class-II, Non Gazetted post by order dated 02.07.2007. On
attaining the age of superannuation, he retired from service on
31.08.2017. Accordingly, refixation of petitioner’s pay was done
and an amount of Rs.2,58,711/- was directed to be recovered. In his original application, the petitioner did not dispute
the action of the respondents in re-fixing his pay. What was
challenged was only the recovery effected as a consequence of
re-fixation. Rafiq Masih (white Washer) and Others,
5. Mr. Sugdare, learned advocate appearing for the
petitioner would submit that even though the petitioner was
promoted on the post of Junior Engineer on 02.07.2007, the recovery
is in respect of the period when he was working on Class-III post. He
would submit that the recovery in respect of such a long period could
not have been effected after retirement of the petitioner. He relied
upon judgment of the Apex Court in The State of Maharashtra and
another Vs. Madhukar Antu Patil and another, Civil Appeal No.1985
of 2022 decided on 21.03.2022. Per contra, Mr. Chillarge, learned advocate appearing for
respondent nos.2 and 3 opposes the petition and would submit that
the petitioner was erroneously granted the benefit of Time Bound
Promotion scheme. He would submit that in addition to Time Bound
Promotions, the petitioner was also granted regular promotion on the
post of Junior Engineer. He would therefore submit that the
respondents have rightly withdrawn the erroneous benefit of Time
Bound Promotion granted to the petitioner and have accordingly
refixed his pay. He would further submit that recovery is a natural
consequence of refixation of pay and the petitioner cannot be
permitted to retain the amount erroneously granted to him. He
would submit that being a Class-II Officer, the petitioner is not
entitled to the benefit of the judgment of the Apex Court in Rafiq
7. The learned AGP appearing for respondent no.1 has
supported the order passed by the Tribunal and has prayed for
dismissal of the petition. The law regarding recovery of excess payment is now
well settled by the judgment of the Apex Court in Rafiq Masih
(supra). After considering the entire jurisprudence regarding the
subject of recovery of excess payment, the Apex Court has
summarised the situations as under:
“12. It is not possible to postulate all situations of
hardship, which would govern employees on the issue
of recovery, where payments have mistakenly been
made by the employer, in excess of their entitlement. Be that as it may, based on the decisions referred to
herein above, we may, as a ready reference,
summarise the following few situations, wherein
recoveries by the employers, would be impermissible
(i) Recovery from employees belonging to Class-III
and Class-IV service (or Group 'C' and Group 'D'
service). (ii) Recovery from retired employees, or employees
who are due to retire within one year, of the order of
recovery. (iii) Recovery from employees, when the excess
payment has been made for a period in excess of five
years, before the order of recovery is issued. (iv) Recovery in cases where an employee has
wrongfully been required to discharge duties of a
higher post, and has been paid accordingly, even
though he should have rightfully been required to
work against an inferior post. (v) In any other case, where the Court arrives at the
conclusion, that recovery if made from the employee,
would be iniquitous or harsh or arbitrary to such an
extent, as would far outweigh the equitable balance of
the employer's right to recover.” The Apex Court itself has made it clear that it is not
possible to postulate all the situations of hardships, which would
govern employees on the issue of recovery, where payments have
mistakenly been made by the employer in excess of their entitlement. Thus, it cannot be stated that only in five situations summarized by
the Apex Court, the recovery would be bad. It would always be open
to the Courts to extend the benefit of protection from recovery in an
appropriate case which is not covered by any of the five situations
summarized in Rafiq Masih (supra). We have gone through the affidavit-in-reply filed on
behalf of respondent no.1 before the Tribunal. We find that the exact
reason for re-fixation of pay of the petitioner was not disclosed in the
affidavit-in-reply. However, following averments were made in
para - 4 thereof. I say that as to contents of para No.6 (a), as
submitted herein above, initial appointment of the
applicant was on daily wages and on completion of
five years, he was brought on CRTE. As submitted by
the applicant, his services are to be reckoned from
12. Thus, from the averments made in para - 4 of the
affidavit-in-reply filed before the Tribunal, it appears that the
petitioner’s initial appointment w.e.f. 16.02.1982 was apparently on
daily wages, that too on work charged establishment. This fact can
be ascertained from para - 2 of the petition, wherein the petitioner
has averred as under:
“02. The petitioner states that he belongs to Other
Backward Class (O.B.C.). He was appointed as
Technical Assistant in the Office of the Respondent
No.3 on 16-02-1982. He continuously worked on the
work charged establishment till he came to be
absorbed on the post Civil Engineering Assistant w.e.f. The petitioner passed Sub Overseer
Examination on dated 18-05-1985, therefore, he was
promoted on the post of Sub Overseer and he was
granted ‘deemed date’ as on 18-05-1985. The
petitioner rendered more than 12 years continuous
service from the date of his appointment on
16-02-1982. He was found eligible for promotion but
for the want of vacancy he was given benefit of Time
Bound Promotion from 01-10-1994 on the post of
Junior Engineer. Thereafter, he completed 24 years
satisfactory service on the post of Technical Assistant,
therefore, his case was considered for grand of 2 nd
benefit (Second Time Bound Promotion). Accordingly, benefit was extended to him w.e.f. Thus, the petitioner came to be absorbed in regular
service only on 01.01.1989 as Civil Engineering Assistant. It appears
that for counting the service for grant of Time Bound Promotion, his
initial service on work charged establishment with effect from
16.02.1982 was counted and he was granted the first Time Bound
Promotion on 01.10.1994. The error was
continued while granting second Time Bound Promotion on
completion of 24 years of service w.e.f. It appears that
the respondents have corrected the dates of effecting Time Bound
Promotions by counting service of the petitioner from 01.01.1989. C. By order or directions the respondent no.3 be
directed to pay the amount which is sought to be
recovered under office order no.13 of 2018 of
Rs.2,58,711/- to the applicant.” However, after the Tribunal criticized the petitioner for
not having challenged refixation of pay, the petitioner has sought to
challenge refixation of pay and has sought the relief of restoration of
Time Bound Promotions as on 01.10.1994 and 01.10.2006 in the
present petition. The prayers in the present petition are as under :
“A. Writ Petition may pleased be allowed. writ in like nature, impugned order No.13/2018 dated
24/01/2018 issued by the Respondent No.3 in respect
of recovery of Rs.2,58,711/- (revised amount of
Rs.2,62,837/-) (in words Rs. Two Lakh Sixty
Thousand Eight Hundred Thirty Seven only) be
quashed and set aside. writ in like nature the impugned letter dated 6 th
September, 2017 issued by the Accountant General,
Mumbai please be quashed and set aside. writ in like nature the Respondent No.3 may be
directed to refix the pay of the petitioner by counting
his service from his initial date of appointment i.e.
16-02-1982, by restoring Time Bound Promotion as on
01-10-1994 and 01-10-2006 respectively. We are afraid, in exercise of power of Superintendence
over the order passed by the Tribunal, we cannot permit the
petitioner to expand the scope of challenge in the present petition. We, therefore, proceed to ignore prayer clause ‘E’ made in the present
petition. In Madhukar Antu Patil (supra) relied upon by
Mr. Sugdare, the fact situation was somewhat similar. In that case,
the respondent therein was initially appointed on 11.05.1982 as
Technical Assistant on work charged basis and came to be absorbed
as Civil Engineering Assistant in the year 1989. He was erroneously
granted Time Bound Promotions by considering the date of his initial
appointment as 1982 and after his retirement, the error was sought
to be corrected. The Apex Court has held in para nos.3.1, 4 and 5 as
“3.1 At the outset, it is required to be noted and it
is not in dispute that respondent no.1 was initially
appointed on 11.05.1982 as a Technical Assistant on
work charge basis. It is also not in dispute that
thereafter he was absorbed in the year 1989 on the
newly created post of Civil Engineering Assistant,
which carried a different pay scale. Therefore, when
the contesting respondent was absorbed in the year
1989 on the newly created post of Civil Engineering
Assistant which carried a different pay scale, he shall
be entitled to the first TBP on completion of twelve
years of service from the date of his absorption in the
post of Civil Engineering Assistant. The services
rendered by the contesting respondent as Technical
Assistant on work charge basis from 11.05.1982 could
not have been considered for the grant of benefit of
first TBP. If the contesting respondent would have
been absorbed on the same post of Technical Assistant
on which he was serving on work charge basis, the
position may have been different. The benefit of TBP
scheme shall be applicable when an employee has
worked for twelve years in the same post and in the
same pay scale. In the present case, as observed hereinabove,
his initial appointment in the year 1982 was in the
post of Technical Assistant on work charge basis,
which was altogether a different post than the newly
created post of Civil Engineering Assistant in which he
was absorbed in the year 1989, which carried a
different pay scale. Therefore, the department was
right in holding that the contesting respondent was
entitled to the first TBP on completion of twelve years
from the date of his absorption in the year 1989 in the
post of Civil Engineering Assistant. Therefore both, the
High Court as well as the Tribunal have erred in
observing that as the first TBP was granted on the
approval of the Government and the Finance
Department, subsequently the same cannot be
modified and/or withdrawn. Merely because the
benefit of the first TBP was granted after the approval
of the Department cannot be a ground to continue the
same, if ultimately it is found that the contesting
respondent was entitled to the first TBP on completion
of twelve years of service only from the year 1989. Therefore both, the High Court as well as the Tribunal
have committed a grave error in quashing and setting
aside the revision of pay scale and the revision in
pension, which were on re-fixing the date of grant of
first TBP from the date of his absorption in the year
1989 as Civil Engineering Assistant. However, at the same time, as the grant of
first TBP considering his initial period of appointment
of 1982 was not due to any misrepresentation by the
contesting respondent and on the contrary, the same
was granted on the approval of the Government and
the Finance Department and since the downward
revision of the pay scale was after the retirement of
the respondent, we are of the opinion that there shall
not be any recovery on re-fixation of the pay scale. Thus, under similar circumstances, the Apex Court has
granted protection from recovery on re-fixation of pay scale in the
case of Madhukar Antu Patil (supra). The question that therefore arises is,
whether we can extend the protection granted in the case of
Madhukar Antu Patil (supra) by following the judgment of the Apex
Court or whether we restrain ourselves from doing so only because
the petitioner does not fall in situation at serial no.(i) of the
Judgment in Rafiq Masih (supra) i.e. he is not Class-III or Class-IV
employee. The recovery in the instant case has been effected after
retirement of the petitioner. Nothing had prevented the respondents
from correcting the mistake in grant of Time Bound Promotions to
the petitioner during his service career. The refixation appears to
have been done w.e.f. 01.10.1994 as the corrective action involved
withdrawal of benefit of first Time Bound Promotion granted w.e.f. Thus, the corrective action is taken after a period of 23
long years and consequently, the recovery also appears to be in
respect of 23 long years. Also, most of the period of recovery was
when the petitioner was occupying Class-III post. Admittedly, there
was no misrepresentation on the post of the petitioner in securing the
excess payment. We have two very strong reasons in the present case
for arriving at a conclusion that the recovery would be arbitrary, viz. unduly long period of 23 years of recovery and retirement of the
petitioner. After weighing these two positive factors against the
negative factor of the petitioner retiring on Class-II Officer post, we
find that the former would outweigh the latter. Undeniably, the case
of the petitioner is similar to that of Madhukar Antu Patil (supra). The only distinguishing factor is the petitioner retired on Class-II post
of Junior Engineer, whereas Madhukar Antu Patil (supra) retired on
Class-III post of Civil Engineering Assistant. We find that the Apex
Court in Madhukar Antu Patil (supra) without considering whether
he belonged to Class-II or Class-III post extended the protection of
recovery of excess payment. The protection is granted in the peculiar
facts and circumstances of the case. Since the two cases are similar,
we have no hesitation in following the judgment and applying the
ratio of the judgment in Madhukar Antu Patil (supra) to the present
case. It was always open to the petitioner to question
only the recovery and not his refixation. In fact, we find that the
petitioner has rightly not challenged refixation of his pay and he was
still entitled to challenge recovery of excess payment after his
retirement. Consequently, we allow the present petition by quashing
and setting aside the impugned judgment and order of the Tribunal. The
respondents are directed to refund the recovered amount to the
petitioner along with the interest thereon at the rate of 6% per
annum within a period of four weeks from the date of receipt of this
order.
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The Aurangabad bench of the Bombay High Court granted protection to a retired Junior Assistant (Class II officer) against recovery of excess salary and benefits erroneously paid to him by the Water Resources Department of the Government of Maharashtra during his service. "We have two very strong reasons in the present case for arriving at a conclusion that the recovery would...
The Aurangabad bench of the Bombay High Court granted protection to a retired Junior Assistant (Class II officer) against recovery of excess salary and benefits erroneously paid to him by the Water Resources Department of the Government of Maharashtra during his service.
"We have two very strong reasons in the present case for arriving at a conclusion that the recovery would be arbitrary, viz. unduly long period of 23 years of recovery and retirement of the petitioner", the court held.
A division bench of Justices Mangesh S. Patil and Sandeep V. Marne, passed the judgement in a writ petition challenging the Maharashtra Administrative Tribunal's (MAT) order upholding the recovery of excess benefits from petitioner's retirement benefits.
The petitioner was employed at the office of the Executive Engineer, Waghur Dam Division, Jalgaon as a Technical Assistant (daily wage) since 1982. He was absorbed into regular service as a Civil Engineering Assistant (Class III) in 1989. Subsequently, he obtained two time-bound promotions. On his retirement, the Accountant General, Mumbai realised that for the purpose of calculation of period of service, his initial appointment in 1982 was erroneously considered instead of his appointment in 1989.
The petitioner's pay was refixed and recovery of excess pay worth almost 2.6 lakhs was directed from his retirement benefits. The petitioner challenged this before the MAT which rejected his application. The petitioner then approached the High Court.
Advocate A. D. Sugdare for the petitioner submitted that even though petitioner was promoted to a Class II post, the recovery is in respect of his Class III post. The recovery for such a long period could not have been made after the retirement of the petitioner.
Advocate Subhash Chillarge for the respondents submitted that the respondents rightly withdrew the excess benefits and accordingly refixed the petitioner's pay. Recovery is a natural consequence of refixation and the petitioner cannot be permitted to retain the excess benefit erroneously given to him. Further, being a Class II officer, he is not protected under the Supreme Court judgement in State of Punjab v. Rafiq Masih.
The court referred to the Apex Court decision in Rafiq Masih regarding recovery of excess payment. It provides that inter alia, employees belonging to Class III and IV of service are protected from recovery of excess pay.
The court observed that the situations surmised in Rafiq Masih are not exhaustive. It is open to the courts to extend the benefit of protection from recovery in an appropriate case.
The court relied on the judgment in State of Maharashtra v. Madhukar Antu Patil which had granted protection from recovery on refixation of pay scale under similar circumstances. The court held that such protection will extend to the present case.
The court concluded that in an appropriate and rare case it is justified to extend the benefit of protection of recovery even to Class I or Class II officers.
The court observed that nothing prevented the respondents from correcting the mistake during the service of petitioner for about 23 years. Most of the period of recovery was when he was occupying a Class III post. Further, there is no mis-representation on the part of the petitioner in securing the excess payment.
The court weighed the two positive factors, namely, the retirement of the petitioner and the unduly long period of recovery outweigh the negative factor of petitioner retiring as a Class II officer.
The court also observed that the petitioner has rightly not challenged refixation of pay and he was still entitled to challenge recovery of excess payment after his retirement.
The court clarified that the applicability of judgement of Rafiq Masih is on the basis of the peculiar facts of the case and it does not mean that all Class I and Class II officers are protected from recovery of excess benefits.
The court set aside the judgement of the tribunal and the order effecting recovery of about 2.6 lakhs from the pensionary benefits of the petitioner. The court directed the respondents to refund the amount to the petitioner.
Case no. – Writ Petition No. 14526 of 2019
Case title – Ajabrao Rambhau Patil v. State of Maharashtra and Ors.
Also Read: Excess Payment Made To Employee Due To Erroneous Interpretation Of Rule Not Recoverable : Supreme Court
|
The Aurangabad bench of the Bombay High Court granted protection to a retired Junior Assistant (Class II officer) against recovery of excess salary and benefits erroneously paid to him by the Water Resources Department of the Government of Maharashtra during his service. "We have two very strong reasons in the present case for arriving at a conclusion that the recovery would...
The Aurangabad bench of the Bombay High Court granted protection to a retired Junior Assistant (Class II officer) against recovery of excess salary and benefits erroneously paid to him by the Water Resources Department of the Government of Maharashtra during his service.
"We have two very strong reasons in the present case for arriving at a conclusion that the recovery would be arbitrary, viz. unduly long period of 23 years of recovery and retirement of the petitioner", the court held.
A division bench of Justices Mangesh S. Patil and Sandeep V. Marne, passed the judgement in a writ petition challenging the Maharashtra Administrative Tribunal's (MAT) order upholding the recovery of excess benefits from petitioner's retirement benefits.
The petitioner was employed at the office of the Executive Engineer, Waghur Dam Division, Jalgaon as a Technical Assistant (daily wage) since 1982. He was absorbed into regular service as a Civil Engineering Assistant (Class III) in 1989. Subsequently, he obtained two time-bound promotions. On his retirement, the Accountant General, Mumbai realised that for the purpose of calculation of period of service, his initial appointment in 1982 was erroneously considered instead of his appointment in 1989.
The petitioner's pay was refixed and recovery of excess pay worth almost 2.6 lakhs was directed from his retirement benefits. The petitioner challenged this before the MAT which rejected his application. The petitioner then approached the High Court.
Advocate A. D. Sugdare for the petitioner submitted that even though petitioner was promoted to a Class II post, the recovery is in respect of his Class III post. The recovery for such a long period could not have been made after the retirement of the petitioner.
Advocate Subhash Chillarge for the respondents submitted that the respondents rightly withdrew the excess benefits and accordingly refixed the petitioner's pay. Recovery is a natural consequence of refixation and the petitioner cannot be permitted to retain the excess benefit erroneously given to him. Further, being a Class II officer, he is not protected under the Supreme Court judgement in State of Punjab v. Rafiq Masih.
The court referred to the Apex Court decision in Rafiq Masih regarding recovery of excess payment. It provides that inter alia, employees belonging to Class III and IV of service are protected from recovery of excess pay.
The court observed that the situations surmised in Rafiq Masih are not exhaustive. It is open to the courts to extend the benefit of protection from recovery in an appropriate case.
The court relied on the judgment in State of Maharashtra v. Madhukar Antu Patil which had granted protection from recovery on refixation of pay scale under similar circumstances. The court held that such protection will extend to the present case.
The court concluded that in an appropriate and rare case it is justified to extend the benefit of protection of recovery even to Class I or Class II officers.
The court observed that nothing prevented the respondents from correcting the mistake during the service of petitioner for about 23 years. Most of the period of recovery was when he was occupying a Class III post. Further, there is no mis-representation on the part of the petitioner in securing the excess payment.
The court weighed the two positive factors, namely, the retirement of the petitioner and the unduly long period of recovery outweigh the negative factor of petitioner retiring as a Class II officer.
The court also observed that the petitioner has rightly not challenged refixation of pay and he was still entitled to challenge recovery of excess payment after his retirement.
The court clarified that the applicability of judgement of Rafiq Masih is on the basis of the peculiar facts of the case and it does not mean that all Class I and Class II officers are protected from recovery of excess benefits.
The court set aside the judgement of the tribunal and the order effecting recovery of about 2.6 lakhs from the pensionary benefits of the petitioner. The court directed the respondents to refund the amount to the petitioner.
Case no. – Writ Petition No. 14526 of 2019
Case title – Ajabrao Rambhau Patil v. State of Maharashtra and Ors.
Also Read: Excess Payment Made To Employee Due To Erroneous Interpretation Of Rule Not Recoverable : Supreme Court
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Jug Suraiya, Bachi Karkaria, E.P.Unny and G.Sampath ... if
any one of them, or for that matter any satirist or cartoonist had
authored this judgement, they would have proposed a momentous
amendment to the Constitution of India to incorporate sub-clause
(l) in Article 51-A. Article 51-A states that it shall be the duty of
“(a)to abide by the Constitution and respect
its ideals and institutions, the National Flag and the
(b)to cherish and follow the noble ideals
which inspired our national struggle for freedom;
(c)to uphold and protect the sovereignty,
(d)to defend the country and render national
(e)to promote harmony and the spirit of
common brotherhood amongst all the people of India
transcending religious, linguistic and regional or
sectional diversities; to renounce practices
derogatory to the dignity of women;
(f)to value and preserve the rich heritage of
(g)to protect and improve the natural
environment including forests, lakes, rivers and wild
life, and to have compassion for living creatures;
(h)to develop the scientific temper,
humanism and the spirit of inquiry and reform;
(i)to safeguard public property and to abjure
(j)to strive towards excellence in all spheres
of individual and collective activity so that the nation
constantly rises to higher levels of endeavour and
(k)who is a parent or guardian to provide
opportunities for education to his child or, as the case
may be, ward between the age of six and fourteen
years.”
To this, the hypothetical author would have added one more
fundamental duty - duty to laugh. The correlative right to be funny
can be mined in Article 19 (1) (a) of the Constitution of India (the
use of crypto vocabulary to be forgiven). Being funny is one thing
and poking fun at another is different altogether.
2.“Laugh at what?” is a serious question. This is because
we have holy cows grazing all over from Varanasi to Vadipatty.
One dare not poke fun at them. There is however no single
catalogue of holy cows. It varies from person to person and from
region to region. A real cow, even if terribly underfed and
emaciated, shall be holy in Yogi's terrain. In West Bengal, Tagore
is such an iconic figure that Khushwant Singh learnt the lesson at
some cost. Coming to my own Tamil Desh, the all-time iconoclast
“Periyar” Shri.E.V.Ramasamy is a super-holy cow. In today's
Kerala, Marx and Lenin are beyond the bounds of criticism or
satire. Chhatrapati Shivaji and Veer Savarkar enjoy a similar
immunity in Maharashtra. But all over India, there is one ultimate
holy cow and that is “national security”.
3.The petitioner herein is an important office-bearer of a
not-so-important political party. CPI (ML) is now an over-ground
organization which contests elections also. Paper warriors are also
entitled to fantasise that they are swadeshi Che Guevaras.
4.On 16.09.2021, the petitioner herein went on a
sightseeing pleasure trip with his daughter and son-in-law to
Sirumalai hills. He put out the photographs taken on the occasion
in his Facebook page. He gave the caption “Jg;ghf;fp gapw;rpf;fhf
rpWkiy gazk;!” (Trip to Sirumalai for shooting practice).
Revolutionaries, whether real or phoney, are not usually credited
with any sense of humour (or at least this is the stereotype). For a
change, the petitioner tried to be funny. Perhaps it was his maiden
attempt at humour.
5.Vadipatty Police did not find it to be a joke. They
thought the petitioner was making preparations to wage war
against the State. They registered a case in Crime No.415 of 2021
against the petitioner for the offences under Sections 120B, 122,
505(1)(b) and 507 of IPC. They did not stop at that. They arrested
the petitioner and produced him before the jurisdictional
magistrate for remanding him to custody. Mercifully,
Mr.M.C.Arun, the Judicial Magistrate, Vadipatty, had the good
sense to refuse remand. Bearing in mind the principles laid down in
State v. Nakeeran Gopal (2019 SCC OnLine Mad 42), he
passed a detailed rejection order. I wish other magistrates in the
State of Tamil Nadu act likewise. Remand can never be made for
the asking. The police and the prosecution will seek remand in
every case. It is for the magistrate to satisfy herself that the
arrestee deserves to be remanded. Requests for remand must be
decided on the touchstone of Section 41 of Cr.Pc and Article 21 of
the Constitution. Thanks to the judicious conduct so well exhibited
by Shri.M.C.Arun (the Judicial Magistrate, Vadipatty), the
petitioner escaped incarceration by a whisker.
6.This criminal original petition has been filed to quash the
FIR itself. The learned counsel for the petitioner reiterated all the
contentions set out in the memorandum of grounds and submitted
that the very registration of the impugned FIR is an abuse of legal
process. Per contra, the learned Additional Public Prosecutor
appearing for the respondents submitted that no case for quashing
has been made out.
7.I carefully considered the rival contentions and went
through the materials on record. For an act to constitute a crime,
there are four stages, i)intention, ii)preparation, iii)attempt and
iv)accomplishment. While penal laws intervene only at the third
and fourth stages normally, even preparation is made an offence in
certain cases. Section 399 of IPC is one such provision. Section
122 IPC is another. Any penal provision has to be strictly
construed. Application of the provisions which penalize even
preparation must meet a higher threshold.
8.Section 122 of IPC is as follows :
“122.Collecting arms, etc., with intention of
waging war against the Government of India.-
Whoever collects men, arms or ammunition or
otherwise prepares to wage war with the intention of
either waging or being prepared to wage war
against the [Government of India], shall be punished
with [imprisonment for life] or imprisonment of
either description for a term not exceeding ten
years, [and shall also be liable to fine].”
To wage war would require several steps and crossing of stages.
There has to be mobilisation of men as well as accumulation of
arms and ammunition. That would require a concerted effort.
Each individual who is a party to the conspiracy to wage war may
be allotted a particular task. One may be tasked with collecting
men, another with arms and the third with ammunition. The
expression “otherwise prepares” in this context should not be
construed on the application of the principle of ejusdem generis. A
person may be engaged in fund-raising. Another may be
responsible for providing reinforcements. Some may be engaged in
making logistical arrangements. Some may be engaged in the
intellectual front. There could be several dimensions. All of them
would fall within the scope of “otherwise prepares”. But as
already held, when it comes to application of the provision to
concrete facts, courts will apply a higher threshold.
9.Now let us see what the petitioner did. Except giving
the title mentioned above to the photographs amateurishly taken
on the occasion of his trip to Sirumalai hills, the petitioner has done
nothing else. The petitioner is aged 62 years. His daughter is
standing next to him. His son-in-law is also seen in the photograph.
Four other photographs capturing the scenic beauty of the place
have also been posted. No weapon or proscribed material was
recovered from the petitioner. The petitioner neither intended to
wage war nor did he commit any act towards preparation therefor.
10.Section 505(1)(b) of IPC is as follows :
“Whoever makes, publishes or circulates
(b) with intent to cause, or which is likely to
cause, fear or alarm to the public, or to any section
of the public whereby any person may be induced to
commit an offence against the State or against the
shall be punished with imprisonment which may
extend to [three years], or with fine, or with both.”
This provision also can be invoked only if the offending act induces
or is likely to induce any person to commit an offence against the
State or against the public tranquility. In this case, the
photographs with the aforesaid caption was posted only in the
petitioner's Facebook page. Any normal and reasonable person
coming across the Facebook post would have laughed it off.
11.Section 507 of IPC is as follows :
“507.Criminal intimidation by an
anonymous communication.—Whoever commits
the offence of criminal intimidation by an
anonymous communication, or having taken
precaution to conceal the name or abode of the
person from whom the threat comes, shall be
punished with imprisonment of either description
for a term which may extend to two years, in
addition to the punishment provided for the
offence by the last preceding section.”
Invocation of this provision makes me laugh. Section 507 IPC can
be invoked only if the person sending the communication had
concealed his identity. The communication must be anonymous.
In this case, the petitioner had posted the photographs along with
the caption in his Facebook page. He has not concealed his
identity. There is nothing anonymous about the act in question.
12.None of the ingredients set out in Section 122, 505(1)
(b) and Section 507 are present in this case. Section 120 B of IPC
cannot be invoked for two reasons. Firstly, the petitioner is the sole
accused. To constitute the offence of conspiracy, there must be a
meeting of two or more minds. One cannot conspire with oneself.
Secondly, conspiracy is hatched to commit an offence mentioned in
the Section. When the ingredients of the primary offences have
been shown to be non-existent, the prosecution cannot hang on to
Section 120B IPC alone.
13.The very registration of the impugned FIR is absurd
and an abuse of legal process. It stands quashed. The criminal
original petition is allowed. Connected miscellaneous petition is
closed.
Note: In view of the present lock down owing
to COVID-19 pandemic, a web copy of the order
may be utilized for official purposes, but,
ensuring that the copy of the order that is
presented is the correct copy, shall be the
responsibility of the advocate/litigant
concerned.
|
"The very registration of the impugned FIR is absurd and an abuse of legal process", the Court said.While quashing an FIR registered against an office-bearer of CPI (ML) who uploaded vacation pictures with the caption 'Trip to Sirumalai for shooting practice', the Madurai Bench of Madras High Court went on to make some interesting observations about the 'duty to laugh' and the 'right to be funny'. Justice G.R Swaminathan quashed the FIR against the 62-year-old accused while...
While quashing an FIR registered against an office-bearer of CPI (ML) who uploaded vacation pictures with the caption 'Trip to Sirumalai for shooting practice', the Madurai Bench of Madras High Court went on to make some interesting observations about the 'duty to laugh' and the 'right to be funny'.
Justice G.R Swaminathan quashed the FIR against the 62-year-old accused while underscoring that the case registered by Vadipatty Police, booking the latter for 'making preparations to wage war against the State', is 'absurd and an abuse of legal process'.
Justice GR Swaminathan started the judgment by observing :
"Jug Suraiya, Bachi Karkaria, E.P.Unny and G.Sampath...if any satirist or cartoonist had authored this judgement, they would have proposed a momentous amendment to the Constitution of India to incorporate sub-clause (l) in Article 51-A…. To this, the hypothetical author would have added one more fundamental duty - duty to laugh."
The Court went on to observe that the correlative right to be funny can be "mined in Article 19 (1) (a) of the Constitution of India".
While noting that 'being funny' and 'poking fun at another' is different, the court rhetorically states that "Laugh at what?" is a serious question. The court also explains as to why the question becomes pertinent in the backdrop of regional diversity in India.
"…This is because we have holy cows grazing all over from Varanasi to Vadipatty. One dare not poke fun at them. There is however no single catalogue of holy cows. It varies from person to person and from region to region. A real cow, even if terribly underfed and emaciated, shall be holy in Yogi's terrain. In West Bengal, Tagore is such an iconic figure that Khushwant Singh learnt the lesson at some cost. Coming to my own Tamil Desh, the all-time iconoclast "Periyar" Shri.E.V.Ramasamy is a super-holy cow. In today's Kerala, Marx and Lenin are beyond the bounds of criticism or satire. Chhatrapati Shivaji and Veer Savarkar enjoy a similar immunity in Maharashtra. But all over India, there is one ultimate holy cow and that is "national security"."
Vadipetty Police had booked the petitioner accused who went for a sight-seeing trip along with his family for offences under Sections 120B [Criminal Conspiracy], 122 [waging war against the state], and 507 [Criminal Intimidation by Conspiracy] of IPC.
He was also booked for Section 505(1) (b) for posting the pictures with the contentious caption on his Facebook page.
However, Section 505(1) (b) prescribes the punishment for:
"making, publishing, or circulating any statement, or rumour, or report, with intent to cause, or which is likely to cause, fear or alarm to the public or to any section of the public whereby any person may be induced to commit an offence against the State or against the public tranquillity."
In its order, the court also noted petitioner was the office-bearer of the Communist Party of India (Marxist-Leninist), a "not so important political party". The Court said that CPI-ML is now an overground organisation that contests in elections. The order also satirically remarks that,
'paper warriors are also entitled to fantasise that they are Swadeshi Che Gueveras…. Revolutionaries, whether real or phoney, are not usually credited with any sense of humour (or at least this is the stereotype). For a change, the petitioner tried to be funny. Perhaps it was his maiden attempt at humour.'
The accused man was arrested by Vadipetty police station on the above grounds and produced before the Magistrate for remand to custody. However, remand was refused by the Magistrate by citing State v. Nakeeran Gopal (2019). The Madras High Court has also appreciated the Magistrate for the due application of mind while rejecting the remand plea. The court note that the police and prosecution will always seek custody and it is for the Magistrate to decide such applications judiciously on the touchstone of Section 41 of Cr.Pc and Article 21 of the Constitution.
Court's Observations
For penal provisions like Section 399 and Section 122 of IPC, even the preparatory stage for the commission of a crime can be made an offence but the provision has to be strictly construed and preparation must meet a higher threshold. About Section 122 of IPC which the petitioner was charged with, the court further states that waging war against the state requires crossing certain stages. Mobilisation of men and accumulation of arms and ammunition through a concerted effort are instances of preparing to wage war against the state. The meaning rendered by 'otherwise prepares' in Section 122 IPC can also encompass fundraising, providing reinforcements, making logistical arrangements and other dimensions of contributions. However, all of such must meet the higher threshold proscribed by the strict construing of the penal statute to the peculiar facts of the case, notes the court.
About the conduct of the petitioner, the court noted that the petitioner merely took photographs of a scenic place during a family trip with an intended-to-be funny caption.
"No weapon or proscribed material was recovered from the petitioner. The petitioner neither intended to wage war nor did he commit any act towards preparation therefor."
About booking the petitioner for the offence under Section 505 (1)(b), the court similarly observes that 'any reasonable and normal person coming across the Facebook post would have laughed it off'. According to the court, the post of the petitioner on his Facebook page could not have induced or wass likely to induce any person to commit an offence against the State or against the public tranquility.
About the invocation of the provision under Section 507of IPC, the court notes as follows:
"Invocation of this provision makes me laugh. Section 507 IPC can be invoked only if the person sending the communication had concealed his identity. The communication must be anonymous. In this case, the petitioner had posted the photographs along with the caption in his Facebook page. He has not concealed his identity. There is nothing anonymous about the act in question."
Additionally, on the inclusion of Section 120 B of IPC in the FIR, the court notes that the provision can't be invoked unless there is a meeting of mind of two persons, whereas, the petitioner is the sole accused in the present case.
"One cannot conspire with oneself. Secondly, conspiracy is hatched to commit an offence mentioned in the Section. When the ingredients of the primary offences have been shown to be non-existent, the prosecution cannot hang on to Section 120B IPC alone.", concluded the court while quashing the FIR registered against the CPI(ML) office bearer.
Case Title: Mathivanan v. Inspector of Police & Ors.
Case No: Crl OP(MD)No.18337 of 2021 and Crl MP(MD)No.10063 of 2021
|
Jug Suraiya, Bachi Karkaria, E.P.Unny and G.Sampath ... if
any one of them, or for that matter any satirist or cartoonist had
authored this judgement, they would have proposed a momentous
amendment to the Constitution of India to incorporate sub-clause
(l) in Article 51-A. Article 51-A states that it shall be the duty of
“(a)to abide by the Constitution and respect
its ideals and institutions, the National Flag and the
(b)to cherish and follow the noble ideals
which inspired our national struggle for freedom;
(c)to uphold and protect the sovereignty,
(d)to defend the country and render national
(e)to promote harmony and the spirit of
common brotherhood amongst all the people of India
transcending religious, linguistic and regional or
sectional diversities; to renounce practices
derogatory to the dignity of women;
(f)to value and preserve the rich heritage of
(g)to protect and improve the natural
environment including forests, lakes, rivers and wild
life, and to have compassion for living creatures;
(h)to develop the scientific temper,
humanism and the spirit of inquiry and reform;
(i)to safeguard public property and to abjure
(j)to strive towards excellence in all spheres
of individual and collective activity so that the nation
constantly rises to higher levels of endeavour and
(k)who is a parent or guardian to provide
opportunities for education to his child or, as the case
may be, ward between the age of six and fourteen
years.”
To this, the hypothetical author would have added one more
fundamental duty - duty to laugh. The correlative right to be funny
can be mined in Article 19 (1) (a) of the Constitution of India (the
use of crypto vocabulary to be forgiven). Being funny is one thing
and poking fun at another is different altogether.
2.“Laugh at what?” is a serious question. This is because
we have holy cows grazing all over from Varanasi to Vadipatty.
One dare not poke fun at them. There is however no single
catalogue of holy cows. It varies from person to person and from
region to region. A real cow, even if terribly underfed and
emaciated, shall be holy in Yogi's terrain. In West Bengal, Tagore
is such an iconic figure that Khushwant Singh learnt the lesson at
some cost. Coming to my own Tamil Desh, the all-time iconoclast
“Periyar” Shri.E.V.Ramasamy is a super-holy cow. In today's
Kerala, Marx and Lenin are beyond the bounds of criticism or
satire. Chhatrapati Shivaji and Veer Savarkar enjoy a similar
immunity in Maharashtra. But all over India, there is one ultimate
holy cow and that is “national security”.
3.The petitioner herein is an important office-bearer of a
not-so-important political party. CPI (ML) is now an over-ground
organization which contests elections also. Paper warriors are also
entitled to fantasise that they are swadeshi Che Guevaras.
4.On 16.09.2021, the petitioner herein went on a
sightseeing pleasure trip with his daughter and son-in-law to
Sirumalai hills. He put out the photographs taken on the occasion
in his Facebook page. He gave the caption “Jg;ghf;fp gapw;rpf;fhf
rpWkiy gazk;!” (Trip to Sirumalai for shooting practice).
Revolutionaries, whether real or phoney, are not usually credited
with any sense of humour (or at least this is the stereotype). For a
change, the petitioner tried to be funny. Perhaps it was his maiden
attempt at humour.
5.Vadipatty Police did not find it to be a joke. They
thought the petitioner was making preparations to wage war
against the State. They registered a case in Crime No.415 of 2021
against the petitioner for the offences under Sections 120B, 122,
505(1)(b) and 507 of IPC. They did not stop at that. They arrested
the petitioner and produced him before the jurisdictional
magistrate for remanding him to custody. Mercifully,
Mr.M.C.Arun, the Judicial Magistrate, Vadipatty, had the good
sense to refuse remand. Bearing in mind the principles laid down in
State v. Nakeeran Gopal (2019 SCC OnLine Mad 42), he
passed a detailed rejection order. I wish other magistrates in the
State of Tamil Nadu act likewise. Remand can never be made for
the asking. The police and the prosecution will seek remand in
every case. It is for the magistrate to satisfy herself that the
arrestee deserves to be remanded. Requests for remand must be
decided on the touchstone of Section 41 of Cr.Pc and Article 21 of
the Constitution. Thanks to the judicious conduct so well exhibited
by Shri.M.C.Arun (the Judicial Magistrate, Vadipatty), the
petitioner escaped incarceration by a whisker.
6.This criminal original petition has been filed to quash the
FIR itself. The learned counsel for the petitioner reiterated all the
contentions set out in the memorandum of grounds and submitted
that the very registration of the impugned FIR is an abuse of legal
process. Per contra, the learned Additional Public Prosecutor
appearing for the respondents submitted that no case for quashing
has been made out.
7.I carefully considered the rival contentions and went
through the materials on record. For an act to constitute a crime,
there are four stages, i)intention, ii)preparation, iii)attempt and
iv)accomplishment. While penal laws intervene only at the third
and fourth stages normally, even preparation is made an offence in
certain cases. Section 399 of IPC is one such provision. Section
122 IPC is another. Any penal provision has to be strictly
construed. Application of the provisions which penalize even
preparation must meet a higher threshold.
8.Section 122 of IPC is as follows :
“122.Collecting arms, etc., with intention of
waging war against the Government of India.-
Whoever collects men, arms or ammunition or
otherwise prepares to wage war with the intention of
either waging or being prepared to wage war
against the [Government of India], shall be punished
with [imprisonment for life] or imprisonment of
either description for a term not exceeding ten
years, [and shall also be liable to fine].”
To wage war would require several steps and crossing of stages.
There has to be mobilisation of men as well as accumulation of
arms and ammunition. That would require a concerted effort.
Each individual who is a party to the conspiracy to wage war may
be allotted a particular task. One may be tasked with collecting
men, another with arms and the third with ammunition. The
expression “otherwise prepares” in this context should not be
construed on the application of the principle of ejusdem generis. A
person may be engaged in fund-raising. Another may be
responsible for providing reinforcements. Some may be engaged in
making logistical arrangements. Some may be engaged in the
intellectual front. There could be several dimensions. All of them
would fall within the scope of “otherwise prepares”. But as
already held, when it comes to application of the provision to
concrete facts, courts will apply a higher threshold.
9.Now let us see what the petitioner did. Except giving
the title mentioned above to the photographs amateurishly taken
on the occasion of his trip to Sirumalai hills, the petitioner has done
nothing else. The petitioner is aged 62 years. His daughter is
standing next to him. His son-in-law is also seen in the photograph.
Four other photographs capturing the scenic beauty of the place
have also been posted. No weapon or proscribed material was
recovered from the petitioner. The petitioner neither intended to
wage war nor did he commit any act towards preparation therefor.
10.Section 505(1)(b) of IPC is as follows :
“Whoever makes, publishes or circulates
(b) with intent to cause, or which is likely to
cause, fear or alarm to the public, or to any section
of the public whereby any person may be induced to
commit an offence against the State or against the
shall be punished with imprisonment which may
extend to [three years], or with fine, or with both.”
This provision also can be invoked only if the offending act induces
or is likely to induce any person to commit an offence against the
State or against the public tranquility. In this case, the
photographs with the aforesaid caption was posted only in the
petitioner's Facebook page. Any normal and reasonable person
coming across the Facebook post would have laughed it off.
11.Section 507 of IPC is as follows :
“507.Criminal intimidation by an
anonymous communication.—Whoever commits
the offence of criminal intimidation by an
anonymous communication, or having taken
precaution to conceal the name or abode of the
person from whom the threat comes, shall be
punished with imprisonment of either description
for a term which may extend to two years, in
addition to the punishment provided for the
offence by the last preceding section.”
Invocation of this provision makes me laugh. Section 507 IPC can
be invoked only if the person sending the communication had
concealed his identity. The communication must be anonymous.
In this case, the petitioner had posted the photographs along with
the caption in his Facebook page. He has not concealed his
identity. There is nothing anonymous about the act in question.
12.None of the ingredients set out in Section 122, 505(1)
(b) and Section 507 are present in this case. Section 120 B of IPC
cannot be invoked for two reasons. Firstly, the petitioner is the sole
accused. To constitute the offence of conspiracy, there must be a
meeting of two or more minds. One cannot conspire with oneself.
Secondly, conspiracy is hatched to commit an offence mentioned in
the Section. When the ingredients of the primary offences have
been shown to be non-existent, the prosecution cannot hang on to
Section 120B IPC alone.
13.The very registration of the impugned FIR is absurd
and an abuse of legal process. It stands quashed. The criminal
original petition is allowed. Connected miscellaneous petition is
closed.
Note: In view of the present lock down owing
to COVID-19 pandemic, a web copy of the order
may be utilized for official purposes, but,
ensuring that the copy of the order that is
presented is the correct copy, shall be the
responsibility of the advocate/litigant
concerned.
|
Jug Suraiya, Bachi Karkaria, E.P.Unny and G.Sampath ... if
any one of them, or for that matter any satirist or cartoonist had
authored this judgement, they would have proposed a momentous
amendment to the Constitution of India to incorporate sub-clause
(l) in Article 51-A. Article 51-A states that it shall be the duty of
“(a)to abide by the Constitution and respect
its ideals and institutions, the National Flag and the
(b)to cherish and follow the noble ideals
which inspired our national struggle for freedom;
(c)to uphold and protect the sovereignty,
(d)to defend the country and render national
(e)to promote harmony and the spirit of
common brotherhood amongst all the people of India
transcending religious, linguistic and regional or
sectional diversities; to renounce practices
derogatory to the dignity of women;
(f)to value and preserve the rich heritage of
(g)to protect and improve the natural
environment including forests, lakes, rivers and wild
life, and to have compassion for living creatures;
(h)to develop the scientific temper,
humanism and the spirit of inquiry and reform;
(i)to safeguard public property and to abjure
(j)to strive towards excellence in all spheres
of individual and collective activity so that the nation
constantly rises to higher levels of endeavour and
(k)who is a parent or guardian to provide
opportunities for education to his child or, as the case
may be, ward between the age of six and fourteen
years.”
To this, the hypothetical author would have added one more
fundamental duty - duty to laugh. The correlative right to be funny
can be mined in Article 19 (1) (a) of the Constitution of India (the
use of crypto vocabulary to be forgiven). Being funny is one thing
and poking fun at another is different altogether.
2.“Laugh at what?” is a serious question. This is because
we have holy cows grazing all over from Varanasi to Vadipatty.
One dare not poke fun at them. There is however no single
catalogue of holy cows. It varies from person to person and from
region to region. A real cow, even if terribly underfed and
emaciated, shall be holy in Yogi's terrain. In West Bengal, Tagore
is such an iconic figure that Khushwant Singh learnt the lesson at
some cost. Coming to my own Tamil Desh, the all-time iconoclast
“Periyar” Shri.E.V.Ramasamy is a super-holy cow. In today's
Kerala, Marx and Lenin are beyond the bounds of criticism or
satire. Chhatrapati Shivaji and Veer Savarkar enjoy a similar
immunity in Maharashtra. But all over India, there is one ultimate
holy cow and that is “national security”.
3.The petitioner herein is an important office-bearer of a
not-so-important political party. CPI (ML) is now an over-ground
organization which contests elections also. Paper warriors are also
entitled to fantasise that they are swadeshi Che Guevaras.
4.On 16.09.2021, the petitioner herein went on a
sightseeing pleasure trip with his daughter and son-in-law to
Sirumalai hills. He put out the photographs taken on the occasion
in his Facebook page. He gave the caption “Jg;ghf;fp gapw;rpf;fhf
rpWkiy gazk;!” (Trip to Sirumalai for shooting practice).
Revolutionaries, whether real or phoney, are not usually credited
with any sense of humour (or at least this is the stereotype). For a
change, the petitioner tried to be funny. Perhaps it was his maiden
attempt at humour.
5.Vadipatty Police did not find it to be a joke. They
thought the petitioner was making preparations to wage war
against the State. They registered a case in Crime No.415 of 2021
against the petitioner for the offences under Sections 120B, 122,
505(1)(b) and 507 of IPC. They did not stop at that. They arrested
the petitioner and produced him before the jurisdictional
magistrate for remanding him to custody. Mercifully,
Mr.M.C.Arun, the Judicial Magistrate, Vadipatty, had the good
sense to refuse remand. Bearing in mind the principles laid down in
State v. Nakeeran Gopal (2019 SCC OnLine Mad 42), he
passed a detailed rejection order. I wish other magistrates in the
State of Tamil Nadu act likewise. Remand can never be made for
the asking. The police and the prosecution will seek remand in
every case. It is for the magistrate to satisfy herself that the
arrestee deserves to be remanded. Requests for remand must be
decided on the touchstone of Section 41 of Cr.Pc and Article 21 of
the Constitution. Thanks to the judicious conduct so well exhibited
by Shri.M.C.Arun (the Judicial Magistrate, Vadipatty), the
petitioner escaped incarceration by a whisker.
6.This criminal original petition has been filed to quash the
FIR itself. The learned counsel for the petitioner reiterated all the
contentions set out in the memorandum of grounds and submitted
that the very registration of the impugned FIR is an abuse of legal
process. Per contra, the learned Additional Public Prosecutor
appearing for the respondents submitted that no case for quashing
has been made out.
7.I carefully considered the rival contentions and went
through the materials on record. For an act to constitute a crime,
there are four stages, i)intention, ii)preparation, iii)attempt and
iv)accomplishment. While penal laws intervene only at the third
and fourth stages normally, even preparation is made an offence in
certain cases. Section 399 of IPC is one such provision. Section
122 IPC is another. Any penal provision has to be strictly
construed. Application of the provisions which penalize even
preparation must meet a higher threshold.
8.Section 122 of IPC is as follows :
“122.Collecting arms, etc., with intention of
waging war against the Government of India.-
Whoever collects men, arms or ammunition or
otherwise prepares to wage war with the intention of
either waging or being prepared to wage war
against the [Government of India], shall be punished
with [imprisonment for life] or imprisonment of
either description for a term not exceeding ten
years, [and shall also be liable to fine].”
To wage war would require several steps and crossing of stages.
There has to be mobilisation of men as well as accumulation of
arms and ammunition. That would require a concerted effort.
Each individual who is a party to the conspiracy to wage war may
be allotted a particular task. One may be tasked with collecting
men, another with arms and the third with ammunition. The
expression “otherwise prepares” in this context should not be
construed on the application of the principle of ejusdem generis. A
person may be engaged in fund-raising. Another may be
responsible for providing reinforcements. Some may be engaged in
making logistical arrangements. Some may be engaged in the
intellectual front. There could be several dimensions. All of them
would fall within the scope of “otherwise prepares”. But as
already held, when it comes to application of the provision to
concrete facts, courts will apply a higher threshold.
9.Now let us see what the petitioner did. Except giving
the title mentioned above to the photographs amateurishly taken
on the occasion of his trip to Sirumalai hills, the petitioner has done
nothing else. The petitioner is aged 62 years. His daughter is
standing next to him. His son-in-law is also seen in the photograph.
Four other photographs capturing the scenic beauty of the place
have also been posted. No weapon or proscribed material was
recovered from the petitioner. The petitioner neither intended to
wage war nor did he commit any act towards preparation therefor.
10.Section 505(1)(b) of IPC is as follows :
“Whoever makes, publishes or circulates
(b) with intent to cause, or which is likely to
cause, fear or alarm to the public, or to any section
of the public whereby any person may be induced to
commit an offence against the State or against the
shall be punished with imprisonment which may
extend to [three years], or with fine, or with both.”
This provision also can be invoked only if the offending act induces
or is likely to induce any person to commit an offence against the
State or against the public tranquility. In this case, the
photographs with the aforesaid caption was posted only in the
petitioner's Facebook page. Any normal and reasonable person
coming across the Facebook post would have laughed it off.
11.Section 507 of IPC is as follows :
“507.Criminal intimidation by an
anonymous communication.—Whoever commits
the offence of criminal intimidation by an
anonymous communication, or having taken
precaution to conceal the name or abode of the
person from whom the threat comes, shall be
punished with imprisonment of either description
for a term which may extend to two years, in
addition to the punishment provided for the
offence by the last preceding section.”
Invocation of this provision makes me laugh. Section 507 IPC can
be invoked only if the person sending the communication had
concealed his identity. The communication must be anonymous.
In this case, the petitioner had posted the photographs along with
the caption in his Facebook page. He has not concealed his
identity. There is nothing anonymous about the act in question.
12.None of the ingredients set out in Section 122, 505(1)
(b) and Section 507 are present in this case. Section 120 B of IPC
cannot be invoked for two reasons. Firstly, the petitioner is the sole
accused. To constitute the offence of conspiracy, there must be a
meeting of two or more minds. One cannot conspire with oneself.
Secondly, conspiracy is hatched to commit an offence mentioned in
the Section. When the ingredients of the primary offences have
been shown to be non-existent, the prosecution cannot hang on to
Section 120B IPC alone.
13.The very registration of the impugned FIR is absurd
and an abuse of legal process. It stands quashed. The criminal
original petition is allowed. Connected miscellaneous petition is
closed.
Note: In view of the present lock down owing
to COVID-19 pandemic, a web copy of the order
may be utilized for official purposes, but,
ensuring that the copy of the order that is
presented is the correct copy, shall be the
responsibility of the advocate/litigant
concerned.
|
"The very registration of the impugned FIR is absurd and an abuse of legal process", the Court said.While quashing an FIR registered against an office-bearer of CPI (ML) who uploaded vacation pictures with the caption 'Trip to Sirumalai for shooting practice', the Madurai Bench of Madras High Court went on to make some interesting observations about the 'duty to laugh' and the 'right to be funny'. Justice G.R Swaminathan quashed the FIR against the 62-year-old accused while...
While quashing an FIR registered against an office-bearer of CPI (ML) who uploaded vacation pictures with the caption 'Trip to Sirumalai for shooting practice', the Madurai Bench of Madras High Court went on to make some interesting observations about the 'duty to laugh' and the 'right to be funny'.
Justice G.R Swaminathan quashed the FIR against the 62-year-old accused while underscoring that the case registered by Vadipatty Police, booking the latter for 'making preparations to wage war against the State', is 'absurd and an abuse of legal process'.
Justice GR Swaminathan started the judgment by observing :
"Jug Suraiya, Bachi Karkaria, E.P.Unny and G.Sampath...if any satirist or cartoonist had authored this judgement, they would have proposed a momentous amendment to the Constitution of India to incorporate sub-clause (l) in Article 51-A…. To this, the hypothetical author would have added one more fundamental duty - duty to laugh."
The Court went on to observe that the correlative right to be funny can be "mined in Article 19 (1) (a) of the Constitution of India".
While noting that 'being funny' and 'poking fun at another' is different, the court rhetorically states that "Laugh at what?" is a serious question. The court also explains as to why the question becomes pertinent in the backdrop of regional diversity in India.
"…This is because we have holy cows grazing all over from Varanasi to Vadipatty. One dare not poke fun at them. There is however no single catalogue of holy cows. It varies from person to person and from region to region. A real cow, even if terribly underfed and emaciated, shall be holy in Yogi's terrain. In West Bengal, Tagore is such an iconic figure that Khushwant Singh learnt the lesson at some cost. Coming to my own Tamil Desh, the all-time iconoclast "Periyar" Shri.E.V.Ramasamy is a super-holy cow. In today's Kerala, Marx and Lenin are beyond the bounds of criticism or satire. Chhatrapati Shivaji and Veer Savarkar enjoy a similar immunity in Maharashtra. But all over India, there is one ultimate holy cow and that is "national security"."
Vadipetty Police had booked the petitioner accused who went for a sight-seeing trip along with his family for offences under Sections 120B [Criminal Conspiracy], 122 [waging war against the state], and 507 [Criminal Intimidation by Conspiracy] of IPC.
He was also booked for Section 505(1) (b) for posting the pictures with the contentious caption on his Facebook page.
However, Section 505(1) (b) prescribes the punishment for:
"making, publishing, or circulating any statement, or rumour, or report, with intent to cause, or which is likely to cause, fear or alarm to the public or to any section of the public whereby any person may be induced to commit an offence against the State or against the public tranquillity."
In its order, the court also noted petitioner was the office-bearer of the Communist Party of India (Marxist-Leninist), a "not so important political party". The Court said that CPI-ML is now an overground organisation that contests in elections. The order also satirically remarks that,
'paper warriors are also entitled to fantasise that they are Swadeshi Che Gueveras…. Revolutionaries, whether real or phoney, are not usually credited with any sense of humour (or at least this is the stereotype). For a change, the petitioner tried to be funny. Perhaps it was his maiden attempt at humour.'
The accused man was arrested by Vadipetty police station on the above grounds and produced before the Magistrate for remand to custody. However, remand was refused by the Magistrate by citing State v. Nakeeran Gopal (2019). The Madras High Court has also appreciated the Magistrate for the due application of mind while rejecting the remand plea. The court note that the police and prosecution will always seek custody and it is for the Magistrate to decide such applications judiciously on the touchstone of Section 41 of Cr.Pc and Article 21 of the Constitution.
Court's Observations
For penal provisions like Section 399 and Section 122 of IPC, even the preparatory stage for the commission of a crime can be made an offence but the provision has to be strictly construed and preparation must meet a higher threshold. About Section 122 of IPC which the petitioner was charged with, the court further states that waging war against the state requires crossing certain stages. Mobilisation of men and accumulation of arms and ammunition through a concerted effort are instances of preparing to wage war against the state. The meaning rendered by 'otherwise prepares' in Section 122 IPC can also encompass fundraising, providing reinforcements, making logistical arrangements and other dimensions of contributions. However, all of such must meet the higher threshold proscribed by the strict construing of the penal statute to the peculiar facts of the case, notes the court.
About the conduct of the petitioner, the court noted that the petitioner merely took photographs of a scenic place during a family trip with an intended-to-be funny caption.
"No weapon or proscribed material was recovered from the petitioner. The petitioner neither intended to wage war nor did he commit any act towards preparation therefor."
About booking the petitioner for the offence under Section 505 (1)(b), the court similarly observes that 'any reasonable and normal person coming across the Facebook post would have laughed it off'. According to the court, the post of the petitioner on his Facebook page could not have induced or wass likely to induce any person to commit an offence against the State or against the public tranquility.
About the invocation of the provision under Section 507of IPC, the court notes as follows:
"Invocation of this provision makes me laugh. Section 507 IPC can be invoked only if the person sending the communication had concealed his identity. The communication must be anonymous. In this case, the petitioner had posted the photographs along with the caption in his Facebook page. He has not concealed his identity. There is nothing anonymous about the act in question."
Additionally, on the inclusion of Section 120 B of IPC in the FIR, the court notes that the provision can't be invoked unless there is a meeting of mind of two persons, whereas, the petitioner is the sole accused in the present case.
"One cannot conspire with oneself. Secondly, conspiracy is hatched to commit an offence mentioned in the Section. When the ingredients of the primary offences have been shown to be non-existent, the prosecution cannot hang on to Section 120B IPC alone.", concluded the court while quashing the FIR registered against the CPI(ML) office bearer.
Case Title: Mathivanan v. Inspector of Police & Ors.
Case No: Crl OP(MD)No.18337 of 2021 and Crl MP(MD)No.10063 of 2021
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"The very registration of the impugned FIR is absurd and an abuse of legal process", the Court said. Justice G.R Swaminathan quashed the FIR against the 62-year-old accused while...
While quashing an FIR registered against an office-bearer of CPI (ML) who uploaded vacation pictures with the caption 'Trip to Sirumalai for shooting practice', the Madurai Bench of Madras High Court went on to make some interesting observations about the 'duty to laugh' and the 'right to be funny'. Justice GR Swaminathan started the judgment by observing :
"Jug Suraiya, Bachi Karkaria, E.P.Unny and G.Sampath...if any satirist or cartoonist had authored this judgement, they would have proposed a momentous amendment to the Constitution of India to incorporate sub-clause (l) in Article 51-A…. To this, the hypothetical author would have added one more fundamental duty - duty to laugh." While noting that 'being funny' and 'poking fun at another' is different, the court rhetorically states that "Laugh at what?" There is however no single catalogue of holy cows. It varies from person to person and from region to region. A real cow, even if terribly underfed and emaciated, shall be holy in Yogi's terrain. In West Bengal, Tagore is such an iconic figure that Khushwant Singh learnt the lesson at some cost. In today's Kerala, Marx and Lenin are beyond the bounds of criticism or satire. Chhatrapati Shivaji and Veer Savarkar enjoy a similar immunity in Maharashtra. He was also booked for Section 505(1) (b) for posting the pictures with the contentious caption on his Facebook page. Revolutionaries, whether real or phoney, are not usually credited with any sense of humour (or at least this is the stereotype). For a change, the petitioner tried to be funny. Perhaps it was his maiden attempt at humour.' The accused man was arrested by Vadipetty police station on the above grounds and produced before the Magistrate for remand to custody. Mobilisation of men and accumulation of arms and ammunition through a concerted effort are instances of preparing to wage war against the state. The meaning rendered by 'otherwise prepares' in Section 122 IPC can also encompass fundraising, providing reinforcements, making logistical arrangements and other dimensions of contributions. However, all of such must meet the higher threshold proscribed by the strict construing of the penal statute to the peculiar facts of the case, notes the court. "No weapon or proscribed material was recovered from the petitioner. The petitioner neither intended to wage war nor did he commit any act towards preparation therefor." According to the court, the post of the petitioner on his Facebook page could not have induced or wass likely to induce any person to commit an offence against the State or against the public tranquility. Section 507 IPC can be invoked only if the person sending the communication had concealed his identity. There is nothing anonymous about the act in question." Additionally, on the inclusion of Section 120 B of IPC in the FIR, the court notes that the provision can't be invoked unless there is a meeting of mind of two persons, whereas, the petitioner is the sole accused in the present case. Secondly, conspiracy is hatched to commit an offence mentioned in the Section. Case Title: Mathivanan v. Inspector of Police & Ors. Case No: Crl OP(MD)No.18337 of 2021 and Crl MP(MD)No.10063 of 2021
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It is a shame that every other case we consider is
sadly a rape of a minor. A minor child was pounced upon by a
neighbour, when she was alone in her house and forcefully
molested, which is the case of the prosecution.
2. Kum. Sai Pooja, learned Counsel for the
appellant, vehemently argued in defence, claiming the
improbability of the story and stressing upon the
inconsistencies. Though in cases of rape, it is trite that a
conviction can be based on the sole testimony of the
prosecutrix; corroboration would be necessary if the evidence
is found to be not of sterling quality. Discrepancies in the
evidence of the victim, PW1 and her mother, PW9 are
specifically highlighted. The incident is portrayed as a very
violent one, but the injuries detected in medical examination
are not commensurate with the violence alleged. It has been
deposed that the victim was forcefully taken inside the room
of her house and rape was carried out with equally violent
penetration alleged. There were no visible injuries either on
the body or the genitals of the victim. The complaints of
pain noticed by the Doctor can always be pretended. As for
the evidence regarding penetration, an extract from the book
'Forensic Medicine for the Police'; by Dr.B.Umadethan, a
celebrated Doctor of Forensic Medicine, has been placed on
record. It is pointed out that the presence or absence of
hymen does not indicate the virginity of a woman.
Emphatically the statement 'Virginity can be proved; but
cannot be disproved' is pointed out. The mere finding that
there was a hymen tear would not conclusively prove the
sexual act of penetration.
3. PW1 and PW9 have stated the time differently;
while PW9 says that the meeting which kept her away from home
was at 5 O'clock, PW1 says it to be at 4.00 p.m and the
incident as recorded in Ext.P2 certificate of medical
examination is at 4.30. The house in which the crime is
perpetrated is situated in a colony which is thickly
populated. The scene of occurrence was not properly
identified and the description of the scene does not reveal
the space available; which is significant insofar as the
violent act of dragging the victim inside the house, throwing
her on a cot and forcefully penetrating her. The scene plan
Ext.P5 and scene mahazar Ext.P6 does not show the
measurements of the rooms. It also shows only one access
into the house. The evidence of PW1 is that when her mother
came home, the accused ran away, in which event the mother
would have definitely seen the accused, to which end PW9 does
not depose. It is pointed out that while PW9, the mother
admitted that there were issues with the family of the
accused, PW13, the father of the victim, asserted that the
accused was his friend. The evidence of PW1, the victim
clearly shows that she was tutored and leading questions were
put to her in the chief-examination. She is said to have
failed in the 10th standard and also failed twice earlier. A
14-year-old, who failed twice cannot be in the 10 th standard
and PW1 does not remember when she stopped her studies, a
deliberate falsehood. There is hence suppression of material
facts and PW1 is not a witness of sterling quality. The
entire incident as spoken of by the prosecutrix; in the
thickly populated area is prima facie unnatural. There is no
valid proof of date of birth since only a certified copy of
the birth certificate was produced and it was not marked
through the custodian of such a document.
4. The learned Counsel would argue that the defence
was conducted shabbily and it clearly indicates that the
accused did not have proper legal aid. Reliance is placed on
Varghese @ Biju v. State of Kerala, 2007 (2) KHC 310 to urge
a remand. Ganesan v. State represented by Inspector of
Police, (2020) 10 SCC 573 is placed reliance on to urge this
Court to seek corroboration to the testimony of the
prosecutrix, who is not credible. Santosh Prasad @ Santosh
Kumar v. State of Bihar, (2020) 3 SCC 443 is also relied upon
to seek acquittal of the accused. The learned Counsel also
valiantly sought for mitigation in the sentence, even if the
conviction is affirmed; since doubt lingers on all counts.
5. The learned Public Prosecutor Smt.Bindu O.V.
argued for sustaining the impugned judgment. It is pointed
out that PW9 has produced Ext.P9 certificate of date of
birth, which is the certified copy of a public document. The
evidence of the Headmaster (HM) (PW5) further corroborates
the date of birth and establishes the child victim to be only
14 years of age when the alleged incident occurred. The
evidence of PW1 is amply corroborated by that of the Doctor
and the certificate of examination produced, Ext.P2. It
clearly indicates the history of the incident, which is in
tune with the FIS and the deposition of PW1 before court. The
trial court has seen the demeanour of the witness, assessed
her conduct and found her to be competent. The trial court
was abundantly careful in recording the chief-examination, as
question and answer and none of them are leading questions.
The prosecutrix without any deviation, braved searching
cross-examination and stood her ground. The suggestive
questions put to the victim in cross-examination indirectly
is an admission of the incident having occurred. The accused
had pounced on the victim knowing very well that there would
be no person available in the house. The alleged incident
would not necessarily cause any bodily injury as such. The
absence of bodily injury cannot be the sole ground for an
acquittal and in any event, the victim has complained of body
pain as is evident from the deposition of the Doctor. Johny
C. v. State of Kerala, 2021 (4) KHC 296 is relied on to argue
that the mother, immediately after the incident heard about
the rape and the perpetrator from the victim, which can be
treated as res gestae under Sec.6 of the Evidence Act.
6. We would first deal with the contention raised
relying upon Varghese @ Biju (supra) regarding no effective
legal aid having been received. A reading of the decision
would indicate that in the cited case, the Legal Aid Counsel
only had four years of experience and on the very next day of
his engagement, he was required to cross-examine the
important witnesses. There are no such facts brought before
this Court on which alone there could be prejudice found by
this Court; as has been found in the cited case. The learned
Counsel, would emphasize how the case was conducted, to seek
for a remand. We are however not inclined to so remand a
matter merely for the reason of the defence having not been
conducted properly. We also notice that but for the
suggestion put in cross-examination, which tends to be an
indirect admission, there is no inefficiency discernible in
the defence set-up. In fact, Ganesan (supra) found that
merely because an appeal is disposed of within four days, it
cannot be presumed that there was no fair and sufficient
opportunity given to the accused to defend himself. In the
present case, there is not even a ground urged of prejudice.
7. PW1, the victim deposed in tandem with the FIS
given by her. We see that the court has recorded the chief-
examination as questions and answers. But however, we do not
find them to be leading questions. The prosecutrix deposed
that on 04.05.2014 at around 5.00 p.m she was alone at her
residence when her father's friend trespassed into her house
and closed the door at the entrance. He removed his dress,
caught hold of her and forcefully removed her churidar-pants.
When she protested and tried to raise an alarm, the accused
covered her mouth with his hand and caught her breasts. He
threatened to cut off her breasts and removed her
undergarment. The victim was then forcefully made to lie on
the cot and subjected to penetrative sexual assault. After
the incident, she cried and when her mother came home, the
accused fled the scene. The victim was also told by the
accused not to divulge the incident to anybody. However, she
spoke to her mother about the molestation and later on; the
next day, Ext.P1 FIS was registered. She also spoke about
having been examined at the Taluk Head Quarters Hospital,
Vythiri and having surrendered MO1 to MO3 dresses before the
I.O. She spoke of her date of birth as 14.03.1999. She
withstood searching cross-examination and no inconsistency as
such could be brought out. In fact, there was a more graphic
description of the incident, on the suggestions made in
cross. She also explained how the accused stifled her cries,
physically and by threats levelled, negativing any
possibility of the nearby residents coming to her rescue.
8. PW2 is a neighbour who went along with the
mother to the Kudumbasree meeting. She had different versions
about how she came to know of what happened to PW1. We do not
place any reliance on that part of her evidence. PW9, the
mother of the victim, spoke in tandem with what the victim
said. She had been away for the Kudumbasree meeting, which at
least receives corroboration from PW2, who was also present
at the meeting. When she returned and saw her daughter
crying, she enquired the reason with her daughter. Though she
did not immediately say anything, later the victim disclosed
what transpired in the absence of the mother. On the next
day, they went to the Vanitha Helpline at Kalpetta to make
the complaint. PW9 also affirmed that the birth of her
daughter was registered and a birth certificate, the original
of which was with her, was produced. The same was marked as
Ext.P9, which indicates the date of birth to be 14.03.1999.
The original after perusal by the Court was given back and a
copy placed in evidence. PW13 is the father, who was away on
work. He was working at a slightly distant place, in a hotel.
He confirmed that PW1 was alone in the house, since his wife
had gone for the Kudumbasree meeting and his elder daughter
was away at Palakkad. This fact was spoken of by PW1, PW2 and
PW9 also. He was informed over the telephone about the rape
committed on his daughter at around 9.00 clock at night and
the next day morning he came home, after which the complaint
was made.
9. We do not find any inconsistency in the evidence
of PW1 and PW9 as to the time. PW1, in her cross-examination
had only said that her mother had left for the Kudumbasree
meeting at around 4 o'clock and PW9 spoke of her having gone
for a meeting at around 5 o'clock. We do not think that the
witnesses should be pinned down to the exact time and it is
highly unlikely that every routine would be carried out by an
individual looking at a clock. That the house was empty on
the evening of the crucial day and that the offence was
committed between 4 to 5 p.m is fairly clear from the
evidence of PW1 and PW9. The learned Counsel has also
stressed the fact that, while PW9 speaks of some issues with
the family of the accused, PW13 spoke of the accused being a
friend. PW1 also deposed that she was acquainted with the
accused since he and her father were friends. The attempt of
the defence obviously was to allege a motive for raising a
false allegation against the accused by the family of the
victim. It is only natural that even between friends or
family, there exist certain issues. But that alone cannot
lead to such a false allegation and we find no credence in
the contention raised on that count by the accused.
10. The learned Government Pleader has relied on
Johny (supra) to urge res gestae under Sec.6. Parbati Devi v.
State, AIR 1952 SC 831 was relied on to raise the ground of
relevance under Sec.8 of the Indian Evidence Act. We would
not go into that, especially since the question put to PW9 in
chief-examination was a leading question. PW9 in chief-
examination, while narrating what transpired, spoke of her
daughter having not first divulged the reason for weeping.
She also said that, it was only later, when she persisted,
the girl came out with the specific allegation of
molestation. The prosecution before the trial court put a
question as to whether PW1 had stated about the molestation
when enquiries were made with her, to which an affirmative
answer was given. We would not place any reliance on the same
and in that circumstance, we would not also consider the
contention raised under Sec.6 and 8 of the Evidence Act.
11. PW3 is the Doctor who examined the victim at
7.45 p.m on 05.05.2014, the very next day. The certificate
issued was marked as Ext.P2. The history relating to the
incident is recorded as 'alleged H/O sexual assault by Balan
(Mani Balan) on 4.5.2014 at abound 4.30 p.m …' at the
victim's residence. The details of position and degree of
violence were also recorded. The victim was pinned down by
the assailant and her panties and pants removed, after which
penetration with the penis was attempted. The victim was
unable to give any resistance since the accused was lying
over her. The victim also stated that she was having pain
while urinating and she had washed her genitals after the
incident. Vaginal swabs, vaginal smears, nail clippings, hair
samples, etc. were taken. On examination, her hymen was found
to be torn at 7 o'clock position, but there were no injuries
on the vagina. According to the Doctor, there was evidence of
vaginal penetration since the hymen is torn at the 7 o'clock
position and the vagina admits one finger loosely and two
fingers tightly. The history of the incident as recorded in
Ext.P2 corroborates the FIS and the deposition of the
prosecutrix. It is argued by the learned Counsel, Ext.P17 FSL
report does not reveal any evidence of sexual intercourse,
which normally leaves remnants for about 72 hours. This by
itself cannot be conclusive to find no penetration. In the
light of the credible and consistent evidence spoken of by
the victim, which is in tune with the FIS and the history
reported to the Doctor, we find no reason to interfere with
the finding of the trial court that there was actual
penetration and rape was committed.
12. The learned Counsel has placed before us an
authoritative text by a celebrated Forensic Specialist, which
indicates that even the presence or absence of hymen does not
disprove virginity conclusively. We should understand that if
the hymen is present and does not reveal any injury,
virginity stands proved, but not otherwise. In the present
case, the virginity is not proved and coupled with the
evidence of the prosecutrix, with sufficient corroboration
from other witnesses, we are inclined to find the molestation
having occurred as spoken of by the prosecutrix.
13. The age of the victim is proved by Ext.P9
certificate of birth issued by the Registrar of Births &
Deaths, though the same was not produced before the I.O. PW9,
the mother produced it from her custody before court when she
was examined. The date of birth as seen from Ext.P9
certificate is 14.03.1999. The Register of Births and Deaths
is a public document as provided under Sec.74 and the
certified copy of the public document is one issued under
Sec.76. There is a presumption insofar as the genuineness of
the certified copies so declared to be admissible as evidence
of any particular fact, duly certified, interalia, by a State
Government Officer. We rely on the judgment of a Division
Bench in Rajan v. State of Kerala, 2021 (4) KLT 274. We do
not find any reason to doubt the certified copy nor is it
inadmissible in evidence. Though no corroboration is
necessary, the HM, PW5, produced the extract of the School
register as Ext.P4, which also confirms the date of birth as
spoken of by PW1, PW9 and revealed from Ext.P9. Significantly
the mother of the victim also spoke of her age.
14. The official witnesses, including the I.O, have
spoken of their role in the investigation, on which no
dispute is raised. The scene plan is marked as Ext.P5 and the
scene mahazar as Ext.P6. The residence of PW1 is a small one
and has an asbestos roof. True, the description of the rooms
are not given, but that is not a reason to assume that the
alleged actions could not have been committed in the house.
The allegation is also that the accused had entered the
house, closed the door at the entrance and then molested the
victim. She is also said to have been dragged to the bed
where she was forced to lie down. We do not think there are
any spatial constraints in the house, normally habituated by
four persons, the victim, her parents and her elder sister,
all of whom, except the victim, were away at the time when
the incident occurred.
15. We find no reason to interfere with the
conviction entered under Sec.376(2)(i) of IPC and Sec.450 of
IPC. There is ample evidence to find rape having been
committed on the victim, who has also been proved to be below
the age of 16 years. As far as the conviction under Sec.5(i)
read with Sec.6, we agree with the learned Counsel for the
appellant that there is no aggravated penetrative sexual
assault. No separate sentence was awarded under the POCSO Act
by the trial court noticing Sec.42 of the Act because of the
sentence imposed under Sec.376(2)(i) of the IPC. An
aggravated penetrative sexual assault arises interalia when
it is committed on a child below 12 years. In the present
case, the child is 14 years and hence there can be no
conviction under Sec.5(m). The charge seems to be under
Sec.5(i). However, there is no grievous hurt, bodily harm or
injury on the body of the child or to the sexual organs. Be
that as it may, the accused is found to have committed
penetrative sexual assault under Sec.3, a lesser offence, for
which the punishment varies from 10 years to imprisonment for
life. We do not think that we should impose any sentence
separately, especially since the Sessions Court has not
imposed it by virtue of Sec.42 and the sentence imposed under
Sec.376(2)(i). We hence set aside the conviction under
Sec.5(i) read with Sec.6 of the POCSO Act and confirm the
conviction under Sec.376(2)(i) and Sec.450 of the IPC. The
accused is also found guilty of the offence under Sec.3 read
with Sec.4 of the POCSO Act, 2012. The sentence imposed by
the Court below is affirmed in toto. The appeal hence stands
partly allowed.
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Appalled by the rising instances of minors being subjected to rape in the State, the Kerala High Court while hearing a criminal appeal remarked: "It is a shame that every other case we consider is sadly a rape of a minor." A Division Bench of Justice K. Vinod Chandran and Justice Ziyad Rahman A. A while upholding the conviction of a man accused of raping a minor girl living in...
Appalled by the rising instances of minors being subjected to rape in the State, the Kerala High Court while hearing a criminal appeal remarked:
"It is a shame that every other case we consider is sadly a rape of a minor."
A Division Bench of Justice K. Vinod Chandran and Justice Ziyad Rahman A. A while upholding the conviction of a man accused of raping a minor girl living in his neighbourhood, found that there was no inconsistency in the evidence produced by the prosecution.
The case of the prosecution was that the 14-year-old victim was pounced upon by her neighbour when she was alone in her house and forcefully molested.
It was alleged that she was dragged inside the house and thrown on a cot and forcibly penetrated. There was a highly graphic description of the incident when it was narrated by the victim in the chief examination before the trial court.
The prosecutrix alleged that when her mother came home, the accused fled the scene. She claimed to have been told by the accused not to divulge the incident to anybody. However, she disclosed it to her mother and on the next day, FIS was registered.
Subsequently, the Sessions Court convicted the accused for commission of offences punishable under Sections 376(2)(i) (Rape) and 450 (House-trespass) of the IPC read with Sections 5(i) (aggravated penetrative sexual assault) of the POCSO Act.
In appeal, the accused contended that the defence was conducted shabbily and that he was not provided proper legal aid.
Pointing out several aspects where the prosecution was lacking, the perpetrator sought mitigation in the sentence even if the conviction was affirmed.
Nevertheless, the prosecution established that the victim was a minor by producing her birth certificate and convinced the Court that the trial court was abundantly careful in recording the chief examination.
The High Court was inclined to uphold the conviction of the accused:
"We find no reason to interfere with the conviction entered under Sec.376(2)(i) of IPC and Sec.450 of IPC. There is ample evidence to find rape having been committed on the victim, who has also been proved to be below the age of 16 years."
However, it was found that no grievous hurt, bodily harm or injury was found on the body of the child or to the sexual organs.
Therefore, the Court agreed that there was no aggravated penetrative sexual assault in the matter.
Be that as it may, the accused was found to have committed penetrative sexual assault under Section 3, a lesser offence, for which the punishment varies from 10 years to imprisonment for life.
Accordingly, the Bench set aside the conviction under Sec.5(i) read with Sec.6 of the POCSO Act, thereby allowing the appeal partly.
Legal Aid Counsel Advocate Rishikesh Shenoy, Advocate P Mohamed Sabah and Advocate Saipooja appeared for the petitioners and Public Prosecutor Bindu O.V represented the State in the matter.
Case Title: Mani Balan v. State of Kerala
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It is a shame that every other case we consider is
sadly a rape of a minor. A minor child was pounced upon by a
neighbour, when she was alone in her house and forcefully
molested, which is the case of the prosecution.
2. Kum. Sai Pooja, learned Counsel for the
appellant, vehemently argued in defence, claiming the
improbability of the story and stressing upon the
inconsistencies. Though in cases of rape, it is trite that a
conviction can be based on the sole testimony of the
prosecutrix; corroboration would be necessary if the evidence
is found to be not of sterling quality. Discrepancies in the
evidence of the victim, PW1 and her mother, PW9 are
specifically highlighted. The incident is portrayed as a very
violent one, but the injuries detected in medical examination
are not commensurate with the violence alleged. It has been
deposed that the victim was forcefully taken inside the room
of her house and rape was carried out with equally violent
penetration alleged. There were no visible injuries either on
the body or the genitals of the victim. The complaints of
pain noticed by the Doctor can always be pretended. As for
the evidence regarding penetration, an extract from the book
'Forensic Medicine for the Police'; by Dr.B.Umadethan, a
celebrated Doctor of Forensic Medicine, has been placed on
record. It is pointed out that the presence or absence of
hymen does not indicate the virginity of a woman.
Emphatically the statement 'Virginity can be proved; but
cannot be disproved' is pointed out. The mere finding that
there was a hymen tear would not conclusively prove the
sexual act of penetration.
3. PW1 and PW9 have stated the time differently;
while PW9 says that the meeting which kept her away from home
was at 5 O'clock, PW1 says it to be at 4.00 p.m and the
incident as recorded in Ext.P2 certificate of medical
examination is at 4.30. The house in which the crime is
perpetrated is situated in a colony which is thickly
populated. The scene of occurrence was not properly
identified and the description of the scene does not reveal
the space available; which is significant insofar as the
violent act of dragging the victim inside the house, throwing
her on a cot and forcefully penetrating her. The scene plan
Ext.P5 and scene mahazar Ext.P6 does not show the
measurements of the rooms. It also shows only one access
into the house. The evidence of PW1 is that when her mother
came home, the accused ran away, in which event the mother
would have definitely seen the accused, to which end PW9 does
not depose. It is pointed out that while PW9, the mother
admitted that there were issues with the family of the
accused, PW13, the father of the victim, asserted that the
accused was his friend. The evidence of PW1, the victim
clearly shows that she was tutored and leading questions were
put to her in the chief-examination. She is said to have
failed in the 10th standard and also failed twice earlier. A
14-year-old, who failed twice cannot be in the 10 th standard
and PW1 does not remember when she stopped her studies, a
deliberate falsehood. There is hence suppression of material
facts and PW1 is not a witness of sterling quality. The
entire incident as spoken of by the prosecutrix; in the
thickly populated area is prima facie unnatural. There is no
valid proof of date of birth since only a certified copy of
the birth certificate was produced and it was not marked
through the custodian of such a document.
4. The learned Counsel would argue that the defence
was conducted shabbily and it clearly indicates that the
accused did not have proper legal aid. Reliance is placed on
Varghese @ Biju v. State of Kerala, 2007 (2) KHC 310 to urge
a remand. Ganesan v. State represented by Inspector of
Police, (2020) 10 SCC 573 is placed reliance on to urge this
Court to seek corroboration to the testimony of the
prosecutrix, who is not credible. Santosh Prasad @ Santosh
Kumar v. State of Bihar, (2020) 3 SCC 443 is also relied upon
to seek acquittal of the accused. The learned Counsel also
valiantly sought for mitigation in the sentence, even if the
conviction is affirmed; since doubt lingers on all counts.
5. The learned Public Prosecutor Smt.Bindu O.V.
argued for sustaining the impugned judgment. It is pointed
out that PW9 has produced Ext.P9 certificate of date of
birth, which is the certified copy of a public document. The
evidence of the Headmaster (HM) (PW5) further corroborates
the date of birth and establishes the child victim to be only
14 years of age when the alleged incident occurred. The
evidence of PW1 is amply corroborated by that of the Doctor
and the certificate of examination produced, Ext.P2. It
clearly indicates the history of the incident, which is in
tune with the FIS and the deposition of PW1 before court. The
trial court has seen the demeanour of the witness, assessed
her conduct and found her to be competent. The trial court
was abundantly careful in recording the chief-examination, as
question and answer and none of them are leading questions.
The prosecutrix without any deviation, braved searching
cross-examination and stood her ground. The suggestive
questions put to the victim in cross-examination indirectly
is an admission of the incident having occurred. The accused
had pounced on the victim knowing very well that there would
be no person available in the house. The alleged incident
would not necessarily cause any bodily injury as such. The
absence of bodily injury cannot be the sole ground for an
acquittal and in any event, the victim has complained of body
pain as is evident from the deposition of the Doctor. Johny
C. v. State of Kerala, 2021 (4) KHC 296 is relied on to argue
that the mother, immediately after the incident heard about
the rape and the perpetrator from the victim, which can be
treated as res gestae under Sec.6 of the Evidence Act.
6. We would first deal with the contention raised
relying upon Varghese @ Biju (supra) regarding no effective
legal aid having been received. A reading of the decision
would indicate that in the cited case, the Legal Aid Counsel
only had four years of experience and on the very next day of
his engagement, he was required to cross-examine the
important witnesses. There are no such facts brought before
this Court on which alone there could be prejudice found by
this Court; as has been found in the cited case. The learned
Counsel, would emphasize how the case was conducted, to seek
for a remand. We are however not inclined to so remand a
matter merely for the reason of the defence having not been
conducted properly. We also notice that but for the
suggestion put in cross-examination, which tends to be an
indirect admission, there is no inefficiency discernible in
the defence set-up. In fact, Ganesan (supra) found that
merely because an appeal is disposed of within four days, it
cannot be presumed that there was no fair and sufficient
opportunity given to the accused to defend himself. In the
present case, there is not even a ground urged of prejudice.
7. PW1, the victim deposed in tandem with the FIS
given by her. We see that the court has recorded the chief-
examination as questions and answers. But however, we do not
find them to be leading questions. The prosecutrix deposed
that on 04.05.2014 at around 5.00 p.m she was alone at her
residence when her father's friend trespassed into her house
and closed the door at the entrance. He removed his dress,
caught hold of her and forcefully removed her churidar-pants.
When she protested and tried to raise an alarm, the accused
covered her mouth with his hand and caught her breasts. He
threatened to cut off her breasts and removed her
undergarment. The victim was then forcefully made to lie on
the cot and subjected to penetrative sexual assault. After
the incident, she cried and when her mother came home, the
accused fled the scene. The victim was also told by the
accused not to divulge the incident to anybody. However, she
spoke to her mother about the molestation and later on; the
next day, Ext.P1 FIS was registered. She also spoke about
having been examined at the Taluk Head Quarters Hospital,
Vythiri and having surrendered MO1 to MO3 dresses before the
I.O. She spoke of her date of birth as 14.03.1999. She
withstood searching cross-examination and no inconsistency as
such could be brought out. In fact, there was a more graphic
description of the incident, on the suggestions made in
cross. She also explained how the accused stifled her cries,
physically and by threats levelled, negativing any
possibility of the nearby residents coming to her rescue.
8. PW2 is a neighbour who went along with the
mother to the Kudumbasree meeting. She had different versions
about how she came to know of what happened to PW1. We do not
place any reliance on that part of her evidence. PW9, the
mother of the victim, spoke in tandem with what the victim
said. She had been away for the Kudumbasree meeting, which at
least receives corroboration from PW2, who was also present
at the meeting. When she returned and saw her daughter
crying, she enquired the reason with her daughter. Though she
did not immediately say anything, later the victim disclosed
what transpired in the absence of the mother. On the next
day, they went to the Vanitha Helpline at Kalpetta to make
the complaint. PW9 also affirmed that the birth of her
daughter was registered and a birth certificate, the original
of which was with her, was produced. The same was marked as
Ext.P9, which indicates the date of birth to be 14.03.1999.
The original after perusal by the Court was given back and a
copy placed in evidence. PW13 is the father, who was away on
work. He was working at a slightly distant place, in a hotel.
He confirmed that PW1 was alone in the house, since his wife
had gone for the Kudumbasree meeting and his elder daughter
was away at Palakkad. This fact was spoken of by PW1, PW2 and
PW9 also. He was informed over the telephone about the rape
committed on his daughter at around 9.00 clock at night and
the next day morning he came home, after which the complaint
was made.
9. We do not find any inconsistency in the evidence
of PW1 and PW9 as to the time. PW1, in her cross-examination
had only said that her mother had left for the Kudumbasree
meeting at around 4 o'clock and PW9 spoke of her having gone
for a meeting at around 5 o'clock. We do not think that the
witnesses should be pinned down to the exact time and it is
highly unlikely that every routine would be carried out by an
individual looking at a clock. That the house was empty on
the evening of the crucial day and that the offence was
committed between 4 to 5 p.m is fairly clear from the
evidence of PW1 and PW9. The learned Counsel has also
stressed the fact that, while PW9 speaks of some issues with
the family of the accused, PW13 spoke of the accused being a
friend. PW1 also deposed that she was acquainted with the
accused since he and her father were friends. The attempt of
the defence obviously was to allege a motive for raising a
false allegation against the accused by the family of the
victim. It is only natural that even between friends or
family, there exist certain issues. But that alone cannot
lead to such a false allegation and we find no credence in
the contention raised on that count by the accused.
10. The learned Government Pleader has relied on
Johny (supra) to urge res gestae under Sec.6. Parbati Devi v.
State, AIR 1952 SC 831 was relied on to raise the ground of
relevance under Sec.8 of the Indian Evidence Act. We would
not go into that, especially since the question put to PW9 in
chief-examination was a leading question. PW9 in chief-
examination, while narrating what transpired, spoke of her
daughter having not first divulged the reason for weeping.
She also said that, it was only later, when she persisted,
the girl came out with the specific allegation of
molestation. The prosecution before the trial court put a
question as to whether PW1 had stated about the molestation
when enquiries were made with her, to which an affirmative
answer was given. We would not place any reliance on the same
and in that circumstance, we would not also consider the
contention raised under Sec.6 and 8 of the Evidence Act.
11. PW3 is the Doctor who examined the victim at
7.45 p.m on 05.05.2014, the very next day. The certificate
issued was marked as Ext.P2. The history relating to the
incident is recorded as 'alleged H/O sexual assault by Balan
(Mani Balan) on 4.5.2014 at abound 4.30 p.m …' at the
victim's residence. The details of position and degree of
violence were also recorded. The victim was pinned down by
the assailant and her panties and pants removed, after which
penetration with the penis was attempted. The victim was
unable to give any resistance since the accused was lying
over her. The victim also stated that she was having pain
while urinating and she had washed her genitals after the
incident. Vaginal swabs, vaginal smears, nail clippings, hair
samples, etc. were taken. On examination, her hymen was found
to be torn at 7 o'clock position, but there were no injuries
on the vagina. According to the Doctor, there was evidence of
vaginal penetration since the hymen is torn at the 7 o'clock
position and the vagina admits one finger loosely and two
fingers tightly. The history of the incident as recorded in
Ext.P2 corroborates the FIS and the deposition of the
prosecutrix. It is argued by the learned Counsel, Ext.P17 FSL
report does not reveal any evidence of sexual intercourse,
which normally leaves remnants for about 72 hours. This by
itself cannot be conclusive to find no penetration. In the
light of the credible and consistent evidence spoken of by
the victim, which is in tune with the FIS and the history
reported to the Doctor, we find no reason to interfere with
the finding of the trial court that there was actual
penetration and rape was committed.
12. The learned Counsel has placed before us an
authoritative text by a celebrated Forensic Specialist, which
indicates that even the presence or absence of hymen does not
disprove virginity conclusively. We should understand that if
the hymen is present and does not reveal any injury,
virginity stands proved, but not otherwise. In the present
case, the virginity is not proved and coupled with the
evidence of the prosecutrix, with sufficient corroboration
from other witnesses, we are inclined to find the molestation
having occurred as spoken of by the prosecutrix.
13. The age of the victim is proved by Ext.P9
certificate of birth issued by the Registrar of Births &
Deaths, though the same was not produced before the I.O. PW9,
the mother produced it from her custody before court when she
was examined. The date of birth as seen from Ext.P9
certificate is 14.03.1999. The Register of Births and Deaths
is a public document as provided under Sec.74 and the
certified copy of the public document is one issued under
Sec.76. There is a presumption insofar as the genuineness of
the certified copies so declared to be admissible as evidence
of any particular fact, duly certified, interalia, by a State
Government Officer. We rely on the judgment of a Division
Bench in Rajan v. State of Kerala, 2021 (4) KLT 274. We do
not find any reason to doubt the certified copy nor is it
inadmissible in evidence. Though no corroboration is
necessary, the HM, PW5, produced the extract of the School
register as Ext.P4, which also confirms the date of birth as
spoken of by PW1, PW9 and revealed from Ext.P9. Significantly
the mother of the victim also spoke of her age.
14. The official witnesses, including the I.O, have
spoken of their role in the investigation, on which no
dispute is raised. The scene plan is marked as Ext.P5 and the
scene mahazar as Ext.P6. The residence of PW1 is a small one
and has an asbestos roof. True, the description of the rooms
are not given, but that is not a reason to assume that the
alleged actions could not have been committed in the house.
The allegation is also that the accused had entered the
house, closed the door at the entrance and then molested the
victim. She is also said to have been dragged to the bed
where she was forced to lie down. We do not think there are
any spatial constraints in the house, normally habituated by
four persons, the victim, her parents and her elder sister,
all of whom, except the victim, were away at the time when
the incident occurred.
15. We find no reason to interfere with the
conviction entered under Sec.376(2)(i) of IPC and Sec.450 of
IPC. There is ample evidence to find rape having been
committed on the victim, who has also been proved to be below
the age of 16 years. As far as the conviction under Sec.5(i)
read with Sec.6, we agree with the learned Counsel for the
appellant that there is no aggravated penetrative sexual
assault. No separate sentence was awarded under the POCSO Act
by the trial court noticing Sec.42 of the Act because of the
sentence imposed under Sec.376(2)(i) of the IPC. An
aggravated penetrative sexual assault arises interalia when
it is committed on a child below 12 years. In the present
case, the child is 14 years and hence there can be no
conviction under Sec.5(m). The charge seems to be under
Sec.5(i). However, there is no grievous hurt, bodily harm or
injury on the body of the child or to the sexual organs. Be
that as it may, the accused is found to have committed
penetrative sexual assault under Sec.3, a lesser offence, for
which the punishment varies from 10 years to imprisonment for
life. We do not think that we should impose any sentence
separately, especially since the Sessions Court has not
imposed it by virtue of Sec.42 and the sentence imposed under
Sec.376(2)(i). We hence set aside the conviction under
Sec.5(i) read with Sec.6 of the POCSO Act and confirm the
conviction under Sec.376(2)(i) and Sec.450 of the IPC. The
accused is also found guilty of the offence under Sec.3 read
with Sec.4 of the POCSO Act, 2012. The sentence imposed by
the Court below is affirmed in toto. The appeal hence stands
partly allowed.
|
It is a shame that every other case we consider is
sadly a rape of a minor. A minor child was pounced upon by a
neighbour, when she was alone in her house and forcefully
molested, which is the case of the prosecution. Sai Pooja, learned Counsel for the
appellant, vehemently argued in defence, claiming the
improbability of the story and stressing upon the
inconsistencies. Though in cases of rape, it is trite that a
conviction can be based on the sole testimony of the
prosecutrix; corroboration would be necessary if the evidence
is found to be not of sterling quality. Discrepancies in the
evidence of the victim, PW1 and her mother, PW9 are
specifically highlighted. The incident is portrayed as a very
violent one, but the injuries detected in medical examination
are not commensurate with the violence alleged. It has been
deposed that the victim was forcefully taken inside the room
of her house and rape was carried out with equally violent
penetration alleged. There were no visible injuries either on
the body or the genitals of the victim. The complaints of
pain noticed by the Doctor can always be pretended. As for
the evidence regarding penetration, an extract from the book
'Forensic Medicine for the Police'; by Dr.B.Umadethan, a
celebrated Doctor of Forensic Medicine, has been placed on
record. It is pointed out that the presence or absence of
hymen does not indicate the virginity of a woman. Emphatically the statement 'Virginity can be proved; but
cannot be disproved' is pointed out. The mere finding that
there was a hymen tear would not conclusively prove the
sexual act of penetration. PW1 and PW9 have stated the time differently;
while PW9 says that the meeting which kept her away from home
was at 5 O'clock, PW1 says it to be at 4.00 p.m and the
incident as recorded in Ext. P2 certificate of medical
examination is at 4.30. The house in which the crime is
perpetrated is situated in a colony which is thickly
populated. The scene of occurrence was not properly
identified and the description of the scene does not reveal
the space available; which is significant insofar as the
violent act of dragging the victim inside the house, throwing
her on a cot and forcefully penetrating her. P6 does not show the
measurements of the rooms. It also shows only one access
into the house. The evidence of PW1 is that when her mother
came home, the accused ran away, in which event the mother
would have definitely seen the accused, to which end PW9 does
not depose. The evidence of PW1, the victim
clearly shows that she was tutored and leading questions were
put to her in the chief-examination. She is said to have
failed in the 10th standard and also failed twice earlier. A
14-year-old, who failed twice cannot be in the 10 th standard
and PW1 does not remember when she stopped her studies, a
deliberate falsehood. There is hence suppression of material
facts and PW1 is not a witness of sterling quality. The
entire incident as spoken of by the prosecutrix; in the
thickly populated area is prima facie unnatural. There is no
valid proof of date of birth since only a certified copy of
the birth certificate was produced and it was not marked
through the custodian of such a document. The learned Counsel would argue that the defence
was conducted shabbily and it clearly indicates that the
accused did not have proper legal aid. Reliance is placed on
Varghese @ Biju v. State of Kerala, 2007 (2) KHC 310 to urge
a remand. Ganesan v. State represented by Inspector of
Police, (2020) 10 SCC 573 is placed reliance on to urge this
Court to seek corroboration to the testimony of the
prosecutrix, who is not credible. Santosh Prasad @ Santosh
Kumar v. State of Bihar, (2020) 3 SCC 443 is also relied upon
to seek acquittal of the accused. The learned Counsel also
valiantly sought for mitigation in the sentence, even if the
conviction is affirmed; since doubt lingers on all counts. The learned Public Prosecutor Smt. Bindu O.V.
argued for sustaining the impugned judgment. It is pointed
out that PW9 has produced Ext. P9 certificate of date of
birth, which is the certified copy of a public document. The
evidence of the Headmaster (HM) (PW5) further corroborates
the date of birth and establishes the child victim to be only
14 years of age when the alleged incident occurred. The
evidence of PW1 is amply corroborated by that of the Doctor
and the certificate of examination produced, Ext. It
clearly indicates the history of the incident, which is in
tune with the FIS and the deposition of PW1 before court. The
trial court has seen the demeanour of the witness, assessed
her conduct and found her to be competent. The trial court
was abundantly careful in recording the chief-examination, as
question and answer and none of them are leading questions. The prosecutrix without any deviation, braved searching
cross-examination and stood her ground. The suggestive
questions put to the victim in cross-examination indirectly
is an admission of the incident having occurred. The accused
had pounced on the victim knowing very well that there would
be no person available in the house. The alleged incident
would not necessarily cause any bodily injury as such. Johny
C. v. State of Kerala, 2021 (4) KHC 296 is relied on to argue
that the mother, immediately after the incident heard about
the rape and the perpetrator from the victim, which can be
treated as res gestae under Sec.6 of the Evidence Act. We would first deal with the contention raised
relying upon Varghese @ Biju (supra) regarding no effective
legal aid having been received. A reading of the decision
would indicate that in the cited case, the Legal Aid Counsel
only had four years of experience and on the very next day of
his engagement, he was required to cross-examine the
important witnesses. There are no such facts brought before
this Court on which alone there could be prejudice found by
this Court; as has been found in the cited case. The learned
Counsel, would emphasize how the case was conducted, to seek
for a remand. We are however not inclined to so remand a
matter merely for the reason of the defence having not been
conducted properly. We also notice that but for the
suggestion put in cross-examination, which tends to be an
indirect admission, there is no inefficiency discernible in
the defence set-up. In fact, Ganesan (supra) found that
merely because an appeal is disposed of within four days, it
cannot be presumed that there was no fair and sufficient
opportunity given to the accused to defend himself. In the
present case, there is not even a ground urged of prejudice. PW1, the victim deposed in tandem with the FIS
given by her. We see that the court has recorded the chief-
examination as questions and answers. But however, we do not
find them to be leading questions. The prosecutrix deposed
that on 04.05.2014 at around 5.00 p.m she was alone at her
residence when her father's friend trespassed into her house
and closed the door at the entrance. He removed his dress,
caught hold of her and forcefully removed her churidar-pants. When she protested and tried to raise an alarm, the accused
covered her mouth with his hand and caught her breasts. He
threatened to cut off her breasts and removed her
undergarment. The victim was then forcefully made to lie on
the cot and subjected to penetrative sexual assault. After
the incident, she cried and when her mother came home, the
accused fled the scene. The victim was also told by the
accused not to divulge the incident to anybody. However, she
spoke to her mother about the molestation and later on; the
next day, Ext. She also spoke about
having been examined at the Taluk Head Quarters Hospital,
Vythiri and having surrendered MO1 to MO3 dresses before the
I.O. She spoke of her date of birth as 14.03.1999. She
withstood searching cross-examination and no inconsistency as
such could be brought out. In fact, there was a more graphic
description of the incident, on the suggestions made in
cross. She also explained how the accused stifled her cries,
physically and by threats levelled, negativing any
possibility of the nearby residents coming to her rescue. PW2 is a neighbour who went along with the
mother to the Kudumbasree meeting. She had different versions
about how she came to know of what happened to PW1. We do not
place any reliance on that part of her evidence. PW9, the
mother of the victim, spoke in tandem with what the victim
said. She had been away for the Kudumbasree meeting, which at
least receives corroboration from PW2, who was also present
at the meeting. When she returned and saw her daughter
crying, she enquired the reason with her daughter. Though she
did not immediately say anything, later the victim disclosed
what transpired in the absence of the mother. On the next
day, they went to the Vanitha Helpline at Kalpetta to make
the complaint. PW9 also affirmed that the birth of her
daughter was registered and a birth certificate, the original
of which was with her, was produced. P9, which indicates the date of birth to be 14.03.1999. The original after perusal by the Court was given back and a
copy placed in evidence. PW13 is the father, who was away on
work. He was working at a slightly distant place, in a hotel. He confirmed that PW1 was alone in the house, since his wife
had gone for the Kudumbasree meeting and his elder daughter
was away at Palakkad. This fact was spoken of by PW1, PW2 and
PW9 also. He was informed over the telephone about the rape
committed on his daughter at around 9.00 clock at night and
the next day morning he came home, after which the complaint
was made. We do not find any inconsistency in the evidence
of PW1 and PW9 as to the time. We do not think that the
witnesses should be pinned down to the exact time and it is
highly unlikely that every routine would be carried out by an
individual looking at a clock. The learned Counsel has also
stressed the fact that, while PW9 speaks of some issues with
the family of the accused, PW13 spoke of the accused being a
friend. PW1 also deposed that she was acquainted with the
accused since he and her father were friends. The attempt of
the defence obviously was to allege a motive for raising a
false allegation against the accused by the family of the
victim. It is only natural that even between friends or
family, there exist certain issues. But that alone cannot
lead to such a false allegation and we find no credence in
the contention raised on that count by the accused. The learned Government Pleader has relied on
Johny (supra) to urge res gestae under Sec.6. We would
not go into that, especially since the question put to PW9 in
chief-examination was a leading question. PW9 in chief-
examination, while narrating what transpired, spoke of her
daughter having not first divulged the reason for weeping. She also said that, it was only later, when she persisted,
the girl came out with the specific allegation of
molestation. The prosecution before the trial court put a
question as to whether PW1 had stated about the molestation
when enquiries were made with her, to which an affirmative
answer was given. We would not place any reliance on the same
and in that circumstance, we would not also consider the
contention raised under Sec.6 and 8 of the Evidence Act. PW3 is the Doctor who examined the victim at
7.45 p.m on 05.05.2014, the very next day. The certificate
issued was marked as Ext. The history relating to the
incident is recorded as 'alleged H/O sexual assault by Balan
(Mani Balan) on 4.5.2014 at abound 4.30 p.m …' at the
victim's residence. The details of position and degree of
violence were also recorded. The victim was pinned down by
the assailant and her panties and pants removed, after which
penetration with the penis was attempted. The victim was
unable to give any resistance since the accused was lying
over her. The victim also stated that she was having pain
while urinating and she had washed her genitals after the
incident. Vaginal swabs, vaginal smears, nail clippings, hair
samples, etc. On examination, her hymen was found
to be torn at 7 o'clock position, but there were no injuries
on the vagina. According to the Doctor, there was evidence of
vaginal penetration since the hymen is torn at the 7 o'clock
position and the vagina admits one finger loosely and two
fingers tightly. The history of the incident as recorded in
Ext. P2 corroborates the FIS and the deposition of the
prosecutrix. It is argued by the learned Counsel, Ext. P17 FSL
report does not reveal any evidence of sexual intercourse,
which normally leaves remnants for about 72 hours. This by
itself cannot be conclusive to find no penetration. The learned Counsel has placed before us an
authoritative text by a celebrated Forensic Specialist, which
indicates that even the presence or absence of hymen does not
disprove virginity conclusively. We should understand that if
the hymen is present and does not reveal any injury,
virginity stands proved, but not otherwise. In the present
case, the virginity is not proved and coupled with the
evidence of the prosecutrix, with sufficient corroboration
from other witnesses, we are inclined to find the molestation
having occurred as spoken of by the prosecutrix. The age of the victim is proved by Ext. P9
certificate of birth issued by the Registrar of Births &
Deaths, though the same was not produced before the I.O. PW9,
the mother produced it from her custody before court when she
was examined. The date of birth as seen from Ext. The Register of Births and Deaths
is a public document as provided under Sec.74 and the
certified copy of the public document is one issued under
Sec.76. There is a presumption insofar as the genuineness of
the certified copies so declared to be admissible as evidence
of any particular fact, duly certified, interalia, by a State
Government Officer. We rely on the judgment of a Division
Bench in Rajan v. State of Kerala, 2021 (4) KLT 274. We do
not find any reason to doubt the certified copy nor is it
inadmissible in evidence. Though no corroboration is
necessary, the HM, PW5, produced the extract of the School
register as Ext. P4, which also confirms the date of birth as
spoken of by PW1, PW9 and revealed from Ext. Significantly
the mother of the victim also spoke of her age. The official witnesses, including the I.O, have
spoken of their role in the investigation, on which no
dispute is raised. The residence of PW1 is a small one
and has an asbestos roof. True, the description of the rooms
are not given, but that is not a reason to assume that the
alleged actions could not have been committed in the house. The allegation is also that the accused had entered the
house, closed the door at the entrance and then molested the
victim. She is also said to have been dragged to the bed
where she was forced to lie down. We do not think there are
any spatial constraints in the house, normally habituated by
four persons, the victim, her parents and her elder sister,
all of whom, except the victim, were away at the time when
the incident occurred. We find no reason to interfere with the
conviction entered under Sec.376(2)(i) of IPC and Sec.450 of
IPC. There is ample evidence to find rape having been
committed on the victim, who has also been proved to be below
the age of 16 years. As far as the conviction under Sec.5(i)
read with Sec.6, we agree with the learned Counsel for the
appellant that there is no aggravated penetrative sexual
assault. An
aggravated penetrative sexual assault arises interalia when
it is committed on a child below 12 years. In the present
case, the child is 14 years and hence there can be no
conviction under Sec.5(m). The charge seems to be under
Sec.5(i). However, there is no grievous hurt, bodily harm or
injury on the body of the child or to the sexual organs. We do not think that we should impose any sentence
separately, especially since the Sessions Court has not
imposed it by virtue of Sec.42 and the sentence imposed under
Sec.376(2)(i). The sentence imposed by
the Court below is affirmed in toto.
|
Appalled by the rising instances of minors being subjected to rape in the State, the Kerala High Court while hearing a criminal appeal remarked: "It is a shame that every other case we consider is sadly a rape of a minor." A Division Bench of Justice K. Vinod Chandran and Justice Ziyad Rahman A. A while upholding the conviction of a man accused of raping a minor girl living in...
Appalled by the rising instances of minors being subjected to rape in the State, the Kerala High Court while hearing a criminal appeal remarked:
"It is a shame that every other case we consider is sadly a rape of a minor."
A Division Bench of Justice K. Vinod Chandran and Justice Ziyad Rahman A. A while upholding the conviction of a man accused of raping a minor girl living in his neighbourhood, found that there was no inconsistency in the evidence produced by the prosecution.
The case of the prosecution was that the 14-year-old victim was pounced upon by her neighbour when she was alone in her house and forcefully molested.
It was alleged that she was dragged inside the house and thrown on a cot and forcibly penetrated. There was a highly graphic description of the incident when it was narrated by the victim in the chief examination before the trial court.
The prosecutrix alleged that when her mother came home, the accused fled the scene. She claimed to have been told by the accused not to divulge the incident to anybody. However, she disclosed it to her mother and on the next day, FIS was registered.
Subsequently, the Sessions Court convicted the accused for commission of offences punishable under Sections 376(2)(i) (Rape) and 450 (House-trespass) of the IPC read with Sections 5(i) (aggravated penetrative sexual assault) of the POCSO Act.
In appeal, the accused contended that the defence was conducted shabbily and that he was not provided proper legal aid.
Pointing out several aspects where the prosecution was lacking, the perpetrator sought mitigation in the sentence even if the conviction was affirmed.
Nevertheless, the prosecution established that the victim was a minor by producing her birth certificate and convinced the Court that the trial court was abundantly careful in recording the chief examination.
The High Court was inclined to uphold the conviction of the accused:
"We find no reason to interfere with the conviction entered under Sec.376(2)(i) of IPC and Sec.450 of IPC. There is ample evidence to find rape having been committed on the victim, who has also been proved to be below the age of 16 years."
However, it was found that no grievous hurt, bodily harm or injury was found on the body of the child or to the sexual organs.
Therefore, the Court agreed that there was no aggravated penetrative sexual assault in the matter.
Be that as it may, the accused was found to have committed penetrative sexual assault under Section 3, a lesser offence, for which the punishment varies from 10 years to imprisonment for life.
Accordingly, the Bench set aside the conviction under Sec.5(i) read with Sec.6 of the POCSO Act, thereby allowing the appeal partly.
Legal Aid Counsel Advocate Rishikesh Shenoy, Advocate P Mohamed Sabah and Advocate Saipooja appeared for the petitioners and Public Prosecutor Bindu O.V represented the State in the matter.
Case Title: Mani Balan v. State of Kerala
|
Appalled by the rising instances of minors being subjected to rape in the State, the Kerala High Court while hearing a criminal appeal remarked: "It is a shame that every other case we consider is sadly a rape of a minor." A Division Bench of Justice K. Vinod Chandran and Justice Ziyad Rahman A. A while upholding the conviction of a man accused of raping a minor girl living in...
Appalled by the rising instances of minors being subjected to rape in the State, the Kerala High Court while hearing a criminal appeal remarked:
"It is a shame that every other case we consider is sadly a rape of a minor."
A Division Bench of Justice K. Vinod Chandran and Justice Ziyad Rahman A. A while upholding the conviction of a man accused of raping a minor girl living in his neighbourhood, found that there was no inconsistency in the evidence produced by the prosecution.
The case of the prosecution was that the 14-year-old victim was pounced upon by her neighbour when she was alone in her house and forcefully molested.
It was alleged that she was dragged inside the house and thrown on a cot and forcibly penetrated. There was a highly graphic description of the incident when it was narrated by the victim in the chief examination before the trial court.
The prosecutrix alleged that when her mother came home, the accused fled the scene. She claimed to have been told by the accused not to divulge the incident to anybody. However, she disclosed it to her mother and on the next day, FIS was registered.
Subsequently, the Sessions Court convicted the accused for commission of offences punishable under Sections 376(2)(i) (Rape) and 450 (House-trespass) of the IPC read with Sections 5(i) (aggravated penetrative sexual assault) of the POCSO Act.
In appeal, the accused contended that the defence was conducted shabbily and that he was not provided proper legal aid.
Pointing out several aspects where the prosecution was lacking, the perpetrator sought mitigation in the sentence even if the conviction was affirmed.
Nevertheless, the prosecution established that the victim was a minor by producing her birth certificate and convinced the Court that the trial court was abundantly careful in recording the chief examination.
The High Court was inclined to uphold the conviction of the accused:
"We find no reason to interfere with the conviction entered under Sec.376(2)(i) of IPC and Sec.450 of IPC. There is ample evidence to find rape having been committed on the victim, who has also been proved to be below the age of 16 years."
However, it was found that no grievous hurt, bodily harm or injury was found on the body of the child or to the sexual organs.
Therefore, the Court agreed that there was no aggravated penetrative sexual assault in the matter.
Be that as it may, the accused was found to have committed penetrative sexual assault under Section 3, a lesser offence, for which the punishment varies from 10 years to imprisonment for life.
Accordingly, the Bench set aside the conviction under Sec.5(i) read with Sec.6 of the POCSO Act, thereby allowing the appeal partly.
Legal Aid Counsel Advocate Rishikesh Shenoy, Advocate P Mohamed Sabah and Advocate Saipooja appeared for the petitioners and Public Prosecutor Bindu O.V represented the State in the matter.
Case Title: Mani Balan v. State of Kerala
| 0.855591
| 0.935078
| 1
| 1
|
Heard Sri Jahangir Haider, learned counsel for the petitioner
and Sri Amit Manohar, learned Additional Chief Standing
Counsel for the respondents.
This writ petition has been filed praying for the following
"i. Issue a writ, order or direction in the nature of mandamus directing the
respondent no.2 to restore the possession of the petitioner's factory seized
machine situated at S-115 Harsha Compound, Site-2, Loni Road,
Industrial Area Mohan Nagar, District Ghaziabad, in favour of the
petitioner to enable him to run his factory smoothly."
Learned counsel for the petitioner submits that the petitioner
neither took any loan from M/s Hero Fincorp Limited nor
mortgaged his property nor stood as guarantor for any one and
yet, his machineries located at S-115, Harsha Compound Site-2,
have been seized by respondent no. 2 and an order dated
28.12.2021 under Section 14 of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 has been passed by the Additional District
Magistrate (Finance and Revenue), Ghaziabad in Case No.
7749 of 2021 (Hero Fincorp Limited Vs. M/s Zeb Designers
and others) which is wholly without authority of law, arbitrary
and illegal and, therefore, it deserves to be quashed.
Learned counsel for the petitioner on being questioned, states
that the loan was taken by his wife, namely, Shabih Asif
(S.Asif) who is proprietor of M/s Zeb Designers and location of
her factory is 33/312, site-2, Loni Road, Industrial Area, Mohan
Nagar, Ghaziabad. He further states that the seized
machineries etc. belongs to M/s Umbrella Corporation
which is a proprietorship concern of the petitioner and not
of his wife or M/s Zeb Designers.
We have perused the writ petition and we find that the petitioner
has neither stated in the writ petition that the machinery in
question belongs to M/s Umbrella Corporation nor he has
disclosed that the proprietor of M/s Zeb Designers is his wife
nor he disclosed any GST registration of alleged M/s Umbrella
Corporation nor has filed any document indicating registration
of M/s Umbrella Corporation under the CGST/UPGST Act or
under the Factories Act nor any proof of seized machinery
belonging to him have been filed.
In the writ petition, no papers has been filed to indicate that
there actually exist a proprietorship concern in the name and
style of M/s Umbrella Corporation. On the contrary, on perusal
of paragraph no. 11 of the writ petition, we find that the
petitioner has stated to have made representations dated
28.4.2022 and 2.5.2022 to the Additional District Magistrate
(Finance and Revenue), Ghaziabad and copy whereof has been
filed as Annexure nos. 1 and 2. Perusal of Annexure-2 to the
writ petition shows that it was sent by Asif Zaidi through e-
mail and as per schedule-1 annexed to the deed of guarantee
appearing at page 84 of the personal affidavit of Additional
District Magistrate (Finance and Revenue) dated 10.1.2023 who
is the son of the petitioner and his full name is Ashar Asif Zaidi
and the petitioner's full name of Asif K. Zaidi. Learned counsel
for the petitioner has stated that full name of petitioner is Asif
Khalik Zaidi. The petitioner has very conveniently concealed all
these material facts in the writ petition.
Thus, the writ petition has been filed making false averments
and suppressing material facts.
In the case of United India Insurance Company Ltd. V.
B.Rajendra Singh and others, JT 2000(3) SC.151,
considering the fact of fraud, Hon'ble Supreme Court held in
paragraph 3 as under :
"Fraud and justice never dwell together". (Frans et jus nunquam
cohabitant) is a pristine maxim which has never lost its temper overall
these centuries. Lord Denning observed in a language without
equivocation that "no judegment of a Court, no order of a Minister can be
allowed to stand if it has been obtained by fraud, for fraud unravels
(Emphasis supplied by the Court)."
In the case of S.P. ChengalVaraya Naidu (dead) by L.Rs Vs.
Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the
Hon'ble Supreme Court held in para 7 as under :-
"7. The High Court, in our view, fell into patent error. The short question
before the High Court was whether in the facts and circumstances of this
case, Jagannath obtained the preliminary decree by playing fraud on the
court. The High Court, however, went haywire and made observations
which are wholly perverse. We do not agree with the High Court that
"there is no legal duty cast upon the plaintiff to come to court with a true
case and prove it by true evidence". The principle of "finality of litigation"
cannot be pressed to the extent of such an absurdity that it becomes an
engine of fraud in the hands of dishonest litigants. The courts of law are
meant for imparting justice between the parties. One who comes to the
court, must come with clean hands. We are constrained to say that more
often than not, process of the court is being abused. Property-grabbers,
tax-evaders, bank-loan-dodgers and other unscrupulous persons from all
walks of life find the court-process a convenient lever to retain the illegal-
gains indefinitely. We have no hesitation to say that a person, who's case
is based on falsehood, has no right to approach the court. He can be
summarily thrown out at any stage of the litigation."
We find that the petitioner has approached this Court by
suppressing and concealing material facts. Therefore, the writ
petition deserves to be dismissed with exemplary cost.
For all the reasons aforestated, the writ petition is dismissed
with a cost of Rs. One lac which shall be deposited by the
petitioner with the High Court Legal Services Committee
within two weeks from today. A copy of this order shall be sent
by the learned Standing Counsel to the Additional District
Magistrate (Finance and Revenue), Ghaziabad within a week
who shall ensure compliance of this order.
Since, the financier i.e. M/s Hero Fincorp Limited has not been
made party in the present writ petition, therefore, we direct the
Additional District Magistrate (Finance and Revenue),
Ghaziabad to inform about this order to the aforesaid M/s Hero
|
The Allahabad High Court recently imposed a ₹1 lakh cost on a man who filed a writ petition making false averments and suppressing material facts.
The bench of Justice Surya Prakash Kesarwani and Justice Jayant Banerji directed the petitioner (Asif Khaliq) to deposit the cost with the High Court Legal Services Committee within two weeks.
The petitioner had moved the Court seeking possession of the factory machines, belonging to his firm M/s Umbrella Corporation, seized by respondent no. 2.
It was his case that the machines were seized even when he neither took any loan from M/s Hero Fincorp Limited nor mortgaged his property nor stood as guarantor for anyone.
On being questioned, the Counsel for the petitioner submitted that the loan was in fact taken by the wife of the petitioner, who is the proprietor of M/s Zeb Designers, which has no links with M/s Umbrella Corporation, a firm owned by the petitioner.
Against the backdrop of these facts, the Court, at the outset, perused the writ petition and found that the petitioner did not state that the machinery in question belongs to M/s Umbrella Corporation. He also did not disclose that the proprietor of M/s Zeb Designers belongs to his wife.
Further, the Court also noted that no registration details of the alleged M/s Umbrella Corporation had been filed, and no proof of seized machinery belonging to him had been filed. In fact, no papers had been filed to indicate that there actually exists a proprietorship concern in the name and style of M/s Umbrella Corporation
The Court also noted that in the writ petition, it was stated that the petitioner filed representations regarding the seizure of machines with the Additional District Magistrate (Finance and Revenue), however, the said representation was sent by one Asif Zaidi, who happens to be the son of the petitioner.
“…we find that the petitioner has stated to have made representations dated 28.4.2022 and 2.5.2022 to the Additional District Magistrate (Finance and Revenue), Ghaziabad and copy whereof has been filed as Annexure nos. 1 and 2. Perusal of Annexure-2 to the writ petition shows that it was sent by Asif Zaidi through email and as per schedule-1 annexed to the deed of guarantee appearing at page 84 of the personal affidavit of Additional District Magistrate (Finance and Revenue) dated 10.1.2023 who is the son of the petitioner and his full name is Ashar Asif Zaidi and the petitioner's full name of Asif K. Zaidi. Learned counsel for the petitioner has stated that full name of petitioner is Asif Khalik Zaidi. The petitioner has very conveniently concealed all these material facts in the writ petition,” the Court said.
Against this backdrop, referring to Apex Court’s rulings in the case of United India Insurance Company Ltd. V. B.Rajendra Singh and others, JT 2000(3) SC.151 and S.P. ChengalVaraya Naidu (dead) by L.Rs Vs. Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the Bench stressed upon the requirement of a petitioner to come to court with clean hands.
Hence, finding that the petitioner approached the Court by suppressing and concealing material facts, the Court dismissed the plea by imposing costs of Rs. 1 Lakh. -
The Court also directed that M/s Hero Fincorp Limited be informed of the order, since it had not been impleaded in the matter as a party.
Case title - Asif Khaliq vs. State Of U.P. And 2 Others [WRIT - C No. - 16263 of 2022]
|
Heard Sri Jahangir Haider, learned counsel for the petitioner
and Sri Amit Manohar, learned Additional Chief Standing
Counsel for the respondents.
This writ petition has been filed praying for the following
"i. Issue a writ, order or direction in the nature of mandamus directing the
respondent no.2 to restore the possession of the petitioner's factory seized
machine situated at S-115 Harsha Compound, Site-2, Loni Road,
Industrial Area Mohan Nagar, District Ghaziabad, in favour of the
petitioner to enable him to run his factory smoothly."
Learned counsel for the petitioner submits that the petitioner
neither took any loan from M/s Hero Fincorp Limited nor
mortgaged his property nor stood as guarantor for any one and
yet, his machineries located at S-115, Harsha Compound Site-2,
have been seized by respondent no. 2 and an order dated
28.12.2021 under Section 14 of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 has been passed by the Additional District
Magistrate (Finance and Revenue), Ghaziabad in Case No.
7749 of 2021 (Hero Fincorp Limited Vs. M/s Zeb Designers
and others) which is wholly without authority of law, arbitrary
and illegal and, therefore, it deserves to be quashed.
Learned counsel for the petitioner on being questioned, states
that the loan was taken by his wife, namely, Shabih Asif
(S.Asif) who is proprietor of M/s Zeb Designers and location of
her factory is 33/312, site-2, Loni Road, Industrial Area, Mohan
Nagar, Ghaziabad. He further states that the seized
machineries etc. belongs to M/s Umbrella Corporation
which is a proprietorship concern of the petitioner and not
of his wife or M/s Zeb Designers.
We have perused the writ petition and we find that the petitioner
has neither stated in the writ petition that the machinery in
question belongs to M/s Umbrella Corporation nor he has
disclosed that the proprietor of M/s Zeb Designers is his wife
nor he disclosed any GST registration of alleged M/s Umbrella
Corporation nor has filed any document indicating registration
of M/s Umbrella Corporation under the CGST/UPGST Act or
under the Factories Act nor any proof of seized machinery
belonging to him have been filed.
In the writ petition, no papers has been filed to indicate that
there actually exist a proprietorship concern in the name and
style of M/s Umbrella Corporation. On the contrary, on perusal
of paragraph no. 11 of the writ petition, we find that the
petitioner has stated to have made representations dated
28.4.2022 and 2.5.2022 to the Additional District Magistrate
(Finance and Revenue), Ghaziabad and copy whereof has been
filed as Annexure nos. 1 and 2. Perusal of Annexure-2 to the
writ petition shows that it was sent by Asif Zaidi through e-
mail and as per schedule-1 annexed to the deed of guarantee
appearing at page 84 of the personal affidavit of Additional
District Magistrate (Finance and Revenue) dated 10.1.2023 who
is the son of the petitioner and his full name is Ashar Asif Zaidi
and the petitioner's full name of Asif K. Zaidi. Learned counsel
for the petitioner has stated that full name of petitioner is Asif
Khalik Zaidi. The petitioner has very conveniently concealed all
these material facts in the writ petition.
Thus, the writ petition has been filed making false averments
and suppressing material facts.
In the case of United India Insurance Company Ltd. V.
B.Rajendra Singh and others, JT 2000(3) SC.151,
considering the fact of fraud, Hon'ble Supreme Court held in
paragraph 3 as under :
"Fraud and justice never dwell together". (Frans et jus nunquam
cohabitant) is a pristine maxim which has never lost its temper overall
these centuries. Lord Denning observed in a language without
equivocation that "no judegment of a Court, no order of a Minister can be
allowed to stand if it has been obtained by fraud, for fraud unravels
(Emphasis supplied by the Court)."
In the case of S.P. ChengalVaraya Naidu (dead) by L.Rs Vs.
Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the
Hon'ble Supreme Court held in para 7 as under :-
"7. The High Court, in our view, fell into patent error. The short question
before the High Court was whether in the facts and circumstances of this
case, Jagannath obtained the preliminary decree by playing fraud on the
court. The High Court, however, went haywire and made observations
which are wholly perverse. We do not agree with the High Court that
"there is no legal duty cast upon the plaintiff to come to court with a true
case and prove it by true evidence". The principle of "finality of litigation"
cannot be pressed to the extent of such an absurdity that it becomes an
engine of fraud in the hands of dishonest litigants. The courts of law are
meant for imparting justice between the parties. One who comes to the
court, must come with clean hands. We are constrained to say that more
often than not, process of the court is being abused. Property-grabbers,
tax-evaders, bank-loan-dodgers and other unscrupulous persons from all
walks of life find the court-process a convenient lever to retain the illegal-
gains indefinitely. We have no hesitation to say that a person, who's case
is based on falsehood, has no right to approach the court. He can be
summarily thrown out at any stage of the litigation."
We find that the petitioner has approached this Court by
suppressing and concealing material facts. Therefore, the writ
petition deserves to be dismissed with exemplary cost.
For all the reasons aforestated, the writ petition is dismissed
with a cost of Rs. One lac which shall be deposited by the
petitioner with the High Court Legal Services Committee
within two weeks from today. A copy of this order shall be sent
by the learned Standing Counsel to the Additional District
Magistrate (Finance and Revenue), Ghaziabad within a week
who shall ensure compliance of this order.
Since, the financier i.e. M/s Hero Fincorp Limited has not been
made party in the present writ petition, therefore, we direct the
Additional District Magistrate (Finance and Revenue),
Ghaziabad to inform about this order to the aforesaid M/s Hero
|
Heard Sri Jahangir Haider, learned counsel for the petitioner
and Sri Amit Manohar, learned Additional Chief Standing
Counsel for the respondents.
This writ petition has been filed praying for the following
"i. Issue a writ, order or direction in the nature of mandamus directing the
respondent no.2 to restore the possession of the petitioner's factory seized
machine situated at S-115 Harsha Compound, Site-2, Loni Road,
Industrial Area Mohan Nagar, District Ghaziabad, in favour of the
petitioner to enable him to run his factory smoothly."
Learned counsel for the petitioner submits that the petitioner
neither took any loan from M/s Hero Fincorp Limited nor
mortgaged his property nor stood as guarantor for any one and
yet, his machineries located at S-115, Harsha Compound Site-2,
have been seized by respondent no. 2 and an order dated
28.12.2021 under Section 14 of the Securitization and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 has been passed by the Additional District
Magistrate (Finance and Revenue), Ghaziabad in Case No.
7749 of 2021 (Hero Fincorp Limited Vs. M/s Zeb Designers
and others) which is wholly without authority of law, arbitrary
and illegal and, therefore, it deserves to be quashed.
Learned counsel for the petitioner on being questioned, states
that the loan was taken by his wife, namely, Shabih Asif
(S.Asif) who is proprietor of M/s Zeb Designers and location of
her factory is 33/312, site-2, Loni Road, Industrial Area, Mohan
Nagar, Ghaziabad. He further states that the seized
machineries etc. belongs to M/s Umbrella Corporation
which is a proprietorship concern of the petitioner and not
of his wife or M/s Zeb Designers.
We have perused the writ petition and we find that the petitioner
has neither stated in the writ petition that the machinery in
question belongs to M/s Umbrella Corporation nor he has
disclosed that the proprietor of M/s Zeb Designers is his wife
nor he disclosed any GST registration of alleged M/s Umbrella
Corporation nor has filed any document indicating registration
of M/s Umbrella Corporation under the CGST/UPGST Act or
under the Factories Act nor any proof of seized machinery
belonging to him have been filed.
In the writ petition, no papers has been filed to indicate that
there actually exist a proprietorship concern in the name and
style of M/s Umbrella Corporation. On the contrary, on perusal
of paragraph no. 11 of the writ petition, we find that the
petitioner has stated to have made representations dated
28.4.2022 and 2.5.2022 to the Additional District Magistrate
(Finance and Revenue), Ghaziabad and copy whereof has been
filed as Annexure nos. 1 and 2. Perusal of Annexure-2 to the
writ petition shows that it was sent by Asif Zaidi through e-
mail and as per schedule-1 annexed to the deed of guarantee
appearing at page 84 of the personal affidavit of Additional
District Magistrate (Finance and Revenue) dated 10.1.2023 who
is the son of the petitioner and his full name is Ashar Asif Zaidi
and the petitioner's full name of Asif K. Zaidi. Learned counsel
for the petitioner has stated that full name of petitioner is Asif
Khalik Zaidi. The petitioner has very conveniently concealed all
these material facts in the writ petition.
Thus, the writ petition has been filed making false averments
and suppressing material facts.
In the case of United India Insurance Company Ltd. V.
B.Rajendra Singh and others, JT 2000(3) SC.151,
considering the fact of fraud, Hon'ble Supreme Court held in
paragraph 3 as under :
"Fraud and justice never dwell together". (Frans et jus nunquam
cohabitant) is a pristine maxim which has never lost its temper overall
these centuries. Lord Denning observed in a language without
equivocation that "no judegment of a Court, no order of a Minister can be
allowed to stand if it has been obtained by fraud, for fraud unravels
(Emphasis supplied by the Court)."
In the case of S.P. ChengalVaraya Naidu (dead) by L.Rs Vs.
Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the
Hon'ble Supreme Court held in para 7 as under :-
"7. The High Court, in our view, fell into patent error. The short question
before the High Court was whether in the facts and circumstances of this
case, Jagannath obtained the preliminary decree by playing fraud on the
court. The High Court, however, went haywire and made observations
which are wholly perverse. We do not agree with the High Court that
"there is no legal duty cast upon the plaintiff to come to court with a true
case and prove it by true evidence". The principle of "finality of litigation"
cannot be pressed to the extent of such an absurdity that it becomes an
engine of fraud in the hands of dishonest litigants. The courts of law are
meant for imparting justice between the parties. One who comes to the
court, must come with clean hands. We are constrained to say that more
often than not, process of the court is being abused. Property-grabbers,
tax-evaders, bank-loan-dodgers and other unscrupulous persons from all
walks of life find the court-process a convenient lever to retain the illegal-
gains indefinitely. We have no hesitation to say that a person, who's case
is based on falsehood, has no right to approach the court. He can be
summarily thrown out at any stage of the litigation."
We find that the petitioner has approached this Court by
suppressing and concealing material facts. Therefore, the writ
petition deserves to be dismissed with exemplary cost.
For all the reasons aforestated, the writ petition is dismissed
with a cost of Rs. One lac which shall be deposited by the
petitioner with the High Court Legal Services Committee
within two weeks from today. A copy of this order shall be sent
by the learned Standing Counsel to the Additional District
Magistrate (Finance and Revenue), Ghaziabad within a week
who shall ensure compliance of this order.
Since, the financier i.e. M/s Hero Fincorp Limited has not been
made party in the present writ petition, therefore, we direct the
Additional District Magistrate (Finance and Revenue),
Ghaziabad to inform about this order to the aforesaid M/s Hero
|
The Allahabad High Court recently imposed a ₹1 lakh cost on a man who filed a writ petition making false averments and suppressing material facts.
The bench of Justice Surya Prakash Kesarwani and Justice Jayant Banerji directed the petitioner (Asif Khaliq) to deposit the cost with the High Court Legal Services Committee within two weeks.
The petitioner had moved the Court seeking possession of the factory machines, belonging to his firm M/s Umbrella Corporation, seized by respondent no. 2.
It was his case that the machines were seized even when he neither took any loan from M/s Hero Fincorp Limited nor mortgaged his property nor stood as guarantor for anyone.
On being questioned, the Counsel for the petitioner submitted that the loan was in fact taken by the wife of the petitioner, who is the proprietor of M/s Zeb Designers, which has no links with M/s Umbrella Corporation, a firm owned by the petitioner.
Against the backdrop of these facts, the Court, at the outset, perused the writ petition and found that the petitioner did not state that the machinery in question belongs to M/s Umbrella Corporation. He also did not disclose that the proprietor of M/s Zeb Designers belongs to his wife.
Further, the Court also noted that no registration details of the alleged M/s Umbrella Corporation had been filed, and no proof of seized machinery belonging to him had been filed. In fact, no papers had been filed to indicate that there actually exists a proprietorship concern in the name and style of M/s Umbrella Corporation
The Court also noted that in the writ petition, it was stated that the petitioner filed representations regarding the seizure of machines with the Additional District Magistrate (Finance and Revenue), however, the said representation was sent by one Asif Zaidi, who happens to be the son of the petitioner.
“…we find that the petitioner has stated to have made representations dated 28.4.2022 and 2.5.2022 to the Additional District Magistrate (Finance and Revenue), Ghaziabad and copy whereof has been filed as Annexure nos. 1 and 2. Perusal of Annexure-2 to the writ petition shows that it was sent by Asif Zaidi through email and as per schedule-1 annexed to the deed of guarantee appearing at page 84 of the personal affidavit of Additional District Magistrate (Finance and Revenue) dated 10.1.2023 who is the son of the petitioner and his full name is Ashar Asif Zaidi and the petitioner's full name of Asif K. Zaidi. Learned counsel for the petitioner has stated that full name of petitioner is Asif Khalik Zaidi. The petitioner has very conveniently concealed all these material facts in the writ petition,” the Court said.
Against this backdrop, referring to Apex Court’s rulings in the case of United India Insurance Company Ltd. V. B.Rajendra Singh and others, JT 2000(3) SC.151 and S.P. ChengalVaraya Naidu (dead) by L.Rs Vs. Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the Bench stressed upon the requirement of a petitioner to come to court with clean hands.
Hence, finding that the petitioner approached the Court by suppressing and concealing material facts, the Court dismissed the plea by imposing costs of Rs. 1 Lakh. -
The Court also directed that M/s Hero Fincorp Limited be informed of the order, since it had not been impleaded in the matter as a party.
Case title - Asif Khaliq vs. State Of U.P. And 2 Others [WRIT - C No. - 16263 of 2022]
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The Allahabad High Court recently imposed a ₹1 lakh cost on a man who filed a writ petition making false averments and suppressing material facts.
The bench of Justice Surya Prakash Kesarwani and Justice Jayant Banerji directed the petitioner (Asif Khaliq) to deposit the cost with the High Court Legal Services Committee within two weeks.
The petitioner had moved the Court seeking possession of the factory machines, belonging to his firm M/s Umbrella Corporation, seized by respondent no. 2.
It was his case that the machines were seized even when he neither took any loan from M/s Hero Fincorp Limited nor mortgaged his property nor stood as guarantor for anyone.
On being questioned, the Counsel for the petitioner submitted that the loan was in fact taken by the wife of the petitioner, who is the proprietor of M/s Zeb Designers, which has no links with M/s Umbrella Corporation, a firm owned by the petitioner.
Against the backdrop of these facts, the Court, at the outset, perused the writ petition and found that the petitioner did not state that the machinery in question belongs to M/s Umbrella Corporation. He also did not disclose that the proprietor of M/s Zeb Designers belongs to his wife.
Further, the Court also noted that no registration details of the alleged M/s Umbrella Corporation had been filed, and no proof of seized machinery belonging to him had been filed. In fact, no papers had been filed to indicate that there actually exists a proprietorship concern in the name and style of M/s Umbrella Corporation
The Court also noted that in the writ petition, it was stated that the petitioner filed representations regarding the seizure of machines with the Additional District Magistrate (Finance and Revenue), however, the said representation was sent by one Asif Zaidi, who happens to be the son of the petitioner.
“…we find that the petitioner has stated to have made representations dated 28.4.2022 and 2.5.2022 to the Additional District Magistrate (Finance and Revenue), Ghaziabad and copy whereof has been filed as Annexure nos. 1 and 2. Perusal of Annexure-2 to the writ petition shows that it was sent by Asif Zaidi through email and as per schedule-1 annexed to the deed of guarantee appearing at page 84 of the personal affidavit of Additional District Magistrate (Finance and Revenue) dated 10.1.2023 who is the son of the petitioner and his full name is Ashar Asif Zaidi and the petitioner's full name of Asif K. Zaidi. Learned counsel for the petitioner has stated that full name of petitioner is Asif Khalik Zaidi. The petitioner has very conveniently concealed all these material facts in the writ petition,” the Court said.
Against this backdrop, referring to Apex Court’s rulings in the case of United India Insurance Company Ltd. V. B.Rajendra Singh and others, JT 2000(3) SC.151 and S.P. ChengalVaraya Naidu (dead) by L.Rs Vs. Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the Bench stressed upon the requirement of a petitioner to come to court with clean hands.
Hence, finding that the petitioner approached the Court by suppressing and concealing material facts, the Court dismissed the plea by imposing costs of Rs. 1 Lakh. -
The Court also directed that M/s Hero Fincorp Limited be informed of the order, since it had not been impleaded in the matter as a party.
Case title - Asif Khaliq vs. State Of U.P. And 2 Others [WRIT - C No. - 16263 of 2022]
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The instant Criminal Appeal has been preferred by appellants
Smt. Sayari, Moti Bai and Kanaram under Section 374 (2)
Cr.P.C. being aggrieved of the impugned judgment dated
17.04.1996 passed by the learned Additional Sessions Judge,
Sojat in Sessions Case No.216/1992 whereby, all three accused-
appellants were convicted and sentenced as under:-
Accused- Offence Sentences Fine and
1. Sayari} 498A IPC 2 Years RI Rs.1,000/- and
2.Moti Bai} in default to
All the sentences were ordered to run concurrently.
In nutshell, facts relevant and essential for disposal of the
criminal appeal are noted hereinbelow:-
Complainant Jairam (P.W.19) submitted a written report
(Ex.P/8) to the SHO, Police Station Sojat, District Pali on
28.02.1992 at 12:15 p.m. alleging inter alia that in the morning,
one Budharam Sirvi, resident of Village Atabada, visited his house
and informed his elder brother Pemaram that his daughter Indra
(Pemaram’s daughter) was not well so they had to visit her at her
house. On this, all the family members went to Indra’s house,
where they saw that dead body of Indra was lying on the floor and
blood stains were found on her mouth. They asked to Kanaram on
which, he feigned ignorance by saying that on previous night, he
was at his aunt’s house and when he returned back in the morning
he saw that Indra was hanging by a noose.
On the basis of this report, FIR No.50/1992(Ex.P/36) came
to be registered at the Police Station Sojat, District Pali for the
offences under Sections 498A and 304B IPC and investigation was
The usual investigation was undertaken. The dead body of
Indra was subjected to postmortem by a Medical Jurist at
Government Hospital, Sojat, which issued a postmortem report
(3 of 5) [CRLA-277/1996]
(Ex.P/18) wherein, cause of death was opined to be asphyxia due
to strangulation.
The accused-appellants were arrested vide Memos Ex.P/13,
Ex.P/14 and Ex.P/37 and weapon of offence i.e. knife vide Memo
Ex.P/15 and their own blood stained clothes vide Memo Ex.P/34
were recovered by the Investigating Officer during investigation.
Ultimately, after completing the investigation, a charge sheet
came to be filed against the accused-appellants Sayari and Moti
Bai for the offence under Section 498A and against accused
Kanaram for the offence under Sections 498A and 302 IPC in the
court concerned.
As the offence under Section 302 IPC was exclusively triable
by the Court of Sessions the case was committed to the Court of
Sessions Judge, Pali, from where, it was transferred to the Court
of Additional Sessions Judge, Sojat for trial where charges were
framed against the accused-appellants for the above offences.
They pleaded not guilty and claimed trial. The prosecution
examined as many as 31 witnesses and exhibited 38 documents
to prove its case. The accused-appellants were questioned under
Section 313 CrPC and upon being confronted with the
circumstances appearing against them in the prosecution
evidence, they denied the same and claimed to be innocent.
However, no oral evidence was led in defence. At the conclusion
of the trial, after hearing the arguments advanced by the
prosecution and the defence counsel and upon appreciating the
evidence available on record, the learned trial court proceeded to
convict and sentence the accused-appellants as above. Hence,
this appeal.
Learned counsel for the appellants at the outset, stated that
so far as appellants No.2 and 3 Smt. Moti Bai and Kana Ram are
concerned, they expired during pendency of the appeal and hence
the appeal stood abated to their extent vide orders dated
19.08.2020 and 03.09.2020.
As per order of this Court dated 03.01.2022, the verification
report regarding appellant Sayari, submitted by the SHO, Sojat
City, District Pali, is taken on record.
Learned counsel for the appellants does not challenge the
conviction of the appellant-Sayari as recorded by the learned
Additional Sessions Judge, Sojat. He further submits that
appellant-Sayari has already attained the age of 82 years and the
sentences awarded to her be reduced to the one already
undergone by her by taking a sympathetic and lenient view. He
submitted that out of the total sentence awarded, appellant
Sayari has already undergone around two and half months of
sentence and she was released on bail by order of this Court on
19.05.1992. Learned counsel for the appellant also submitted that
looking to the Covid Pandemic, if the appellant is now directed to
serve the remaining sentences, there would be danger to the life
of the appellant as she is in the eve of her life and would be put at
risk of life threatening infection, if sent to the prison at this age.
Learned Public Prosecutor vehemently and fervently opposed
the submissions advanced by the appellants counsel.
We have given our thoughtful consideration to the
submissions advanced at the Bar and have gone through the
impugned judgment.
Taking into consideration the overall facts and circumstances
of the case we are of the view that as appellant Sayari has already
attained the age of 82 years, the sentences awarded to her be
reduced to the period already undergone by her which is nearly
two and half months.
The appeal thus deserves to be and is hereby accepted in
part. While affirming conviction of the appellant-Sayari for the
offence under Section 498A IPC as recorded by the trial court by
the impugned judgment dated 17.04.1996 passed by the learned
Additional Sessions Judge, Sojat, Pali, the sentence awarded to
the appellant is reduced to the period already undergone by her.
The appellant is on bail. She need not surrender, if not required in
any other case. Her bail bonds are discharged.
The appeal is partly allowed in these terms.
However, keeping in view the provisions of Section 437-A
Cr.P.C., the appellant is directed to furnish a personal bond in the
sum of Rs.40,000/- and a surety bond in the like amount before
the learned trial court, which shall be effective for a period of six
months to the effect that in the event of filing of a Special Leave
Petition against the present judgment on receipt of notice thereof,
the appellants shall appear before the Supreme Court.
Record be sent back forthwith.
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While taking a lenient view, a Division Bench of Rajasthan High Court reduced sentence awarded to an 82 year old woman charged under 498A IPC to the period already served by her which is nearly two and half months. Justice Sandeep Mehta and Justice Vinod Kumar Bharwani observed, "We are of the view that as appellant Sayari has already attained the age of 82 years, the sentences awarded...
While taking a lenient view, a Division Bench of Rajasthan High Court reduced sentence awarded to an 82 year old woman charged under 498A IPC to the period already served by her which is nearly two and half months.
Justice Sandeep Mehta and Justice Vinod Kumar Bharwani observed, "We are of the view that as appellant Sayari has already attained the age of 82 years, the sentences awarded to her be reduced to the period already undergone by her which is nearly two and half months".
Affirming the conviction of the woman, the court ordered that for the offence under Section 498A IPC, as recorded by the trial court and passed by the learned Additional Sessions Judge, Sojat, Pali, the sentence awarded to the appellant be reduced to the period already undergone by her.
The court observed that as the appellant is on bail, she is not required to surrender, if not required in any other case. The court further discharged her bail bonds.
The court, as per Section 437-A Cr.P.C, directed the appellant to furnish a personal bond in the sum of Rs.40,000/- and a surety bond in the like amount before the trial court. The court added that the same shall be effective for a period of six months to the effect that in the event of filing of a Special Leave Petition against this judgment on receipt of notice thereof, the appellants shall appear before the Supreme Court.
Background
Jairam-complainant alleged that one Budharam Sirvi informed his elder brother Pemaram that the latter's daughter Indra was not well. So, all the family members went to Indra's house, where her dead body was lying on the floor and blood stains were found on her mouth. They asked Kanaram-appellant on which he feigned ignorance by saying that on previous night, he was at his aunt's house and saw that Indra was hanging by a noose when he returned in morning. Thereafter, FIR was filed and postmortem report opined reason of death to be asphyxia due to strangulation.
After hearing the arguments advanced and upon appreciating the evidence on record, the trial court proceeded to convict and sentence accused-appellants Sayari and Moti Bai for the offence under Section 498A ,while Kanaram under Sections 498A and 302 IPC.
As the offence under Section 302 IPC was exclusively triable by the Court of Sessions, the case was committed to the Court of Sessions Judge, Pali, from where, it was transferred to the Court of Additional Sessions Judge, Sojat. Aggrieved by the latter trial court's order dated 17.04.1996, Criminal Appeal has been preferred by appellants under Section 374 (2) CrPC.
Case Title: Smt. Sayari and Ors. v. State of Rajasthan
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The instant Criminal Appeal has been preferred by appellants
Smt. Sayari, Moti Bai and Kanaram under Section 374 (2)
Cr.P.C. being aggrieved of the impugned judgment dated
17.04.1996 passed by the learned Additional Sessions Judge,
Sojat in Sessions Case No.216/1992 whereby, all three accused-
appellants were convicted and sentenced as under:-
Accused- Offence Sentences Fine and
1. Sayari} 498A IPC 2 Years RI Rs.1,000/- and
2.Moti Bai} in default to
All the sentences were ordered to run concurrently.
In nutshell, facts relevant and essential for disposal of the
criminal appeal are noted hereinbelow:-
Complainant Jairam (P.W.19) submitted a written report
(Ex.P/8) to the SHO, Police Station Sojat, District Pali on
28.02.1992 at 12:15 p.m. alleging inter alia that in the morning,
one Budharam Sirvi, resident of Village Atabada, visited his house
and informed his elder brother Pemaram that his daughter Indra
(Pemaram’s daughter) was not well so they had to visit her at her
house. On this, all the family members went to Indra’s house,
where they saw that dead body of Indra was lying on the floor and
blood stains were found on her mouth. They asked to Kanaram on
which, he feigned ignorance by saying that on previous night, he
was at his aunt’s house and when he returned back in the morning
he saw that Indra was hanging by a noose.
On the basis of this report, FIR No.50/1992(Ex.P/36) came
to be registered at the Police Station Sojat, District Pali for the
offences under Sections 498A and 304B IPC and investigation was
The usual investigation was undertaken. The dead body of
Indra was subjected to postmortem by a Medical Jurist at
Government Hospital, Sojat, which issued a postmortem report
(3 of 5) [CRLA-277/1996]
(Ex.P/18) wherein, cause of death was opined to be asphyxia due
to strangulation.
The accused-appellants were arrested vide Memos Ex.P/13,
Ex.P/14 and Ex.P/37 and weapon of offence i.e. knife vide Memo
Ex.P/15 and their own blood stained clothes vide Memo Ex.P/34
were recovered by the Investigating Officer during investigation.
Ultimately, after completing the investigation, a charge sheet
came to be filed against the accused-appellants Sayari and Moti
Bai for the offence under Section 498A and against accused
Kanaram for the offence under Sections 498A and 302 IPC in the
court concerned.
As the offence under Section 302 IPC was exclusively triable
by the Court of Sessions the case was committed to the Court of
Sessions Judge, Pali, from where, it was transferred to the Court
of Additional Sessions Judge, Sojat for trial where charges were
framed against the accused-appellants for the above offences.
They pleaded not guilty and claimed trial. The prosecution
examined as many as 31 witnesses and exhibited 38 documents
to prove its case. The accused-appellants were questioned under
Section 313 CrPC and upon being confronted with the
circumstances appearing against them in the prosecution
evidence, they denied the same and claimed to be innocent.
However, no oral evidence was led in defence. At the conclusion
of the trial, after hearing the arguments advanced by the
prosecution and the defence counsel and upon appreciating the
evidence available on record, the learned trial court proceeded to
convict and sentence the accused-appellants as above. Hence,
this appeal.
Learned counsel for the appellants at the outset, stated that
so far as appellants No.2 and 3 Smt. Moti Bai and Kana Ram are
concerned, they expired during pendency of the appeal and hence
the appeal stood abated to their extent vide orders dated
19.08.2020 and 03.09.2020.
As per order of this Court dated 03.01.2022, the verification
report regarding appellant Sayari, submitted by the SHO, Sojat
City, District Pali, is taken on record.
Learned counsel for the appellants does not challenge the
conviction of the appellant-Sayari as recorded by the learned
Additional Sessions Judge, Sojat. He further submits that
appellant-Sayari has already attained the age of 82 years and the
sentences awarded to her be reduced to the one already
undergone by her by taking a sympathetic and lenient view. He
submitted that out of the total sentence awarded, appellant
Sayari has already undergone around two and half months of
sentence and she was released on bail by order of this Court on
19.05.1992. Learned counsel for the appellant also submitted that
looking to the Covid Pandemic, if the appellant is now directed to
serve the remaining sentences, there would be danger to the life
of the appellant as she is in the eve of her life and would be put at
risk of life threatening infection, if sent to the prison at this age.
Learned Public Prosecutor vehemently and fervently opposed
the submissions advanced by the appellants counsel.
We have given our thoughtful consideration to the
submissions advanced at the Bar and have gone through the
impugned judgment.
Taking into consideration the overall facts and circumstances
of the case we are of the view that as appellant Sayari has already
attained the age of 82 years, the sentences awarded to her be
reduced to the period already undergone by her which is nearly
two and half months.
The appeal thus deserves to be and is hereby accepted in
part. While affirming conviction of the appellant-Sayari for the
offence under Section 498A IPC as recorded by the trial court by
the impugned judgment dated 17.04.1996 passed by the learned
Additional Sessions Judge, Sojat, Pali, the sentence awarded to
the appellant is reduced to the period already undergone by her.
The appellant is on bail. She need not surrender, if not required in
any other case. Her bail bonds are discharged.
The appeal is partly allowed in these terms.
However, keeping in view the provisions of Section 437-A
Cr.P.C., the appellant is directed to furnish a personal bond in the
sum of Rs.40,000/- and a surety bond in the like amount before
the learned trial court, which shall be effective for a period of six
months to the effect that in the event of filing of a Special Leave
Petition against the present judgment on receipt of notice thereof,
the appellants shall appear before the Supreme Court.
Record be sent back forthwith.
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The instant Criminal Appeal has been preferred by appellants
Smt. Sayari, Moti Bai and Kanaram under Section 374 (2)
Cr.P.C. being aggrieved of the impugned judgment dated
17.04.1996 passed by the learned Additional Sessions Judge,
Sojat in Sessions Case No.216/1992 whereby, all three accused-
appellants were convicted and sentenced as under:-
Accused- Offence Sentences Fine and
1. Sayari} 498A IPC 2 Years RI Rs.1,000/- and
2.Moti Bai} in default to
All the sentences were ordered to run concurrently.
In nutshell, facts relevant and essential for disposal of the
criminal appeal are noted hereinbelow:-
Complainant Jairam (P.W.19) submitted a written report
(Ex.P/8) to the SHO, Police Station Sojat, District Pali on
28.02.1992 at 12:15 p.m. alleging inter alia that in the morning,
one Budharam Sirvi, resident of Village Atabada, visited his house
and informed his elder brother Pemaram that his daughter Indra
(Pemaram’s daughter) was not well so they had to visit her at her
house. On this, all the family members went to Indra’s house,
where they saw that dead body of Indra was lying on the floor and
blood stains were found on her mouth. They asked to Kanaram on
which, he feigned ignorance by saying that on previous night, he
was at his aunt’s house and when he returned back in the morning
he saw that Indra was hanging by a noose.
On the basis of this report, FIR No.50/1992(Ex.P/36) came
to be registered at the Police Station Sojat, District Pali for the
offences under Sections 498A and 304B IPC and investigation was
The usual investigation was undertaken. The dead body of
Indra was subjected to postmortem by a Medical Jurist at
Government Hospital, Sojat, which issued a postmortem report
(3 of 5) [CRLA-277/1996]
(Ex.P/18) wherein, cause of death was opined to be asphyxia due
to strangulation.
The accused-appellants were arrested vide Memos Ex.P/13,
Ex.P/14 and Ex.P/37 and weapon of offence i.e. knife vide Memo
Ex.P/15 and their own blood stained clothes vide Memo Ex.P/34
were recovered by the Investigating Officer during investigation.
Ultimately, after completing the investigation, a charge sheet
came to be filed against the accused-appellants Sayari and Moti
Bai for the offence under Section 498A and against accused
Kanaram for the offence under Sections 498A and 302 IPC in the
court concerned.
As the offence under Section 302 IPC was exclusively triable
by the Court of Sessions the case was committed to the Court of
Sessions Judge, Pali, from where, it was transferred to the Court
of Additional Sessions Judge, Sojat for trial where charges were
framed against the accused-appellants for the above offences.
They pleaded not guilty and claimed trial. The prosecution
examined as many as 31 witnesses and exhibited 38 documents
to prove its case. The accused-appellants were questioned under
Section 313 CrPC and upon being confronted with the
circumstances appearing against them in the prosecution
evidence, they denied the same and claimed to be innocent.
However, no oral evidence was led in defence. At the conclusion
of the trial, after hearing the arguments advanced by the
prosecution and the defence counsel and upon appreciating the
evidence available on record, the learned trial court proceeded to
convict and sentence the accused-appellants as above. Hence,
this appeal.
Learned counsel for the appellants at the outset, stated that
so far as appellants No.2 and 3 Smt. Moti Bai and Kana Ram are
concerned, they expired during pendency of the appeal and hence
the appeal stood abated to their extent vide orders dated
19.08.2020 and 03.09.2020.
As per order of this Court dated 03.01.2022, the verification
report regarding appellant Sayari, submitted by the SHO, Sojat
City, District Pali, is taken on record.
Learned counsel for the appellants does not challenge the
conviction of the appellant-Sayari as recorded by the learned
Additional Sessions Judge, Sojat. He further submits that
appellant-Sayari has already attained the age of 82 years and the
sentences awarded to her be reduced to the one already
undergone by her by taking a sympathetic and lenient view. He
submitted that out of the total sentence awarded, appellant
Sayari has already undergone around two and half months of
sentence and she was released on bail by order of this Court on
19.05.1992. Learned counsel for the appellant also submitted that
looking to the Covid Pandemic, if the appellant is now directed to
serve the remaining sentences, there would be danger to the life
of the appellant as she is in the eve of her life and would be put at
risk of life threatening infection, if sent to the prison at this age.
Learned Public Prosecutor vehemently and fervently opposed
the submissions advanced by the appellants counsel.
We have given our thoughtful consideration to the
submissions advanced at the Bar and have gone through the
impugned judgment.
Taking into consideration the overall facts and circumstances
of the case we are of the view that as appellant Sayari has already
attained the age of 82 years, the sentences awarded to her be
reduced to the period already undergone by her which is nearly
two and half months.
The appeal thus deserves to be and is hereby accepted in
part. While affirming conviction of the appellant-Sayari for the
offence under Section 498A IPC as recorded by the trial court by
the impugned judgment dated 17.04.1996 passed by the learned
Additional Sessions Judge, Sojat, Pali, the sentence awarded to
the appellant is reduced to the period already undergone by her.
The appellant is on bail. She need not surrender, if not required in
any other case. Her bail bonds are discharged.
The appeal is partly allowed in these terms.
However, keeping in view the provisions of Section 437-A
Cr.P.C., the appellant is directed to furnish a personal bond in the
sum of Rs.40,000/- and a surety bond in the like amount before
the learned trial court, which shall be effective for a period of six
months to the effect that in the event of filing of a Special Leave
Petition against the present judgment on receipt of notice thereof,
the appellants shall appear before the Supreme Court.
Record be sent back forthwith.
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While taking a lenient view, a Division Bench of Rajasthan High Court reduced sentence awarded to an 82 year old woman charged under 498A IPC to the period already served by her which is nearly two and half months. Justice Sandeep Mehta and Justice Vinod Kumar Bharwani observed, "We are of the view that as appellant Sayari has already attained the age of 82 years, the sentences awarded...
While taking a lenient view, a Division Bench of Rajasthan High Court reduced sentence awarded to an 82 year old woman charged under 498A IPC to the period already served by her which is nearly two and half months.
Justice Sandeep Mehta and Justice Vinod Kumar Bharwani observed, "We are of the view that as appellant Sayari has already attained the age of 82 years, the sentences awarded to her be reduced to the period already undergone by her which is nearly two and half months".
Affirming the conviction of the woman, the court ordered that for the offence under Section 498A IPC, as recorded by the trial court and passed by the learned Additional Sessions Judge, Sojat, Pali, the sentence awarded to the appellant be reduced to the period already undergone by her.
The court observed that as the appellant is on bail, she is not required to surrender, if not required in any other case. The court further discharged her bail bonds.
The court, as per Section 437-A Cr.P.C, directed the appellant to furnish a personal bond in the sum of Rs.40,000/- and a surety bond in the like amount before the trial court. The court added that the same shall be effective for a period of six months to the effect that in the event of filing of a Special Leave Petition against this judgment on receipt of notice thereof, the appellants shall appear before the Supreme Court.
Background
Jairam-complainant alleged that one Budharam Sirvi informed his elder brother Pemaram that the latter's daughter Indra was not well. So, all the family members went to Indra's house, where her dead body was lying on the floor and blood stains were found on her mouth. They asked Kanaram-appellant on which he feigned ignorance by saying that on previous night, he was at his aunt's house and saw that Indra was hanging by a noose when he returned in morning. Thereafter, FIR was filed and postmortem report opined reason of death to be asphyxia due to strangulation.
After hearing the arguments advanced and upon appreciating the evidence on record, the trial court proceeded to convict and sentence accused-appellants Sayari and Moti Bai for the offence under Section 498A ,while Kanaram under Sections 498A and 302 IPC.
As the offence under Section 302 IPC was exclusively triable by the Court of Sessions, the case was committed to the Court of Sessions Judge, Pali, from where, it was transferred to the Court of Additional Sessions Judge, Sojat. Aggrieved by the latter trial court's order dated 17.04.1996, Criminal Appeal has been preferred by appellants under Section 374 (2) CrPC.
Case Title: Smt. Sayari and Ors. v. State of Rajasthan
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While taking a lenient view, a Division Bench of Rajasthan High Court reduced sentence awarded to an 82 year old woman charged under 498A IPC to the period already served by her which is nearly two and half months. Justice Sandeep Mehta and Justice Vinod Kumar Bharwani observed, "We are of the view that as appellant Sayari has already attained the age of 82 years, the sentences awarded...
While taking a lenient view, a Division Bench of Rajasthan High Court reduced sentence awarded to an 82 year old woman charged under 498A IPC to the period already served by her which is nearly two and half months.
Justice Sandeep Mehta and Justice Vinod Kumar Bharwani observed, "We are of the view that as appellant Sayari has already attained the age of 82 years, the sentences awarded to her be reduced to the period already undergone by her which is nearly two and half months".
Affirming the conviction of the woman, the court ordered that for the offence under Section 498A IPC, as recorded by the trial court and passed by the learned Additional Sessions Judge, Sojat, Pali, the sentence awarded to the appellant be reduced to the period already undergone by her.
The court observed that as the appellant is on bail, she is not required to surrender, if not required in any other case. The court further discharged her bail bonds.
The court, as per Section 437-A Cr.P.C, directed the appellant to furnish a personal bond in the sum of Rs.40,000/- and a surety bond in the like amount before the trial court. The court added that the same shall be effective for a period of six months to the effect that in the event of filing of a Special Leave Petition against this judgment on receipt of notice thereof, the appellants shall appear before the Supreme Court.
Background
Jairam-complainant alleged that one Budharam Sirvi informed his elder brother Pemaram that the latter's daughter Indra was not well. So, all the family members went to Indra's house, where her dead body was lying on the floor and blood stains were found on her mouth. They asked Kanaram-appellant on which he feigned ignorance by saying that on previous night, he was at his aunt's house and saw that Indra was hanging by a noose when he returned in morning. Thereafter, FIR was filed and postmortem report opined reason of death to be asphyxia due to strangulation.
After hearing the arguments advanced and upon appreciating the evidence on record, the trial court proceeded to convict and sentence accused-appellants Sayari and Moti Bai for the offence under Section 498A ,while Kanaram under Sections 498A and 302 IPC.
As the offence under Section 302 IPC was exclusively triable by the Court of Sessions, the case was committed to the Court of Sessions Judge, Pali, from where, it was transferred to the Court of Additional Sessions Judge, Sojat. Aggrieved by the latter trial court's order dated 17.04.1996, Criminal Appeal has been preferred by appellants under Section 374 (2) CrPC.
Case Title: Smt. Sayari and Ors. v. State of Rajasthan
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The prayers in this Crl.M.C are as follows;
1) Pass an order to modify Annexure A2, interim
bail granted to the petitioner as an absolute bail.
2) Pass an order to delete the 1 st condition imposed
upon the petitioner in Annexure A2 bail order to
surrender before the Superintendent of Sub Jail,
Attingal at 3:30 PM on 30.03.2023 while granting
interim bail to the petitioner and to declare that
such a condition is onerous and unreasonable and
is liable to be set-aside.
3) And also to grant such other relief's this Hon'ble
Court may deem fit and proper in the interest of
justice.
2. Heard the learned counsel for the petitioner and the
3. The petitioner is the accused in Crime No.336/2023 of
Chirayankeezhu Police Station. The offences alleged are punishable
under Sections 450, 376(2)(n), 361 r/w Section 363, 342, 354-A (1)(i)
of IPC and Section 5(I) r/w Section 6, Section 7 r/w Section 8 of the
Crl.M.C No.2630 of 2023
Protection of Children from Sexual Offences Act,2012.
4. The petitioner has been in Judicial Custody since
07.03.2023. The petitioner filed Crl.M.P 612/2023 before the
Additional Session Court for the trial of cases relating to Atrocities
and Sexual Violence against Women and Children,
Thiruvananthapuram seeking regular bail. The Court below
disposed of the bail application, the operative portion of which
a) Interim bail is granted to the petitioner till
30.03.2023 at 3.00 PM. The petitioner shall
surrender before the Superintendent of Sub Jail
Attingal at 3.30 PM on 30.03.2023.
b) The petitioner shall execute a bond for
Rs.50,000/-(Rupees Fifty thousand only) each with
two solvent sureties for like sum.
c)The petitioner shall not influence or threaten the
witnesses including the victim.
d)The petitioner shall not have any form of
communication or interaction with the victim
e) The petitioner shall not enter the place of abode of
the victim.
f) The petitioner shall not involve similar type of
Crl.M.C No.2630 of 2023
g) The Copy of Hall Ticket is enclosed herewith for
appropriate action and compliance of the order.
5. The learned counsel for the petitioner submitted that the
trial Court has not considered the merits of the regular bail
application filed by the petitioner, instead the Court granted only
interim bail and disposed of the same. The petitioner has been
directed to surrender before the Superintendent of Sub Jail,
Attingal on 30.03.2023. As the petitioner filed an application seeking
regular bail the Court below ought to have considered the
entitlement of the petitioner to have regular bail.
6. Therefore, the Crl.M.P No.612/2023 is restored to file.
The trial Court is directed to consider the entitlement of the
petitioner for regular bail before 30.03.2023.
This Crl.M.C is disposed of as above.
Crl.M.C No.2630 of 2023
|
The Kerala High Court on Tuesday remanded a bail application in a POCSO case for fresh consideration by the trial Court, while exercising its jurisdiction under Section 482 Cr.P.C.
The Single Judge Bench of Justice K. Babu directed the Trial Court to consider the entitlement of the petitioner for regular bail before March 30, 2023.
The petitioner is accused of offences punishable under Sections 450, 376(2)(n), 361 r/w Section 363, 342, 354-A (1)(i) of IPC and Section 5(I) r/w Section 6, Section 7 r/w Section 8 of the POCSO Act. He had been in judicial custody since March 7, 2023.
When he filed a petition before the Additional Session Court for the trial of cases relating to Atrocities and Sexual Violence against Women and Children, Thiruvananthapuram seeking regular bail, the court below disposed of the same granting him interim bail till March 30, 2023 at 3.00 PM, and further directing the petitioner to surrender before the Superintendent of Sub Jail Attingal at 3.30 PM on the same date.
It was contended by the counsels for the petitioner that the Trial Court had not considered the merits of the regular bail application filed by the petitioner, but instead, disposed of the same after granting him interim bail, and further directed him to surrender before the Superintendent of Sub Jail, Attingal on March 30, 2023.
"As the petitioner filed an application seeking regular bail the Court below ought to have considered the entitlement of the petitioner to have regular bail," it was contended.
It was under these circumstances that the Court disposed the application with the aforementioned directions.
The petitioner was represented by Advocates Navaneeth N. Nath, Sanel Cherian, K.S. Stejo, and Abhirami S. The Public Prosecutor appeared on behalf of the State.
Case Title: Nithinram R.S. v. State of Kerala
|
The prayers in this Crl.M.C are as follows;
1) Pass an order to modify Annexure A2, interim
bail granted to the petitioner as an absolute bail.
2) Pass an order to delete the 1 st condition imposed
upon the petitioner in Annexure A2 bail order to
surrender before the Superintendent of Sub Jail,
Attingal at 3:30 PM on 30.03.2023 while granting
interim bail to the petitioner and to declare that
such a condition is onerous and unreasonable and
is liable to be set-aside.
3) And also to grant such other relief's this Hon'ble
Court may deem fit and proper in the interest of
justice.
2. Heard the learned counsel for the petitioner and the
3. The petitioner is the accused in Crime No.336/2023 of
Chirayankeezhu Police Station. The offences alleged are punishable
under Sections 450, 376(2)(n), 361 r/w Section 363, 342, 354-A (1)(i)
of IPC and Section 5(I) r/w Section 6, Section 7 r/w Section 8 of the
Crl.M.C No.2630 of 2023
Protection of Children from Sexual Offences Act,2012.
4. The petitioner has been in Judicial Custody since
07.03.2023. The petitioner filed Crl.M.P 612/2023 before the
Additional Session Court for the trial of cases relating to Atrocities
and Sexual Violence against Women and Children,
Thiruvananthapuram seeking regular bail. The Court below
disposed of the bail application, the operative portion of which
a) Interim bail is granted to the petitioner till
30.03.2023 at 3.00 PM. The petitioner shall
surrender before the Superintendent of Sub Jail
Attingal at 3.30 PM on 30.03.2023.
b) The petitioner shall execute a bond for
Rs.50,000/-(Rupees Fifty thousand only) each with
two solvent sureties for like sum.
c)The petitioner shall not influence or threaten the
witnesses including the victim.
d)The petitioner shall not have any form of
communication or interaction with the victim
e) The petitioner shall not enter the place of abode of
the victim.
f) The petitioner shall not involve similar type of
Crl.M.C No.2630 of 2023
g) The Copy of Hall Ticket is enclosed herewith for
appropriate action and compliance of the order.
5. The learned counsel for the petitioner submitted that the
trial Court has not considered the merits of the regular bail
application filed by the petitioner, instead the Court granted only
interim bail and disposed of the same. The petitioner has been
directed to surrender before the Superintendent of Sub Jail,
Attingal on 30.03.2023. As the petitioner filed an application seeking
regular bail the Court below ought to have considered the
entitlement of the petitioner to have regular bail.
6. Therefore, the Crl.M.P No.612/2023 is restored to file.
The trial Court is directed to consider the entitlement of the
petitioner for regular bail before 30.03.2023.
This Crl.M.C is disposed of as above.
Crl.M.C No.2630 of 2023
|
The prayers in this Crl.M.C are as follows;
1) Pass an order to modify Annexure A2, interim
bail granted to the petitioner as an absolute bail.
2) Pass an order to delete the 1 st condition imposed
upon the petitioner in Annexure A2 bail order to
surrender before the Superintendent of Sub Jail,
Attingal at 3:30 PM on 30.03.2023 while granting
interim bail to the petitioner and to declare that
such a condition is onerous and unreasonable and
is liable to be set-aside.
3) And also to grant such other relief's this Hon'ble
Court may deem fit and proper in the interest of
justice.
2. Heard the learned counsel for the petitioner and the
3. The petitioner is the accused in Crime No.336/2023 of
Chirayankeezhu Police Station. The offences alleged are punishable
under Sections 450, 376(2)(n), 361 r/w Section 363, 342, 354-A (1)(i)
of IPC and Section 5(I) r/w Section 6, Section 7 r/w Section 8 of the
Crl.M.C No.2630 of 2023
Protection of Children from Sexual Offences Act,2012.
4. The petitioner has been in Judicial Custody since
07.03.2023. The petitioner filed Crl.M.P 612/2023 before the
Additional Session Court for the trial of cases relating to Atrocities
and Sexual Violence against Women and Children,
Thiruvananthapuram seeking regular bail. The Court below
disposed of the bail application, the operative portion of which
a) Interim bail is granted to the petitioner till
30.03.2023 at 3.00 PM. The petitioner shall
surrender before the Superintendent of Sub Jail
Attingal at 3.30 PM on 30.03.2023.
b) The petitioner shall execute a bond for
Rs.50,000/-(Rupees Fifty thousand only) each with
two solvent sureties for like sum.
c)The petitioner shall not influence or threaten the
witnesses including the victim.
d)The petitioner shall not have any form of
communication or interaction with the victim
e) The petitioner shall not enter the place of abode of
the victim.
f) The petitioner shall not involve similar type of
Crl.M.C No.2630 of 2023
g) The Copy of Hall Ticket is enclosed herewith for
appropriate action and compliance of the order.
5. The learned counsel for the petitioner submitted that the
trial Court has not considered the merits of the regular bail
application filed by the petitioner, instead the Court granted only
interim bail and disposed of the same. The petitioner has been
directed to surrender before the Superintendent of Sub Jail,
Attingal on 30.03.2023. As the petitioner filed an application seeking
regular bail the Court below ought to have considered the
entitlement of the petitioner to have regular bail.
6. Therefore, the Crl.M.P No.612/2023 is restored to file.
The trial Court is directed to consider the entitlement of the
petitioner for regular bail before 30.03.2023.
This Crl.M.C is disposed of as above.
Crl.M.C No.2630 of 2023
|
The Kerala High Court on Tuesday remanded a bail application in a POCSO case for fresh consideration by the trial Court, while exercising its jurisdiction under Section 482 Cr.P.C.
The Single Judge Bench of Justice K. Babu directed the Trial Court to consider the entitlement of the petitioner for regular bail before March 30, 2023.
The petitioner is accused of offences punishable under Sections 450, 376(2)(n), 361 r/w Section 363, 342, 354-A (1)(i) of IPC and Section 5(I) r/w Section 6, Section 7 r/w Section 8 of the POCSO Act. He had been in judicial custody since March 7, 2023.
When he filed a petition before the Additional Session Court for the trial of cases relating to Atrocities and Sexual Violence against Women and Children, Thiruvananthapuram seeking regular bail, the court below disposed of the same granting him interim bail till March 30, 2023 at 3.00 PM, and further directing the petitioner to surrender before the Superintendent of Sub Jail Attingal at 3.30 PM on the same date.
It was contended by the counsels for the petitioner that the Trial Court had not considered the merits of the regular bail application filed by the petitioner, but instead, disposed of the same after granting him interim bail, and further directed him to surrender before the Superintendent of Sub Jail, Attingal on March 30, 2023.
"As the petitioner filed an application seeking regular bail the Court below ought to have considered the entitlement of the petitioner to have regular bail," it was contended.
It was under these circumstances that the Court disposed the application with the aforementioned directions.
The petitioner was represented by Advocates Navaneeth N. Nath, Sanel Cherian, K.S. Stejo, and Abhirami S. The Public Prosecutor appeared on behalf of the State.
Case Title: Nithinram R.S. v. State of Kerala
|
The Kerala High Court on Tuesday remanded a bail application in a POCSO case for fresh consideration by the trial Court, while exercising its jurisdiction under Section 482 Cr.P.C.
The Single Judge Bench of Justice K. Babu directed the Trial Court to consider the entitlement of the petitioner for regular bail before March 30, 2023.
The petitioner is accused of offences punishable under Sections 450, 376(2)(n), 361 r/w Section 363, 342, 354-A (1)(i) of IPC and Section 5(I) r/w Section 6, Section 7 r/w Section 8 of the POCSO Act. He had been in judicial custody since March 7, 2023.
When he filed a petition before the Additional Session Court for the trial of cases relating to Atrocities and Sexual Violence against Women and Children, Thiruvananthapuram seeking regular bail, the court below disposed of the same granting him interim bail till March 30, 2023 at 3.00 PM, and further directing the petitioner to surrender before the Superintendent of Sub Jail Attingal at 3.30 PM on the same date.
It was contended by the counsels for the petitioner that the Trial Court had not considered the merits of the regular bail application filed by the petitioner, but instead, disposed of the same after granting him interim bail, and further directed him to surrender before the Superintendent of Sub Jail, Attingal on March 30, 2023.
"As the petitioner filed an application seeking regular bail the Court below ought to have considered the entitlement of the petitioner to have regular bail," it was contended.
It was under these circumstances that the Court disposed the application with the aforementioned directions.
The petitioner was represented by Advocates Navaneeth N. Nath, Sanel Cherian, K.S. Stejo, and Abhirami S. The Public Prosecutor appeared on behalf of the State.
Case Title: Nithinram R.S. v. State of Kerala
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The lis involved in these cases is connected to each other.
Therefore, they were heard together and are being disposed of with
the following common order.
2. Crl.P.No. 3786 of 2022 is filed seeking to quash the order
dated 08.04.2022 passed in Crl.M.P. (Sr). No. 3550 of 2022 in File
No. ECIR/HYZO/14/2021 by the Metropolitan Sessions Judge –
cum – Special Court Under PMLA Act, 2002 at Hyderabad.
Likewise, Crl.P.No. 4127 of 2022 and Crl.P.No. 4137 of 2022 are
filed to quash the orders dated 13.04.2022 and 31.03.2022 in File
No. ECIR/HYZO/14/2021 respectively. The petitioner is A.1 in the
said crime.
3. Heard Mr. T. Niranjan Reddy learned Senior Counsel
representing Mr. Avinash Desai learned counsel for the Petitioner
and Mr. Anil Prasad Tiwari, learned Spl. Public Prosecutor for
Directorate of Enforcement for the Respondent.
4. The Petitioner is the Chairman and Managing Director of
Respondent authority had registered ECIR/HYZO/14/2021 for the
offence of money laundering under the Prevention of Money
Laundering Act, 2002 (hereinafter ‘PMLA’) against KSBL. The
allegations against KSBL and the Petitioner include diversion of
large-scale clients funds through shell companies which resulted in
huge losses to the investors. It is further alleged that the clients’
money was misused by the shell companies created by KSBL and
the said money was transferred to the Petitioner and his family
5. Various FIRs were registered against the Petitioner and he
was arrested on 19.08.2021 in relation to Crime No. 100 of 2021
which is pending on the file of P.S. Central Crime Station
Hyderabad. The Petitioner in the said crime was remanded to
judicial custody. Pursuant to a P.T. warrant dated 10.01.2021, the
Petitioner was produced before the Metropolitan Sessions Judge –
cum – Special Court (hereinafter ‘Designated Court’) on
20.01.2021. On the same day, the Petitioner was remanded to
judicial custody.
6. The Petitioner has been in jail since 20.01.2022.
According to the Petitioner, the offences alleged against him are
not punishable for a term not less than ten years, death, life
imprisonment. Therefore, he is entitled for statutory bail under
Section 167(2) of the Cr.P.C. as the investigation is not completed
within sixty (60) days of his remand.
7. According to the Petitioner, the period of sixty days
expired on 21.03.2022. Therefore, on 21.03.2022, he filed an
application seeking default bail under Section 167 (2) of the
Cr.P.C. citing expiry of sixty days. The said application was
returned as infructuous on the ground that a charge sheet/complaint
was filed by the Respondent herein on 19.03.2022 which was
before the expiry of sixty days.
8. However, subsequently on 31.03.2022 another application
under Section 167 was filed by the Respondent herein seeking
extension of remand. According to the Petitioner, the application
was filed seeking further custody of the Petitioner to complete the
investigation. The said application was allowed and the custody of
the Petitioner was extended till 13.04.2022.
9. The Petitioner relying on the application dated 31.03.2022
filed by the Respondent which stated that investigation is yet to be
completed, filed another default bail application dated 01.04.2022
under Section 167(2) of the Cr.P.C. In the said bail application, the
Petitioner contended that no complaint/charge sheet was filed in
terms of Section 173(2) of the Cr.P.C. as investigation is yet to be
completed. The said bail application was returned as infructuous on
08.04.2022. The said order also stated that the application dated
31.03.2022 seeking extension of remand was returned as charge
sheet was already filed on 19.03.2022.
10. Subsequently, another application dated 13.04.2022
under Section 167 of the Cr.P.C. was filed by the Respondent
herein seeking extension of remand. The said application was
allowed and the remand was extended till 27.04.2022.
11. The Petitioner in the present criminal petitions has
challenged the order dated 31.03.2022 in ECIR/HYZO/14/2021, in
Crl.P.No. 4137 of 2022, order dated 13.04.2022 in
ECIR/HYZO/14/2021, in Crl.P.No. 4127 of 2022 and order dated
08.04.2022 in Crl.M.P.(sr) No.3350 of 2022 in
ECIR/HYZO/14/2021, in Crl.P.No. 3786 of 2022, inter alia, on the
ground that he is entitled for statutory bail under Section 167(2) of
i. A complaint in the nature of interim report was filed on
19.03.2022. No complaint/charge sheet in terms of
Section 173(2) of the Cr.P.C. is filed as the investigation
admittedly is not completed. Therefore, in the absence of
completion of investigation, the Petitioner is entitled for
statutory bail under Section 167(2) of the Cr.P.C. after a
period of sixty days which accrued on 21.03.2022.
ii. The complaint dated 19.03.2022 was filed only to deny
statutory bail to the Petitioner.
iii. The object of Section 167(2) of the Cr.P.C. is to complete
the investigation within the prescribed time. Failure of the
prosecution to complete investigation and file charge
sheet within prescribed time will give the accused a right
of statutory bail. Reliance was placed on M. Ravindran
v. Intelligence Officer, Directorate of Revenue
iv. The Designated Court has no power to return the bail
application filed under Section 167(2) of the Cr.P.C.
Reliance was placed on Directorate of Enforcement v.
v. The Petitioner was not produced before the Designated
Court when the remand was extended.
i. A complaint/charge sheet was already filed on
19.03.2022. Therefore, statutory bail under Section
167(2) of the Cr.P.C cannot be claimed once the charge
sheet is filed. Reliance was placed on Serious Fraud
Investigation Office v. Rahul Modi3.
ii. Remand was extended under Section 309 of the Cr.P.C.
and the Respondent can seek custody of the Petitioner to
complete further investigation under Section 44(2) of the
Order dated 15.02.2022 passed in Criminal Petition Nos. 9825, 9846 and 10021 of 2021.
iii. The Petitioner is trying to claim statutory bail to
overcome the requirement of bail under Section 45 of the
iv. The Petitioner did not oppose remand which was extended
under Section 309 of the Cr.P.C. Reliance was placed
Sunil Kumar Sharma v. State4.
14. In the present case, the issue before the Court is whether
the Petitioner is entitled for statutory bail under Section 167(2) of
the Cr.P.C. For the sake of convenience, the chronology of dates is
20.01.2022 Petitioner was remanded to judicial custody
and has been in jail since then.
19.03.2022 Alleged Complaint/charge sheet was filed by
21.03.2022 The date on which statutory bail accrues
after the expiry of sixty days under Section
31.03.2022 The remand of the Petitioner was extended
investigation is pending.
01.04.2022 Application seeking statutory bail under
Section 167(2) is filed.
08.04.2022 The bail application dated 01.04.2022 is
13.04.2022 The remand of the Petitioner is further
Before deciding the issue at hand, it is apposite to discuss the
object and scope of Section 167(2) of the Cr.P.C.
(2) The Magistrate to whom an accused person is forwarded under this
section may, whether he has or has not jurisdiction to try the case, from
time to time, authorise the detention of the accused in such custody as
such Magistrate thinks fit, for a term not exceeding fifteen days in the
whole; and if he has no jurisdiction to try the case or commit it for trial,
and considers further detention unnecessary, he may order the accused to
be forwarded to a Magistrate having such jurisdiction:
(a) the Magistrate may authorise the detention of the accused person,
otherwise than in the custody of the police, beyond the period of fifteen
days; if he is satisfied that adequate grounds exist for doing so, but no
Magistrate shall authorise the detention of the accused person in custody
under this paragraph for a total period exceeding,-
(i) ninety days, where the investigation relates to an offence punishable
with death, imprisonment for life or imprisonment for a term of not less
(ii) sixty days, where the investigation relates to any other offence, and,
on the expiry of the said period of ninety days, or sixty days, as the case
may be, the accused person shall be released on bail if he is prepared to
and does furnish bail, and every person released on bail under this sub-
section shall be deemed to be so released under the provisions of
Chapter XXXIII for the purposes of that Chapter.
(b) no Magistrate shall authorise detention in any custody under this
section unless the accused is produced before him;
(c) no Magistrate of the second class, not specially empowered in this
behalf by the High Court, shall authorise detention in the custody of the
police.
15. Section 167(2) of the Cr.P.C. obligates the investigative
agencies to complete the investigation in a time bound manner. The
object behind incorporating a time limit to complete investigation
was explained by a full bench of the Supreme Court inRavindran
(Supra). The relevant paragraphs are extracted below:
17. Before we proceed to expand upon the parameters of
the right to default bail under Section 167(2) as interpreted by
various decisions of this Court, we find it pertinent to note the
observations made by this Court in Uday Mohanlal
Acharya [Uday Mohanlal Acharya v. State of Maharashtra,
(2001) 5 SCC 453 : 2001 SCC (Cri) 760] on the fundamental
right to personal liberty of the person and the effect of
deprivation of the same as follows: (SCC p. 472, para 13)
“13. … Personal liberty is one of the cherished objects of
the Indian Constitution and deprivation of the same can only be
in accordance with law and in conformity with the provisions
thereof, as stipulated under Article 21 of the Constitution.
When the law provides that the Magistrate could authorise the
detention of the accused in custody up to a maximum period as
indicated in the proviso to sub-section (2) of Section 167, any
further detention beyond the period without filing of a challan
by the investigating agency would be a subterfuge and would
not be in accordance with law and in conformity with the
provisions of the Criminal Procedure Code, and as such, could
be violative of Article 21 of the Constitution.”
17.1. Article 21 of the Constitution of India provides that
“no person shall be deprived of his life or personal liberty
except according to procedure established by law”. It has been
settled by a Constitution Bench of this Court in Maneka
Gandhi v. Union of India [Maneka Gandhi v. Union of India,
(1978) 1 SCC 248] , that such a procedure cannot be arbitrary,
unfair or unreasonable. The history of the enactment of Section
167(2) CrPC and the safeguard of “default bail” contained in
the proviso thereto is intrinsically linked to Article 21 and is
nothing but a legislative exposition of the constitutional
safeguard that no person shall be detained except in accordance
with rule of law.
17.2. Under Section 167 of the Code of Criminal Procedure,
1898 (“the 1898 Code”) which was in force prior to the
enactment of the CrPC, the maximum period for which an
accused could be remanded to custody, either police or judicial,
was 15 days. However, since it was often unworkable to
conclude complicated investigations within 15 days, a practice
arose wherein investigating officers would file “preliminary
charge-sheets” after the expiry of the remand period. The State
would then request the Magistrate to postpone commencement
of the trial and authorise further remand of the accused under
Section 344 of the 1898 Code till the time the investigation was
completed and the final charge-sheet was filed. The Law
Commission of India in Report No. 14 on Reforms of the
Judicial Administration (Vol. II, 1948, pp. 758-760) pointed
out that in many cases the accused were languishing for several
months in custody without any final report being filed before
the courts. It was also pointed out that there was conflict in
judicial opinion as to whether the Magistrate was bound to
release the accused if the police report was not filed within 15
17.3. Hence the Law Commission in Report No. 14
recommended the need for an appropriate provision specifically
providing for continued remand after the expiry of 15 days, in a
manner that “while meeting the needs of a full and proper
investigation in cases of serious crime, will still safeguard the
liberty of the person of the individual”. Further, that the
legislature should prescribe a maximum time period beyond
which no accused could be detained without filing of the police
report before the Magistrate. It was pointed out that in England,
even a person accused of grave offences such as treason could
not be indefinitely detained in prison till commencement of the
17.4. The suggestion made in Report No. 14 was
reiterated by the Law Commission in Report No. 41 on The
Code of Criminal Procedure, 1898 (Vol. I, 1969, pp. 76-77).
The Law Commission re-emphasised the need to guard
against the misuse of Section 344 of the 1898 Code by filing
“preliminary reports” for remanding the accused beyond
the statutory period prescribed under Section 167. It was
pointed out that this could lead to serious abuse wherein
“the arrested person can in this manner be kept in custody
indefinitely while the investigation can go on in a leisurely
manner”. Hence the Commission recommended fixing of a
maximum time-limit of 60 days for remand. The
Commission considered the reservation expressed earlier in
Report No. 37 that such an extension may result in the 60-
day period becoming a matter of routine. However, faith
was expressed that proper supervision by the superior
courts would help circumvent the same.
17.6. It was in this backdrop that Section 167(2) was
enacted within the present day CrPC, providing for time-
limits on the period of remand of the accused,
proportionate to the seriousness of the offence committed,
failing which the accused acquires the indefeasible right to
bail. As is evident from the recommendations of the Law
Commission mentioned supra, the intent of the legislature
was to balance the need for sufficient time-limits to
complete the investigation with the need to protect the civil
liberties of the accused. Section 167(2) provides for a clear
mandate that the investigative agency must collect the
required evidence within the prescribed time period, failing
which the accused can no longer be detained. This ensures
that the investigating officers are compelled to act swiftly
and efficiently without misusing the prospect of further
remand. This also ensures that the court takes cognizance
of the case without any undue delay from the date of giving
information of the offence, so that society at large does not
lose faith and develop cynicism towards the criminal justice
17.9. Additionally, it is well-settled that in case of any
ambiguity in the construction of a penal statute, the courts
must favour the interpretation which leans towards
protecting the rights of the accused, given the ubiquitous
power disparity between the individual accused and the
State machinery. This is applicable not only in the case of
substantive penal statutes but also in the case of procedures
providing for the curtailment of the liberty of the accused.
17.10. With respect to the CrPC particularly, the Statement
of Objects and Reasons (supra) is an important aid of
construction. Section 167(2) has to be interpreted keeping in
mind the threefold objectives expressed by the legislature,
namely, ensuring a fair trial, expeditious investigation and trial,
and setting down a rationalised procedure that protects the
interests of indigent sections of society. These objects are
nothing but subsets of the overarching fundamental right
guaranteed under Article 21.
16. From the above decision, it is clear that a time limit for
completing investigation was incorporated in order to ensure that
the accused does not languish in jail for the investigative
authority’s failure to complete investigation. It was held that the
right to statutory bail accrues on a person if the charge sheet is not
filed within the prescribed period of sixty days. The said right to
bail is indefeasible and is interlinked with personal liberty as
envisaged under Article 21 of the Constitution of India.
17. This Court would like to clarify as to when a person is
entitled for statutory bail under Section 167(2) of Cr.P.C. It was
contended on behalf of the Petitioner that Section 167(2) of Cr.P.C.
comes into operation if no cognizance is taken within the
prescribed period. The said contention cannot be accepted. The test
to determine whether a person is entitled for bail under Section
167(2) of Cr.P.C. is not the date of taking cognizance but the date
of filing charge sheet. In other words, the right of statutory bail
ceases to exist the moment a charge sheet is filed within the
prescribed period of sixty or ninety days.
18. The Supreme Court in Rahul Modi (Supra) clarifying
11. It is clear from the judgment of this Court
in Bhikamchand Jain (supra) that filing of a charge-sheet
is sufficient compliance with the provisions of Section
167, CrPC and that an accused cannot demand release on
default bail under Section 167(2) on the ground that
cognizance has not been taken before the expiry of 60
days. The accused continues to be in the custody of the
Magistrate till such time cognizance is taken by the court
trying the offence, which assumes custody of the accused
for the purpose of remand after cognizance is taken. The
conclusion of the High Court that the accused cannot be
remanded beyond the period of 60 days under Section 167
and that further remand could only be at the post-
cognizance stage, is not correct in view of the judgment of
this Court in Bhikamchand Jain (supra).
16. A close scrutiny of the judgments in Sanjay
Dutt (supra), Madar Sheikh (supra) and M. Ravindran
(supra) would show that there is nothing contrary to what
has been decided in Bhikamchand Jain (supra). In all the
above judgments which are relied upon by either side, this
Court had categorically laid down that the indefeasible
right of an accused to seek statutory bail under Section
167(2) of CrPC arises only if the charge-sheet has not
been filed before the expiry of the statutory period.
Reference to cognizance in Madar Sheikh (supra) is in
view of the fact situation where the application was filed
after the charge-sheet was submitted and cognizance had
been taken by the trial court. Such reference cannot be
construed as this Court introducing an additional
requirement of cognizance having to be taken within the
period prescribed under proviso (a) to Section 167(2),
CrPC, failing which the accused would be entitled to
default bail, even after filing of the charge-sheet within the
statutory period. It is not necessary to repeat that in
both Madar Sheikh (supra) and M. Ravindran (supra), this
Court expressed its view that non-filing of the charge-
sheet within the statutory period is the ground for availing
the indefeasible right to claim bail under Section 167(2),
CrPC. The conundrum relating to the custody of the
accused after the expiry of 60 days has also been dealt
with by this Court in Bhikamchand Jain (supra). It was
made clear that the accused remains in custody of the
Magistrate till cognizance is taken by the relevant court.
As the issue that arises for consideration in this case is
squarely covered by the judgment in Bhikamchand
Jain (supra), the order passed by the High Court on
31.05.2019 is hereby set aside.
To decide whether the Petitioner is entitled to statutory bail, this
Court has to decide whether a charge sheet/complaintdated
19.03.2022 was filed or not. It is relevant to note that, in the
present case the proceedings are initiated under the PMLA. Section
44 of the PMLA provides that the offences under PMLA are triable
by Special Courts. The Special Court can take cognizance of an
offence only based on a complaint which is filed by the authorised
authority under Section 44(1)(b) of the PMLA.
19. The complaint filed under Section 44(1)(b) of the PMLA
is similar to a charge sheet/ final report filed under Section 173(2)
of Cr.P.C. In other words, similar to a charge sheet under Section
173(2) of Cr.P.C., a complaint under Section 44(1)(b) of the
PMLA is filed after completion of investigation, so that the Special
Court can take cognizance under Section 167 of the Cr.P.C. It is
relevant to note that the filing of the complaint and subsequent
cognizance under PMLA is governed by the provisions of the
Cr.P.C. in view of Section 65 of the Cr.P.C.
20. In the present case, the Respondent contended that a
complaint under Section 44(1)(b) of the PMLA was already filed
on 19.03.2022. Therefore, the Petitioner is not entitled for statutory
bail under Section 167(2) of the Cr.P.C. This Court cannot accept
the contention of the Respondent as the investigation was not
completed when the complaint dated 19.03.2022 was filed.
21. The Supreme Court in Satya NarainMusadi v. State of
Bihar5 discussing Section 173(2) of the Cr.P.C. has held that a
charge sheet can be filed only after the completion of investigation.
The relevant paragraph is extracted below:
9. Section 173(2)(1) provides that on completion of the
investigation the police officer investigating into a
cognizable offence shall submit a report in the form
prescribed by the State Government and stating therein
(a) the names of the parties; (b) the nature of the
information; (c) the names of the persons who appear to be
acquainted with the circumstances of the case; (d) whether
any offence appears to have been committed and, if so, by
whom (e) whether the accused has been arrested; (f)
whether he has been released on his bond and, if so,
whether with or without sureties; and (g) whether he has
been forwarded in custody under Section 170. Sub-section
(5) of Section 173 makes it obligatory upon the police
officer to forward along with the report all documents or
relevant extracts thereof on which the prosecution
proposes to rely and the statements recorded under Section
161 of all the persons whom the prosecution proposes to
examine as witnesses at the trial.
Similarly, the Supreme Court in Manu Sharma v. State (NCT of
Delhi)6 has held that the object behind Section 173 of the Cr.P.C.
is to complete the investigation and file the charge sheet. The idea
is to ensure that cognizance is taken without any delay. The
relevant paragraph is extracted below:
206. Section 173 commands the investigating agency to
complete the investigation expeditiously without
unnecessary delay and when such an investigation is
completed, the officer in charge of the police station
shall forward to a Magistrate empowered to take
cognizance of offence on a police report the details in
the form as may be prescribed by the State
Government and provide the information required
under this section.
22. From the above decisions, it is clear that a charge sheet
can be filed only after the completion of investigation.
Investigation is said to be completed if sufficient material is
collected by the Investigating Officer based on which cognizance
can be taken under Section 167 of the Cr.P.C. It was contended by
the Respondent that the complaint dated 19.03.2022 is a charge
sheet and only further investigation is being carried out which is
permissible under Section 44(1)(d)(ii). The said contention cannot
be accepted.
23. The Designated Court has extended the remand of the
accused on 31.03.2022 and subsequently on 13.04.2022 under
Section 167(2) of the Cr.P.C. on the ground that investigation is
pending. This clearly indicates that the complaint dated 19.03.2022
was filed without completing the investigation. Therefore, the
complaint dated 19.03.2022 is an incomplete complaint/charge
sheet. Further, if complaint dated 19.03.2022 was filed after
completion of investigation, the Designated Court would have
taken cognizance of the offence. Not taking cognizance of the
offence when complaint dated 19.03.2022 was already filed
indicates that investigation is incomplete. Therefore, complaint
dated 19.03.2022 cannot be treated as a complaint/charge sheet
under Section 173(2) of the Cr.P.C. The Supreme Court in
Ravindran (Supra) discussed how the Investigating Officers used
to file preliminary charge sheets to seek extension of remand
beyond the statutory period. It was to discourage such abuse of
process that a statutory limit of sixty days was incorporated in
Section 167(2) to complete the investigation and file the charge
sheet. In the present case, the Respondent cannot file a complaint
without completing the investigation and seek extension of remand
beyond the statutory period of sixty days. A complaint/charge sheet
filed without completing the investigation cannot be used to
circumvent the right of statutory bail under Section 167(2) of the
24. The Bombay High Court in Sharadchandra Vinayak
Dongre v. State of Maharashtra7 had to deal with a similar
situation. The State contended that charge sheet was already filed
but the investigation is yet to be completed. The Court therein drew
a distinction between completion of investigation and further
investigation. It held that it is only after the completion of
investigation and filing of charge sheet that further investigation
can be resorted to. In other words, Section 173(8) of the Cr.P.C.
comes into picture only after completion of investigation and filing
of the charge sheet under Section 173(2) of the Cr.P.C. Further, the
court held that by filing incomplete charge sheets, the State cannot
circumvent Section 167(2) of the Cr.P.C. The relevant paragraphs
23. Reference here may usefully be made to a decision
of the Supreme Court in Abhinandan Jha v. Dinesh Mitra,
AIR 1968 SC 117, which points out that the investigation
under the Code takes in several aspects and stages ending
ultimately with the formation of an opinion by the police
as to whether, as from the material covered and collected,
a case is made out to place the accused before the
Magistrate for trial and the submission of either a charge-
sheet or a final report is dependent on the nature of the
opinion so formed. The formation of the said opinion by
the police is the final step in the investigation evidenced
by the “police report” contemplated under section 173(2)
of the Code.
24. In my view, a plain reading of section 173 of the
Code shows that every investigation must be completed
without unnecessary delay and as soon as it is completed,
the Officer-in-charge of the Police Station shall forward a
report to the Magistrate in the form prescribed. Therefore,
there is no question of sending up of a “police report”
within the meaning of section 173, sub-section (2) of
Criminal Procedure Code until the investigation is
completed. Any report sent before the investigation is
completed will not be a police report within the meaning
of sub-section (2) of section 173 of the Criminal Procedure
Code read with section 2(r) of the Code and there is no
question of the Magistrate taking cognizance of the
offence within the meaning of section 190(1)(b) of the
Code on the basis of an incomplete charge-sheet. In the
present case, admittedly an incomplete charge-sheet has
been filed and it is specifically stated therein that the
investigation is not yet completed. The application,
Exhibit 2, clearly further recites that the investigation is
not completed and this fact is even admitted before me as
stated in the reply affidavit filed by the Investigating
Officer opposing the present Application. Consequently,
the incomplete charge-sheets cannot be treated as a “police
report” at all as contemplated under section 173(2) of the
Code to entitle the Magistrate to take cognizance of the
offences. The learned Counsel for the applicants is right in
contending that the definition of “police report” as given
in the Code cannot be enlarged under the guise of
interpretation and it is contended that when the meaning of
a statutory provision is plain and clear, the Court should
not be impelled by factors like practical difficulties and
inconvenience. The learned Counsel appears to be further
right when he canvassed that the expression “incomplete
charge-sheet” does not occur anywhere in the Code and
that forwarding of a “police report” after the completion of
the investigation is the requirement of sub-section (2) of
section 173 of the Code. Any report or statement of facts
in the form of an “incomplete charge-sheet” does not
become “police report” by merely giving a particular
25. The learned Counsel for the State contended
that the new provision added in sub-section (8) of
section 173 of the Code can be resorted to by the
Investigating Officer for collecting further evidence.
According to him, it tends to indicate that the
investigation is not shut but remains in suspended
animation till the police report is sent to the
Magistrate. As has already been pointed out, a police
report as defined in section 2(r) of the Code can only be
filed “as soon as the investigation is completed”. If it is
not complete; no such report can be filed. When no
report is forwarded as required by the Code, the
Magistrate cannot take cognizance. Thus, unless all
these steps are crossed, sub-section (8) cannot be
pressed in aid for collecting further evidence which
really can be called in aid if further evidence is
discovered after the filing of the charge-sheet or the
police report on the completion of the investigation.
26. As stated earlier, sub-section (2) of section 173
of the Code also speaks of taking cognizance of the
offence by a Magistrate on a police report. Thus,
without the police report as defined in section 2(r) of
the Code, the Magistrate is not empowered and is
incapacitated to take cognizance and unless cognizance
has been taken, sub-section (8) cannot be set in motion.
27. The question thus emerges naturally is, whether
the Magistrate can take cognizance on the admittedly
“incomplete charge-sheet” forwarded by the police.
The answer stubbornly and admittedly must be in the
negative, because the investigation is yet incomplete
and the “police report” yet remains to be filed. Thus,
the filing of the incomplete charge-sheet cannot
circumvent the provisions of sub-section (2) of section
173 of the Code and incomplete report or an
incomplete charge-sheet with whatsoever expression it
may be called does not meet the obligatory
requirements of law. If the view as contended by the
State is accepted, the provisions of section 167(2) or to
say section 468 of the Criminal Procedure Code can
always be circumvented by the prosecution and the
apparent legislative intents under those provisions
would not only be not effectuated but undoubtedly
stultified.
25. The Andhra Pradesh High Court in Akula Ravi Teja v.
State of A.P.8 dealt with a situation where a ‘preliminary charge
sheet’ was filed without completing the investigation. The Court
therein held that an incomplete charge sheet filed without
completing the investigation cannot be used to defeat the right of
statutory bail under Section 167(2) of the Cr.P.C. The relevant
19. Now the crucial question that arises for
determination is whether filing a preliminary charge-sheet
without completing the investigation would defeat the right
of the accused to claim default bail under proviso (a) to
Section 167(2) Cr.P.C. In this context, it is relevant to note
that the Parliament in its wisdom, considering the right of
the accused to speedy investigation, stipulated period of
time in proviso (a) to Section 167(2) Cr.P.C. stating that in
all offences which are punishable with death or life
imprisonment or with 10 years imprisonment, the
investigation is to be completed within 90 days and in other
offences, the investigation is to be completed within 60
days. The Code clearly envisaged that if the prosecuting
agency fails to complete the investigation within the said
stipulated period of time as contemplated under the Code,
the accused is entitled to claim default bail. The said right
conferred by the statute on the accused is an indefeasible
right and he is entitled to bail as a matter of right on
account of the default committed by the prosecuting agency
in completing the investigation within the time stipulated
by the statute.
20. It is significant to note that a plain reading of
proviso (a) to Section 167(2) Cr.P.C. makes it manifest that
what is required to claim for default bail under proviso (a)
to Section 167(2) Cr.P.C. is failure on the part of the
Investigating Agency to complete the investigation within
the stipulated period of time. In other words, it is the
default committed by the Investigating Agency to
complete the entire investigation within the stipulated
time that confers right on the accused to claim for
default bail. So, filing of charge-sheet is not the criteria
or the actual test to be applied to decide whether the
accused is entitled to default bail or not. It is relevant to
note that the charge-sheet after completion of
investigation will be filed to enable the Court to take
cognizance of the offence. So, the Court cannot take
cognizance of the offence on the basis of a preliminary
charge-sheet filed without completing the entire
investigation. Therefore, the crucial aspect that needs to
be ascertained to consider the claim of the accused for
default bail is whether the investigation is completed
within the stipulated time of 90 days or not. So, when
the Investigating Agency files only preliminary charge-
sheet within the said stipulated time keeping the
investigation pending or without completing the
investigation, it will not under any circumstances defeat
the right conferred on the accused to claim for default
bail. By mere filing a preliminary charge-sheet without
completing the entire investigation and filing a final and
full-fledged charge-sheet, the prosecuting agency cannot
vanquish the indefeasible statutory right of the accused
to claim for default bail.
21. The 3-Judge Bench of the Supreme Court in the
case of Rakesh Kumar Paul v. State of Assam2 held that
right to personal liberty under Article 21 of the Constitution
of India includes right to speedy investigation and
entitlement to “default bail” where statutory period of filing
charge-sheet has expired and accused has applied and is
willing to furnish bail.
22. A plain reading of Section 167 Cr.P.C. makes it
abundantly clear that it is not the intention of the legislation
that charge-sheet is to be filed within the stipulated period.
The intention of the legislation is that the investigation is to
be completed within the stipulated time. Nowhere in
Section 167 Cr.P.C. it is stated that the charge-sheet is to be
filed within the prescribed period of time. All that it is
stated in Section 167 Cr.P.C. is that the investigation is to
be completed within the said stipulated period of 90 days or
60 days, as the case may be. Therefore, the Court has to
see whether the investigation is completed or not while
considering the plea of the accused for grant of default
bail. Generally, charge-sheet will be filed only after
completion of the investigation. So, when the charge-
sheet is filed, it indicates that investigation is completed.
Therefore, it is in practice that when the Investigating
Agency files the charge-sheet that the Courts usually
presume that the investigation is completed. However, it
is to be noticed that at times, even when the
investigation is not fully completed that the police are in
the habit of filing preliminary charge-sheet or an
incomplete charge-sheet keeping some part of the
investigation pending as a clever contrivance and
subterfuge to prevent the accused from claiming default
bail by exercising his right conferred under the Code.
So, Courts must be on guard and should not fall in the
trap of such trickery and tactics of the investigating
agency when they only file preliminary charge-sheet
without fully completing the investigation. Therefore,
the real test to be applied to ascertain whether the
accused is entitled to default bail or not in a given case
is not to see whether the charge-sheet is filed or not. It
has to be ascertained whether the entire investigation is
completed or not within the stipulated period of time
and whether the said charge-sheet is filed after
completion of the entire investigation or not. A
preliminary charge-sheet filed without completing the
entire investigation cannot be allowed to serve as an
impediment to come in the way of exercising the
statutory right of the accused for default bail.
23. The very contents of the charge-sheet, which are
extracted above, clinchingly establishes that the
investigation is not completed and many crucial witnesses
are yet to be examined to prove the overt acts of the
accused in this crime and some other evidence as stated by
the investigating officer is still to be secured. Therefore, on
account of default committed by the prosecuting agency in
completing the investigation within the stipulated period of
time, the petitioner acquired an indefeasible right to claim
default bail under proviso (a) to Section 167(2) Cr.P.C.
24. In a petition filed under proviso (a) to Section
167(2) Cr.P.C. for grant of default bail, no discretion is
vested with the Magistrate/Court to deny bail to him. In the
judgment of the aforesaid 3-Judge Bench of the Apex
Court, it is clearly held that no discretion is vested with the
Court while granting default bail where accused satisfies
the prerequisite for grant thereof. The Apex Court in
another case Rajnikant JivanlalPatel v. Intelligence Officer,
Narcotic Control Bureau, New Delhi3 held as follows:
“The right to bail under Section 167(2) proviso (a)
thereto is absolute. It is a legislative command and not
Court's discretion. If the investigating agency fails to file
charge-sheet before the expiry of 90/60 days, as the case
may be, the accused in custody should be released on bail.
But at that stage, merits of the case are not to be examined.
Not at all. In fact, the Magistrate has no power to remand a
person beyond the stipulated period of 90/60 days.”
Therefore, the legal position is very clear that
irrespective of the gravity of the offence and the nature and
seriousness of the offence, the moment the accused claims
bail under proviso (a) to Section 167(2) Cr.P.C. on account
of the default committed by the Investigating Agency to
complete the investigation within the stipulated time, and
he is prepared to furnish bail, the Court has no other option
except to grant bail to him. The very nature of right which
is “indefeasible right” indicates that the said right cannot be
defeated or frustrated once accrued to the accused. Even
filing of preliminary charge-sheet cannot defeat the said
25. Therefore, in the considered opinion of the
Court, after analysing the law on the point, it would be
more in consonance with the legislative mandate to hold
that mere filing preliminary charge-sheet without
completing the investigation will not defeat the
indefeasible statutory right of the accused to claim for
default bail. In a way the right to claim bail by a
remanded accused touches the personal liberty of an
individual guaranteed under the Constitution of India.
Personal liberty is a valuable right of an individual and
it is one of the cherished objects of the Indian
Constitution. It can be deprived only in accordance with
law and in conformity with the provisions thereof, as
stipulated under Article 21 of the Constitution.
Therefore, when the law mandates that the Magistrate
could authorise detention of the accused in custody up
to a maximum period as indicated in the proviso to sub-
section (2) of Section 167 Cr.P.C. any further detention
beyond the period when, the investigation is not
completed and the final charge-sheet is not filed on
completion of the entire investigation by the
Investigating Agency would be a subterfuge and would
not be in accordance with law and in conformity with
the provisions of the Criminal Procedure Code.
Therefore, it could be violative of Article 21 of the
Constitution of India.
At the cost of repetition, this Court holds that the complaint dated
19.03.2022 was not a final complaint based on which cognizance
could have been taken. A complaint/report cannot be treated as
final report unless the investigation is completed, In the present
case, the investigation is admittedly not completed and the
statutory period of sixty days expired on 21.03.2022. Therefore, in
the absence of complete investigation and absence of filing a final
complaint, the Petitioner is entitled for statutory bail under Section
167(2) of the Cr.P.C.
26. It was sought to be contended on behalf of the
Respondent that the Petitioner was remanded not under Section
167 of the Cr.P.C. but under Section 309 of the Cr.P.C. The said
contention is ex facie misconceived. The Supreme Court in Dinesh
Dalmia v. CBI9 has held that Section 309 of the Cr.P.C. comes
into operation only after cognizance of the offence is taken. In the
present case, no cognizance is taken till date.
27. The Respondent relying on Y.S. Jagan Mohan Reddy v.
CBI10 and Ajay Kumar v. Directorate of Enforcement11
contended that economic offences are serious offences. It was
contended that the Petitioner is claiming bail under Section 167(2)
of the PMLA only to circumvent the strict rigors of bail under
Section 45 of the PMLA. The said contention cannot be accepted.
The investigative authority cannot rely on Section 45 of the PMLA
to deny statutory bail under Section 167(2) of the Cr.P.C. The
Supreme Court in Ashok Munilal Jain v. Directorate of
Enforcement12 held that an accused is entitled to statutory bail
under Section 167(2) of the Cr.P.C. even in PMLA proceedings.
The relevant paragraphs are extracted below:
5. We, thus, do not agree with the opinion of the High
Court that the provisions of Section 167(2) CrPC
would not be applicable to the proceedings under the
PMLA Act. In the present case, as no complaint was
filed even after the expiry of 60 days from the date
when the appellant was taken into custody, he was
entitled to statutory bail in view of the provisions
contained in Section 167(2) CrPC.
6. This appeal is, accordingly, allowed and as a result
thereof, the appellant shall be given the benefit of statutory
bail and be released forthwith subject to the conditions that
may be imposed by the trial court.
A perusal of the impugned order dated 08.04.2022 indicates that
the Designated Court has returned the application dated 31.03.2022
seeking extension of remand and the bail application dated
01.04.2022. According to this Court, the Designated Court has no
power to return the said applications. This Court in Kamma
Srinivas Rao (Supra) has held that it is incumbent on the
Designated Court to pass a reasoned order and not merely return
the applications. Neither the Cr.P.C. nor the PMLA contemplates
any provision which empowers the Designated Court to return
applications seeking remand or applications seeking bail. The
relevant paragraphs are extracted below:
47. A perusal of above orders clearly indicates that the
remand applications were returned. According to this
Court, the Designated Court cannot return a remand
application filed under Section 167(2) of Cr.P.C. It is
relevant to note that a Court performs a judicial function
while deciding an application for remand under Section
167(2) of the Cr.P.C. The Court while exercising the
judicial function under Section 167(2) of the Cr.P.C. is
bound to pass a judicial order by applying its mind. The
Court under Section 167 of the Cr.P.C. by passing a
judicial order has to, where there are adequate grounds for
proceeding with the investigation, remand the accused to
judicial custody or where no such further investigation is
required release him on bail on satisfying conditions as
prescribed.
49. It is also relevant to note that neither the Cr.P.C.
nor the Criminal Rules of Practice have any provisions
conferring the power on the Court to return an
application seeking remand under Section 167(2) of the
Cr.P.C. While the Code of Civil Procedure under
Order VII Rules 10 & 10A provides for return of
plaint, no such provision/procedure is provided under
the Cr.P.C.
28. In light of the aforesaid discussion and in view of the law
laid down by the Apex Court discussed supra, according to this
Court, the Petitioner herein is entitled for statutory bail under
Section 167(2) of the Cr.P.C.
i) The three Criminal Petitions are allowed.
ii) The orders dated 31.03.2022 and 13.04.2022 passed in
File No. ECIR/HYZO/14/2021 by the Metropolitan
Sessions Judge – cum – Special Court under PMLA
Act, 2002 at Hyderabad extending the remand of the
accused are hereby quashed.
iii) As the bail application dated 01.04.2022 was returned
on 08.04.2022, the petitioner is at liberty to file a fresh
bail application under Section 167(2) of Cr.P.C. before
the Metropolitan Sessions Judge – cum – Special Court
under PMLA Act, 2002 at Hyderabad. The said Court
is directed to consider the said application if it is
otherwise in order and pass orders in accordance with
law, within a period of one week from the date of filing
of such application.
iv) Consequently, miscellaneous petitions pending shall
stand closed.
Note; L.R.Copy to be marked.
|
In a recent case, the Telangana High Court ruled that accused under the Prevention of Money Laundering Act, 2002 is entitled to statutory bail under Section 167(2) of CrPC if the charge sheet is not submitted in terms of Section 173(2) of the Cr.P.C without completion of investigation. Justice K. Lakshman held that:
"At the cost of repetition, this Court holds that the complaint dated 19.03.2022 was not a final complaint based on which cognizance could have been taken. A complaint/report cannot be treated as final report unless the investigation is completed, In the present case, the investigation is admittedly not completed and the statutory period of sixty days expired on 21.03.2022. Therefore, in the absence of complete investigation and absence of filing a final complaint, the Petitioner is entitled for statutory bail under Section 167(2) of the Cr.P.C."
Brief Facts of the Case
The Petitioner is the Chairman and Managing Director of M/s Karvy Stock Broking Ltd. (KSBL) The Respondent authority had registered the offence of money laundering under the Prevention of Money Laundering Act, 2002 (PMLA) against KSBL. The allegations against KSBL and the Petitioner included diversion of large-scale clients' funds through shell companies which resulted in huge losses to the investors.
Various FIRs were registered against the Petitioner and he was arrested and produced before the Metropolitan Sessions Judge cum Special Court (Designated Court) on 20.01.2022 and on the same day the Petitioner was remanded to judicial custody. The Petitioner had been in jail since 20.01.2022. According to the Petitioner, the offences alleged against him are not punishable for a term not less than 10 years, death, life imprisonment. Therefore, he was entitled for statutory bail under Section 167(2) of CrPC as the investigation was not completed within 60 days.
According to the Petitioner, the period of 60 days expired on 21.03.2022. Therefore, he filed an application for default bail. But the said application was dismissed as the complaint/charge sheet was filed by the Respondent on 19.03.2022.
However, on 31.03.2022, another application under Section 167 was filed by the Respondent seeking extension of remand. The application was filed seeking further custody of the Petitioner to complete the investigation. The said application was allowed and the custody of the Petitioner was extended till 13.04.2022.
Subsequently, another application on 13.04.2022 was filed by Respondent seeking extension of remand. The remand was extended till 27.04.2022.
Contention of Petitioner
Mr. T. Niranjan Reddy, Semior counsel representing Mr. Avinash Desai on behalf of the Petitioner contended that a complaint in the nature of interim report was only filed on 19.03.2022 and no complaint/charge sheet was filed in terms of Section 173(2) of CrPC as the investigation was admittedly not completed. Therefore, in the absence of completion of investigation, the petitioner was entitled for statutory bail under Section 167(2) of CrPC.
Contention of Respondent
Mr. Anil Prasad Tiwari, Special Public Prosecutor for Directorate of Enforcement for the Respondent was that a complaint/charge sheet was already filed on 19.03.2022. Therefore, the statutory bail under Section 167(2) of CrPC cannot be claimed once the charge sheet was filed. The remand was extended under Section 309 of CrPC and the Respondent can seek custody of the petitioner to complete further investigation under Section 44(2) of the PMLA.
Issue
The issue was whether the Petitioner is entitled for statutory bail under Section 167(2) of the Cr.P.C.
Findings of the Court
Justice K. Lakshman relied on many decisions to observe that Section 167(2) of the Cr.P.C. obligates the investigative agencies to complete the investigation in a time bound manner.
In M. Ravindran v. Intelligence Officer, Directorate of Revenue Intelligence (2021), it was made clear by the Supreme Court that a time limit for completing investigation was incorporated in order to ensure that the accused did not languish in jail for the investigative authority's failure to complete the investigation.
"It was in this backdrop that Section 167(2) was enacted within the present day CrPC, providing for time-limits on the period of remand of the accused, proportionate to the seriousness of the offence committed, failing which the accused acquires the indefeasible right to bail. As is evident from the recommendations of the Law Commission mentioned supra, the intent of the legislature was to balance the need for sufficient time-limits to complete the investigation with the need to protect the civil liberties of the accused. Section 167(2) provides for a clear mandate that the investigative agency must collect the required evidence within the prescribed time period, failing which the accused can no longer be detained. This ensures that the investigating officers are compelled to act swiftly and efficiently without misusing the prospect of further remand. This also ensures that the court takes cognizance of the case without any undue delay from the date of giving information of the offence, so that society at large does not lose faith and develop cynicism towards the criminal justice system."
The Court relied on the Supreme Court decision in Satya NarainMusadi v. State of Bihar (1980) which discussed Section 173(2) of the Cr.P.C. to hold that a charge sheet can be filed only after the completion of investigation.
Thus, it was clear that a charge sheet can be filed only after the completion of investigation. Investigation is said to be completed if sufficient material is collected by the Investigating Officer based on which cognizance can be taken under Section 167 of the Cr.P.C.
In this case, if complaint dated 19.03.2022 was filed after completion of investigation, the Designated Court would have taken cognizance of the offence. Not taking cognizance of the offence when complaint dated 19.03.2022 was already filed indicates that investigation is incomplete. Therefore, complaint dated 19.03.2022 cannot be treated as a complaint/charge sheet under Section 173(2) of the Cr.P.C.
Furthermore, in a Bombay High Court decision in Sharadchandra Vinayak Dongre v. State of Maharashtra, 1991 it was held that a complaint/charge sheet filed without completing the investigation cannot be used to circumvent the right of statutory bail under Section 167(2) of the Cr.P.C.
As has already been pointed out, a police report as defined in section 2(r) of the Code can only be filed "as soon as the investigation is completed". If it is not complete; no such report can be filed. When no report is forwarded as required by the Code, the Magistrate cannot take cognizance…The question thus emerges naturally is, whether the Magistrate can take cognizance on the admittedly "incomplete charge-sheet" forwarded by the police. The answer stubbornly and admittedly must be in the negative, because the investigation is yet incomplete and the "police report" yet remains to be filed. Thus, the filing of the incomplete charge-sheet cannot circumvent the provisions of sub-section (2) of section 173 of the Code and incomplete report or an incomplete charge-sheet with whatsoever expression it may be called does not meet the obligatory requirements of law.
Justice K. Lakshman reiterated that the complaint dated 19.03.2022 was not a final complaint. Therefore, the Petitioner was entitled to statutory bail under Section 167(2). The Petitioner cannot be remanded under Section 309 of CrPC as it comes into operation only after cognizance of the offence was taken. Thus, the Criminal petition was allowed and it was held that the Petitioner was entitled for statutory bail under Section 167(2) of CrPC.
Case Title: C. Parthasarthy v. Director of Enforcement
|
The lis involved in these cases is connected to each other.
Therefore, they were heard together and are being disposed of with
the following common order.
2. Crl.P.No. 3786 of 2022 is filed seeking to quash the order
dated 08.04.2022 passed in Crl.M.P. (Sr). No. 3550 of 2022 in File
No. ECIR/HYZO/14/2021 by the Metropolitan Sessions Judge –
cum – Special Court Under PMLA Act, 2002 at Hyderabad.
Likewise, Crl.P.No. 4127 of 2022 and Crl.P.No. 4137 of 2022 are
filed to quash the orders dated 13.04.2022 and 31.03.2022 in File
No. ECIR/HYZO/14/2021 respectively. The petitioner is A.1 in the
said crime.
3. Heard Mr. T. Niranjan Reddy learned Senior Counsel
representing Mr. Avinash Desai learned counsel for the Petitioner
and Mr. Anil Prasad Tiwari, learned Spl. Public Prosecutor for
Directorate of Enforcement for the Respondent.
4. The Petitioner is the Chairman and Managing Director of
Respondent authority had registered ECIR/HYZO/14/2021 for the
offence of money laundering under the Prevention of Money
Laundering Act, 2002 (hereinafter ‘PMLA’) against KSBL. The
allegations against KSBL and the Petitioner include diversion of
large-scale clients funds through shell companies which resulted in
huge losses to the investors. It is further alleged that the clients’
money was misused by the shell companies created by KSBL and
the said money was transferred to the Petitioner and his family
5. Various FIRs were registered against the Petitioner and he
was arrested on 19.08.2021 in relation to Crime No. 100 of 2021
which is pending on the file of P.S. Central Crime Station
Hyderabad. The Petitioner in the said crime was remanded to
judicial custody. Pursuant to a P.T. warrant dated 10.01.2021, the
Petitioner was produced before the Metropolitan Sessions Judge –
cum – Special Court (hereinafter ‘Designated Court’) on
20.01.2021. On the same day, the Petitioner was remanded to
judicial custody.
6. The Petitioner has been in jail since 20.01.2022.
According to the Petitioner, the offences alleged against him are
not punishable for a term not less than ten years, death, life
imprisonment. Therefore, he is entitled for statutory bail under
Section 167(2) of the Cr.P.C. as the investigation is not completed
within sixty (60) days of his remand.
7. According to the Petitioner, the period of sixty days
expired on 21.03.2022. Therefore, on 21.03.2022, he filed an
application seeking default bail under Section 167 (2) of the
Cr.P.C. citing expiry of sixty days. The said application was
returned as infructuous on the ground that a charge sheet/complaint
was filed by the Respondent herein on 19.03.2022 which was
before the expiry of sixty days.
8. However, subsequently on 31.03.2022 another application
under Section 167 was filed by the Respondent herein seeking
extension of remand. According to the Petitioner, the application
was filed seeking further custody of the Petitioner to complete the
investigation. The said application was allowed and the custody of
the Petitioner was extended till 13.04.2022.
9. The Petitioner relying on the application dated 31.03.2022
filed by the Respondent which stated that investigation is yet to be
completed, filed another default bail application dated 01.04.2022
under Section 167(2) of the Cr.P.C. In the said bail application, the
Petitioner contended that no complaint/charge sheet was filed in
terms of Section 173(2) of the Cr.P.C. as investigation is yet to be
completed. The said bail application was returned as infructuous on
08.04.2022. The said order also stated that the application dated
31.03.2022 seeking extension of remand was returned as charge
sheet was already filed on 19.03.2022.
10. Subsequently, another application dated 13.04.2022
under Section 167 of the Cr.P.C. was filed by the Respondent
herein seeking extension of remand. The said application was
allowed and the remand was extended till 27.04.2022.
11. The Petitioner in the present criminal petitions has
challenged the order dated 31.03.2022 in ECIR/HYZO/14/2021, in
Crl.P.No. 4137 of 2022, order dated 13.04.2022 in
ECIR/HYZO/14/2021, in Crl.P.No. 4127 of 2022 and order dated
08.04.2022 in Crl.M.P.(sr) No.3350 of 2022 in
ECIR/HYZO/14/2021, in Crl.P.No. 3786 of 2022, inter alia, on the
ground that he is entitled for statutory bail under Section 167(2) of
i. A complaint in the nature of interim report was filed on
19.03.2022. No complaint/charge sheet in terms of
Section 173(2) of the Cr.P.C. is filed as the investigation
admittedly is not completed. Therefore, in the absence of
completion of investigation, the Petitioner is entitled for
statutory bail under Section 167(2) of the Cr.P.C. after a
period of sixty days which accrued on 21.03.2022.
ii. The complaint dated 19.03.2022 was filed only to deny
statutory bail to the Petitioner.
iii. The object of Section 167(2) of the Cr.P.C. is to complete
the investigation within the prescribed time. Failure of the
prosecution to complete investigation and file charge
sheet within prescribed time will give the accused a right
of statutory bail. Reliance was placed on M. Ravindran
v. Intelligence Officer, Directorate of Revenue
iv. The Designated Court has no power to return the bail
application filed under Section 167(2) of the Cr.P.C.
Reliance was placed on Directorate of Enforcement v.
v. The Petitioner was not produced before the Designated
Court when the remand was extended.
i. A complaint/charge sheet was already filed on
19.03.2022. Therefore, statutory bail under Section
167(2) of the Cr.P.C cannot be claimed once the charge
sheet is filed. Reliance was placed on Serious Fraud
Investigation Office v. Rahul Modi3.
ii. Remand was extended under Section 309 of the Cr.P.C.
and the Respondent can seek custody of the Petitioner to
complete further investigation under Section 44(2) of the
Order dated 15.02.2022 passed in Criminal Petition Nos. 9825, 9846 and 10021 of 2021.
iii. The Petitioner is trying to claim statutory bail to
overcome the requirement of bail under Section 45 of the
iv. The Petitioner did not oppose remand which was extended
under Section 309 of the Cr.P.C. Reliance was placed
Sunil Kumar Sharma v. State4.
14. In the present case, the issue before the Court is whether
the Petitioner is entitled for statutory bail under Section 167(2) of
the Cr.P.C. For the sake of convenience, the chronology of dates is
20.01.2022 Petitioner was remanded to judicial custody
and has been in jail since then.
19.03.2022 Alleged Complaint/charge sheet was filed by
21.03.2022 The date on which statutory bail accrues
after the expiry of sixty days under Section
31.03.2022 The remand of the Petitioner was extended
investigation is pending.
01.04.2022 Application seeking statutory bail under
Section 167(2) is filed.
08.04.2022 The bail application dated 01.04.2022 is
13.04.2022 The remand of the Petitioner is further
Before deciding the issue at hand, it is apposite to discuss the
object and scope of Section 167(2) of the Cr.P.C.
(2) The Magistrate to whom an accused person is forwarded under this
section may, whether he has or has not jurisdiction to try the case, from
time to time, authorise the detention of the accused in such custody as
such Magistrate thinks fit, for a term not exceeding fifteen days in the
whole; and if he has no jurisdiction to try the case or commit it for trial,
and considers further detention unnecessary, he may order the accused to
be forwarded to a Magistrate having such jurisdiction:
(a) the Magistrate may authorise the detention of the accused person,
otherwise than in the custody of the police, beyond the period of fifteen
days; if he is satisfied that adequate grounds exist for doing so, but no
Magistrate shall authorise the detention of the accused person in custody
under this paragraph for a total period exceeding,-
(i) ninety days, where the investigation relates to an offence punishable
with death, imprisonment for life or imprisonment for a term of not less
(ii) sixty days, where the investigation relates to any other offence, and,
on the expiry of the said period of ninety days, or sixty days, as the case
may be, the accused person shall be released on bail if he is prepared to
and does furnish bail, and every person released on bail under this sub-
section shall be deemed to be so released under the provisions of
Chapter XXXIII for the purposes of that Chapter.
(b) no Magistrate shall authorise detention in any custody under this
section unless the accused is produced before him;
(c) no Magistrate of the second class, not specially empowered in this
behalf by the High Court, shall authorise detention in the custody of the
police.
15. Section 167(2) of the Cr.P.C. obligates the investigative
agencies to complete the investigation in a time bound manner. The
object behind incorporating a time limit to complete investigation
was explained by a full bench of the Supreme Court inRavindran
(Supra). The relevant paragraphs are extracted below:
17. Before we proceed to expand upon the parameters of
the right to default bail under Section 167(2) as interpreted by
various decisions of this Court, we find it pertinent to note the
observations made by this Court in Uday Mohanlal
Acharya [Uday Mohanlal Acharya v. State of Maharashtra,
(2001) 5 SCC 453 : 2001 SCC (Cri) 760] on the fundamental
right to personal liberty of the person and the effect of
deprivation of the same as follows: (SCC p. 472, para 13)
“13. … Personal liberty is one of the cherished objects of
the Indian Constitution and deprivation of the same can only be
in accordance with law and in conformity with the provisions
thereof, as stipulated under Article 21 of the Constitution.
When the law provides that the Magistrate could authorise the
detention of the accused in custody up to a maximum period as
indicated in the proviso to sub-section (2) of Section 167, any
further detention beyond the period without filing of a challan
by the investigating agency would be a subterfuge and would
not be in accordance with law and in conformity with the
provisions of the Criminal Procedure Code, and as such, could
be violative of Article 21 of the Constitution.”
17.1. Article 21 of the Constitution of India provides that
“no person shall be deprived of his life or personal liberty
except according to procedure established by law”. It has been
settled by a Constitution Bench of this Court in Maneka
Gandhi v. Union of India [Maneka Gandhi v. Union of India,
(1978) 1 SCC 248] , that such a procedure cannot be arbitrary,
unfair or unreasonable. The history of the enactment of Section
167(2) CrPC and the safeguard of “default bail” contained in
the proviso thereto is intrinsically linked to Article 21 and is
nothing but a legislative exposition of the constitutional
safeguard that no person shall be detained except in accordance
with rule of law.
17.2. Under Section 167 of the Code of Criminal Procedure,
1898 (“the 1898 Code”) which was in force prior to the
enactment of the CrPC, the maximum period for which an
accused could be remanded to custody, either police or judicial,
was 15 days. However, since it was often unworkable to
conclude complicated investigations within 15 days, a practice
arose wherein investigating officers would file “preliminary
charge-sheets” after the expiry of the remand period. The State
would then request the Magistrate to postpone commencement
of the trial and authorise further remand of the accused under
Section 344 of the 1898 Code till the time the investigation was
completed and the final charge-sheet was filed. The Law
Commission of India in Report No. 14 on Reforms of the
Judicial Administration (Vol. II, 1948, pp. 758-760) pointed
out that in many cases the accused were languishing for several
months in custody without any final report being filed before
the courts. It was also pointed out that there was conflict in
judicial opinion as to whether the Magistrate was bound to
release the accused if the police report was not filed within 15
17.3. Hence the Law Commission in Report No. 14
recommended the need for an appropriate provision specifically
providing for continued remand after the expiry of 15 days, in a
manner that “while meeting the needs of a full and proper
investigation in cases of serious crime, will still safeguard the
liberty of the person of the individual”. Further, that the
legislature should prescribe a maximum time period beyond
which no accused could be detained without filing of the police
report before the Magistrate. It was pointed out that in England,
even a person accused of grave offences such as treason could
not be indefinitely detained in prison till commencement of the
17.4. The suggestion made in Report No. 14 was
reiterated by the Law Commission in Report No. 41 on The
Code of Criminal Procedure, 1898 (Vol. I, 1969, pp. 76-77).
The Law Commission re-emphasised the need to guard
against the misuse of Section 344 of the 1898 Code by filing
“preliminary reports” for remanding the accused beyond
the statutory period prescribed under Section 167. It was
pointed out that this could lead to serious abuse wherein
“the arrested person can in this manner be kept in custody
indefinitely while the investigation can go on in a leisurely
manner”. Hence the Commission recommended fixing of a
maximum time-limit of 60 days for remand. The
Commission considered the reservation expressed earlier in
Report No. 37 that such an extension may result in the 60-
day period becoming a matter of routine. However, faith
was expressed that proper supervision by the superior
courts would help circumvent the same.
17.6. It was in this backdrop that Section 167(2) was
enacted within the present day CrPC, providing for time-
limits on the period of remand of the accused,
proportionate to the seriousness of the offence committed,
failing which the accused acquires the indefeasible right to
bail. As is evident from the recommendations of the Law
Commission mentioned supra, the intent of the legislature
was to balance the need for sufficient time-limits to
complete the investigation with the need to protect the civil
liberties of the accused. Section 167(2) provides for a clear
mandate that the investigative agency must collect the
required evidence within the prescribed time period, failing
which the accused can no longer be detained. This ensures
that the investigating officers are compelled to act swiftly
and efficiently without misusing the prospect of further
remand. This also ensures that the court takes cognizance
of the case without any undue delay from the date of giving
information of the offence, so that society at large does not
lose faith and develop cynicism towards the criminal justice
17.9. Additionally, it is well-settled that in case of any
ambiguity in the construction of a penal statute, the courts
must favour the interpretation which leans towards
protecting the rights of the accused, given the ubiquitous
power disparity between the individual accused and the
State machinery. This is applicable not only in the case of
substantive penal statutes but also in the case of procedures
providing for the curtailment of the liberty of the accused.
17.10. With respect to the CrPC particularly, the Statement
of Objects and Reasons (supra) is an important aid of
construction. Section 167(2) has to be interpreted keeping in
mind the threefold objectives expressed by the legislature,
namely, ensuring a fair trial, expeditious investigation and trial,
and setting down a rationalised procedure that protects the
interests of indigent sections of society. These objects are
nothing but subsets of the overarching fundamental right
guaranteed under Article 21.
16. From the above decision, it is clear that a time limit for
completing investigation was incorporated in order to ensure that
the accused does not languish in jail for the investigative
authority’s failure to complete investigation. It was held that the
right to statutory bail accrues on a person if the charge sheet is not
filed within the prescribed period of sixty days. The said right to
bail is indefeasible and is interlinked with personal liberty as
envisaged under Article 21 of the Constitution of India.
17. This Court would like to clarify as to when a person is
entitled for statutory bail under Section 167(2) of Cr.P.C. It was
contended on behalf of the Petitioner that Section 167(2) of Cr.P.C.
comes into operation if no cognizance is taken within the
prescribed period. The said contention cannot be accepted. The test
to determine whether a person is entitled for bail under Section
167(2) of Cr.P.C. is not the date of taking cognizance but the date
of filing charge sheet. In other words, the right of statutory bail
ceases to exist the moment a charge sheet is filed within the
prescribed period of sixty or ninety days.
18. The Supreme Court in Rahul Modi (Supra) clarifying
11. It is clear from the judgment of this Court
in Bhikamchand Jain (supra) that filing of a charge-sheet
is sufficient compliance with the provisions of Section
167, CrPC and that an accused cannot demand release on
default bail under Section 167(2) on the ground that
cognizance has not been taken before the expiry of 60
days. The accused continues to be in the custody of the
Magistrate till such time cognizance is taken by the court
trying the offence, which assumes custody of the accused
for the purpose of remand after cognizance is taken. The
conclusion of the High Court that the accused cannot be
remanded beyond the period of 60 days under Section 167
and that further remand could only be at the post-
cognizance stage, is not correct in view of the judgment of
this Court in Bhikamchand Jain (supra).
16. A close scrutiny of the judgments in Sanjay
Dutt (supra), Madar Sheikh (supra) and M. Ravindran
(supra) would show that there is nothing contrary to what
has been decided in Bhikamchand Jain (supra). In all the
above judgments which are relied upon by either side, this
Court had categorically laid down that the indefeasible
right of an accused to seek statutory bail under Section
167(2) of CrPC arises only if the charge-sheet has not
been filed before the expiry of the statutory period.
Reference to cognizance in Madar Sheikh (supra) is in
view of the fact situation where the application was filed
after the charge-sheet was submitted and cognizance had
been taken by the trial court. Such reference cannot be
construed as this Court introducing an additional
requirement of cognizance having to be taken within the
period prescribed under proviso (a) to Section 167(2),
CrPC, failing which the accused would be entitled to
default bail, even after filing of the charge-sheet within the
statutory period. It is not necessary to repeat that in
both Madar Sheikh (supra) and M. Ravindran (supra), this
Court expressed its view that non-filing of the charge-
sheet within the statutory period is the ground for availing
the indefeasible right to claim bail under Section 167(2),
CrPC. The conundrum relating to the custody of the
accused after the expiry of 60 days has also been dealt
with by this Court in Bhikamchand Jain (supra). It was
made clear that the accused remains in custody of the
Magistrate till cognizance is taken by the relevant court.
As the issue that arises for consideration in this case is
squarely covered by the judgment in Bhikamchand
Jain (supra), the order passed by the High Court on
31.05.2019 is hereby set aside.
To decide whether the Petitioner is entitled to statutory bail, this
Court has to decide whether a charge sheet/complaintdated
19.03.2022 was filed or not. It is relevant to note that, in the
present case the proceedings are initiated under the PMLA. Section
44 of the PMLA provides that the offences under PMLA are triable
by Special Courts. The Special Court can take cognizance of an
offence only based on a complaint which is filed by the authorised
authority under Section 44(1)(b) of the PMLA.
19. The complaint filed under Section 44(1)(b) of the PMLA
is similar to a charge sheet/ final report filed under Section 173(2)
of Cr.P.C. In other words, similar to a charge sheet under Section
173(2) of Cr.P.C., a complaint under Section 44(1)(b) of the
PMLA is filed after completion of investigation, so that the Special
Court can take cognizance under Section 167 of the Cr.P.C. It is
relevant to note that the filing of the complaint and subsequent
cognizance under PMLA is governed by the provisions of the
Cr.P.C. in view of Section 65 of the Cr.P.C.
20. In the present case, the Respondent contended that a
complaint under Section 44(1)(b) of the PMLA was already filed
on 19.03.2022. Therefore, the Petitioner is not entitled for statutory
bail under Section 167(2) of the Cr.P.C. This Court cannot accept
the contention of the Respondent as the investigation was not
completed when the complaint dated 19.03.2022 was filed.
21. The Supreme Court in Satya NarainMusadi v. State of
Bihar5 discussing Section 173(2) of the Cr.P.C. has held that a
charge sheet can be filed only after the completion of investigation.
The relevant paragraph is extracted below:
9. Section 173(2)(1) provides that on completion of the
investigation the police officer investigating into a
cognizable offence shall submit a report in the form
prescribed by the State Government and stating therein
(a) the names of the parties; (b) the nature of the
information; (c) the names of the persons who appear to be
acquainted with the circumstances of the case; (d) whether
any offence appears to have been committed and, if so, by
whom (e) whether the accused has been arrested; (f)
whether he has been released on his bond and, if so,
whether with or without sureties; and (g) whether he has
been forwarded in custody under Section 170. Sub-section
(5) of Section 173 makes it obligatory upon the police
officer to forward along with the report all documents or
relevant extracts thereof on which the prosecution
proposes to rely and the statements recorded under Section
161 of all the persons whom the prosecution proposes to
examine as witnesses at the trial.
Similarly, the Supreme Court in Manu Sharma v. State (NCT of
Delhi)6 has held that the object behind Section 173 of the Cr.P.C.
is to complete the investigation and file the charge sheet. The idea
is to ensure that cognizance is taken without any delay. The
relevant paragraph is extracted below:
206. Section 173 commands the investigating agency to
complete the investigation expeditiously without
unnecessary delay and when such an investigation is
completed, the officer in charge of the police station
shall forward to a Magistrate empowered to take
cognizance of offence on a police report the details in
the form as may be prescribed by the State
Government and provide the information required
under this section.
22. From the above decisions, it is clear that a charge sheet
can be filed only after the completion of investigation.
Investigation is said to be completed if sufficient material is
collected by the Investigating Officer based on which cognizance
can be taken under Section 167 of the Cr.P.C. It was contended by
the Respondent that the complaint dated 19.03.2022 is a charge
sheet and only further investigation is being carried out which is
permissible under Section 44(1)(d)(ii). The said contention cannot
be accepted.
23. The Designated Court has extended the remand of the
accused on 31.03.2022 and subsequently on 13.04.2022 under
Section 167(2) of the Cr.P.C. on the ground that investigation is
pending. This clearly indicates that the complaint dated 19.03.2022
was filed without completing the investigation. Therefore, the
complaint dated 19.03.2022 is an incomplete complaint/charge
sheet. Further, if complaint dated 19.03.2022 was filed after
completion of investigation, the Designated Court would have
taken cognizance of the offence. Not taking cognizance of the
offence when complaint dated 19.03.2022 was already filed
indicates that investigation is incomplete. Therefore, complaint
dated 19.03.2022 cannot be treated as a complaint/charge sheet
under Section 173(2) of the Cr.P.C. The Supreme Court in
Ravindran (Supra) discussed how the Investigating Officers used
to file preliminary charge sheets to seek extension of remand
beyond the statutory period. It was to discourage such abuse of
process that a statutory limit of sixty days was incorporated in
Section 167(2) to complete the investigation and file the charge
sheet. In the present case, the Respondent cannot file a complaint
without completing the investigation and seek extension of remand
beyond the statutory period of sixty days. A complaint/charge sheet
filed without completing the investigation cannot be used to
circumvent the right of statutory bail under Section 167(2) of the
24. The Bombay High Court in Sharadchandra Vinayak
Dongre v. State of Maharashtra7 had to deal with a similar
situation. The State contended that charge sheet was already filed
but the investigation is yet to be completed. The Court therein drew
a distinction between completion of investigation and further
investigation. It held that it is only after the completion of
investigation and filing of charge sheet that further investigation
can be resorted to. In other words, Section 173(8) of the Cr.P.C.
comes into picture only after completion of investigation and filing
of the charge sheet under Section 173(2) of the Cr.P.C. Further, the
court held that by filing incomplete charge sheets, the State cannot
circumvent Section 167(2) of the Cr.P.C. The relevant paragraphs
23. Reference here may usefully be made to a decision
of the Supreme Court in Abhinandan Jha v. Dinesh Mitra,
AIR 1968 SC 117, which points out that the investigation
under the Code takes in several aspects and stages ending
ultimately with the formation of an opinion by the police
as to whether, as from the material covered and collected,
a case is made out to place the accused before the
Magistrate for trial and the submission of either a charge-
sheet or a final report is dependent on the nature of the
opinion so formed. The formation of the said opinion by
the police is the final step in the investigation evidenced
by the “police report” contemplated under section 173(2)
of the Code.
24. In my view, a plain reading of section 173 of the
Code shows that every investigation must be completed
without unnecessary delay and as soon as it is completed,
the Officer-in-charge of the Police Station shall forward a
report to the Magistrate in the form prescribed. Therefore,
there is no question of sending up of a “police report”
within the meaning of section 173, sub-section (2) of
Criminal Procedure Code until the investigation is
completed. Any report sent before the investigation is
completed will not be a police report within the meaning
of sub-section (2) of section 173 of the Criminal Procedure
Code read with section 2(r) of the Code and there is no
question of the Magistrate taking cognizance of the
offence within the meaning of section 190(1)(b) of the
Code on the basis of an incomplete charge-sheet. In the
present case, admittedly an incomplete charge-sheet has
been filed and it is specifically stated therein that the
investigation is not yet completed. The application,
Exhibit 2, clearly further recites that the investigation is
not completed and this fact is even admitted before me as
stated in the reply affidavit filed by the Investigating
Officer opposing the present Application. Consequently,
the incomplete charge-sheets cannot be treated as a “police
report” at all as contemplated under section 173(2) of the
Code to entitle the Magistrate to take cognizance of the
offences. The learned Counsel for the applicants is right in
contending that the definition of “police report” as given
in the Code cannot be enlarged under the guise of
interpretation and it is contended that when the meaning of
a statutory provision is plain and clear, the Court should
not be impelled by factors like practical difficulties and
inconvenience. The learned Counsel appears to be further
right when he canvassed that the expression “incomplete
charge-sheet” does not occur anywhere in the Code and
that forwarding of a “police report” after the completion of
the investigation is the requirement of sub-section (2) of
section 173 of the Code. Any report or statement of facts
in the form of an “incomplete charge-sheet” does not
become “police report” by merely giving a particular
25. The learned Counsel for the State contended
that the new provision added in sub-section (8) of
section 173 of the Code can be resorted to by the
Investigating Officer for collecting further evidence.
According to him, it tends to indicate that the
investigation is not shut but remains in suspended
animation till the police report is sent to the
Magistrate. As has already been pointed out, a police
report as defined in section 2(r) of the Code can only be
filed “as soon as the investigation is completed”. If it is
not complete; no such report can be filed. When no
report is forwarded as required by the Code, the
Magistrate cannot take cognizance. Thus, unless all
these steps are crossed, sub-section (8) cannot be
pressed in aid for collecting further evidence which
really can be called in aid if further evidence is
discovered after the filing of the charge-sheet or the
police report on the completion of the investigation.
26. As stated earlier, sub-section (2) of section 173
of the Code also speaks of taking cognizance of the
offence by a Magistrate on a police report. Thus,
without the police report as defined in section 2(r) of
the Code, the Magistrate is not empowered and is
incapacitated to take cognizance and unless cognizance
has been taken, sub-section (8) cannot be set in motion.
27. The question thus emerges naturally is, whether
the Magistrate can take cognizance on the admittedly
“incomplete charge-sheet” forwarded by the police.
The answer stubbornly and admittedly must be in the
negative, because the investigation is yet incomplete
and the “police report” yet remains to be filed. Thus,
the filing of the incomplete charge-sheet cannot
circumvent the provisions of sub-section (2) of section
173 of the Code and incomplete report or an
incomplete charge-sheet with whatsoever expression it
may be called does not meet the obligatory
requirements of law. If the view as contended by the
State is accepted, the provisions of section 167(2) or to
say section 468 of the Criminal Procedure Code can
always be circumvented by the prosecution and the
apparent legislative intents under those provisions
would not only be not effectuated but undoubtedly
stultified.
25. The Andhra Pradesh High Court in Akula Ravi Teja v.
State of A.P.8 dealt with a situation where a ‘preliminary charge
sheet’ was filed without completing the investigation. The Court
therein held that an incomplete charge sheet filed without
completing the investigation cannot be used to defeat the right of
statutory bail under Section 167(2) of the Cr.P.C. The relevant
19. Now the crucial question that arises for
determination is whether filing a preliminary charge-sheet
without completing the investigation would defeat the right
of the accused to claim default bail under proviso (a) to
Section 167(2) Cr.P.C. In this context, it is relevant to note
that the Parliament in its wisdom, considering the right of
the accused to speedy investigation, stipulated period of
time in proviso (a) to Section 167(2) Cr.P.C. stating that in
all offences which are punishable with death or life
imprisonment or with 10 years imprisonment, the
investigation is to be completed within 90 days and in other
offences, the investigation is to be completed within 60
days. The Code clearly envisaged that if the prosecuting
agency fails to complete the investigation within the said
stipulated period of time as contemplated under the Code,
the accused is entitled to claim default bail. The said right
conferred by the statute on the accused is an indefeasible
right and he is entitled to bail as a matter of right on
account of the default committed by the prosecuting agency
in completing the investigation within the time stipulated
by the statute.
20. It is significant to note that a plain reading of
proviso (a) to Section 167(2) Cr.P.C. makes it manifest that
what is required to claim for default bail under proviso (a)
to Section 167(2) Cr.P.C. is failure on the part of the
Investigating Agency to complete the investigation within
the stipulated period of time. In other words, it is the
default committed by the Investigating Agency to
complete the entire investigation within the stipulated
time that confers right on the accused to claim for
default bail. So, filing of charge-sheet is not the criteria
or the actual test to be applied to decide whether the
accused is entitled to default bail or not. It is relevant to
note that the charge-sheet after completion of
investigation will be filed to enable the Court to take
cognizance of the offence. So, the Court cannot take
cognizance of the offence on the basis of a preliminary
charge-sheet filed without completing the entire
investigation. Therefore, the crucial aspect that needs to
be ascertained to consider the claim of the accused for
default bail is whether the investigation is completed
within the stipulated time of 90 days or not. So, when
the Investigating Agency files only preliminary charge-
sheet within the said stipulated time keeping the
investigation pending or without completing the
investigation, it will not under any circumstances defeat
the right conferred on the accused to claim for default
bail. By mere filing a preliminary charge-sheet without
completing the entire investigation and filing a final and
full-fledged charge-sheet, the prosecuting agency cannot
vanquish the indefeasible statutory right of the accused
to claim for default bail.
21. The 3-Judge Bench of the Supreme Court in the
case of Rakesh Kumar Paul v. State of Assam2 held that
right to personal liberty under Article 21 of the Constitution
of India includes right to speedy investigation and
entitlement to “default bail” where statutory period of filing
charge-sheet has expired and accused has applied and is
willing to furnish bail.
22. A plain reading of Section 167 Cr.P.C. makes it
abundantly clear that it is not the intention of the legislation
that charge-sheet is to be filed within the stipulated period.
The intention of the legislation is that the investigation is to
be completed within the stipulated time. Nowhere in
Section 167 Cr.P.C. it is stated that the charge-sheet is to be
filed within the prescribed period of time. All that it is
stated in Section 167 Cr.P.C. is that the investigation is to
be completed within the said stipulated period of 90 days or
60 days, as the case may be. Therefore, the Court has to
see whether the investigation is completed or not while
considering the plea of the accused for grant of default
bail. Generally, charge-sheet will be filed only after
completion of the investigation. So, when the charge-
sheet is filed, it indicates that investigation is completed.
Therefore, it is in practice that when the Investigating
Agency files the charge-sheet that the Courts usually
presume that the investigation is completed. However, it
is to be noticed that at times, even when the
investigation is not fully completed that the police are in
the habit of filing preliminary charge-sheet or an
incomplete charge-sheet keeping some part of the
investigation pending as a clever contrivance and
subterfuge to prevent the accused from claiming default
bail by exercising his right conferred under the Code.
So, Courts must be on guard and should not fall in the
trap of such trickery and tactics of the investigating
agency when they only file preliminary charge-sheet
without fully completing the investigation. Therefore,
the real test to be applied to ascertain whether the
accused is entitled to default bail or not in a given case
is not to see whether the charge-sheet is filed or not. It
has to be ascertained whether the entire investigation is
completed or not within the stipulated period of time
and whether the said charge-sheet is filed after
completion of the entire investigation or not. A
preliminary charge-sheet filed without completing the
entire investigation cannot be allowed to serve as an
impediment to come in the way of exercising the
statutory right of the accused for default bail.
23. The very contents of the charge-sheet, which are
extracted above, clinchingly establishes that the
investigation is not completed and many crucial witnesses
are yet to be examined to prove the overt acts of the
accused in this crime and some other evidence as stated by
the investigating officer is still to be secured. Therefore, on
account of default committed by the prosecuting agency in
completing the investigation within the stipulated period of
time, the petitioner acquired an indefeasible right to claim
default bail under proviso (a) to Section 167(2) Cr.P.C.
24. In a petition filed under proviso (a) to Section
167(2) Cr.P.C. for grant of default bail, no discretion is
vested with the Magistrate/Court to deny bail to him. In the
judgment of the aforesaid 3-Judge Bench of the Apex
Court, it is clearly held that no discretion is vested with the
Court while granting default bail where accused satisfies
the prerequisite for grant thereof. The Apex Court in
another case Rajnikant JivanlalPatel v. Intelligence Officer,
Narcotic Control Bureau, New Delhi3 held as follows:
“The right to bail under Section 167(2) proviso (a)
thereto is absolute. It is a legislative command and not
Court's discretion. If the investigating agency fails to file
charge-sheet before the expiry of 90/60 days, as the case
may be, the accused in custody should be released on bail.
But at that stage, merits of the case are not to be examined.
Not at all. In fact, the Magistrate has no power to remand a
person beyond the stipulated period of 90/60 days.”
Therefore, the legal position is very clear that
irrespective of the gravity of the offence and the nature and
seriousness of the offence, the moment the accused claims
bail under proviso (a) to Section 167(2) Cr.P.C. on account
of the default committed by the Investigating Agency to
complete the investigation within the stipulated time, and
he is prepared to furnish bail, the Court has no other option
except to grant bail to him. The very nature of right which
is “indefeasible right” indicates that the said right cannot be
defeated or frustrated once accrued to the accused. Even
filing of preliminary charge-sheet cannot defeat the said
25. Therefore, in the considered opinion of the
Court, after analysing the law on the point, it would be
more in consonance with the legislative mandate to hold
that mere filing preliminary charge-sheet without
completing the investigation will not defeat the
indefeasible statutory right of the accused to claim for
default bail. In a way the right to claim bail by a
remanded accused touches the personal liberty of an
individual guaranteed under the Constitution of India.
Personal liberty is a valuable right of an individual and
it is one of the cherished objects of the Indian
Constitution. It can be deprived only in accordance with
law and in conformity with the provisions thereof, as
stipulated under Article 21 of the Constitution.
Therefore, when the law mandates that the Magistrate
could authorise detention of the accused in custody up
to a maximum period as indicated in the proviso to sub-
section (2) of Section 167 Cr.P.C. any further detention
beyond the period when, the investigation is not
completed and the final charge-sheet is not filed on
completion of the entire investigation by the
Investigating Agency would be a subterfuge and would
not be in accordance with law and in conformity with
the provisions of the Criminal Procedure Code.
Therefore, it could be violative of Article 21 of the
Constitution of India.
At the cost of repetition, this Court holds that the complaint dated
19.03.2022 was not a final complaint based on which cognizance
could have been taken. A complaint/report cannot be treated as
final report unless the investigation is completed, In the present
case, the investigation is admittedly not completed and the
statutory period of sixty days expired on 21.03.2022. Therefore, in
the absence of complete investigation and absence of filing a final
complaint, the Petitioner is entitled for statutory bail under Section
167(2) of the Cr.P.C.
26. It was sought to be contended on behalf of the
Respondent that the Petitioner was remanded not under Section
167 of the Cr.P.C. but under Section 309 of the Cr.P.C. The said
contention is ex facie misconceived. The Supreme Court in Dinesh
Dalmia v. CBI9 has held that Section 309 of the Cr.P.C. comes
into operation only after cognizance of the offence is taken. In the
present case, no cognizance is taken till date.
27. The Respondent relying on Y.S. Jagan Mohan Reddy v.
CBI10 and Ajay Kumar v. Directorate of Enforcement11
contended that economic offences are serious offences. It was
contended that the Petitioner is claiming bail under Section 167(2)
of the PMLA only to circumvent the strict rigors of bail under
Section 45 of the PMLA. The said contention cannot be accepted.
The investigative authority cannot rely on Section 45 of the PMLA
to deny statutory bail under Section 167(2) of the Cr.P.C. The
Supreme Court in Ashok Munilal Jain v. Directorate of
Enforcement12 held that an accused is entitled to statutory bail
under Section 167(2) of the Cr.P.C. even in PMLA proceedings.
The relevant paragraphs are extracted below:
5. We, thus, do not agree with the opinion of the High
Court that the provisions of Section 167(2) CrPC
would not be applicable to the proceedings under the
PMLA Act. In the present case, as no complaint was
filed even after the expiry of 60 days from the date
when the appellant was taken into custody, he was
entitled to statutory bail in view of the provisions
contained in Section 167(2) CrPC.
6. This appeal is, accordingly, allowed and as a result
thereof, the appellant shall be given the benefit of statutory
bail and be released forthwith subject to the conditions that
may be imposed by the trial court.
A perusal of the impugned order dated 08.04.2022 indicates that
the Designated Court has returned the application dated 31.03.2022
seeking extension of remand and the bail application dated
01.04.2022. According to this Court, the Designated Court has no
power to return the said applications. This Court in Kamma
Srinivas Rao (Supra) has held that it is incumbent on the
Designated Court to pass a reasoned order and not merely return
the applications. Neither the Cr.P.C. nor the PMLA contemplates
any provision which empowers the Designated Court to return
applications seeking remand or applications seeking bail. The
relevant paragraphs are extracted below:
47. A perusal of above orders clearly indicates that the
remand applications were returned. According to this
Court, the Designated Court cannot return a remand
application filed under Section 167(2) of Cr.P.C. It is
relevant to note that a Court performs a judicial function
while deciding an application for remand under Section
167(2) of the Cr.P.C. The Court while exercising the
judicial function under Section 167(2) of the Cr.P.C. is
bound to pass a judicial order by applying its mind. The
Court under Section 167 of the Cr.P.C. by passing a
judicial order has to, where there are adequate grounds for
proceeding with the investigation, remand the accused to
judicial custody or where no such further investigation is
required release him on bail on satisfying conditions as
prescribed.
49. It is also relevant to note that neither the Cr.P.C.
nor the Criminal Rules of Practice have any provisions
conferring the power on the Court to return an
application seeking remand under Section 167(2) of the
Cr.P.C. While the Code of Civil Procedure under
Order VII Rules 10 & 10A provides for return of
plaint, no such provision/procedure is provided under
the Cr.P.C.
28. In light of the aforesaid discussion and in view of the law
laid down by the Apex Court discussed supra, according to this
Court, the Petitioner herein is entitled for statutory bail under
Section 167(2) of the Cr.P.C.
i) The three Criminal Petitions are allowed.
ii) The orders dated 31.03.2022 and 13.04.2022 passed in
File No. ECIR/HYZO/14/2021 by the Metropolitan
Sessions Judge – cum – Special Court under PMLA
Act, 2002 at Hyderabad extending the remand of the
accused are hereby quashed.
iii) As the bail application dated 01.04.2022 was returned
on 08.04.2022, the petitioner is at liberty to file a fresh
bail application under Section 167(2) of Cr.P.C. before
the Metropolitan Sessions Judge – cum – Special Court
under PMLA Act, 2002 at Hyderabad. The said Court
is directed to consider the said application if it is
otherwise in order and pass orders in accordance with
law, within a period of one week from the date of filing
of such application.
iv) Consequently, miscellaneous petitions pending shall
stand closed.
Note; L.R.Copy to be marked.
|
The lis involved in these cases is connected to each other. Therefore, they were heard together and are being disposed of with
the following common order. ECIR/HYZO/14/2021 by the Metropolitan Sessions Judge –
cum – Special Court Under PMLA Act, 2002 at Hyderabad. Public Prosecutor for
Directorate of Enforcement for the Respondent. It is further alleged that the clients’
money was misused by the shell companies created by KSBL and
the said money was transferred to the Petitioner and his family
5. 100 of 2021
which is pending on the file of P.S. Central Crime Station
Hyderabad. On the same day, the Petitioner was remanded to
judicial custody. The Petitioner has been in jail since 20.01.2022. According to the Petitioner, the offences alleged against him are
not punishable for a term not less than ten years, death, life
imprisonment. P.C. as the investigation is not completed
within sixty (60) days of his remand. According to the Petitioner, the period of sixty days
expired on 21.03.2022. Therefore, on 21.03.2022, he filed an
application seeking default bail under Section 167 (2) of the
Cr. According to the Petitioner, the application
was filed seeking further custody of the Petitioner to complete the
investigation. P.C. as investigation is yet to be
completed. The said bail application was returned as infructuous on
08.04.2022. P.C. was filed by the Respondent
herein seeking extension of remand. The said application was
allowed and the remand was extended till 27.04.2022. The Petitioner in the present criminal petitions has
challenged the order dated 31.03.2022 in ECIR/HYZO/14/2021, in
Crl. 4137 of 2022, order dated 13.04.2022 in
ECIR/HYZO/14/2021, in Crl. 4127 of 2022 and order dated
08.04.2022 in Crl. M.P.(sr) No.3350 of 2022 in
ECIR/HYZO/14/2021, in Crl. 3786 of 2022, inter alia, on the
ground that he is entitled for statutory bail under Section 167(2) of
i. A complaint in the nature of interim report was filed on
19.03.2022. No complaint/charge sheet in terms of
Section 173(2) of the Cr. P.C. is filed as the investigation
admittedly is not completed. P.C. after a
period of sixty days which accrued on 21.03.2022. The complaint dated 19.03.2022 was filed only to deny
statutory bail to the Petitioner. P.C. is to complete
the investigation within the prescribed time. Reliance was placed on M. Ravindran
v. Intelligence Officer, Directorate of Revenue
iv. i. A complaint/charge sheet was already filed on
19.03.2022. Therefore, statutory bail under Section
167(2) of the Cr. P.C cannot be claimed once the charge
sheet is filed. Remand was extended under Section 309 of the Cr. In the present case, the issue before the Court is whether
the Petitioner is entitled for statutory bail under Section 167(2) of
the Cr. P.C. For the sake of convenience, the chronology of dates is
20.01.2022 Petitioner was remanded to judicial custody
and has been in jail since then. 19.03.2022 Alleged Complaint/charge sheet was filed by
21.03.2022 The date on which statutory bail accrues
after the expiry of sixty days under Section
31.03.2022 The remand of the Petitioner was extended
investigation is pending. 08.04.2022 The bail application dated 01.04.2022 is
13.04.2022 The remand of the Petitioner is further
Before deciding the issue at hand, it is apposite to discuss the
object and scope of Section 167(2) of the Cr. (b) no Magistrate shall authorise detention in any custody under this
section unless the accused is produced before him;
(c) no Magistrate of the second class, not specially empowered in this
behalf by the High Court, shall authorise detention in the custody of the
police. P.C. obligates the investigative
agencies to complete the investigation in a time bound manner. The relevant paragraphs are extracted below:
17. When the law provides that the Magistrate could authorise the
detention of the accused in custody up to a maximum period as
indicated in the proviso to sub-section (2) of Section 167, any
further detention beyond the period without filing of a challan
by the investigating agency would be a subterfuge and would
not be in accordance with law and in conformity with the
provisions of the Criminal Procedure Code, and as such, could
be violative of Article 21 of the Constitution.” The Law
Commission of India in Report No. 14 on Reforms of the
Judicial Administration (Vol. 14
recommended the need for an appropriate provision specifically
providing for continued remand after the expiry of 15 days, in a
manner that “while meeting the needs of a full and proper
investigation in cases of serious crime, will still safeguard the
liberty of the person of the individual”. 41 on The
Code of Criminal Procedure, 1898 (Vol. Hence the Commission recommended fixing of a
maximum time-limit of 60 days for remand. The
Commission considered the reservation expressed earlier in
Report No. 37 that such an extension may result in the 60-
day period becoming a matter of routine. As is evident from the recommendations of the Law
Commission mentioned supra, the intent of the legislature
was to balance the need for sufficient time-limits to
complete the investigation with the need to protect the civil
liberties of the accused. Section 167(2) provides for a clear
mandate that the investigative agency must collect the
required evidence within the prescribed time period, failing
which the accused can no longer be detained. From the above decision, it is clear that a time limit for
completing investigation was incorporated in order to ensure that
the accused does not languish in jail for the investigative
authority’s failure to complete investigation. P.C.
comes into operation if no cognizance is taken within the
prescribed period. P.C. is not the date of taking cognizance but the date
of filing charge sheet. The Supreme Court in Rahul Modi (Supra) clarifying
11. In all the
above judgments which are relied upon by either side, this
Court had categorically laid down that the indefeasible
right of an accused to seek statutory bail under Section
167(2) of CrPC arises only if the charge-sheet has not
been filed before the expiry of the statutory period. It is not necessary to repeat that in
both Madar Sheikh (supra) and M. Ravindran (supra), this
Court expressed its view that non-filing of the charge-
sheet within the statutory period is the ground for availing
the indefeasible right to claim bail under Section 167(2),
CrPC. It was
made clear that the accused remains in custody of the
Magistrate till cognizance is taken by the relevant court. It is relevant to note that, in the
present case the proceedings are initiated under the PMLA. Section
44 of the PMLA provides that the offences under PMLA are triable
by Special Courts. In the present case, the Respondent contended that a
complaint under Section 44(1)(b) of the PMLA was already filed
on 19.03.2022. The Supreme Court in Satya NarainMusadi v. State of
Bihar5 discussing Section 173(2) of the Cr. P.C. has held that a
charge sheet can be filed only after the completion of investigation. The relevant paragraph is extracted below:
9. Similarly, the Supreme Court in Manu Sharma v. State (NCT of
Delhi)6 has held that the object behind Section 173 of the Cr. The idea
is to ensure that cognizance is taken without any delay. P.C. It was contended by
the Respondent that the complaint dated 19.03.2022 is a charge
sheet and only further investigation is being carried out which is
permissible under Section 44(1)(d)(ii). P.C. on the ground that investigation is
pending. Therefore, the
complaint dated 19.03.2022 is an incomplete complaint/charge
sheet. It was to discourage such abuse of
process that a statutory limit of sixty days was incorporated in
Section 167(2) to complete the investigation and file the charge
sheet. The State contended that charge sheet was already filed
but the investigation is yet to be completed. The Court therein drew
a distinction between completion of investigation and further
investigation. Reference here may usefully be made to a decision
of the Supreme Court in Abhinandan Jha v. Dinesh Mitra,
AIR 1968 SC 117, which points out that the investigation
under the Code takes in several aspects and stages ending
ultimately with the formation of an opinion by the police
as to whether, as from the material covered and collected,
a case is made out to place the accused before the
Magistrate for trial and the submission of either a charge-
sheet or a final report is dependent on the nature of the
opinion so formed. Consequently,
the incomplete charge-sheets cannot be treated as a “police
report” at all as contemplated under section 173(2) of the
Code to entitle the Magistrate to take cognizance of the
offences. The learned Counsel appears to be further
right when he canvassed that the expression “incomplete
charge-sheet” does not occur anywhere in the Code and
that forwarding of a “police report” after the completion of
the investigation is the requirement of sub-section (2) of
section 173 of the Code. According to him, it tends to indicate that the
investigation is not shut but remains in suspended
animation till the police report is sent to the
Magistrate. If it is
not complete; no such report can be filed. When no
report is forwarded as required by the Code, the
Magistrate cannot take cognizance. P.C. In this context, it is relevant to note
that the Parliament in its wisdom, considering the right of
the accused to speedy investigation, stipulated period of
time in proviso (a) to Section 167(2) Cr. P.C. stating that in
all offences which are punishable with death or life
imprisonment or with 10 years imprisonment, the
investigation is to be completed within 90 days and in other
offences, the investigation is to be completed within 60
days. In other words, it is the
default committed by the Investigating Agency to
complete the entire investigation within the stipulated
time that confers right on the accused to claim for
default bail. So, the Court cannot take
cognizance of the offence on the basis of a preliminary
charge-sheet filed without completing the entire
investigation. Therefore, the crucial aspect that needs to
be ascertained to consider the claim of the accused for
default bail is whether the investigation is completed
within the stipulated time of 90 days or not. The intention of the legislation is that the investigation is to
be completed within the stipulated time. It
has to be ascertained whether the entire investigation is
completed or not within the stipulated period of time
and whether the said charge-sheet is filed after
completion of the entire investigation or not. The Apex Court in
another case Rajnikant JivanlalPatel v. Intelligence Officer,
Narcotic Control Bureau, New Delhi3 held as follows:
“The right to bail under Section 167(2) proviso (a)
thereto is absolute. It is a legislative command and not
Court's discretion. If the investigating agency fails to file
charge-sheet before the expiry of 90/60 days, as the case
may be, the accused in custody should be released on bail. But at that stage, merits of the case are not to be examined. In fact, the Magistrate has no power to remand a
person beyond the stipulated period of 90/60 days.” P.C. on account
of the default committed by the Investigating Agency to
complete the investigation within the stipulated time, and
he is prepared to furnish bail, the Court has no other option
except to grant bail to him. In a way the right to claim bail by a
remanded accused touches the personal liberty of an
individual guaranteed under the Constitution of India. It can be deprived only in accordance with
law and in conformity with the provisions thereof, as
stipulated under Article 21 of the Constitution. Therefore, it could be violative of Article 21 of the
Constitution of India. Therefore, in
the absence of complete investigation and absence of filing a final
complaint, the Petitioner is entitled for statutory bail under Section
167(2) of the Cr. P.C. The said
contention is ex facie misconceived. P.C. comes
into operation only after cognizance of the offence is taken. In the
present case, no cognizance is taken till date. The Respondent relying on Y.S. Jagan Mohan Reddy v.
CBI10 and Ajay Kumar v. Directorate of Enforcement11
contended that economic offences are serious offences. According to this Court, the Designated Court has no
power to return the said applications. P.C. It is
relevant to note that a Court performs a judicial function
while deciding an application for remand under Section
167(2) of the Cr. P.C. The Court while exercising the
judicial function under Section 167(2) of the Cr. P.C. is
bound to pass a judicial order by applying its mind. P.C. by passing a
judicial order has to, where there are adequate grounds for
proceeding with the investigation, remand the accused to
judicial custody or where no such further investigation is
required release him on bail on satisfying conditions as
prescribed. It is also relevant to note that neither the Cr. P.C.
i) The three Criminal Petitions are allowed. ii) The orders dated 31.03.2022 and 13.04.2022 passed in
File No. P.C. before
the Metropolitan Sessions Judge – cum – Special Court
under PMLA Act, 2002 at Hyderabad. iv) Consequently, miscellaneous petitions pending shall
stand closed.
|
In a recent case, the Telangana High Court ruled that accused under the Prevention of Money Laundering Act, 2002 is entitled to statutory bail under Section 167(2) of CrPC if the charge sheet is not submitted in terms of Section 173(2) of the Cr.P.C without completion of investigation. Justice K. Lakshman held that:
"At the cost of repetition, this Court holds that the complaint dated 19.03.2022 was not a final complaint based on which cognizance could have been taken. A complaint/report cannot be treated as final report unless the investigation is completed, In the present case, the investigation is admittedly not completed and the statutory period of sixty days expired on 21.03.2022. Therefore, in the absence of complete investigation and absence of filing a final complaint, the Petitioner is entitled for statutory bail under Section 167(2) of the Cr.P.C."
Brief Facts of the Case
The Petitioner is the Chairman and Managing Director of M/s Karvy Stock Broking Ltd. (KSBL) The Respondent authority had registered the offence of money laundering under the Prevention of Money Laundering Act, 2002 (PMLA) against KSBL. The allegations against KSBL and the Petitioner included diversion of large-scale clients' funds through shell companies which resulted in huge losses to the investors.
Various FIRs were registered against the Petitioner and he was arrested and produced before the Metropolitan Sessions Judge cum Special Court (Designated Court) on 20.01.2022 and on the same day the Petitioner was remanded to judicial custody. The Petitioner had been in jail since 20.01.2022. According to the Petitioner, the offences alleged against him are not punishable for a term not less than 10 years, death, life imprisonment. Therefore, he was entitled for statutory bail under Section 167(2) of CrPC as the investigation was not completed within 60 days.
According to the Petitioner, the period of 60 days expired on 21.03.2022. Therefore, he filed an application for default bail. But the said application was dismissed as the complaint/charge sheet was filed by the Respondent on 19.03.2022.
However, on 31.03.2022, another application under Section 167 was filed by the Respondent seeking extension of remand. The application was filed seeking further custody of the Petitioner to complete the investigation. The said application was allowed and the custody of the Petitioner was extended till 13.04.2022.
Subsequently, another application on 13.04.2022 was filed by Respondent seeking extension of remand. The remand was extended till 27.04.2022.
Contention of Petitioner
Mr. T. Niranjan Reddy, Semior counsel representing Mr. Avinash Desai on behalf of the Petitioner contended that a complaint in the nature of interim report was only filed on 19.03.2022 and no complaint/charge sheet was filed in terms of Section 173(2) of CrPC as the investigation was admittedly not completed. Therefore, in the absence of completion of investigation, the petitioner was entitled for statutory bail under Section 167(2) of CrPC.
Contention of Respondent
Mr. Anil Prasad Tiwari, Special Public Prosecutor for Directorate of Enforcement for the Respondent was that a complaint/charge sheet was already filed on 19.03.2022. Therefore, the statutory bail under Section 167(2) of CrPC cannot be claimed once the charge sheet was filed. The remand was extended under Section 309 of CrPC and the Respondent can seek custody of the petitioner to complete further investigation under Section 44(2) of the PMLA.
Issue
The issue was whether the Petitioner is entitled for statutory bail under Section 167(2) of the Cr.P.C.
Findings of the Court
Justice K. Lakshman relied on many decisions to observe that Section 167(2) of the Cr.P.C. obligates the investigative agencies to complete the investigation in a time bound manner.
In M. Ravindran v. Intelligence Officer, Directorate of Revenue Intelligence (2021), it was made clear by the Supreme Court that a time limit for completing investigation was incorporated in order to ensure that the accused did not languish in jail for the investigative authority's failure to complete the investigation.
"It was in this backdrop that Section 167(2) was enacted within the present day CrPC, providing for time-limits on the period of remand of the accused, proportionate to the seriousness of the offence committed, failing which the accused acquires the indefeasible right to bail. As is evident from the recommendations of the Law Commission mentioned supra, the intent of the legislature was to balance the need for sufficient time-limits to complete the investigation with the need to protect the civil liberties of the accused. Section 167(2) provides for a clear mandate that the investigative agency must collect the required evidence within the prescribed time period, failing which the accused can no longer be detained. This ensures that the investigating officers are compelled to act swiftly and efficiently without misusing the prospect of further remand. This also ensures that the court takes cognizance of the case without any undue delay from the date of giving information of the offence, so that society at large does not lose faith and develop cynicism towards the criminal justice system."
The Court relied on the Supreme Court decision in Satya NarainMusadi v. State of Bihar (1980) which discussed Section 173(2) of the Cr.P.C. to hold that a charge sheet can be filed only after the completion of investigation.
Thus, it was clear that a charge sheet can be filed only after the completion of investigation. Investigation is said to be completed if sufficient material is collected by the Investigating Officer based on which cognizance can be taken under Section 167 of the Cr.P.C.
In this case, if complaint dated 19.03.2022 was filed after completion of investigation, the Designated Court would have taken cognizance of the offence. Not taking cognizance of the offence when complaint dated 19.03.2022 was already filed indicates that investigation is incomplete. Therefore, complaint dated 19.03.2022 cannot be treated as a complaint/charge sheet under Section 173(2) of the Cr.P.C.
Furthermore, in a Bombay High Court decision in Sharadchandra Vinayak Dongre v. State of Maharashtra, 1991 it was held that a complaint/charge sheet filed without completing the investigation cannot be used to circumvent the right of statutory bail under Section 167(2) of the Cr.P.C.
As has already been pointed out, a police report as defined in section 2(r) of the Code can only be filed "as soon as the investigation is completed". If it is not complete; no such report can be filed. When no report is forwarded as required by the Code, the Magistrate cannot take cognizance…The question thus emerges naturally is, whether the Magistrate can take cognizance on the admittedly "incomplete charge-sheet" forwarded by the police. The answer stubbornly and admittedly must be in the negative, because the investigation is yet incomplete and the "police report" yet remains to be filed. Thus, the filing of the incomplete charge-sheet cannot circumvent the provisions of sub-section (2) of section 173 of the Code and incomplete report or an incomplete charge-sheet with whatsoever expression it may be called does not meet the obligatory requirements of law.
Justice K. Lakshman reiterated that the complaint dated 19.03.2022 was not a final complaint. Therefore, the Petitioner was entitled to statutory bail under Section 167(2). The Petitioner cannot be remanded under Section 309 of CrPC as it comes into operation only after cognizance of the offence was taken. Thus, the Criminal petition was allowed and it was held that the Petitioner was entitled for statutory bail under Section 167(2) of CrPC.
Case Title: C. Parthasarthy v. Director of Enforcement
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In a recent case, the Telangana High Court ruled that accused under the Prevention of Money Laundering Act, 2002 is entitled to statutory bail under Section 167(2) of CrPC if the charge sheet is not submitted in terms of Section 173(2) of the Cr. Justice K. Lakshman held that:
"At the cost of repetition, this Court holds that the complaint dated 19.03.2022 was not a final complaint based on which cognizance could have been taken. The allegations against KSBL and the Petitioner included diversion of large-scale clients' funds through shell companies which resulted in huge losses to the investors. The Petitioner had been in jail since 20.01.2022. According to the Petitioner, the offences alleged against him are not punishable for a term not less than 10 years, death, life imprisonment. Therefore, he was entitled for statutory bail under Section 167(2) of CrPC as the investigation was not completed within 60 days. According to the Petitioner, the period of 60 days expired on 21.03.2022. Therefore, he filed an application for default bail. But the said application was dismissed as the complaint/charge sheet was filed by the Respondent on 19.03.2022. The application was filed seeking further custody of the Petitioner to complete the investigation. Subsequently, another application on 13.04.2022 was filed by Respondent seeking extension of remand. Contention of Petitioner
Mr. T. Niranjan Reddy, Semior counsel representing Mr. Avinash Desai on behalf of the Petitioner contended that a complaint in the nature of interim report was only filed on 19.03.2022 and no complaint/charge sheet was filed in terms of Section 173(2) of CrPC as the investigation was admittedly not completed. Therefore, in the absence of completion of investigation, the petitioner was entitled for statutory bail under Section 167(2) of CrPC. Issue
The issue was whether the Petitioner is entitled for statutory bail under Section 167(2) of the Cr. P.C. obligates the investigative agencies to complete the investigation in a time bound manner. "It was in this backdrop that Section 167(2) was enacted within the present day CrPC, providing for time-limits on the period of remand of the accused, proportionate to the seriousness of the offence committed, failing which the accused acquires the indefeasible right to bail. Section 167(2) provides for a clear mandate that the investigative agency must collect the required evidence within the prescribed time period, failing which the accused can no longer be detained. P.C. to hold that a charge sheet can be filed only after the completion of investigation. Thus, it was clear that a charge sheet can be filed only after the completion of investigation. Therefore, complaint dated 19.03.2022 cannot be treated as a complaint/charge sheet under Section 173(2) of the Cr. P.C.
Furthermore, in a Bombay High Court decision in Sharadchandra Vinayak Dongre v. State of Maharashtra, 1991 it was held that a complaint/charge sheet filed without completing the investigation cannot be used to circumvent the right of statutory bail under Section 167(2) of the Cr. P.C.
As has already been pointed out, a police report as defined in section 2(r) of the Code can only be filed "as soon as the investigation is completed". If it is not complete; no such report can be filed. Justice K. Lakshman reiterated that the complaint dated 19.03.2022 was not a final complaint. Therefore, the Petitioner was entitled to statutory bail under Section 167(2). Case Title: C. Parthasarthy v. Director of Enforcement
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vil Appeal No. 1826 (N) of 1974.
From the Judgment and Order dated 6.4.1972 of the Madhya Pradesh High Court in F.A. No. 23 of 1966.
M.V. Goswami for the Appellants.
U.A. Rana and S.K. Agnihotri for the Respondents.
The Judgment of the Court was delivered by SAIKIA, J.
This plaintiffs ' appeal by special leave is from the appellate Judgment of the Madhya Pradesh High Court dismissing the appeal upholding the Judgment of the trial court dismissing the plaintiffs ' suit on the ground of limitation.
A registered firm Rai Saheb Nandkishore Rai Saheb Ju galki 599 shore (Appellants) was allotted contracts for manufacture and sale of liquor for the calendar year 1959 and for the subsequent period from 1.1.
1960 to 31.3.
1961 for Rs.2,56,200.00 and Rs.4,71,900.00, respectively, by the Government of Madhya Pradesh who also charged 7 1/2 per cent over the auction money as mahua and fuel cess.
As writ petitions challenging the Government 's right to charge this 7 1/2 per cent were pending in the Madhya Pradesh High Court, the Government announced that it would continue to charge it and the question of stopping it was under consid eration of the Government whose decision would be binding on the contractors.
The firm (appellants) thus paid for the above contracts a total extra sum of Rs.54,606.00.
On 17.10.1961 the Under Secretary to Government, M.P., Forest Department, Bhopal wrote the following letter No. 10 130 X/61 (Exhibit D 23) to the Chief Conservator of Forests, Madhya Pradesh, Rewa: "Subject: Levy of cess on liquor contractors.
Under former M.P. Government (Forest Depart ment) memo No. 4595 CR 73 XI dated 25th July, 1953, a royalty at 7 1/2 per cent of the license fee for liquor shops was imposed on liquor contractors to cover the value of mahua & fuel extracted from the reserved or protect ed forests by the contractors for their still.
The M.P. High Court has since decided that the levy of the aforesaid cess is illegal and the cess cannot be recovered from the liquor contractors.
In pursuance of this decision, Government desires that all process es whenever issued or proceedings instituted against liquor contractors for recovery of the mahua or fuel cess should forthwith be with drawn and no revenue recovery certificates should be issued in respect of this cess.
Simultaneously no free supply of mahua or fuel should be permitted by virtue of the imposition mentioned above.
Immediate compliance is requested.
No . .
X/61 Dt.
Bhopal the . . 661 Copy forwarded for immediate compliance to: 600 1.
Conservator of Forests, Bilaspur. 2.
All Divisional Forest Officers, Bilaspur Circle.
Copy to C.F. Raipur Circle for similar auction in this cess levied in any division of his Circle.
" On 24.4.1959 the Madhya Pradesh High Court 's Judgment in Surajdin vs State of M.P., declaring the collection of 7 1/2 per cent illegal was reported in 1960 MPLJ 39.
Even after this decision Government continued to charge 7 1/2 per cent extra money.
Again on 31.8.
1961 the High Court of Madhya Pradesh in N.K. Doongaji vs Collector, Surguja, decided that the charging of 7 1/2 per cent by the Government above the auction money was illegal.
This Judgment was reported in 1962 MPLI 130.
It is the appellants ' case that they came to know about this decision only in or about September 1962.
On 17.10.
1964 they served a notice on Government of Madhya Pradesh under section 80 of the Code of Civil Procedure request ing the refund of Rs.54,606.00, failing which, a suit for recovery would be filed; and later they instituted Civil Suit No. of 1964 in the court of Additional District Judge, Jabalpur on 24.12.1964.
The Government resisted the suit on, inter alia, ground of limitation.
The trial court taking the view that Articles 62 and 96 of the First Schedule to the Limitation Act, 1908 were applicable and the period of limitation began to run from the dates the payments were made to the Government, held the suit to be barred by limi tation and dismissed it.
In appeal, the High Court took the view that Article 113 read with section 17, and not Article 24, of the Schedule to the , was applicable; and held that the limitation began to run from 17.10.
1961 on which date the Government decided not to charge extra 7 1/2 per cent on the auction money, and as such, the suit was barred on 17.12.
1964 taking into consideration the period of two months prescribed by section 80 of the Code of Civil Procedure.
Consequently, the appeal was dismissed.
The appellants ' petition for leave to appeal to this Court was also rejected observing, "it was unfortunate that the peti tioners filed their suit on 24.12.
1964 and as such the suit was barred by time by seven days." Mr. M.V. Goswami, learned counsel for the appellants, submits, inter alia, that the High Court erred in holding that the limitation started running from 17.16.1961 being the date of the letter, Exhibit D 23, which was not communi cated to the appellants or any other contractor and there fore the appellants had no opportunity to know 601 about it on that very date with reasonable diligence under section 17 and the High Court ought to allow atleast a week for knowledge of it by the appellants in which case the suit would be within time.
Counsel further submits that the High Court while rightly discussing that section 17 of the was applicable, erred in not applying that section to the facts of the instant case, wherefore, the impugned Judgment is liable to be set aside.
Mr. Ujjwal A. Rana, the learned counsel for the respond ent, submits, inter alia, that 17.10.2961 having been the date on which the Government finally decided not to recover extra 7 1/2 per cent above the auction .money, the High Court rightly held that the limitation started from that date and the suit was clearly barred under Article 24 or 113 of the Schedule to the ; and that though the records did not show that the Government decision was communicated to the appellants, there was no reason why they, with reasonable diligence, could not have known about it on the same date The only question to be decided, therefore, is whether the decision of the High Court is correct.
To decide that question it was necessary to know what was the suit for.
There is no dispute that 7 1/2 per cent above the auction money was charged by the Government of Madhya Pradesh as mahua and fuel cess, and the High Court subsequently held that it had no power to do so.
In view of those writ peti tions challenging that power, Government asked the contrac tors to continue to pay the same pending Government 's deci sion on the question; and the appellants accordingly paid.
Ultimately on 17.10.1961 Government decided not to recover the extra amount any more but did not yet decide the fate of the amounts already realised.
There is no denial that the liquor contracts were performed by the appellants.
There is no escape from the conclusion that the extra 7 1/2 per cent was charged by the Government believing that it had power, but the High Court in two cases held that the power was not there.
The money realised was under a mistake and without authority of law.
The appellants also while paying suffered from the same mistake.
There is therefore no doubt that the suit was for refund of money paid under mistake of law.
The question is what was the law applicable to the case. 'Nul ne doit senrichir aux depens des autres ' No one ought to enrich himself at the expense of others.
This doctrine at one stage of English common law was remedied by 'indebitatus assumpsit ' which action lay for money "had and received to the use of the plaintiff".
It lay to recover 602 money paid under a mistake, or extorted from the plaintiff by duress of his goods, or paid to the defendant on a con sideration which totally tailed.
On abolition of 'indebit atus assumpsit ', courts used to imply a promise to pay which, however, in course of time was held to be purely fictitious.
Lord Manslied in Moses vs Macferlan, ; at 10 12 explained the juridical basis of the action for money "had and received" thus: "This kind of equitable action, to recover back money, which ought not in justice to be kept, is very beneficial, and therefore much encouraged.
It lies only for money which, 'ex aequo et bono ', the defendant ought to refund; it does not lie for money paid by the plain tiff, which is claimed of him as payable in point of honour and honesty, although it could not have been recovered from him by any course of law; as in payment of a debt barred by the Statute of Limitations, or contracted during his infancy, or to the extent of principal and legal interest upon a usurious contract, or, for money fairly lost at play; because in all these cases, the defendant may retain it with a safe conscience, though by positive law he was barred from recovering.
But it lies for money paid by mistake; or upon a consideration which happens to fail; or for money got through imposition, (express or implied); or extortion; or oppression; or an undue advan tage taken of the plaintiff 's situation, contrary to laws made for the protection of persons under those circumstances.
In one word, the gist of this kind of action is, that the defendant, upon the circumstances of the case, is obliged by the ties of natural jus tice and equity to refund the money." In that case Moses received from Jacob four promissory notes of cash each.
He endorsed these to Macferlan who, by a written agreement, contracted that he would not hold Moses liable on the endorsement.
Subsequently, however, Macferlan sued Moses on the notes in a Court of Conscience.
The Court refused to recognise the agreement, and Moses was forced to pay.
Moses then brought an action against Macferlan in the king 's Bench for money "had and received" to his use.
Lord Manslied allowed him to recover observing as above.
Courts in England have since been trying to formulate a juridicial basis of this obligation.
Idealistic formulations as 'aequum et bonum ' and 'natural justice ' were considered to be inadequate and the 603 more legalistic basis of unjust enrichment is formulated.
The doctrine of 'unjust enrichment ' is that in certain situation it would be 'unjust ' to allow the defendant to retain a benefit at the plaintiff 's expense.
The relatively modern principle of Restitution is of the nature of quasi contract.
But the English law has not yet recognised any generalised right to restitution in every case of unjust enrichment.
As Lord Diplock has said, "there is no general doctrine of "unjust enrichment" recognised in English law.
What it does is to provide specific remedies in particular cases of what might be classed as unjust enrichment in a legal system i.e. based upon the civil law.
" In Sinclair vs Brougham, Lord Haldane said that law could 'de jure ' impute promises to repay whether for money "had and received" otherwise, which may, if made defacto, it would inexorably avoid.
The principle of unjust enrichment requires: first, that the defendant has been 'enriched ' by the receipt of a "benefit"; secondly, that this enrichment is "at the expense of the plaintiff"; and thirdly, that the retention of the enrichment be unjust.
This justifies restitution.
Enrichment may take the form of direct advantage to the recipient wealth such as by the receipt of money or indirect one for instance where inevitable expense has been saved.
Another analysis of the obligation is of quasi contract.
It was said; "if the defendant be under an obligation from the ties of natural justice, to refund; the law implies a debt, and give this action rounded in the equity of the plaintiff 's case, as it were, upon a contract (quasi ex contracts) as the Roman law expresses it." As Lord Wright in Fibrosa Spolka vs Fairbairn Lawson, [1943] AC 32 1942 pointed out, "the obligation is as efficacious as if it were upon a contract.
Such remedies are quasi contract or restitution and theory of unjust enrichment has not been closed in English law.
" Section 72 of the Indian Contract Act deals with liabil ity of person to whom money is paid or thing delivered, by mistake or under coercion.
It says: "A person to whom money has been paid, or anything delivered, by mistake or under coer cion, must repay or return it." Illustration (b) to the section is: "A Railway Company refuses to deliver up certain goods to the consignee, except upon the payment of an illegal 604 charge for carriage.
The consignee pays the sum charged in order to obtain the goods.
He is entitled to recover so much of the charge as was illegally excessive.
" Our law having been codified, we have to apply the law.
It is true, as Pollock wrote in 1905 in the preface to the first Edition of Pollock and Mulla 's Indian Contract and Specific Relief Acts: "The Indian Contract Act is in effect . . a code of English law.
Like all codes based on an existing authoritative doctrine, it assumes a certain knowledge of the principles and habits of thought which are embodied in that doctrine.
" It is, therefore, helpful to know "those fundamental notions in the common law which are concisely declared, with or, without modification by the text.
" There is no doubt that the instant suit is for refund of money paid by mistake and refusal to refund may result in unjust enrichment depending on the facts and circumstances of the case.
It may be said that this court has referred to unjust enrichment in cases under section 72 of the Contract Act.
See ; ; and ; The next question is whether, and if so, which provision of the will apply to such a suit.
On this question we find two lines of decisions of this Court, one in respect of civil sulks and the other in respect of peti tions under Article 226 of the Constitution of India.
Though there is no constitutionally provided period of limitation for petitions under Article 226, the limitation prescribed for such suits has been accepted as the guideline, though little more latitude is available in the former.
A tax paid under mistake of law is refundable under section 72 of the .
In Sales Tax Officer vs Kanhaiya Lal, where the respondent, a regis tered firm, paid sales tax in respect of the forward trans actions in pursuance of the assessment orders passed by the Sales Tax Officer for the year 1949 51; in 1952 the Allaha bad High Court held in M/s Budh Prakash Jai Prakash vs Sales Tax Officer, Kanpur, that the levy of sales tax on forward transactions was ultra vires.
The respondent asked for a refund of the mounts paid, filing a writ peti tion under Article 226 of 605 the Constitution.
It was contended for the Sales Tax Author ities that the respondent was not entitled to a refund because (1) the amounts in dispute were paid by the respond ent under a mistake of law and were, therefore, irrecovera ble, (2) the payments were in discharge of the liability under the Sales Tax Act and were voluntary payments without protest, and (3) inasmuch as the monies which had been received by the Government had not been retained but had been spent away by it and the respondent was disentitled to recover the said amounts.
This Court held that the term "mistake" in section 72 of the comprised within its scope a mistake of law as well as a mistake of fact and that, under that section a party is entitled to recover money paid by mistake or under coercion, and if it is established that the payment, even though it be of a tax, has been made by the party labouring under a mistake of law, the party receiving the money is bound to repay or return it though it might have been paid voluntarily, subject, howev er, to questions of estoppel, waiver, limitation or the like.
On the question of limitation, it was held that section 17(1)(c) of the would be applicable and that where a suit will be to recover "monies paid under a mistake of law, a writ petition within the period of limita tion prescribed, i.e., within 3 years ' of the knowledge of the mistake, would also lie.
" It was also accepted that the period of limitation does not begin to run until the plain tiff has discovered the mistake or could, with reasonable diligence, have discovered it.
The money may not be recoverable if in paying and re ceiving it the parties were in pan delicto.
In Kiriri Cotton Co. Ltd. vs Ranchhoddas Keshavji Dewani, , where the appellant company, in consideration of granting to the respondent a sub lease asked for and received from him a premium of Sh.
10,000 and the latter.claimed refund thereof, the Privy Council held that the duty of observing the law was firmly placed by the Ordinance on the shoulders of the landlord for the protection of the tenant, and the appellant company and the respondent were not therefore in pari delic to in receiving and paying respectively the illegal premium, which, therefore, in accordance with established common law principles, the respondent was entitled to recover from the landlord and that the omission of a statutory remedy did not in cases of this kind exclude the remedy by money had and received.
In the instant case also the parties could not be said to be in pari delicto in paying and receiving the extra 7 1/2% per cent.
Had the appellants not paid this amount, they would not have been given the contracts.
In D. Cawasji &.
Co. vs The State of Mysore & Anr.
, ; , the appellants paid certain amount to the Government as 606 excise duty and education cess for the years 195 1 52 to 1965 66 in one case and from 1951 52 to 1961 62 in the other.
The High Court struck down the provisions of the relevant Acts as unconstitutional.
In Writ Petitions before the High Court claiming refund, the appellants contended that the payments in question were made by them under mis take of law; that the mistake was discovered when the High Court struck down the provisions as unconstitutional and the petitions were, therefore, in time but the High Court dis missed them on the ground of inordinate delay.
Dismissing the appeals, this Court held that where a suit would lie to recover monies paid under a mistake of law, a writ petition for refund of tax within the period of limitation would lie.
For filing a writ petition to recover the money paid under a mistake of law the starting point of limitation is from the date on which the judgment declaring as void the particular law under which the tax was paid was rendered.
It was held in D. Cawasji (supra) that although section 72 of the Contract Act has been held to cover cases of payment of money under a mistake of law, as the State stands in a peculiar position in respect of taxes paid to it, there are perhaps practical reasons for the law according different treatment both in the matter of the heads under which they could be recovered and the period of limitation for recovery.
P.N. Bhagwati, J., as he then was, in Madras Port Trust vs Hymanshu Inter national, , deprecated any resort to plea of limitation by public authority to defeat just claim of citizens observing that though permissible under law, such technical plea should only be taken when claim is not well founded.
Section 17(1)(c) of the , provides that in the case of a suit for relief of the ground of mistake, the period of limitation does not begin to run until the plaintiff had discovered the mistake or could with reasonable diligence, have discovered it.
In a case where payment has been made under a mistake of law as contrasted with a mistake of fact, generally the mistake become known to the party only when a court makes a declaration as to the invalidity of the law.
Though a party could, with reasonable diligence, discover a mistake of fact even before a court makes a pronouncement, it is seldom that a person can, even with reasonable diligence, discover a mistake of law before a judgment adjudging the validity of the law.
E.S. Venkataramiah, J., as his Lordship then was, in Shri Vallabh Glass Works Ltd. vs Union of India, ; , where the appellants claimed refund of excess duty paid under Central Excise and Salt Act, 1944, laid down that the excess amount paid by the appellants would have become refundable by virtue of section 72 of the 607 if the appellants had filed a suit within the period of limitation; and that section 17(1)(c) and Article 113 of the would be applicable.
In Commissioner of Sales Tax, U.P.v.
M/s Auriaya Chamber of Commerce Allahabad; , , the Supreme Court in its decision dated May 3, 1954 in Sales Tax Officer vs Budh Prakash Jai Prakash, [1954] 5 STC 193 having held tax on forward contracts to be illegal and ultra vires the U.P. Sales Tax Act, and that the decision was applicable to the assessee 's case, the assessee filed several revisions for quashing the assessment order for the year 1949 50 and for subsequent years which were all dismissed on ground of limitation.
In appeal to this Court Sabyasachi Mukharji, J. while dismissing the appeal held that money paid under a mistake of law comes within mistake in section 72 of the Contract Act; there is no question of any estoppel when the mistake of law is common to both the assessee and taxing authority.
His Lordship observed that section 5 of the Limitation Act, 1908 and Article 96 of its First Schedule which prescribed a period of 3 years were applicable to suits for refund of illegally collected tax.
In Salonah Tea Co. Ltd. & Ors.
vs Superintendent of Taxes, Nowgong and Ors.
, ; , the Assam Taxa tion (on Goods carried by Road or Inland Waterways) Act, 1954 was declared ultra vies the Constitution by the Supreme Court in Atiabari Tea Co. Ltd. vs State of Assam, ; A subsequent Act was also declared ultra vires by High Court on August 1, 1963 against which the State of Assam and other respondents preferred appeals to Supreme Court.
Meanwhile the Supreme Court in a writ petition Khyer bari Tea Co. Ltd. vs State of Assam, ; , declared on December 13, 1963 the Act to be intra vires.
Consequently the above appeals were allowed.
Notices were, therefore, issued requiring the appellant under section 7(2) of the Act to submit returns.
Returns were duly filed and assessment orders passed thereon.
On July 10, 1973, the Gauhati High Court in its Judgment in Loong Soong Tea Es tate 's case, Civil Rule No. 1005 of 1969, decided on July 10, 1973, declared the assessment to be without jurisdic tion.
In November, 1973 the appellant filed writ petition in the High Court contending that in view of the decision in Loong Soong Tea Estate 's case he came to know about the mistake in paying tax as per assessment order and also that he became entitled to refund of the amount paid.
The High Court set aside the order and the notice of demand for tax under the Act but declined to order refund of the taxes paid by the appellant on the ground of delay and laches as in view of the High Court it was possible for the appellant to know about 608 the illegality of the tax sought to be imposed as early as in 1963, when the Act in question was declared ultra vires.
Allowing the assessee 's appeal, Mukharji, J. speaking for this Court held: "In this case indisputably it appears that tax was collected without the authority of law.
Indeed the appellant had to pay the tax in view of the notices which were without juris diction.
It appears that the assessment was made under section 9(3) of the Act.
Therefore, it was without jurisdiction.
In the premises it is manifest that the respondents had no authority to retain the money collected with out the authority of law and as such the money was liable to refund.
" The question there was whether in the application under article 226 of the Constitution, the Court should have refused refund on ground of laches and delay, the case of the appel lant having been that it was after the Judgment in the case of Loong Soong tea Estate, the cause of action arose.
That judgment was passed in July, 1973.
The High Court was, therefore, held to have been in error in refusing to order refund on the ground that it was possible for the appellant to know about the legality of the tax sought to be imposed as early as 1973 when the Act in question was declared ultra vires.
The Court observed: "Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law.
Equally, as a corollary of the said statement of law it follows that taxes col lected without the authority of law as in this case from a citizen should be refunded because no State has the right to receive or to retain taxes or monies realised from citizens without the authority of law.
" On the question of limitation referring to Suganmal vs State of M.P., AIR 1965 SC 1740, and Tilokchand Motichand vs H.B. Munshi, , his Lordship observed that the period of limitation prescribed for recovery of money paid by mistake started from the date when the mistake was known.
In that case knowledge was attributable from the date of the Judgment in Loong Soong Tea Estate 's case on July 10, 1973.
There had been statement that the appellant came to know of that matter in October, 1973 and there was no denial of the averment made.
On that ground, the High Court was held to be in 609 error.
It was accordingly held that the writ petition filed by the appellants were within the period of limitation prescribed under article 113 of the Schedule read with section 23 of the .
It is thus a settled law that in suit for refund of money paid by mistake of law, section 72 of the Contract Act is applicable and the period of limitation is three years as prescribed by Article 113 of the Schedule to the Indian and the provisions of section 17(1)(c) of that Act will be applicable so that the period will begin to run from the date of knowledge of the particular law, where under the money was paid, being declared void; and this court be the date of judgment of a competent court declaring that law void.
In the instant case, though the Madhya Pradesh High Court in Surajdin vs State of M.P., declared the collection on 7 1/2% per cent illegal and that decision was reported in , the Government was still charging it saying that the matter was under consideration of the Government.
The final decision of the Government as stated in the letter dated 17.10.
1961 was purely an internal communication of the Government copy whereof was never communicated to the appellants or other liquor contractors.
There could, there fore, be no question of the limitation starting from that date.
Even with reasonable diligence, as envisaged in section 17(1)(c) of the , the appellants would have taken at least week to know about it.
Mr. Rana has fairly stated that there was nothing on record to show that the appellants knew about this letter on 17.10.
1961 itself or within a reasonable time thereafter.
We are inclined to allow at least a week to the appellants under the above provision.
Again Mr. Rana has not been in a position to show that the statement of the appellants that they knew about the mistake only after the judgment in Doongaji 's case reported in , in or about September, 1962, whereafter they issued the notice under section 80 C.P.C. was untrue.
This statement has not been shown to be false.
In either of the above cases, namely, of knowledge one week after the letter dated 17.10.
1961 or in or about September, 1962, the suit would be within the period of limitation under Article 113 of the Schedule to the .
In the result, we set aside the Judgment of the High Court, allow the appeal and remand the suit.
The records will be sent down forthwith to the trial court to decide the suit on merit in accordance with law, expeditiously.
The appellants shall be entitled to the costs of this appeal.
R.N .J.
Appeal allowed.
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The appellant firm was allotted contracts for manufac ture and sale of liquor for the year 1959 and for the subse quent periods from 1.1.
1960 to 31.3.1961 for Rs.2,56,200 and Rs.4,71,900 respectively by the M.P. Govt.
who also charged 7 1/2% over the auction money as mahua and fuel cess.
As writ petitions challenging the government 's right to charge this 7 1/2% were pending in the M.P. High Court, the Govt.
announced that it would continue to charge it and the question of stopping it was under consideration of Govt.
whose decision would be binding on the contractors.
The appellant firm paid for the above contracts a total extra sum of Rs.54,606.00.
On 24.4.1959 the M.P. High Court in Surajdin vs State of M.P., declared the collection of 7 1/2% as illegal.
Even after this decision the Govt.
continue to charge 7 1/2% extra money.
Again on 31.8.1961, the High Court of Madhya Pradesh in N.K. Doongaji vs Collector, Surguja, decided that charg ing of 7 1/2% by the Govt.
above the auction money was illegal.
Appellants came to know of this decision only in or about September, 1962.
On 17.10.1964 the appellants gave a notice under section 80 C.P.C. to the Govt.
of Madhya Pradesh requesting for the refund of Rs.54,606.00.
failing which a suit for recovery would be filed and later they instituted a civil suit in the court of additional District Judge, Jabalpur on 24.12.1964.
The Govt.
resisted the suit inter alia on the ground of limitation.
The Trial Court held that the suit was barred by 597 limitation and dismissed it.
The High Court also dismissed the appeal.
The appellants then came up in appeal by special leave.
While allowing the appeal and remanding the suit to the Trial Court for decision on merits.
This Court, HELD: 'Nul ne doit senrichir aux depens des autres ' No one ought to enrich himself at the expense of others.
This doctrine at one stage of English common Law was remedied by 'indebitatus assumpsit ' which action lay for money ' had and received to the use of the plaintiff '.
It lay to recover money paid under a mistake or extorted from the plaintiff by duress of his goods, or paid to the defendant on a consider ation which totally failed.
On abolition of 'indebitatus assumpsit ', courts used to imply a promise to pay which, however, in course of time was held to be purely fictitious.
[601G 602A] Courts is England have since been trying to formulate a juridical basis of this obligation.
Idealistic formulations as 'aequum et bonum ' and 'natural justice ' were considered to be inadequate and the more legalistic basis of unjust enrichment is formulated.
The doctrine of 'unjust enrich ment ' is that in certain situations it would be 'unjust ' to allow the defendant to retain a benefit at the plaintiff 's expense.
The relatively modern principle of restitution is of the nature of quasi contract.
But the English law has not yet recognised any generalised right to restriction in every case of unjust enrichment.
[602H 603B] The principle of unjust enrichment requires; first, that the defendant has been 'enriched ' by the receipt of a "benefit"; secondly.
that this enrichment is "at the expense of the plaintiff" and thirdly, that the retention of the enrichment be unjust.
This justified restitution.
Enrichment may take the form of direct advantage to the recipient wealth such as by the receipt of money or indirect one for instance where inevitable expense has been saved.
[603C 603D] There is no doubt that the suit in the instant case, is for refund of money paid by mistake and refusal to refund may result in unjust enrichment depending on the facts and circumstances of the case.
[604D] Though there is no constitutionally provided period of limitation for petitions under Article 226, the limitation prescribed for such suits has been accepted as the guide line, though little more latitude is available in the for mer.
[604F] For filing a writ petition to recover the money paid under a mis 598 take of law the starting point of limitation is three years is prescribed by Article 113 of the Schedule to the Indian and the provisions of section 17(1)(c) of the Act will be applicable so that the period will begin to run from the date of knowledge of the particular law, where under the money was paid, being declared void and this could be the date of the judgment of a competent court declaring that law void.
[609B] Moses vs Macferlan, ; at 1012; Sin clair vs Brougham, ; Fibrosa Spolka vs Fair bairn Lawson; , = ; ; Sales Tax Officer vs Kanhaiya Lal, ; M/s Budh Prakash Jai Prakash vs Sales Tax Officer, Kanpur, ; Kiriri Cotton Co. Ltd. vs Ranchhoddas Keshavji Dewani, ; D. Cawasji & Co. vs The State of Mysore & Anr., ; ; Madras Port 7rust vs Hymanshu Inter national, ; Shri Vallabh Glass Works Lid.
vs Union of India; , ; Commissioner of Sales Tax, U.P.v.
M/s. Auriaya Chamber of Commerce Allahabad; , ; Sales Tax Officer vs Budh Prakash Jai Prakash, [1954] 5 STC 193; Salonah Tea Co. Ltd. & Ors.
vs Superin tendent of Taxes, Nowgong & Ors.
, ; ; Atiabari Tea Co. Ltd. vs State of Assam, ; ; Khyerbari Tea Co. Ltd. vs State of Assam, ; ; Loong Soong Tea Estate 's, case decided on July 10, 1973; Suganmal vs State of M.P., AIR 1965 SC 1740; Tilokchand Motichand vs H.B. Munshi, , referred to.
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vil Appeal No. 1826 (N) of 1974.
From the Judgment and Order dated 6.4.1972 of the Madhya Pradesh High Court in F.A. No. 23 of 1966.
M.V. Goswami for the Appellants.
U.A. Rana and S.K. Agnihotri for the Respondents.
The Judgment of the Court was delivered by SAIKIA, J.
This plaintiffs ' appeal by special leave is from the appellate Judgment of the Madhya Pradesh High Court dismissing the appeal upholding the Judgment of the trial court dismissing the plaintiffs ' suit on the ground of limitation.
A registered firm Rai Saheb Nandkishore Rai Saheb Ju galki 599 shore (Appellants) was allotted contracts for manufacture and sale of liquor for the calendar year 1959 and for the subsequent period from 1.1.
1960 to 31.3.
1961 for Rs.2,56,200.00 and Rs.4,71,900.00, respectively, by the Government of Madhya Pradesh who also charged 7 1/2 per cent over the auction money as mahua and fuel cess.
As writ petitions challenging the Government 's right to charge this 7 1/2 per cent were pending in the Madhya Pradesh High Court, the Government announced that it would continue to charge it and the question of stopping it was under consid eration of the Government whose decision would be binding on the contractors.
The firm (appellants) thus paid for the above contracts a total extra sum of Rs.54,606.00.
On 17.10.1961 the Under Secretary to Government, M.P., Forest Department, Bhopal wrote the following letter No. 10 130 X/61 (Exhibit D 23) to the Chief Conservator of Forests, Madhya Pradesh, Rewa: "Subject: Levy of cess on liquor contractors.
Under former M.P. Government (Forest Depart ment) memo No. 4595 CR 73 XI dated 25th July, 1953, a royalty at 7 1/2 per cent of the license fee for liquor shops was imposed on liquor contractors to cover the value of mahua & fuel extracted from the reserved or protect ed forests by the contractors for their still.
The M.P. High Court has since decided that the levy of the aforesaid cess is illegal and the cess cannot be recovered from the liquor contractors.
In pursuance of this decision, Government desires that all process es whenever issued or proceedings instituted against liquor contractors for recovery of the mahua or fuel cess should forthwith be with drawn and no revenue recovery certificates should be issued in respect of this cess.
Simultaneously no free supply of mahua or fuel should be permitted by virtue of the imposition mentioned above.
Immediate compliance is requested.
No . .
X/61 Dt.
Bhopal the . . 661 Copy forwarded for immediate compliance to: 600 1.
Conservator of Forests, Bilaspur. 2.
All Divisional Forest Officers, Bilaspur Circle.
Copy to C.F. Raipur Circle for similar auction in this cess levied in any division of his Circle.
" On 24.4.1959 the Madhya Pradesh High Court 's Judgment in Surajdin vs State of M.P., declaring the collection of 7 1/2 per cent illegal was reported in 1960 MPLJ 39.
Even after this decision Government continued to charge 7 1/2 per cent extra money.
Again on 31.8.
1961 the High Court of Madhya Pradesh in N.K. Doongaji vs Collector, Surguja, decided that the charging of 7 1/2 per cent by the Government above the auction money was illegal.
This Judgment was reported in 1962 MPLI 130.
It is the appellants ' case that they came to know about this decision only in or about September 1962.
On 17.10.
1964 they served a notice on Government of Madhya Pradesh under section 80 of the Code of Civil Procedure request ing the refund of Rs.54,606.00, failing which, a suit for recovery would be filed; and later they instituted Civil Suit No. of 1964 in the court of Additional District Judge, Jabalpur on 24.12.1964.
The Government resisted the suit on, inter alia, ground of limitation.
The trial court taking the view that Articles 62 and 96 of the First Schedule to the Limitation Act, 1908 were applicable and the period of limitation began to run from the dates the payments were made to the Government, held the suit to be barred by limi tation and dismissed it.
In appeal, the High Court took the view that Article 113 read with section 17, and not Article 24, of the Schedule to the , was applicable; and held that the limitation began to run from 17.10.
1961 on which date the Government decided not to charge extra 7 1/2 per cent on the auction money, and as such, the suit was barred on 17.12.
1964 taking into consideration the period of two months prescribed by section 80 of the Code of Civil Procedure.
Consequently, the appeal was dismissed.
The appellants ' petition for leave to appeal to this Court was also rejected observing, "it was unfortunate that the peti tioners filed their suit on 24.12.
1964 and as such the suit was barred by time by seven days." Mr. M.V. Goswami, learned counsel for the appellants, submits, inter alia, that the High Court erred in holding that the limitation started running from 17.16.1961 being the date of the letter, Exhibit D 23, which was not communi cated to the appellants or any other contractor and there fore the appellants had no opportunity to know 601 about it on that very date with reasonable diligence under section 17 and the High Court ought to allow atleast a week for knowledge of it by the appellants in which case the suit would be within time.
Counsel further submits that the High Court while rightly discussing that section 17 of the was applicable, erred in not applying that section to the facts of the instant case, wherefore, the impugned Judgment is liable to be set aside.
Mr. Ujjwal A. Rana, the learned counsel for the respond ent, submits, inter alia, that 17.10.2961 having been the date on which the Government finally decided not to recover extra 7 1/2 per cent above the auction .money, the High Court rightly held that the limitation started from that date and the suit was clearly barred under Article 24 or 113 of the Schedule to the ; and that though the records did not show that the Government decision was communicated to the appellants, there was no reason why they, with reasonable diligence, could not have known about it on the same date The only question to be decided, therefore, is whether the decision of the High Court is correct.
To decide that question it was necessary to know what was the suit for.
There is no dispute that 7 1/2 per cent above the auction money was charged by the Government of Madhya Pradesh as mahua and fuel cess, and the High Court subsequently held that it had no power to do so.
In view of those writ peti tions challenging that power, Government asked the contrac tors to continue to pay the same pending Government 's deci sion on the question; and the appellants accordingly paid.
Ultimately on 17.10.1961 Government decided not to recover the extra amount any more but did not yet decide the fate of the amounts already realised.
There is no denial that the liquor contracts were performed by the appellants.
There is no escape from the conclusion that the extra 7 1/2 per cent was charged by the Government believing that it had power, but the High Court in two cases held that the power was not there.
The money realised was under a mistake and without authority of law.
The appellants also while paying suffered from the same mistake.
There is therefore no doubt that the suit was for refund of money paid under mistake of law.
The question is what was the law applicable to the case. 'Nul ne doit senrichir aux depens des autres ' No one ought to enrich himself at the expense of others.
This doctrine at one stage of English common law was remedied by 'indebitatus assumpsit ' which action lay for money "had and received to the use of the plaintiff".
It lay to recover 602 money paid under a mistake, or extorted from the plaintiff by duress of his goods, or paid to the defendant on a con sideration which totally tailed.
On abolition of 'indebit atus assumpsit ', courts used to imply a promise to pay which, however, in course of time was held to be purely fictitious.
Lord Manslied in Moses vs Macferlan, ; at 10 12 explained the juridical basis of the action for money "had and received" thus: "This kind of equitable action, to recover back money, which ought not in justice to be kept, is very beneficial, and therefore much encouraged.
It lies only for money which, 'ex aequo et bono ', the defendant ought to refund; it does not lie for money paid by the plain tiff, which is claimed of him as payable in point of honour and honesty, although it could not have been recovered from him by any course of law; as in payment of a debt barred by the Statute of Limitations, or contracted during his infancy, or to the extent of principal and legal interest upon a usurious contract, or, for money fairly lost at play; because in all these cases, the defendant may retain it with a safe conscience, though by positive law he was barred from recovering.
But it lies for money paid by mistake; or upon a consideration which happens to fail; or for money got through imposition, (express or implied); or extortion; or oppression; or an undue advan tage taken of the plaintiff 's situation, contrary to laws made for the protection of persons under those circumstances.
In one word, the gist of this kind of action is, that the defendant, upon the circumstances of the case, is obliged by the ties of natural jus tice and equity to refund the money." In that case Moses received from Jacob four promissory notes of cash each.
He endorsed these to Macferlan who, by a written agreement, contracted that he would not hold Moses liable on the endorsement.
Subsequently, however, Macferlan sued Moses on the notes in a Court of Conscience.
The Court refused to recognise the agreement, and Moses was forced to pay.
Moses then brought an action against Macferlan in the king 's Bench for money "had and received" to his use.
Lord Manslied allowed him to recover observing as above.
Courts in England have since been trying to formulate a juridicial basis of this obligation.
Idealistic formulations as 'aequum et bonum ' and 'natural justice ' were considered to be inadequate and the 603 more legalistic basis of unjust enrichment is formulated.
The doctrine of 'unjust enrichment ' is that in certain situation it would be 'unjust ' to allow the defendant to retain a benefit at the plaintiff 's expense.
The relatively modern principle of Restitution is of the nature of quasi contract.
But the English law has not yet recognised any generalised right to restitution in every case of unjust enrichment.
As Lord Diplock has said, "there is no general doctrine of "unjust enrichment" recognised in English law.
What it does is to provide specific remedies in particular cases of what might be classed as unjust enrichment in a legal system i.e. based upon the civil law.
" In Sinclair vs Brougham, Lord Haldane said that law could 'de jure ' impute promises to repay whether for money "had and received" otherwise, which may, if made defacto, it would inexorably avoid.
The principle of unjust enrichment requires: first, that the defendant has been 'enriched ' by the receipt of a "benefit"; secondly, that this enrichment is "at the expense of the plaintiff"; and thirdly, that the retention of the enrichment be unjust.
This justifies restitution.
Enrichment may take the form of direct advantage to the recipient wealth such as by the receipt of money or indirect one for instance where inevitable expense has been saved.
Another analysis of the obligation is of quasi contract.
It was said; "if the defendant be under an obligation from the ties of natural justice, to refund; the law implies a debt, and give this action rounded in the equity of the plaintiff 's case, as it were, upon a contract (quasi ex contracts) as the Roman law expresses it." As Lord Wright in Fibrosa Spolka vs Fairbairn Lawson, [1943] AC 32 1942 pointed out, "the obligation is as efficacious as if it were upon a contract.
Such remedies are quasi contract or restitution and theory of unjust enrichment has not been closed in English law.
" Section 72 of the Indian Contract Act deals with liabil ity of person to whom money is paid or thing delivered, by mistake or under coercion.
It says: "A person to whom money has been paid, or anything delivered, by mistake or under coer cion, must repay or return it." Illustration (b) to the section is: "A Railway Company refuses to deliver up certain goods to the consignee, except upon the payment of an illegal 604 charge for carriage.
The consignee pays the sum charged in order to obtain the goods.
He is entitled to recover so much of the charge as was illegally excessive.
" Our law having been codified, we have to apply the law.
It is true, as Pollock wrote in 1905 in the preface to the first Edition of Pollock and Mulla 's Indian Contract and Specific Relief Acts: "The Indian Contract Act is in effect . . a code of English law.
Like all codes based on an existing authoritative doctrine, it assumes a certain knowledge of the principles and habits of thought which are embodied in that doctrine.
" It is, therefore, helpful to know "those fundamental notions in the common law which are concisely declared, with or, without modification by the text.
" There is no doubt that the instant suit is for refund of money paid by mistake and refusal to refund may result in unjust enrichment depending on the facts and circumstances of the case.
It may be said that this court has referred to unjust enrichment in cases under section 72 of the Contract Act.
See ; ; and ; The next question is whether, and if so, which provision of the will apply to such a suit.
On this question we find two lines of decisions of this Court, one in respect of civil sulks and the other in respect of peti tions under Article 226 of the Constitution of India.
Though there is no constitutionally provided period of limitation for petitions under Article 226, the limitation prescribed for such suits has been accepted as the guideline, though little more latitude is available in the former.
A tax paid under mistake of law is refundable under section 72 of the .
In Sales Tax Officer vs Kanhaiya Lal, where the respondent, a regis tered firm, paid sales tax in respect of the forward trans actions in pursuance of the assessment orders passed by the Sales Tax Officer for the year 1949 51; in 1952 the Allaha bad High Court held in M/s Budh Prakash Jai Prakash vs Sales Tax Officer, Kanpur, that the levy of sales tax on forward transactions was ultra vires.
The respondent asked for a refund of the mounts paid, filing a writ peti tion under Article 226 of 605 the Constitution.
It was contended for the Sales Tax Author ities that the respondent was not entitled to a refund because (1) the amounts in dispute were paid by the respond ent under a mistake of law and were, therefore, irrecovera ble, (2) the payments were in discharge of the liability under the Sales Tax Act and were voluntary payments without protest, and (3) inasmuch as the monies which had been received by the Government had not been retained but had been spent away by it and the respondent was disentitled to recover the said amounts.
This Court held that the term "mistake" in section 72 of the comprised within its scope a mistake of law as well as a mistake of fact and that, under that section a party is entitled to recover money paid by mistake or under coercion, and if it is established that the payment, even though it be of a tax, has been made by the party labouring under a mistake of law, the party receiving the money is bound to repay or return it though it might have been paid voluntarily, subject, howev er, to questions of estoppel, waiver, limitation or the like.
On the question of limitation, it was held that section 17(1)(c) of the would be applicable and that where a suit will be to recover "monies paid under a mistake of law, a writ petition within the period of limita tion prescribed, i.e., within 3 years ' of the knowledge of the mistake, would also lie.
" It was also accepted that the period of limitation does not begin to run until the plain tiff has discovered the mistake or could, with reasonable diligence, have discovered it.
The money may not be recoverable if in paying and re ceiving it the parties were in pan delicto.
In Kiriri Cotton Co. Ltd. vs Ranchhoddas Keshavji Dewani, , where the appellant company, in consideration of granting to the respondent a sub lease asked for and received from him a premium of Sh.
10,000 and the latter.claimed refund thereof, the Privy Council held that the duty of observing the law was firmly placed by the Ordinance on the shoulders of the landlord for the protection of the tenant, and the appellant company and the respondent were not therefore in pari delic to in receiving and paying respectively the illegal premium, which, therefore, in accordance with established common law principles, the respondent was entitled to recover from the landlord and that the omission of a statutory remedy did not in cases of this kind exclude the remedy by money had and received.
In the instant case also the parties could not be said to be in pari delicto in paying and receiving the extra 7 1/2% per cent.
Had the appellants not paid this amount, they would not have been given the contracts.
In D. Cawasji &.
Co. vs The State of Mysore & Anr.
, ; , the appellants paid certain amount to the Government as 606 excise duty and education cess for the years 195 1 52 to 1965 66 in one case and from 1951 52 to 1961 62 in the other.
The High Court struck down the provisions of the relevant Acts as unconstitutional.
In Writ Petitions before the High Court claiming refund, the appellants contended that the payments in question were made by them under mis take of law; that the mistake was discovered when the High Court struck down the provisions as unconstitutional and the petitions were, therefore, in time but the High Court dis missed them on the ground of inordinate delay.
Dismissing the appeals, this Court held that where a suit would lie to recover monies paid under a mistake of law, a writ petition for refund of tax within the period of limitation would lie.
For filing a writ petition to recover the money paid under a mistake of law the starting point of limitation is from the date on which the judgment declaring as void the particular law under which the tax was paid was rendered.
It was held in D. Cawasji (supra) that although section 72 of the Contract Act has been held to cover cases of payment of money under a mistake of law, as the State stands in a peculiar position in respect of taxes paid to it, there are perhaps practical reasons for the law according different treatment both in the matter of the heads under which they could be recovered and the period of limitation for recovery.
P.N. Bhagwati, J., as he then was, in Madras Port Trust vs Hymanshu Inter national, , deprecated any resort to plea of limitation by public authority to defeat just claim of citizens observing that though permissible under law, such technical plea should only be taken when claim is not well founded.
Section 17(1)(c) of the , provides that in the case of a suit for relief of the ground of mistake, the period of limitation does not begin to run until the plaintiff had discovered the mistake or could with reasonable diligence, have discovered it.
In a case where payment has been made under a mistake of law as contrasted with a mistake of fact, generally the mistake become known to the party only when a court makes a declaration as to the invalidity of the law.
Though a party could, with reasonable diligence, discover a mistake of fact even before a court makes a pronouncement, it is seldom that a person can, even with reasonable diligence, discover a mistake of law before a judgment adjudging the validity of the law.
E.S. Venkataramiah, J., as his Lordship then was, in Shri Vallabh Glass Works Ltd. vs Union of India, ; , where the appellants claimed refund of excess duty paid under Central Excise and Salt Act, 1944, laid down that the excess amount paid by the appellants would have become refundable by virtue of section 72 of the 607 if the appellants had filed a suit within the period of limitation; and that section 17(1)(c) and Article 113 of the would be applicable.
In Commissioner of Sales Tax, U.P.v.
M/s Auriaya Chamber of Commerce Allahabad; , , the Supreme Court in its decision dated May 3, 1954 in Sales Tax Officer vs Budh Prakash Jai Prakash, [1954] 5 STC 193 having held tax on forward contracts to be illegal and ultra vires the U.P. Sales Tax Act, and that the decision was applicable to the assessee 's case, the assessee filed several revisions for quashing the assessment order for the year 1949 50 and for subsequent years which were all dismissed on ground of limitation.
In appeal to this Court Sabyasachi Mukharji, J. while dismissing the appeal held that money paid under a mistake of law comes within mistake in section 72 of the Contract Act; there is no question of any estoppel when the mistake of law is common to both the assessee and taxing authority.
His Lordship observed that section 5 of the Limitation Act, 1908 and Article 96 of its First Schedule which prescribed a period of 3 years were applicable to suits for refund of illegally collected tax.
In Salonah Tea Co. Ltd. & Ors.
vs Superintendent of Taxes, Nowgong and Ors.
, ; , the Assam Taxa tion (on Goods carried by Road or Inland Waterways) Act, 1954 was declared ultra vies the Constitution by the Supreme Court in Atiabari Tea Co. Ltd. vs State of Assam, ; A subsequent Act was also declared ultra vires by High Court on August 1, 1963 against which the State of Assam and other respondents preferred appeals to Supreme Court.
Meanwhile the Supreme Court in a writ petition Khyer bari Tea Co. Ltd. vs State of Assam, ; , declared on December 13, 1963 the Act to be intra vires.
Consequently the above appeals were allowed.
Notices were, therefore, issued requiring the appellant under section 7(2) of the Act to submit returns.
Returns were duly filed and assessment orders passed thereon.
On July 10, 1973, the Gauhati High Court in its Judgment in Loong Soong Tea Es tate 's case, Civil Rule No. 1005 of 1969, decided on July 10, 1973, declared the assessment to be without jurisdic tion.
In November, 1973 the appellant filed writ petition in the High Court contending that in view of the decision in Loong Soong Tea Estate 's case he came to know about the mistake in paying tax as per assessment order and also that he became entitled to refund of the amount paid.
The High Court set aside the order and the notice of demand for tax under the Act but declined to order refund of the taxes paid by the appellant on the ground of delay and laches as in view of the High Court it was possible for the appellant to know about 608 the illegality of the tax sought to be imposed as early as in 1963, when the Act in question was declared ultra vires.
Allowing the assessee 's appeal, Mukharji, J. speaking for this Court held: "In this case indisputably it appears that tax was collected without the authority of law.
Indeed the appellant had to pay the tax in view of the notices which were without juris diction.
It appears that the assessment was made under section 9(3) of the Act.
Therefore, it was without jurisdiction.
In the premises it is manifest that the respondents had no authority to retain the money collected with out the authority of law and as such the money was liable to refund.
" The question there was whether in the application under article 226 of the Constitution, the Court should have refused refund on ground of laches and delay, the case of the appel lant having been that it was after the Judgment in the case of Loong Soong tea Estate, the cause of action arose.
That judgment was passed in July, 1973.
The High Court was, therefore, held to have been in error in refusing to order refund on the ground that it was possible for the appellant to know about the legality of the tax sought to be imposed as early as 1973 when the Act in question was declared ultra vires.
The Court observed: "Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law.
Equally, as a corollary of the said statement of law it follows that taxes col lected without the authority of law as in this case from a citizen should be refunded because no State has the right to receive or to retain taxes or monies realised from citizens without the authority of law.
" On the question of limitation referring to Suganmal vs State of M.P., AIR 1965 SC 1740, and Tilokchand Motichand vs H.B. Munshi, , his Lordship observed that the period of limitation prescribed for recovery of money paid by mistake started from the date when the mistake was known.
In that case knowledge was attributable from the date of the Judgment in Loong Soong Tea Estate 's case on July 10, 1973.
There had been statement that the appellant came to know of that matter in October, 1973 and there was no denial of the averment made.
On that ground, the High Court was held to be in 609 error.
It was accordingly held that the writ petition filed by the appellants were within the period of limitation prescribed under article 113 of the Schedule read with section 23 of the .
It is thus a settled law that in suit for refund of money paid by mistake of law, section 72 of the Contract Act is applicable and the period of limitation is three years as prescribed by Article 113 of the Schedule to the Indian and the provisions of section 17(1)(c) of that Act will be applicable so that the period will begin to run from the date of knowledge of the particular law, where under the money was paid, being declared void; and this court be the date of judgment of a competent court declaring that law void.
In the instant case, though the Madhya Pradesh High Court in Surajdin vs State of M.P., declared the collection on 7 1/2% per cent illegal and that decision was reported in , the Government was still charging it saying that the matter was under consideration of the Government.
The final decision of the Government as stated in the letter dated 17.10.
1961 was purely an internal communication of the Government copy whereof was never communicated to the appellants or other liquor contractors.
There could, there fore, be no question of the limitation starting from that date.
Even with reasonable diligence, as envisaged in section 17(1)(c) of the , the appellants would have taken at least week to know about it.
Mr. Rana has fairly stated that there was nothing on record to show that the appellants knew about this letter on 17.10.
1961 itself or within a reasonable time thereafter.
We are inclined to allow at least a week to the appellants under the above provision.
Again Mr. Rana has not been in a position to show that the statement of the appellants that they knew about the mistake only after the judgment in Doongaji 's case reported in , in or about September, 1962, whereafter they issued the notice under section 80 C.P.C. was untrue.
This statement has not been shown to be false.
In either of the above cases, namely, of knowledge one week after the letter dated 17.10.
1961 or in or about September, 1962, the suit would be within the period of limitation under Article 113 of the Schedule to the .
In the result, we set aside the Judgment of the High Court, allow the appeal and remand the suit.
The records will be sent down forthwith to the trial court to decide the suit on merit in accordance with law, expeditiously.
The appellants shall be entitled to the costs of this appeal.
R.N .J.
Appeal allowed.
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From the Judgment and Order dated 6.4.1972 of the Madhya Pradesh High Court in F.A. No. U.A. Rana and S.K. Agnihotri for the Respondents. The firm (appellants) thus paid for the above contracts a total extra sum of Rs.54,606.00. On 17.10.1961 the Under Secretary to Government, M.P., Forest Department, Bhopal wrote the following letter No. Under former M.P. Government (Forest Depart ment) memo No. 4595 CR 73 XI dated 25th July, 1953, a royalty at 7 1/2 per cent of the license fee for liquor shops was imposed on liquor contractors to cover the value of mahua & fuel extracted from the reserved or protect ed forests by the contractors for their still. The M.P. High Court has since decided that the levy of the aforesaid cess is illegal and the cess cannot be recovered from the liquor contractors. Simultaneously no free supply of mahua or fuel should be permitted by virtue of the imposition mentioned above. 661 Copy forwarded for immediate compliance to: 600 1. All Divisional Forest Officers, Bilaspur Circle. Copy to C.F. Raipur Circle for similar auction in this cess levied in any division of his Circle. " On 24.4.1959 the Madhya Pradesh High Court 's Judgment in Surajdin vs State of M.P., declaring the collection of 7 1/2 per cent illegal was reported in 1960 MPLJ 39. Even after this decision Government continued to charge 7 1/2 per cent extra money. This Judgment was reported in 1962 MPLI 130. It is the appellants ' case that they came to know about this decision only in or about September 1962. of 1964 in the court of Additional District Judge, Jabalpur on 24.12.1964. The Government resisted the suit on, inter alia, ground of limitation. 1961 on which date the Government decided not to charge extra 7 1/2 per cent on the auction money, and as such, the suit was barred on 17.12. 1964 taking into consideration the period of two months prescribed by section 80 of the Code of Civil Procedure. 1964 and as such the suit was barred by time by seven days." Mr. M.V. Goswami, learned counsel for the appellants, submits, inter alia, that the High Court erred in holding that the limitation started running from 17.16.1961 being the date of the letter, Exhibit D 23, which was not communi cated to the appellants or any other contractor and there fore the appellants had no opportunity to know 601 about it on that very date with reasonable diligence under section 17 and the High Court ought to allow atleast a week for knowledge of it by the appellants in which case the suit would be within time. To decide that question it was necessary to know what was the suit for. In view of those writ peti tions challenging that power, Government asked the contrac tors to continue to pay the same pending Government 's deci sion on the question; and the appellants accordingly paid. Ultimately on 17.10.1961 Government decided not to recover the extra amount any more but did not yet decide the fate of the amounts already realised. There is no denial that the liquor contracts were performed by the appellants. The money realised was under a mistake and without authority of law. The appellants also while paying suffered from the same mistake. There is therefore no doubt that the suit was for refund of money paid under mistake of law. The question is what was the law applicable to the case. ' Nul ne doit senrichir aux depens des autres ' No one ought to enrich himself at the expense of others. It lay to recover 602 money paid under a mistake, or extorted from the plaintiff by duress of his goods, or paid to the defendant on a con sideration which totally tailed. In one word, the gist of this kind of action is, that the defendant, upon the circumstances of the case, is obliged by the ties of natural jus tice and equity to refund the money." In that case Moses received from Jacob four promissory notes of cash each. He endorsed these to Macferlan who, by a written agreement, contracted that he would not hold Moses liable on the endorsement. Subsequently, however, Macferlan sued Moses on the notes in a Court of Conscience. The Court refused to recognise the agreement, and Moses was forced to pay. Moses then brought an action against Macferlan in the king 's Bench for money "had and received" to his use. Lord Manslied allowed him to recover observing as above. Courts in England have since been trying to formulate a juridicial basis of this obligation. Idealistic formulations as 'aequum et bonum ' and 'natural justice ' were considered to be inadequate and the 603 more legalistic basis of unjust enrichment is formulated. The doctrine of 'unjust enrichment ' is that in certain situation it would be 'unjust ' to allow the defendant to retain a benefit at the plaintiff 's expense. The relatively modern principle of Restitution is of the nature of quasi contract. As Lord Diplock has said, "there is no general doctrine of "unjust enrichment" recognised in English law. The principle of unjust enrichment requires: first, that the defendant has been 'enriched ' by the receipt of a "benefit"; secondly, that this enrichment is "at the expense of the plaintiff"; and thirdly, that the retention of the enrichment be unjust. Enrichment may take the form of direct advantage to the recipient wealth such as by the receipt of money or indirect one for instance where inevitable expense has been saved. Another analysis of the obligation is of quasi contract. Such remedies are quasi contract or restitution and theory of unjust enrichment has not been closed in English law. It says: "A person to whom money has been paid, or anything delivered, by mistake or under coer cion, must repay or return it." The consignee pays the sum charged in order to obtain the goods. He is entitled to recover so much of the charge as was illegally excessive. " Our law having been codified, we have to apply the law. It is true, as Pollock wrote in 1905 in the preface to the first Edition of Pollock and Mulla 's Indian Contract and Specific Relief Acts: "The Indian Contract Act is in effect . . Like all codes based on an existing authoritative doctrine, it assumes a certain knowledge of the principles and habits of thought which are embodied in that doctrine. " It is, therefore, helpful to know "those fundamental notions in the common law which are concisely declared, with or, without modification by the text. " There is no doubt that the instant suit is for refund of money paid by mistake and refusal to refund may result in unjust enrichment depending on the facts and circumstances of the case. See ; ; and ; The next question is whether, and if so, which provision of the will apply to such a suit. On this question we find two lines of decisions of this Court, one in respect of civil sulks and the other in respect of peti tions under Article 226 of the Constitution of India. Though there is no constitutionally provided period of limitation for petitions under Article 226, the limitation prescribed for such suits has been accepted as the guideline, though little more latitude is available in the former. A tax paid under mistake of law is refundable under section 72 of the . In Sales Tax Officer vs Kanhaiya Lal, where the respondent, a regis tered firm, paid sales tax in respect of the forward trans actions in pursuance of the assessment orders passed by the Sales Tax Officer for the year 1949 51; in 1952 the Allaha bad High Court held in M/s Budh Prakash Jai Prakash vs Sales Tax Officer, Kanpur, that the levy of sales tax on forward transactions was ultra vires. This Court held that the term "mistake" in section 72 of the comprised within its scope a mistake of law as well as a mistake of fact and that, under that section a party is entitled to recover money paid by mistake or under coercion, and if it is established that the payment, even though it be of a tax, has been made by the party labouring under a mistake of law, the party receiving the money is bound to repay or return it though it might have been paid voluntarily, subject, howev er, to questions of estoppel, waiver, limitation or the like. " It was also accepted that the period of limitation does not begin to run until the plain tiff has discovered the mistake or could, with reasonable diligence, have discovered it. The money may not be recoverable if in paying and re ceiving it the parties were in pan delicto. In the instant case also the parties could not be said to be in pari delicto in paying and receiving the extra 7 1/2% per cent. Had the appellants not paid this amount, they would not have been given the contracts. The High Court struck down the provisions of the relevant Acts as unconstitutional. Dismissing the appeals, this Court held that where a suit would lie to recover monies paid under a mistake of law, a writ petition for refund of tax within the period of limitation would lie. It was held in D. Cawasji (supra) that although section 72 of the Contract Act has been held to cover cases of payment of money under a mistake of law, as the State stands in a peculiar position in respect of taxes paid to it, there are perhaps practical reasons for the law according different treatment both in the matter of the heads under which they could be recovered and the period of limitation for recovery. His Lordship observed that section 5 of the Limitation Act, 1908 and Article 96 of its First Schedule which prescribed a period of 3 years were applicable to suits for refund of illegally collected tax. vs Superintendent of Taxes, Nowgong and Ors. Consequently the above appeals were allowed. Notices were, therefore, issued requiring the appellant under section 7(2) of the Act to submit returns. Returns were duly filed and assessment orders passed thereon. 1005 of 1969, decided on July 10, 1973, declared the assessment to be without jurisdic tion. Allowing the assessee 's appeal, Mukharji, J. speaking for this Court held: "In this case indisputably it appears that tax was collected without the authority of law. Indeed the appellant had to pay the tax in view of the notices which were without juris diction. It appears that the assessment was made under section 9(3) of the Act. The Court observed: "Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law. In that case knowledge was attributable from the date of the Judgment in Loong Soong Tea Estate 's case on July 10, 1973. There had been statement that the appellant came to know of that matter in October, 1973 and there was no denial of the averment made. On that ground, the High Court was held to be in 609 error. In the instant case, though the Madhya Pradesh High Court in Surajdin vs State of M.P., declared the collection on 7 1/2% per cent illegal and that decision was reported in , the Government was still charging it saying that the matter was under consideration of the Government. The final decision of the Government as stated in the letter dated 17.10. 1961 was purely an internal communication of the Government copy whereof was never communicated to the appellants or other liquor contractors. There could, there fore, be no question of the limitation starting from that date. Even with reasonable diligence, as envisaged in section 17(1)(c) of the , the appellants would have taken at least week to know about it. 1961 itself or within a reasonable time thereafter. Again Mr. Rana has not been in a position to show that the statement of the appellants that they knew about the mistake only after the judgment in Doongaji 's case reported in , in or about September, 1962, whereafter they issued the notice under section 80 C.P.C. was untrue. This statement has not been shown to be false. In either of the above cases, namely, of knowledge one week after the letter dated 17.10. In the result, we set aside the Judgment of the High Court, allow the appeal and remand the suit. The records will be sent down forthwith to the trial court to decide the suit on merit in accordance with law, expeditiously. The appellants shall be entitled to the costs of this appeal.
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The appellant firm was allotted contracts for manufac ture and sale of liquor for the year 1959 and for the subse quent periods from 1.1.
1960 to 31.3.1961 for Rs.2,56,200 and Rs.4,71,900 respectively by the M.P. Govt.
who also charged 7 1/2% over the auction money as mahua and fuel cess.
As writ petitions challenging the government 's right to charge this 7 1/2% were pending in the M.P. High Court, the Govt.
announced that it would continue to charge it and the question of stopping it was under consideration of Govt.
whose decision would be binding on the contractors.
The appellant firm paid for the above contracts a total extra sum of Rs.54,606.00.
On 24.4.1959 the M.P. High Court in Surajdin vs State of M.P., declared the collection of 7 1/2% as illegal.
Even after this decision the Govt.
continue to charge 7 1/2% extra money.
Again on 31.8.1961, the High Court of Madhya Pradesh in N.K. Doongaji vs Collector, Surguja, decided that charg ing of 7 1/2% by the Govt.
above the auction money was illegal.
Appellants came to know of this decision only in or about September, 1962.
On 17.10.1964 the appellants gave a notice under section 80 C.P.C. to the Govt.
of Madhya Pradesh requesting for the refund of Rs.54,606.00.
failing which a suit for recovery would be filed and later they instituted a civil suit in the court of additional District Judge, Jabalpur on 24.12.1964.
The Govt.
resisted the suit inter alia on the ground of limitation.
The Trial Court held that the suit was barred by 597 limitation and dismissed it.
The High Court also dismissed the appeal.
The appellants then came up in appeal by special leave.
While allowing the appeal and remanding the suit to the Trial Court for decision on merits.
This Court, HELD: 'Nul ne doit senrichir aux depens des autres ' No one ought to enrich himself at the expense of others.
This doctrine at one stage of English common Law was remedied by 'indebitatus assumpsit ' which action lay for money ' had and received to the use of the plaintiff '.
It lay to recover money paid under a mistake or extorted from the plaintiff by duress of his goods, or paid to the defendant on a consider ation which totally failed.
On abolition of 'indebitatus assumpsit ', courts used to imply a promise to pay which, however, in course of time was held to be purely fictitious.
[601G 602A] Courts is England have since been trying to formulate a juridical basis of this obligation.
Idealistic formulations as 'aequum et bonum ' and 'natural justice ' were considered to be inadequate and the more legalistic basis of unjust enrichment is formulated.
The doctrine of 'unjust enrich ment ' is that in certain situations it would be 'unjust ' to allow the defendant to retain a benefit at the plaintiff 's expense.
The relatively modern principle of restitution is of the nature of quasi contract.
But the English law has not yet recognised any generalised right to restriction in every case of unjust enrichment.
[602H 603B] The principle of unjust enrichment requires; first, that the defendant has been 'enriched ' by the receipt of a "benefit"; secondly.
that this enrichment is "at the expense of the plaintiff" and thirdly, that the retention of the enrichment be unjust.
This justified restitution.
Enrichment may take the form of direct advantage to the recipient wealth such as by the receipt of money or indirect one for instance where inevitable expense has been saved.
[603C 603D] There is no doubt that the suit in the instant case, is for refund of money paid by mistake and refusal to refund may result in unjust enrichment depending on the facts and circumstances of the case.
[604D] Though there is no constitutionally provided period of limitation for petitions under Article 226, the limitation prescribed for such suits has been accepted as the guide line, though little more latitude is available in the for mer.
[604F] For filing a writ petition to recover the money paid under a mis 598 take of law the starting point of limitation is three years is prescribed by Article 113 of the Schedule to the Indian and the provisions of section 17(1)(c) of the Act will be applicable so that the period will begin to run from the date of knowledge of the particular law, where under the money was paid, being declared void and this could be the date of the judgment of a competent court declaring that law void.
[609B] Moses vs Macferlan, ; at 1012; Sin clair vs Brougham, ; Fibrosa Spolka vs Fair bairn Lawson; , = ; ; Sales Tax Officer vs Kanhaiya Lal, ; M/s Budh Prakash Jai Prakash vs Sales Tax Officer, Kanpur, ; Kiriri Cotton Co. Ltd. vs Ranchhoddas Keshavji Dewani, ; D. Cawasji & Co. vs The State of Mysore & Anr., ; ; Madras Port 7rust vs Hymanshu Inter national, ; Shri Vallabh Glass Works Lid.
vs Union of India; , ; Commissioner of Sales Tax, U.P.v.
M/s. Auriaya Chamber of Commerce Allahabad; , ; Sales Tax Officer vs Budh Prakash Jai Prakash, [1954] 5 STC 193; Salonah Tea Co. Ltd. & Ors.
vs Superin tendent of Taxes, Nowgong & Ors.
, ; ; Atiabari Tea Co. Ltd. vs State of Assam, ; ; Khyerbari Tea Co. Ltd. vs State of Assam, ; ; Loong Soong Tea Estate 's, case decided on July 10, 1973; Suganmal vs State of M.P., AIR 1965 SC 1740; Tilokchand Motichand vs H.B. Munshi, , referred to.
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The appellant firm was allotted contracts for manufac ture and sale of liquor for the year 1959 and for the subse quent periods from 1.1. 1960 to 31.3.1961 for Rs.2,56,200 and Rs.4,71,900 respectively by the M.P. Govt. who also charged 7 1/2% over the auction money as mahua and fuel cess. As writ petitions challenging the government 's right to charge this 7 1/2% were pending in the M.P. High Court, the Govt. announced that it would continue to charge it and the question of stopping it was under consideration of Govt. whose decision would be binding on the contractors. On 24.4.1959 the M.P. High Court in Surajdin vs State of M.P., declared the collection of 7 1/2% as illegal. Appellants came to know of this decision only in or about September, 1962. On 17.10.1964 the appellants gave a notice under section 80 C.P.C. to the Govt. of Madhya Pradesh requesting for the refund of Rs.54,606.00. The Trial Court held that the suit was barred by 597 limitation and dismissed it. The High Court also dismissed the appeal. The appellants then came up in appeal by special leave. While allowing the appeal and remanding the suit to the Trial Court for decision on merits. This Court, HELD: 'Nul ne doit senrichir aux depens des autres ' No one ought to enrich himself at the expense of others. On abolition of 'indebitatus assumpsit ', courts used to imply a promise to pay which, however, in course of time was held to be purely fictitious. [601G 602A] Courts is England have since been trying to formulate a juridical basis of this obligation. Idealistic formulations as 'aequum et bonum ' and 'natural justice ' were considered to be inadequate and the more legalistic basis of unjust enrichment is formulated. The doctrine of 'unjust enrich ment ' is that in certain situations it would be 'unjust ' to allow the defendant to retain a benefit at the plaintiff 's expense. The relatively modern principle of restitution is of the nature of quasi contract. that this enrichment is "at the expense of the plaintiff" and thirdly, that the retention of the enrichment be unjust. Enrichment may take the form of direct advantage to the recipient wealth such as by the receipt of money or indirect one for instance where inevitable expense has been saved. [604F] For filing a writ petition to recover the money paid under a mis 598 take of law the starting point of limitation is three years is prescribed by Article 113 of the Schedule to the Indian and the provisions of section 17(1)(c) of the Act will be applicable so that the period will begin to run from the date of knowledge of the particular law, where under the money was paid, being declared void and this could be the date of the judgment of a competent court declaring that law void. Madras Port 7rust vs Hymanshu Inter national, ; Shri Vallabh Glass Works Lid. vs Superin tendent of Taxes, Nowgong & Ors. , ; ; Atiabari Tea Co. Ltd. vs State of Assam, ; ; Khyerbari Tea Co. Ltd. vs State of Assam, ; ; Loong Soong Tea Estate 's, case decided on July 10, 1973; Suganmal vs State of M.P., AIR 1965 SC 1740; Tilokchand Motichand vs H.B. Munshi, , referred to.
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Mr. Sandeep Dere for the Petitioner in WP/224/2023.
Mr. L.S. Deshmukh i/b. Ms. Pooja Mankoji for the Petitioner in
Mr. Pranav Avhad a/w Ms. Darshana Naval for the Respondent
Nos.4 to 7 in WP/224/2023.
Ms. Purna S. Pradhan i/b. Mr. Dinesh B. Khaire for the
Applicants in OA No.830 of 2022 (party not made in
Mr. M.M. Pabale, AGP for the Respondent – State In
Mr. B.V. Samant, AGP for the Respondent – State in
1. Rule. Rule made returnable forthwith. With the consent
of parties taken up for final hearing.
2. By these petitions, petitioners challenge the Order dated
20th December, 2022 passed by the Maharashtra
Administrative Tribunal, Mumbai (Tribunal) in Original
Application Nos.775 of 2022, 776 of 2022, 777 of 2022, 778 of
2022, 779 of 2022, 793 of 2022, 796 of 2022 & 830 of 2022 by
which the Tribunal has proceeded to recall its earlier
Judgment and Order dated 11th April, 2022 passed in Original
Application Nos. 144 of 2022, 145 of 2022, 146 of 2022, 167 of
2022, 203 of 2022, 300 of 2022, 301 of 2022, 321 of 2022.
The petitioners also challenge common Order dated 22 nd
December, 2022 passed in both sets of Original Applications
wp 226.2023 (J) (f).doc
(OA No.775/2022 & other connected OAs and OA No.144 of
2022 & other connected OAs) to a larger Bench.
3. Brief facts of the case are that the recruitment process
for the post of Police Constable (Driver) was initiated by the
Additional Director General of Police, (M.S), Mumbai vide
Advertisement dated 30th November, 2019. The recruitment
process was apparently to be conducted in respect of the
separate Units / Districts. The Applicants in Original
Application No.144 of 2022 & other connected OAs filled up
forms in respect of multiple Units / Districts and also appeared
for multiple examinations. Though their names were included
in the merit list, the same were subsequently deleted from the
revised merit list for the reason of their participation in
selection process in more than one Unit/District. Challenging
deletion of their names from the revised merit list, Original
Application Nos.144 of 2022, 145 of 2022, 146 of 2022, 167 of
2022, 203 of 2022, 300 of 2022, 301 of 2022, 321 of 2022
were instituted by such candidates before the Tribunal. In
those Original Applications, though relief was sought for
inclusion of their names in the merit list and consequential
appointment to the post of Police Constable (Driver), the
wp 226.2023 (J) (f).doc
candidates that were likely to be affected by grant of such
reliefs were not impleaded as parties to those Original
4. The Tribunal proceeded to allow Original Application
No.144 of 2022 & ors, by common judgment and order dated
11th April, 2022 directing consideration of candidature of
applicants therein in further process of selection by setting
aside deletion of their names from the merit list.
5. The State Government proceeded to implement the
Tribunal’s judgment and order dated 11 th April, 2022 and it
appears that, names of some of the candidates got deleted from
the merit list and orders terminating them from service came
to be issued. This led to filing of Original Application Nos. 775
of 2022, 776 of 2022, 777 of 2022, 778 of 2022, 779 of 2022,
793 of 2022, 796 of 2022 & 830 of 2022. During the course of
hearing of those OAs, the Tribunal noticed that implementation
of its Judgment and order dated 11th April, 2022 passed in OA
No.144 of 2022 & ors, was the reason for termination of
services of the applicants in OA No.775 of 2022 & ors. The
Tribunal therefore proceeded to pass Order dated 20 th
wp 226.2023 (J) (f).doc
December, 2022 recalling its Judgment and order dated 11 th
April, 2022 passed in OA No.144 of 2022 & ors and restored all
those Original Applications on its file.
6. The Tribunal thereafter took up both sets of Original
Applications (OA Nos.144 of 2022 & ors and OA Nos. 775 of
2022 & ors) for hearing on 22 nd December, 2022 and
proceeded to refer all Original Applications for decision to a
larger Bench of three learned Members.
7. The petitioners in the present petitions are aggrieved by
Orders dated 20th December, 2022 and 22nd December, 2022
passed by the Tribunal.
8. Appearing for the petitioners, Mr. Dere and Mr.
Deshmukh, the learned counsels would submit that while
hearing OA No.775 of 2022 & ors, the Tribunal had no occasion
to decide the issue of validity of its Judgment and order dated
11th April, 2022 passed in OA No.144 of 2022 & ors. It is
further submitted that while passing order of recall dated 20th
December, 2022, the applicants in OA No.144 of 2022 & ors,
were not heard and the Order passed in their favour has been
wp 226.2023 (J) (f).doc
recalled behind their back. It is further submitted that no case
is made out by the Applicants in OA No.775 of 2022 & ors,
though they came to be affected only on account of passing of
the Judgment & order dated 11th April,2022 in OA No.144 of
2022 & ors. They would also contend that if the Tribunal was
of the view that reference to larger Bench was warranted, it
ought to have first distinguished its earlier decision dated 11 th
April 2022 by recording reasons and then made an order of
reference. That no specific question is formulated by the
Tribunal while making order of reference. Lastly, it is
submitted that the Applicants in OA No.144 of 2022 & ors,
have already been appointed in pursuance of the Judgment
and Order dated 11th April, 2022 and effect of recalling of the
said order would entail termination of their services.
9. Per contra, Mr. Pranav Avhad and Ms. Purva Pradhan,
the learned counsels appearing for Applicants in OA Nos.775 of
2022 & ors would oppose the Petitions and support the Order
passed by the Tribunal. They would submit that the Judgment
and Order dated 11th April, 2022 was erroneously passed by
the Tribunal in OA No.144 of 2022 & ors, without hearing the
candidates who were already selected and appointed and that
wp 226.2023 (J) (f).doc
the Tribunal has merely corrected the error by recalling its
order dated 11th April 2022 for the purpose of affording an
opportunity of hearing the affected candidates. It is further
submitted that reference of the issue to the Larger Bench
would enable the Tribunal to effectively decide the lis between
the competing parties.
10. We have also heard, learned AGP appearing on behalf of
11. There are competing claims of candidates participating
in selection in multiple Units/Districts and those participating
only in one Unit/District. When OA No.144 of 2022 & ors, were
instituted by the candidates appearing for examination in
multiple Units/Districts, the merit lists were already declared.
Names of selected candidates were already known. Therefore,
while challenging such merit lists and seeking inclusion of
their names therein, it was incumbent on such candidates to
include atleast some of the selected candidates in
representative capacity for affording them an opportunity of
defending those OAs. However, without impleading any of the
selected candidates, OA No.144 of 2022 & ors came to be
wp 226.2023 (J) (f).doc
instituted. The Tribunal proceeded to allow those OAs by its
Judgment and order dated 11th April, 2022 setting aside
deletion of names of applicants from the merit list and
directing consideration of their candidature in further
selection process.
12. We feel that the course of action adopted by the Tribunal
in entertaining OA Nos, 144 of 2022 & Ors without
impleadment of affected selected candidates was against the
well settled principles enunciated in various judgments of the
Apex Court. A reference in this regard can be made to the
Judgment in Ranjan Kumar v. State of Bihar 1, in which the
Apex Court has held as under:
7. In Rashmi Mishra v. M.P. Public Service Commission [Rashmi
Mishra v. M.P. Public Service Commission, (2006) 12 SCC 724 :
(2007) 2 SCC (L&S) 345] , after referring to Prabodh Verma [Pra-
bodh Verma v. State of U.P., (1984) 4 SCC 251 : 1984 SCC (L&S)
704] and Indu Shekhar Singh [Indu Shekhar Singh v. State of U.P.,
(2006) 8 SCC 129 : 2006 SCC (L&S) 1916] , the Court took note of
the fact that when no steps had been taken in terms of Order 1 Rule
8 of the Code of Civil Procedure or the principles analogous thereto
all the seventeen selected candidates were necessary parties in the
writ petition. It was further observed that the number of selected
candidates was not many and there was no difficulty for the appel-
lant to implead them as parties in the proceeding. Ultimately, the
Court held that when all the selected candidates were not im-
pleaded as parties to the writ petition, no relief could be granted to
the appellant therein.
8. In Tridip Kumar Dingal v. State of W.B. [Tridip Kumar Din-
gal v. State of W.B., (2009) 1 SCC 768 : (2009) 2 SCC (L&S) 119] ,
this Court approved the view expressed by the tribunal which had
opined that for absence of selected and appointed candidates and
without affording an opportunity of hearing to them, the selection
could not be set aside.
13. In view of the aforesaid enunciation of law, we are disposed to
think that in such a case when all the appointees were not im-
pleaded, the writ petition was defective and hence, no relief could
have been granted to the writ petitioners.
(emphasis supplied)
13. It may well be contended that it is not possible to implead
each and every selected candidate, however atleast some of
them in representative capacity ought to have been impleaded.
This aspect has been expounded by the Apex Court in its re-
cent judgment in Ajay Kumar Shukla and Others Vs. Arvind
Rai and Others2 in which it is held as under:
46. In the recent case of Mukul Kumar Tyagi and Ors. vs. The State
of Uttar Pradesh and Ors.,14 Ashok Bhushan, J., laid emphasis that
when there is a long list of candidates against whom the case is pro-
ceeded, then it becomes unnecessary and irrelevant to implead
each and every candidate. If some of the candidates are impleaded
then they will be said to be representing the interest of rest of the
candidates as well. The relevant portion of paragraph 75 from the
judgment is reproduced below:
“75...... We may further notice that Division Bench also no-
ticed the above argument of non-impleadment of all the se-
lected candidates in the writ petition but Division Bench has
not based its judgment on the above argument. When the in-
clusion in the select list of large number of candidates is on
the basis of an arbitrary or illegal process, the aggrieved par-
ties can complain and in such cases necessity of implead-
ment of each and every person cannot be insisted. Further-
more, when select list contained names of 2211 candidates, it
becomes unnecessary to implead every candidate in view of
the nature of the challenge, which was levelled in the writ pe-
tition. Moreover, few selected candidates were also im-
pleaded in the writ petitions in representative capacity.”
47. The present case is a case of preparation of seniority list and
that too in a situation where the appellants (original writ petition-
ers) did not even know the marks obtained by them or their profi-
ciency in the examination conducted by the Commission. The chal-
lenge was on the ground that the Rules on the preparation of senior-
ity list had not been followed. There were 18 private respondents
arrayed to the writ petition. The original petitioners could not have
known who all would be affected. They had thus broadly impleaded
18 of such Junior Engineers who could be adversely affected. In
matters relating to service jurisprudence, time and again it has
been held that it is not essential to implead each and every one who
could be affected but if a section of such affected employees is im-
pleaded then the interest of all is represented and protected. In
view of the above, it is well settled that impleadment of a few of the
affected employees would be sufficient compliance of the principle of
joinder of parties and they could defend the interest of all affected
persons in their representative capacity. Non-joining of all the par-
ties cannot be held to be fatal.”
14. When the Tribunal proceeded to pass the Judgment and
order dated 11th April, 2022, the same resulted in deletion of
names of some of the candidates from the merit list and many
of them were required to be terminated from service. This led
to filing of OA No.775 of 2022 & ors. by such candidates. This
situation could have been avoided, if such candidates were
impleaded to OA No.144 of 2022 & ors.
15. The Tribunal was thus faced with a situation where it had
already allowed OA Nos.144 of 2022 & ors. by its Judgment
wp 226.2023 (J) (f).doc
and order dated 11th April, 2022 without hearing candidates
who got adversely affected by it. Such affected candidates were
required to institute OA Nos.775 of 2022 & ors. If the Tribunal
was to allow OA Nos.775 of 2022 & ors, the same would have
resulted in conflicting judgments in respect of same selection.
The course of action to be adopted in a situation like this is
stated by the Apex Court in its Judgment in the case of K. Ajit
Babu and Others V. Union of India and Others 3. In Paragraph 6
of the Judgment, the Apex Court has held as under;
“4. ……. Often in service matters the judgments rendered either by
the Tribunal or by the Court also affect other persons, who are not
parties to the cases. It may help one class of employees and at the
same time adversely affect another class of employees. In such
circumstances the judgments of the courts or the tribunals may not
be strictly judgments in personam affecting only the parties to the
cases, they would be judgments in rem. In such a situation, the
question arises: What remedy is available to such affected persons
who are not parties to a case, yet the decision in such a case
adversely affects their rights in the matter of their seniority…….
5. The Tribunal rejected the application of the appellant merely on
the ground that the appellant was seeking setting aside of the
judgment rendered by the Central Administrative Tribunal,
Ahmedabad in the case of P.S. John (supra) in TA No. 263 of 1986.
It is here that the Tribunal apparently fell in error. No doubt the
decision of the Tribunal in the case P.S. John was against the
appellant but the application filed by the appellant under Section 19
of the Act has to be dealt with in accordance with law.
6. Consistency, certainty and uniformity in the field of
judicial decisions are considered to be the benefits arising
out of the “Doctrine of Precedent”. The precedent sets a
pattern upon which a future conduct may be based. One of
the basic principles of administration of justice is, that the
cases should be decided alike. Thus the doctrine of
wp 226.2023 (J) (f).doc
precedent is applicable to the Central Administrative
Tribunal also. Whenever an application under Section 19 of
the Act is filed and the question involved in the said
application stands concluded by some earlier decision of
the Tribunal, the Tribunal necessarily has to take into
account the judgment rendered in the earlier case, as a
precedent and decide the application accordingly. The
Tribunal may either agree with the view taken in the
earlier judgment or it may dissent. If it dissents, then the
matter can be referred to a larger Bench/Full Bench and
place the matter before the Chairman for constituting a
larger Bench so that there may be no conflict upon the two
Benches. The larger Bench, then, has to consider the
correctness of the earlier decision in disposing of the later
application. The larger Bench can overrule the view taken
in the earlier judgment and declare the law, which would
be binding on all the benches (see John Lucas1). In the
present case, what we find is that the Tribunal rejected the
application of the appellants thinking that the appellants
are seeking setting aside of the decision of the Tribunal in
Transfer Application No.263 of 1986. This view taken by
the Tribunal was not correct. The application of the
appellant was required to be decided in accordance with
law.”
16. Similar proposition is laid down by the Apex Court in its
judgment in Gopabandhu Biswal v. Krishna Chandra Mohanty4,
in which it is held in Para 11 as under:
11. According to the applicants certain documents though produced
before the Tribunal were not noticed by the Tribunal in deciding the
main matter. Even so, once a judgment of a Tribunal has attained fi-
nality, it cannot be reopened after the special leave petition against
that judgment has been dismissed. The only remedy for a person
who wants to challenge that judgment is to file a separate applica-
tion before the Tribunal in his own case and persuade the Tribunal
either to refer the question to a larger Bench or, if the Tribunal
prefers to follow its earlier decision, to file an appeal from the Tri-
bunal's judgment and have the Tribunal's judgment set aside in ap-
peal. A review is not an available remedy.
(emphasis supplied)
17. Thus, following the Judgment in K. Ajit Babu and
Gopabandhu Biswal (supra), the candidates who were
adversely affected by the Judgment and Order dated 11th April,
2022 rightly instituted fresh Original Applications (OA
Nos.775 of 2022 & ors). However what is not done by the
Tribunal was to follow mandate of the Judgments of the Apex
Court in K. Ajit Babu and Gopabandhu Biswal. It ought to have
proceeded to decide OA Nos.775 of 2022 & ors by directing
impleadment of all Applicants of OA Nos. 144/2022 & Ors.
thereto. If after hearing all the parties, the Tribunal was to
arrive at a conclusion that the view taken by it in its earlier
order dated 11th April 2022 was correct, OA Nos.775 of 2022 &
ors could be dismissed. On the other hand, if the Tribunal was
to disagree with the view taken in its order dated 11 th April
2022, OA Nos.775 of 2022 & ors would then be referred to
larger Bench of three learned Members. This is the mandate of
judgments in K. Ajit Babu and Gopabandhu Biswal.
18. The Tribunal however adopted procedure unknown to
law by recalling its order dated 11 th April 2022 passed in OA
No.144 of 2022 & ors while hearing OA No.775 of 2022 & ors.
wp 226.2023 (J) (f).doc
it is incomprehensible as to how the Tribunal could have
passed any order in OA Nos. 144/2022 & ors while hearing
altogether different OAs. To make things worse, the order of
recall was passed behind the back of Applicants of OA Nos.
144/2022 & Ors. We find that there was no necessity for the
Tribunal to recall Judgment and order dated 11 th April, 2022.
Instead, the Tribunal ought to have simply directed the
Applicants of OA Nos.775 of 2022 & ors, to implead all the
applicants of OA No.144 of 2022 & ors, as party-respondents
and after hearing them, ought to have decided OA No.775 of
2022 & ors. If it was to agree with the view taken in its
Judgment and Order dated 11th April, 2022, it could have
dismissed OA No.775 of 2022 & ors. On the other hand, if the
Tribunal was to form an opinion that a view taken in OA No.144
of 2022 & ors was erroneous, it could have proceeded to refer
OA No.775 of 2022 & ors to larger Bench following the
mandate of the Judgments in K. Ajit Babu and Gopabandhu
Biswal. The erroneous procedure for making a reference to
larger Bench by recalling order in OA 144/2022 & Ors seems to
have been adopted by the Tribunal as the Judgments in K. Ajit
Babu and Gopabandhu Biswal were possibly not cited before it.
wp 226.2023 (J) (f).doc
19. We are thus not in agreement with the procedure
adopted by the Tribunal in recalling its Judgment and Order
dated 11th April, 2022 for the purpose of referring both set of
Original Applications to a larger Bench. However, at the same
time, though the procedure adopted by the Tribunal does not
commend us, we do not find any reason to interfere in the
ultimate decision of the Tribunal to refer the Original
Applications to a larger Bench. True it is that the Tribunal
ought to have first recorded a finding for disagreement with
the view taken in its order dated 11th April 2022 and then
make an order of reference to a larger Bench. It also ought to
have formulated the exact issue for reference. However since
much water has flown by now, it would not be appropriate to
set aside the impugned orders and to relegate the matter back
to the Tribunal for following the correct procedure for making
reference as mandated in K. Ajit Babu. Since the reference is
already made to larger Bench and since both the sets of parties
are already before the Tribunal, ends of justice would meet if
the larger Bench of the Tribunal is permitted to decide the
controversy before it.
20. It also appears that there is another decision rendered by
the bench of the Tribunal at Nagpur on 31 st March 2022. This
is yet another reason why the larger Bench of the Tribunal
decides the subject matter pending before it. The decision of
the larger Bench would prevail over all past decisions rendered
by the Division Benches of the Tribunal at various Benches.
Therefore, though we are not in agreement with the procedure
adopted by the Tribunal while referring the Original
Applications to a larger Bench, we are not inclined to interfere
in the impugned orders. However, it is made clear that our
decision is in view of the peculiar facts and circumstances of
the present case and the same shall not be construed to mean
that the course of action adopted by the Tribunal in recalling
the Judgment and Order dated 11th April, 2022 is approved by
us in any manner. Nor this judgment shall be treated as a
21. The present petitioners claim to have been appointed on
the post of Police Constable (Driver) in pursuance of the
Judgment and Order dated 11 th April, 2022 passed in OA
No.144 of 2022 & ors. Since the Judgment and Order dated
11th April, 2022 is already recalled, the same may affect the
wp 226.2023 (J) (f).doc
appointments of the petitioners. We are informed that the
larger Bench of the Tribunal has commenced the hearing of
both set of the Original Applications on 5 th January, 2023.
Since the larger Bench is already seized of the Original
Applications, it would be in the fitness of the things if status
with regard to the appointments of the petitioners is
maintained till the larger Bench of the Tribunal finally takes
decision in the Original Applications.
22. We therefore do not find any valid reason to interfere with
the orders passed by the Tribunal on 20th December 2022 and
22nd December 2022 and the present petitions must fail to that
extent. The only interference which we propose to make is to
protect the status of service of the Petitioners during pendency
of proceedings before the larger bench,
23. We accordingly proceed to pass the following order :-
(a) Till the matter is decided by the larger Bench, status
quo as on today be maintained.
(b) In view of the fact that the matter is referred to the
larger Bench, we request to the Tribunal (larger
wp 226.2023 (J) (f).doc
Bench) to hear the matter expeditiously considering
the issues involved.
(c) All contentions of respective parties are kept open.
24. The Writ Petitions stand disposed of accordingly. Rule
stands discharged.
|
The Bombay High Court has refused to interfere in the Maharashtra Administrative Tribunal’s decision to refer a dispute regarding the 2019 recruitment of police constables to a larger bench despite disapproving the procedure adopted by the tribunal.
Ordering a status quo in the matter, a division bench of Acting Chief Justice SV Gangapurwala and Justice Sandeep v. Marne said since the reference has already made to larger Bench and since both the sets of parties are already before the Tribunal, ends of justice would meet if the larger Bench of the Tribunal is permitted to decide the controversy before it.
“However since much water has flown by now, it would not be appropriate to set aside the impugned orders and to relegate the matter back to the Tribunal for following the correct procedure for making reference as mandated in K. Ajit Babu," said the court.
The petitioners were candidates in the recruitment for Police Constable (Driver), 2019. Their names were included in the merit list but they were subsequently deleted from the revised merit list because they participated in the selection process of more than one district. The petitioners, among others, challenged the revised merit list and the tribunal by common order in April 2022 set aside deletion of their names from the merit list.
When the state government implemented the tribunal’s judgement, the names of some of the candidates in the revised merit list got deleted and they were terminated from service. Those candidates approached the tribunal in a second set of Original Applications.
The tribunal noticed that the implementation of its judgement in the first set of applications resulted in termination of service of the second set of applicants. Therefore, it last month recalled its earlier judgement and restored the first set of original applications. The tribunal then referred both sets of original applications to a larger bench of three members. The petitioners (first set of applicants) challenged this before the High Court.
The court noted that when the first set of original applications was filed, the merit lists had been already declared and the names of selected candidates were known. Therefore, while challenging the merit list, the first set of applicants should have impleaded at least some of the selected candidates in a representative capacity, it added.
"We feel that the course of action adopted by the Tribunal in entertaining OA Nos, 144 of 2022 & Ors without impleadment of affected selected candidates was against the well settled principles enunciated in various judgments of the Apex Court," said the bench.
The court noted that the tribunal had already allowed the first set of applications and allowing the second set of applications would have resulted in conflicting judgements regarding the same selection process.
The tribunal should have decided the second set of applications by directing impleadment of all applicants of the first set, the court said.
"If after hearing all the parties, the Tribunal was to arrive at a conclusion that the view taken by it in its earlier order dated 11th April 2022 was correct, OA Nos.775 of 2022 & ors could be dismissed. On the other hand, if the Tribunal was to disagree with the view taken in its order dated 11th April 2022, OA Nos.775 of 2022 & ors would then be referred to larger Bench of three learned Members. This is the mandate of judgments in K. Ajit Babu and Gopabandhu Biswal," said the bench.
The court further said the Tribunal adopted procedure "unknown to law" by recalling its order in the first set of applications while hearing the second set, the court said. It is "incomprehensible" how the tribunal passed any order in the first set of applications while hearing altogether different applications, it added.
"To make things worse, the order of recall was passed behind the back of Applicants of OA Nos. 144/2022 & Ors," said the bench.
While refusing to interfere with the tribunal's decision to refer the matter to a larger bench, the court made it clear that its decision is not a precedent.
"However, it is made clear that our decision is in view of the peculiar facts and circumstances of the present case and the same shall not be construed to mean that the course of action adopted by the Tribunal in recalling the Judgment and Order dated 11th April, 2022 is approved by us in any manner. Nor this judgment shall be treated as a precedent."
The court also said the decision of the larger Bench would prevail over all past decisions rendered by the Division Benches of the Tribunal at various Benches.
"We are informed that the larger Bench of the Tribunal has commenced the hearing of both set of the Original Applications on 5th January, 2023. Since the larger Bench is already seized of the Original Applications, it would be in the fitness of the things if status with regard to the appointments of the petitioners is maintained till the larger Bench of the Tribunal finally takes decision in the Original Applications," it added.
The court said till the matter is decided by the larger Bench, status quo be maintained. It also requested the larger bench to hear the matter expeditiously considering the issues involved.
Advocates Sandeep Dere and L.S. Deshmukh represented the petitioners. Advocates Pranav Avhad and Purna S. Pradhan represented the second set of applicants.
Case no. – Writ Petition No. 224 of 2023
Case Title – Nitin Pandurang Shejwal v. State of Maharashtra and Ors.
|
Mr. Sandeep Dere for the Petitioner in WP/224/2023.
Mr. L.S. Deshmukh i/b. Ms. Pooja Mankoji for the Petitioner in
Mr. Pranav Avhad a/w Ms. Darshana Naval for the Respondent
Nos.4 to 7 in WP/224/2023.
Ms. Purna S. Pradhan i/b. Mr. Dinesh B. Khaire for the
Applicants in OA No.830 of 2022 (party not made in
Mr. M.M. Pabale, AGP for the Respondent – State In
Mr. B.V. Samant, AGP for the Respondent – State in
1. Rule. Rule made returnable forthwith. With the consent
of parties taken up for final hearing.
2. By these petitions, petitioners challenge the Order dated
20th December, 2022 passed by the Maharashtra
Administrative Tribunal, Mumbai (Tribunal) in Original
Application Nos.775 of 2022, 776 of 2022, 777 of 2022, 778 of
2022, 779 of 2022, 793 of 2022, 796 of 2022 & 830 of 2022 by
which the Tribunal has proceeded to recall its earlier
Judgment and Order dated 11th April, 2022 passed in Original
Application Nos. 144 of 2022, 145 of 2022, 146 of 2022, 167 of
2022, 203 of 2022, 300 of 2022, 301 of 2022, 321 of 2022.
The petitioners also challenge common Order dated 22 nd
December, 2022 passed in both sets of Original Applications
wp 226.2023 (J) (f).doc
(OA No.775/2022 & other connected OAs and OA No.144 of
2022 & other connected OAs) to a larger Bench.
3. Brief facts of the case are that the recruitment process
for the post of Police Constable (Driver) was initiated by the
Additional Director General of Police, (M.S), Mumbai vide
Advertisement dated 30th November, 2019. The recruitment
process was apparently to be conducted in respect of the
separate Units / Districts. The Applicants in Original
Application No.144 of 2022 & other connected OAs filled up
forms in respect of multiple Units / Districts and also appeared
for multiple examinations. Though their names were included
in the merit list, the same were subsequently deleted from the
revised merit list for the reason of their participation in
selection process in more than one Unit/District. Challenging
deletion of their names from the revised merit list, Original
Application Nos.144 of 2022, 145 of 2022, 146 of 2022, 167 of
2022, 203 of 2022, 300 of 2022, 301 of 2022, 321 of 2022
were instituted by such candidates before the Tribunal. In
those Original Applications, though relief was sought for
inclusion of their names in the merit list and consequential
appointment to the post of Police Constable (Driver), the
wp 226.2023 (J) (f).doc
candidates that were likely to be affected by grant of such
reliefs were not impleaded as parties to those Original
4. The Tribunal proceeded to allow Original Application
No.144 of 2022 & ors, by common judgment and order dated
11th April, 2022 directing consideration of candidature of
applicants therein in further process of selection by setting
aside deletion of their names from the merit list.
5. The State Government proceeded to implement the
Tribunal’s judgment and order dated 11 th April, 2022 and it
appears that, names of some of the candidates got deleted from
the merit list and orders terminating them from service came
to be issued. This led to filing of Original Application Nos. 775
of 2022, 776 of 2022, 777 of 2022, 778 of 2022, 779 of 2022,
793 of 2022, 796 of 2022 & 830 of 2022. During the course of
hearing of those OAs, the Tribunal noticed that implementation
of its Judgment and order dated 11th April, 2022 passed in OA
No.144 of 2022 & ors, was the reason for termination of
services of the applicants in OA No.775 of 2022 & ors. The
Tribunal therefore proceeded to pass Order dated 20 th
wp 226.2023 (J) (f).doc
December, 2022 recalling its Judgment and order dated 11 th
April, 2022 passed in OA No.144 of 2022 & ors and restored all
those Original Applications on its file.
6. The Tribunal thereafter took up both sets of Original
Applications (OA Nos.144 of 2022 & ors and OA Nos. 775 of
2022 & ors) for hearing on 22 nd December, 2022 and
proceeded to refer all Original Applications for decision to a
larger Bench of three learned Members.
7. The petitioners in the present petitions are aggrieved by
Orders dated 20th December, 2022 and 22nd December, 2022
passed by the Tribunal.
8. Appearing for the petitioners, Mr. Dere and Mr.
Deshmukh, the learned counsels would submit that while
hearing OA No.775 of 2022 & ors, the Tribunal had no occasion
to decide the issue of validity of its Judgment and order dated
11th April, 2022 passed in OA No.144 of 2022 & ors. It is
further submitted that while passing order of recall dated 20th
December, 2022, the applicants in OA No.144 of 2022 & ors,
were not heard and the Order passed in their favour has been
wp 226.2023 (J) (f).doc
recalled behind their back. It is further submitted that no case
is made out by the Applicants in OA No.775 of 2022 & ors,
though they came to be affected only on account of passing of
the Judgment & order dated 11th April,2022 in OA No.144 of
2022 & ors. They would also contend that if the Tribunal was
of the view that reference to larger Bench was warranted, it
ought to have first distinguished its earlier decision dated 11 th
April 2022 by recording reasons and then made an order of
reference. That no specific question is formulated by the
Tribunal while making order of reference. Lastly, it is
submitted that the Applicants in OA No.144 of 2022 & ors,
have already been appointed in pursuance of the Judgment
and Order dated 11th April, 2022 and effect of recalling of the
said order would entail termination of their services.
9. Per contra, Mr. Pranav Avhad and Ms. Purva Pradhan,
the learned counsels appearing for Applicants in OA Nos.775 of
2022 & ors would oppose the Petitions and support the Order
passed by the Tribunal. They would submit that the Judgment
and Order dated 11th April, 2022 was erroneously passed by
the Tribunal in OA No.144 of 2022 & ors, without hearing the
candidates who were already selected and appointed and that
wp 226.2023 (J) (f).doc
the Tribunal has merely corrected the error by recalling its
order dated 11th April 2022 for the purpose of affording an
opportunity of hearing the affected candidates. It is further
submitted that reference of the issue to the Larger Bench
would enable the Tribunal to effectively decide the lis between
the competing parties.
10. We have also heard, learned AGP appearing on behalf of
11. There are competing claims of candidates participating
in selection in multiple Units/Districts and those participating
only in one Unit/District. When OA No.144 of 2022 & ors, were
instituted by the candidates appearing for examination in
multiple Units/Districts, the merit lists were already declared.
Names of selected candidates were already known. Therefore,
while challenging such merit lists and seeking inclusion of
their names therein, it was incumbent on such candidates to
include atleast some of the selected candidates in
representative capacity for affording them an opportunity of
defending those OAs. However, without impleading any of the
selected candidates, OA No.144 of 2022 & ors came to be
wp 226.2023 (J) (f).doc
instituted. The Tribunal proceeded to allow those OAs by its
Judgment and order dated 11th April, 2022 setting aside
deletion of names of applicants from the merit list and
directing consideration of their candidature in further
selection process.
12. We feel that the course of action adopted by the Tribunal
in entertaining OA Nos, 144 of 2022 & Ors without
impleadment of affected selected candidates was against the
well settled principles enunciated in various judgments of the
Apex Court. A reference in this regard can be made to the
Judgment in Ranjan Kumar v. State of Bihar 1, in which the
Apex Court has held as under:
7. In Rashmi Mishra v. M.P. Public Service Commission [Rashmi
Mishra v. M.P. Public Service Commission, (2006) 12 SCC 724 :
(2007) 2 SCC (L&S) 345] , after referring to Prabodh Verma [Pra-
bodh Verma v. State of U.P., (1984) 4 SCC 251 : 1984 SCC (L&S)
704] and Indu Shekhar Singh [Indu Shekhar Singh v. State of U.P.,
(2006) 8 SCC 129 : 2006 SCC (L&S) 1916] , the Court took note of
the fact that when no steps had been taken in terms of Order 1 Rule
8 of the Code of Civil Procedure or the principles analogous thereto
all the seventeen selected candidates were necessary parties in the
writ petition. It was further observed that the number of selected
candidates was not many and there was no difficulty for the appel-
lant to implead them as parties in the proceeding. Ultimately, the
Court held that when all the selected candidates were not im-
pleaded as parties to the writ petition, no relief could be granted to
the appellant therein.
8. In Tridip Kumar Dingal v. State of W.B. [Tridip Kumar Din-
gal v. State of W.B., (2009) 1 SCC 768 : (2009) 2 SCC (L&S) 119] ,
this Court approved the view expressed by the tribunal which had
opined that for absence of selected and appointed candidates and
without affording an opportunity of hearing to them, the selection
could not be set aside.
13. In view of the aforesaid enunciation of law, we are disposed to
think that in such a case when all the appointees were not im-
pleaded, the writ petition was defective and hence, no relief could
have been granted to the writ petitioners.
(emphasis supplied)
13. It may well be contended that it is not possible to implead
each and every selected candidate, however atleast some of
them in representative capacity ought to have been impleaded.
This aspect has been expounded by the Apex Court in its re-
cent judgment in Ajay Kumar Shukla and Others Vs. Arvind
Rai and Others2 in which it is held as under:
46. In the recent case of Mukul Kumar Tyagi and Ors. vs. The State
of Uttar Pradesh and Ors.,14 Ashok Bhushan, J., laid emphasis that
when there is a long list of candidates against whom the case is pro-
ceeded, then it becomes unnecessary and irrelevant to implead
each and every candidate. If some of the candidates are impleaded
then they will be said to be representing the interest of rest of the
candidates as well. The relevant portion of paragraph 75 from the
judgment is reproduced below:
“75...... We may further notice that Division Bench also no-
ticed the above argument of non-impleadment of all the se-
lected candidates in the writ petition but Division Bench has
not based its judgment on the above argument. When the in-
clusion in the select list of large number of candidates is on
the basis of an arbitrary or illegal process, the aggrieved par-
ties can complain and in such cases necessity of implead-
ment of each and every person cannot be insisted. Further-
more, when select list contained names of 2211 candidates, it
becomes unnecessary to implead every candidate in view of
the nature of the challenge, which was levelled in the writ pe-
tition. Moreover, few selected candidates were also im-
pleaded in the writ petitions in representative capacity.”
47. The present case is a case of preparation of seniority list and
that too in a situation where the appellants (original writ petition-
ers) did not even know the marks obtained by them or their profi-
ciency in the examination conducted by the Commission. The chal-
lenge was on the ground that the Rules on the preparation of senior-
ity list had not been followed. There were 18 private respondents
arrayed to the writ petition. The original petitioners could not have
known who all would be affected. They had thus broadly impleaded
18 of such Junior Engineers who could be adversely affected. In
matters relating to service jurisprudence, time and again it has
been held that it is not essential to implead each and every one who
could be affected but if a section of such affected employees is im-
pleaded then the interest of all is represented and protected. In
view of the above, it is well settled that impleadment of a few of the
affected employees would be sufficient compliance of the principle of
joinder of parties and they could defend the interest of all affected
persons in their representative capacity. Non-joining of all the par-
ties cannot be held to be fatal.”
14. When the Tribunal proceeded to pass the Judgment and
order dated 11th April, 2022, the same resulted in deletion of
names of some of the candidates from the merit list and many
of them were required to be terminated from service. This led
to filing of OA No.775 of 2022 & ors. by such candidates. This
situation could have been avoided, if such candidates were
impleaded to OA No.144 of 2022 & ors.
15. The Tribunal was thus faced with a situation where it had
already allowed OA Nos.144 of 2022 & ors. by its Judgment
wp 226.2023 (J) (f).doc
and order dated 11th April, 2022 without hearing candidates
who got adversely affected by it. Such affected candidates were
required to institute OA Nos.775 of 2022 & ors. If the Tribunal
was to allow OA Nos.775 of 2022 & ors, the same would have
resulted in conflicting judgments in respect of same selection.
The course of action to be adopted in a situation like this is
stated by the Apex Court in its Judgment in the case of K. Ajit
Babu and Others V. Union of India and Others 3. In Paragraph 6
of the Judgment, the Apex Court has held as under;
“4. ……. Often in service matters the judgments rendered either by
the Tribunal or by the Court also affect other persons, who are not
parties to the cases. It may help one class of employees and at the
same time adversely affect another class of employees. In such
circumstances the judgments of the courts or the tribunals may not
be strictly judgments in personam affecting only the parties to the
cases, they would be judgments in rem. In such a situation, the
question arises: What remedy is available to such affected persons
who are not parties to a case, yet the decision in such a case
adversely affects their rights in the matter of their seniority…….
5. The Tribunal rejected the application of the appellant merely on
the ground that the appellant was seeking setting aside of the
judgment rendered by the Central Administrative Tribunal,
Ahmedabad in the case of P.S. John (supra) in TA No. 263 of 1986.
It is here that the Tribunal apparently fell in error. No doubt the
decision of the Tribunal in the case P.S. John was against the
appellant but the application filed by the appellant under Section 19
of the Act has to be dealt with in accordance with law.
6. Consistency, certainty and uniformity in the field of
judicial decisions are considered to be the benefits arising
out of the “Doctrine of Precedent”. The precedent sets a
pattern upon which a future conduct may be based. One of
the basic principles of administration of justice is, that the
cases should be decided alike. Thus the doctrine of
wp 226.2023 (J) (f).doc
precedent is applicable to the Central Administrative
Tribunal also. Whenever an application under Section 19 of
the Act is filed and the question involved in the said
application stands concluded by some earlier decision of
the Tribunal, the Tribunal necessarily has to take into
account the judgment rendered in the earlier case, as a
precedent and decide the application accordingly. The
Tribunal may either agree with the view taken in the
earlier judgment or it may dissent. If it dissents, then the
matter can be referred to a larger Bench/Full Bench and
place the matter before the Chairman for constituting a
larger Bench so that there may be no conflict upon the two
Benches. The larger Bench, then, has to consider the
correctness of the earlier decision in disposing of the later
application. The larger Bench can overrule the view taken
in the earlier judgment and declare the law, which would
be binding on all the benches (see John Lucas1). In the
present case, what we find is that the Tribunal rejected the
application of the appellants thinking that the appellants
are seeking setting aside of the decision of the Tribunal in
Transfer Application No.263 of 1986. This view taken by
the Tribunal was not correct. The application of the
appellant was required to be decided in accordance with
law.”
16. Similar proposition is laid down by the Apex Court in its
judgment in Gopabandhu Biswal v. Krishna Chandra Mohanty4,
in which it is held in Para 11 as under:
11. According to the applicants certain documents though produced
before the Tribunal were not noticed by the Tribunal in deciding the
main matter. Even so, once a judgment of a Tribunal has attained fi-
nality, it cannot be reopened after the special leave petition against
that judgment has been dismissed. The only remedy for a person
who wants to challenge that judgment is to file a separate applica-
tion before the Tribunal in his own case and persuade the Tribunal
either to refer the question to a larger Bench or, if the Tribunal
prefers to follow its earlier decision, to file an appeal from the Tri-
bunal's judgment and have the Tribunal's judgment set aside in ap-
peal. A review is not an available remedy.
(emphasis supplied)
17. Thus, following the Judgment in K. Ajit Babu and
Gopabandhu Biswal (supra), the candidates who were
adversely affected by the Judgment and Order dated 11th April,
2022 rightly instituted fresh Original Applications (OA
Nos.775 of 2022 & ors). However what is not done by the
Tribunal was to follow mandate of the Judgments of the Apex
Court in K. Ajit Babu and Gopabandhu Biswal. It ought to have
proceeded to decide OA Nos.775 of 2022 & ors by directing
impleadment of all Applicants of OA Nos. 144/2022 & Ors.
thereto. If after hearing all the parties, the Tribunal was to
arrive at a conclusion that the view taken by it in its earlier
order dated 11th April 2022 was correct, OA Nos.775 of 2022 &
ors could be dismissed. On the other hand, if the Tribunal was
to disagree with the view taken in its order dated 11 th April
2022, OA Nos.775 of 2022 & ors would then be referred to
larger Bench of three learned Members. This is the mandate of
judgments in K. Ajit Babu and Gopabandhu Biswal.
18. The Tribunal however adopted procedure unknown to
law by recalling its order dated 11 th April 2022 passed in OA
No.144 of 2022 & ors while hearing OA No.775 of 2022 & ors.
wp 226.2023 (J) (f).doc
it is incomprehensible as to how the Tribunal could have
passed any order in OA Nos. 144/2022 & ors while hearing
altogether different OAs. To make things worse, the order of
recall was passed behind the back of Applicants of OA Nos.
144/2022 & Ors. We find that there was no necessity for the
Tribunal to recall Judgment and order dated 11 th April, 2022.
Instead, the Tribunal ought to have simply directed the
Applicants of OA Nos.775 of 2022 & ors, to implead all the
applicants of OA No.144 of 2022 & ors, as party-respondents
and after hearing them, ought to have decided OA No.775 of
2022 & ors. If it was to agree with the view taken in its
Judgment and Order dated 11th April, 2022, it could have
dismissed OA No.775 of 2022 & ors. On the other hand, if the
Tribunal was to form an opinion that a view taken in OA No.144
of 2022 & ors was erroneous, it could have proceeded to refer
OA No.775 of 2022 & ors to larger Bench following the
mandate of the Judgments in K. Ajit Babu and Gopabandhu
Biswal. The erroneous procedure for making a reference to
larger Bench by recalling order in OA 144/2022 & Ors seems to
have been adopted by the Tribunal as the Judgments in K. Ajit
Babu and Gopabandhu Biswal were possibly not cited before it.
wp 226.2023 (J) (f).doc
19. We are thus not in agreement with the procedure
adopted by the Tribunal in recalling its Judgment and Order
dated 11th April, 2022 for the purpose of referring both set of
Original Applications to a larger Bench. However, at the same
time, though the procedure adopted by the Tribunal does not
commend us, we do not find any reason to interfere in the
ultimate decision of the Tribunal to refer the Original
Applications to a larger Bench. True it is that the Tribunal
ought to have first recorded a finding for disagreement with
the view taken in its order dated 11th April 2022 and then
make an order of reference to a larger Bench. It also ought to
have formulated the exact issue for reference. However since
much water has flown by now, it would not be appropriate to
set aside the impugned orders and to relegate the matter back
to the Tribunal for following the correct procedure for making
reference as mandated in K. Ajit Babu. Since the reference is
already made to larger Bench and since both the sets of parties
are already before the Tribunal, ends of justice would meet if
the larger Bench of the Tribunal is permitted to decide the
controversy before it.
20. It also appears that there is another decision rendered by
the bench of the Tribunal at Nagpur on 31 st March 2022. This
is yet another reason why the larger Bench of the Tribunal
decides the subject matter pending before it. The decision of
the larger Bench would prevail over all past decisions rendered
by the Division Benches of the Tribunal at various Benches.
Therefore, though we are not in agreement with the procedure
adopted by the Tribunal while referring the Original
Applications to a larger Bench, we are not inclined to interfere
in the impugned orders. However, it is made clear that our
decision is in view of the peculiar facts and circumstances of
the present case and the same shall not be construed to mean
that the course of action adopted by the Tribunal in recalling
the Judgment and Order dated 11th April, 2022 is approved by
us in any manner. Nor this judgment shall be treated as a
21. The present petitioners claim to have been appointed on
the post of Police Constable (Driver) in pursuance of the
Judgment and Order dated 11 th April, 2022 passed in OA
No.144 of 2022 & ors. Since the Judgment and Order dated
11th April, 2022 is already recalled, the same may affect the
wp 226.2023 (J) (f).doc
appointments of the petitioners. We are informed that the
larger Bench of the Tribunal has commenced the hearing of
both set of the Original Applications on 5 th January, 2023.
Since the larger Bench is already seized of the Original
Applications, it would be in the fitness of the things if status
with regard to the appointments of the petitioners is
maintained till the larger Bench of the Tribunal finally takes
decision in the Original Applications.
22. We therefore do not find any valid reason to interfere with
the orders passed by the Tribunal on 20th December 2022 and
22nd December 2022 and the present petitions must fail to that
extent. The only interference which we propose to make is to
protect the status of service of the Petitioners during pendency
of proceedings before the larger bench,
23. We accordingly proceed to pass the following order :-
(a) Till the matter is decided by the larger Bench, status
quo as on today be maintained.
(b) In view of the fact that the matter is referred to the
larger Bench, we request to the Tribunal (larger
wp 226.2023 (J) (f).doc
Bench) to hear the matter expeditiously considering
the issues involved.
(c) All contentions of respective parties are kept open.
24. The Writ Petitions stand disposed of accordingly. Rule
stands discharged.
|
Mr. Sandeep Dere for the Petitioner in WP/224/2023. Mr. L.S. Deshmukh i/b. Ms. Pooja Mankoji for the Petitioner in
Mr. Pranav Avhad a/w Ms. Darshana Naval for the Respondent
Nos.4 to 7 in WP/224/2023. With the consent
of parties taken up for final hearing. 144 of 2022, 145 of 2022, 146 of 2022, 167 of
2022, 203 of 2022, 300 of 2022, 301 of 2022, 321 of 2022. The recruitment
process was apparently to be conducted in respect of the
separate Units / Districts. The Applicants in Original
Application No.144 of 2022 & other connected OAs filled up
forms in respect of multiple Units / Districts and also appeared
for multiple examinations. Though their names were included
in the merit list, the same were subsequently deleted from the
revised merit list for the reason of their participation in
selection process in more than one Unit/District. Challenging
deletion of their names from the revised merit list, Original
Application Nos.144 of 2022, 145 of 2022, 146 of 2022, 167 of
2022, 203 of 2022, 300 of 2022, 301 of 2022, 321 of 2022
were instituted by such candidates before the Tribunal. The State Government proceeded to implement the
Tribunal’s judgment and order dated 11 th April, 2022 and it
appears that, names of some of the candidates got deleted from
the merit list and orders terminating them from service came
to be issued. This led to filing of Original Application Nos. 775
of 2022, 776 of 2022, 777 of 2022, 778 of 2022, 779 of 2022,
793 of 2022, 796 of 2022 & 830 of 2022. During the course of
hearing of those OAs, the Tribunal noticed that implementation
of its Judgment and order dated 11th April, 2022 passed in OA
No.144 of 2022 & ors, was the reason for termination of
services of the applicants in OA No.775 of 2022 & ors. The Tribunal thereafter took up both sets of Original
Applications (OA Nos.144 of 2022 & ors and OA Nos. 775 of
2022 & ors) for hearing on 22 nd December, 2022 and
proceeded to refer all Original Applications for decision to a
larger Bench of three learned Members. The petitioners in the present petitions are aggrieved by
Orders dated 20th December, 2022 and 22nd December, 2022
passed by the Tribunal. It is
further submitted that while passing order of recall dated 20th
December, 2022, the applicants in OA No.144 of 2022 & ors,
were not heard and the Order passed in their favour has been
wp 226.2023 (J) (f).doc
recalled behind their back. That no specific question is formulated by the
Tribunal while making order of reference. Lastly, it is
submitted that the Applicants in OA No.144 of 2022 & ors,
have already been appointed in pursuance of the Judgment
and Order dated 11th April, 2022 and effect of recalling of the
said order would entail termination of their services. They would submit that the Judgment
and Order dated 11th April, 2022 was erroneously passed by
the Tribunal in OA No.144 of 2022 & ors, without hearing the
candidates who were already selected and appointed and that
wp 226.2023 (J) (f).doc
the Tribunal has merely corrected the error by recalling its
order dated 11th April 2022 for the purpose of affording an
opportunity of hearing the affected candidates. It is further
submitted that reference of the issue to the Larger Bench
would enable the Tribunal to effectively decide the lis between
the competing parties. We have also heard, learned AGP appearing on behalf of
11. There are competing claims of candidates participating
in selection in multiple Units/Districts and those participating
only in one Unit/District. When OA No.144 of 2022 & ors, were
instituted by the candidates appearing for examination in
multiple Units/Districts, the merit lists were already declared. Names of selected candidates were already known. Therefore,
while challenging such merit lists and seeking inclusion of
their names therein, it was incumbent on such candidates to
include atleast some of the selected candidates in
representative capacity for affording them an opportunity of
defending those OAs. However, without impleading any of the
selected candidates, OA No.144 of 2022 & ors came to be
wp 226.2023 (J) (f).doc
instituted. The Tribunal proceeded to allow those OAs by its
Judgment and order dated 11th April, 2022 setting aside
deletion of names of applicants from the merit list and
directing consideration of their candidature in further
selection process. A reference in this regard can be made to the
Judgment in Ranjan Kumar v. State of Bihar 1, in which the
Apex Court has held as under:
7. In Rashmi Mishra v. M.P. Public Service Commission [Rashmi
Mishra v. M.P. Public Service Commission, (2006) 12 SCC 724 :
(2007) 2 SCC (L&S) 345] , after referring to Prabodh Verma [Pra-
bodh Verma v. State of U.P., (1984) 4 SCC 251 : 1984 SCC (L&S)
704] and Indu Shekhar Singh [Indu Shekhar Singh v. State of U.P.,
(2006) 8 SCC 129 : 2006 SCC (L&S) 1916] , the Court took note of
the fact that when no steps had been taken in terms of Order 1 Rule
8 of the Code of Civil Procedure or the principles analogous thereto
all the seventeen selected candidates were necessary parties in the
writ petition. It was further observed that the number of selected
candidates was not many and there was no difficulty for the appel-
lant to implead them as parties in the proceeding. Ultimately, the
Court held that when all the selected candidates were not im-
pleaded as parties to the writ petition, no relief could be granted to
the appellant therein. This aspect has been expounded by the Apex Court in its re-
cent judgment in Ajay Kumar Shukla and Others Vs. Arvind
Rai and Others2 in which it is held as under:
46. In the recent case of Mukul Kumar Tyagi and Ors. ,14 Ashok Bhushan, J., laid emphasis that
when there is a long list of candidates against whom the case is pro-
ceeded, then it becomes unnecessary and irrelevant to implead
each and every candidate. If some of the candidates are impleaded
then they will be said to be representing the interest of rest of the
candidates as well. The relevant portion of paragraph 75 from the
judgment is reproduced below:
“75...... We may further notice that Division Bench also no-
ticed the above argument of non-impleadment of all the se-
lected candidates in the writ petition but Division Bench has
not based its judgment on the above argument. Moreover, few selected candidates were also im-
pleaded in the writ petitions in representative capacity.” The present case is a case of preparation of seniority list and
that too in a situation where the appellants (original writ petition-
ers) did not even know the marks obtained by them or their profi-
ciency in the examination conducted by the Commission. The chal-
lenge was on the ground that the Rules on the preparation of senior-
ity list had not been followed. There were 18 private respondents
arrayed to the writ petition. The original petitioners could not have
known who all would be affected. They had thus broadly impleaded
18 of such Junior Engineers who could be adversely affected. In
view of the above, it is well settled that impleadment of a few of the
affected employees would be sufficient compliance of the principle of
joinder of parties and they could defend the interest of all affected
persons in their representative capacity. Non-joining of all the par-
ties cannot be held to be fatal.” This led
to filing of OA No.775 of 2022 & ors. This
situation could have been avoided, if such candidates were
impleaded to OA No.144 of 2022 & ors. The Tribunal was thus faced with a situation where it had
already allowed OA Nos.144 of 2022 & ors. by its Judgment
wp 226.2023 (J) (f).doc
and order dated 11th April, 2022 without hearing candidates
who got adversely affected by it. Such affected candidates were
required to institute OA Nos.775 of 2022 & ors. If the Tribunal
was to allow OA Nos.775 of 2022 & ors, the same would have
resulted in conflicting judgments in respect of same selection. In Paragraph 6
of the Judgment, the Apex Court has held as under;
“4. ……. Often in service matters the judgments rendered either by
the Tribunal or by the Court also affect other persons, who are not
parties to the cases. It may help one class of employees and at the
same time adversely affect another class of employees. In such
circumstances the judgments of the courts or the tribunals may not
be strictly judgments in personam affecting only the parties to the
cases, they would be judgments in rem. In such a situation, the
question arises: What remedy is available to such affected persons
who are not parties to a case, yet the decision in such a case
adversely affects their rights in the matter of their seniority……. It is here that the Tribunal apparently fell in error. Consistency, certainty and uniformity in the field of
judicial decisions are considered to be the benefits arising
out of the “Doctrine of Precedent”. The precedent sets a
pattern upon which a future conduct may be based. One of
the basic principles of administration of justice is, that the
cases should be decided alike. Whenever an application under Section 19 of
the Act is filed and the question involved in the said
application stands concluded by some earlier decision of
the Tribunal, the Tribunal necessarily has to take into
account the judgment rendered in the earlier case, as a
precedent and decide the application accordingly. The
Tribunal may either agree with the view taken in the
earlier judgment or it may dissent. If it dissents, then the
matter can be referred to a larger Bench/Full Bench and
place the matter before the Chairman for constituting a
larger Bench so that there may be no conflict upon the two
Benches. The larger Bench can overrule the view taken
in the earlier judgment and declare the law, which would
be binding on all the benches (see John Lucas1). In the
present case, what we find is that the Tribunal rejected the
application of the appellants thinking that the appellants
are seeking setting aside of the decision of the Tribunal in
Transfer Application No.263 of 1986. This view taken by
the Tribunal was not correct. The application of the
appellant was required to be decided in accordance with
law.” According to the applicants certain documents though produced
before the Tribunal were not noticed by the Tribunal in deciding the
main matter. Even so, once a judgment of a Tribunal has attained fi-
nality, it cannot be reopened after the special leave petition against
that judgment has been dismissed. The only remedy for a person
who wants to challenge that judgment is to file a separate applica-
tion before the Tribunal in his own case and persuade the Tribunal
either to refer the question to a larger Bench or, if the Tribunal
prefers to follow its earlier decision, to file an appeal from the Tri-
bunal's judgment and have the Tribunal's judgment set aside in ap-
peal. Thus, following the Judgment in K. Ajit Babu and
Gopabandhu Biswal (supra), the candidates who were
adversely affected by the Judgment and Order dated 11th April,
2022 rightly instituted fresh Original Applications (OA
Nos.775 of 2022 & ors). It ought to have
proceeded to decide OA Nos.775 of 2022 & ors by directing
impleadment of all Applicants of OA Nos. If after hearing all the parties, the Tribunal was to
arrive at a conclusion that the view taken by it in its earlier
order dated 11th April 2022 was correct, OA Nos.775 of 2022 &
ors could be dismissed. On the other hand, if the Tribunal was
to disagree with the view taken in its order dated 11 th April
2022, OA Nos.775 of 2022 & ors would then be referred to
larger Bench of three learned Members. This is the mandate of
judgments in K. Ajit Babu and Gopabandhu Biswal. The Tribunal however adopted procedure unknown to
law by recalling its order dated 11 th April 2022 passed in OA
No.144 of 2022 & ors while hearing OA No.775 of 2022 & ors. wp 226.2023 (J) (f).doc
it is incomprehensible as to how the Tribunal could have
passed any order in OA Nos. 144/2022 & ors while hearing
altogether different OAs. To make things worse, the order of
recall was passed behind the back of Applicants of OA Nos. Instead, the Tribunal ought to have simply directed the
Applicants of OA Nos.775 of 2022 & ors, to implead all the
applicants of OA No.144 of 2022 & ors, as party-respondents
and after hearing them, ought to have decided OA No.775 of
2022 & ors. If it was to agree with the view taken in its
Judgment and Order dated 11th April, 2022, it could have
dismissed OA No.775 of 2022 & ors. We are thus not in agreement with the procedure
adopted by the Tribunal in recalling its Judgment and Order
dated 11th April, 2022 for the purpose of referring both set of
Original Applications to a larger Bench. However, at the same
time, though the procedure adopted by the Tribunal does not
commend us, we do not find any reason to interfere in the
ultimate decision of the Tribunal to refer the Original
Applications to a larger Bench. True it is that the Tribunal
ought to have first recorded a finding for disagreement with
the view taken in its order dated 11th April 2022 and then
make an order of reference to a larger Bench. It also ought to
have formulated the exact issue for reference. Since the reference is
already made to larger Bench and since both the sets of parties
are already before the Tribunal, ends of justice would meet if
the larger Bench of the Tribunal is permitted to decide the
controversy before it. It also appears that there is another decision rendered by
the bench of the Tribunal at Nagpur on 31 st March 2022. This
is yet another reason why the larger Bench of the Tribunal
decides the subject matter pending before it. The decision of
the larger Bench would prevail over all past decisions rendered
by the Division Benches of the Tribunal at various Benches. Therefore, though we are not in agreement with the procedure
adopted by the Tribunal while referring the Original
Applications to a larger Bench, we are not inclined to interfere
in the impugned orders. However, it is made clear that our
decision is in view of the peculiar facts and circumstances of
the present case and the same shall not be construed to mean
that the course of action adopted by the Tribunal in recalling
the Judgment and Order dated 11th April, 2022 is approved by
us in any manner. Nor this judgment shall be treated as a
21. We are informed that the
larger Bench of the Tribunal has commenced the hearing of
both set of the Original Applications on 5 th January, 2023. The only interference which we propose to make is to
protect the status of service of the Petitioners during pendency
of proceedings before the larger bench,
23. (c) All contentions of respective parties are kept open. The Writ Petitions stand disposed of accordingly.
|
The Bombay High Court has refused to interfere in the Maharashtra Administrative Tribunal’s decision to refer a dispute regarding the 2019 recruitment of police constables to a larger bench despite disapproving the procedure adopted by the tribunal.
Ordering a status quo in the matter, a division bench of Acting Chief Justice SV Gangapurwala and Justice Sandeep v. Marne said since the reference has already made to larger Bench and since both the sets of parties are already before the Tribunal, ends of justice would meet if the larger Bench of the Tribunal is permitted to decide the controversy before it.
“However since much water has flown by now, it would not be appropriate to set aside the impugned orders and to relegate the matter back to the Tribunal for following the correct procedure for making reference as mandated in K. Ajit Babu," said the court.
The petitioners were candidates in the recruitment for Police Constable (Driver), 2019. Their names were included in the merit list but they were subsequently deleted from the revised merit list because they participated in the selection process of more than one district. The petitioners, among others, challenged the revised merit list and the tribunal by common order in April 2022 set aside deletion of their names from the merit list.
When the state government implemented the tribunal’s judgement, the names of some of the candidates in the revised merit list got deleted and they were terminated from service. Those candidates approached the tribunal in a second set of Original Applications.
The tribunal noticed that the implementation of its judgement in the first set of applications resulted in termination of service of the second set of applicants. Therefore, it last month recalled its earlier judgement and restored the first set of original applications. The tribunal then referred both sets of original applications to a larger bench of three members. The petitioners (first set of applicants) challenged this before the High Court.
The court noted that when the first set of original applications was filed, the merit lists had been already declared and the names of selected candidates were known. Therefore, while challenging the merit list, the first set of applicants should have impleaded at least some of the selected candidates in a representative capacity, it added.
"We feel that the course of action adopted by the Tribunal in entertaining OA Nos, 144 of 2022 & Ors without impleadment of affected selected candidates was against the well settled principles enunciated in various judgments of the Apex Court," said the bench.
The court noted that the tribunal had already allowed the first set of applications and allowing the second set of applications would have resulted in conflicting judgements regarding the same selection process.
The tribunal should have decided the second set of applications by directing impleadment of all applicants of the first set, the court said.
"If after hearing all the parties, the Tribunal was to arrive at a conclusion that the view taken by it in its earlier order dated 11th April 2022 was correct, OA Nos.775 of 2022 & ors could be dismissed. On the other hand, if the Tribunal was to disagree with the view taken in its order dated 11th April 2022, OA Nos.775 of 2022 & ors would then be referred to larger Bench of three learned Members. This is the mandate of judgments in K. Ajit Babu and Gopabandhu Biswal," said the bench.
The court further said the Tribunal adopted procedure "unknown to law" by recalling its order in the first set of applications while hearing the second set, the court said. It is "incomprehensible" how the tribunal passed any order in the first set of applications while hearing altogether different applications, it added.
"To make things worse, the order of recall was passed behind the back of Applicants of OA Nos. 144/2022 & Ors," said the bench.
While refusing to interfere with the tribunal's decision to refer the matter to a larger bench, the court made it clear that its decision is not a precedent.
"However, it is made clear that our decision is in view of the peculiar facts and circumstances of the present case and the same shall not be construed to mean that the course of action adopted by the Tribunal in recalling the Judgment and Order dated 11th April, 2022 is approved by us in any manner. Nor this judgment shall be treated as a precedent."
The court also said the decision of the larger Bench would prevail over all past decisions rendered by the Division Benches of the Tribunal at various Benches.
"We are informed that the larger Bench of the Tribunal has commenced the hearing of both set of the Original Applications on 5th January, 2023. Since the larger Bench is already seized of the Original Applications, it would be in the fitness of the things if status with regard to the appointments of the petitioners is maintained till the larger Bench of the Tribunal finally takes decision in the Original Applications," it added.
The court said till the matter is decided by the larger Bench, status quo be maintained. It also requested the larger bench to hear the matter expeditiously considering the issues involved.
Advocates Sandeep Dere and L.S. Deshmukh represented the petitioners. Advocates Pranav Avhad and Purna S. Pradhan represented the second set of applicants.
Case no. – Writ Petition No. 224 of 2023
Case Title – Nitin Pandurang Shejwal v. State of Maharashtra and Ors.
|
The Bombay High Court has refused to interfere in the Maharashtra Administrative Tribunal’s decision to refer a dispute regarding the 2019 recruitment of police constables to a larger bench despite disapproving the procedure adopted by the tribunal. Ordering a status quo in the matter, a division bench of Acting Chief Justice SV Gangapurwala and Justice Sandeep v. Marne said since the reference has already made to larger Bench and since both the sets of parties are already before the Tribunal, ends of justice would meet if the larger Bench of the Tribunal is permitted to decide the controversy before it. “However since much water has flown by now, it would not be appropriate to set aside the impugned orders and to relegate the matter back to the Tribunal for following the correct procedure for making reference as mandated in K. Ajit Babu," said the court. The petitioners were candidates in the recruitment for Police Constable (Driver), 2019. Their names were included in the merit list but they were subsequently deleted from the revised merit list because they participated in the selection process of more than one district. When the state government implemented the tribunal’s judgement, the names of some of the candidates in the revised merit list got deleted and they were terminated from service. Those candidates approached the tribunal in a second set of Original Applications. The tribunal noticed that the implementation of its judgement in the first set of applications resulted in termination of service of the second set of applicants. Therefore, it last month recalled its earlier judgement and restored the first set of original applications. The tribunal then referred both sets of original applications to a larger bench of three members. The petitioners (first set of applicants) challenged this before the High Court. The court noted that when the first set of original applications was filed, the merit lists had been already declared and the names of selected candidates were known. Therefore, while challenging the merit list, the first set of applicants should have impleaded at least some of the selected candidates in a representative capacity, it added. "If after hearing all the parties, the Tribunal was to arrive at a conclusion that the view taken by it in its earlier order dated 11th April 2022 was correct, OA Nos.775 of 2022 & ors could be dismissed. On the other hand, if the Tribunal was to disagree with the view taken in its order dated 11th April 2022, OA Nos.775 of 2022 & ors would then be referred to larger Bench of three learned Members. This is the mandate of judgments in K. Ajit Babu and Gopabandhu Biswal," said the bench. The court further said the Tribunal adopted procedure "unknown to law" by recalling its order in the first set of applications while hearing the second set, the court said. It is "incomprehensible" how the tribunal passed any order in the first set of applications while hearing altogether different applications, it added. "To make things worse, the order of recall was passed behind the back of Applicants of OA Nos. While refusing to interfere with the tribunal's decision to refer the matter to a larger bench, the court made it clear that its decision is not a precedent. Nor this judgment shall be treated as a precedent." The court also said the decision of the larger Bench would prevail over all past decisions rendered by the Division Benches of the Tribunal at various Benches. Since the larger Bench is already seized of the Original Applications, it would be in the fitness of the things if status with regard to the appointments of the petitioners is maintained till the larger Bench of the Tribunal finally takes decision in the Original Applications," it added. The court said till the matter is decided by the larger Bench, status quo be maintained. It also requested the larger bench to hear the matter expeditiously considering the issues involved. Advocates Sandeep Dere and L.S. Deshmukh represented the petitioners. Advocates Pranav Avhad and Purna S. Pradhan represented the second set of applicants.
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| 0.776414
| 0.700609
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The appellant-M/s. Punjab Wool Syndicate has come up in
appeal against the order dated 05.03.2010 (Annexure A-10) passed by the
Tribunal dismissing the Appeal (Vat) No. 565 of 2009 of the appellant and
had upheld the penalty of Rs.69,952/- under Section 51(7)(c) of the Punjab
As per the facts culled out from the order dated 24.07.2006
(Annexure A-7) passed by the Assistant Excise and Taxation
Commissioner, Information Collection Centre (Export), Shambhu at
Mehmadpur, the goods were being transferred in Vehicle No. HR-38-9923
from Ludhiana to Delhi. The driver of the vehicle furnished following
documents at the computer counter for the generation of declaration in form
1. Invoice No. 648 dated 12.7.06 of M/S Krishna Paints &
Chemicals, Jalandhar for Rs.67,754/- in favour of M/s Shri
2. Invoice No. 225 dated 12.7.06 of M/S Super Polyme & Co.
Coating Jalandhar for Rs.13,104/- in favour of M/S Shri Balaji
3. GR No. 431 dated 12.7.06 of M/s. H.S.Aujla Transport Service
from Jalandhar to Saharanpur.
4. Invoice No. 8 dated 12.7.06 of M/S R.S. Machi Mart, Ludhiana
for Rs.30,800/- in favour of Nav Nidh Machine Tolls, Delhi.
5. GR No. 2197 dated 12.7.06 of M/S Tempo Transport Union,
Ludhiana from Ludhiana to New Delhi.
After getting the declaration in form VAT-XXXVI, the driver
of the vehicle produced the above documents before the detaining officer,
who after examining the same, found that the goods seemed to be excessive
and needed physical verification. The goods were physically verified and
found that the driver of the vehicle did not furnish the information in respect
of Invoices No. 526 and 527 both dated 12.7.2006 and GR Nos. 9411 and
9412. Therefore, the goods were detained under Section 51(6) of the
Punjab VAT Act, 2005 and a show cause notice was issued to the owner of
the goods i.e. M/S Punjab Wool Syndicate, Ludhiana for 15.7.2006.
After issuing notice, Sunil Nanda, Accounts Manager of the
consignor party appeared before the detaining officer on 15.7.2006 and he
did not furnish information with respect to invoices No. 526 and 527 dated
12.07.2006. He furnished bank guarantee for Rs.50,000/- and Rs.20,000/-
(Total Rs.70,000/-) and the goods were released by the detaining officer.
Thereafter, show cause notice under Section 51(7)(c) of the Punjab VAT
Act, 2005 was issued to the owner of the goods i.e. M/s. Punjab Wool
Syndicate, Ludhiana for 21.07.2006. He was confronted with the report of
the detaining officer that the driver of the vehicle had failed to furnish
information with respect to goods covered by Invoices No. 526 and 527 at
the I.C.C. The dealer failed to produce his books of account before the
detaining officer and also failed to give any explanation for not submitting
the information in respect of above said two invoices. The value of the
goods was Rs.1,39,904.10 and they were meant for trade. Since the dealer
had not furnished information at the I.C.C. and the intention was to
avoid/evade tax due to the State, a penalty of Rs.69,952/- was imposed. On
appeal, the said order was affirmed by the Deputy Excise & Taxation
Commissioner (A), Patiala Division, Patiala vide order dated 15.06.2009
(Annexure A-8). Vide order dated 05.03.2010 (Annexure A-10), the Value
Added Tax Tribunal, Punjab, Chandigarh had dismissed the appeal filed by
the appellant against the order dated 15.06.2009.
Learned counsel for the appellant has referred to the supply
order (Annexure A-1) given by the Additional Deputy Inspector General of
Police, CRPF, Jalandhar wherein nomenclature of the goods was specified
as Beret Wool Knitted with Nylon Tape Binding (Khakhi) (at page No. 15
of the paper-book) and the total amount was Rs.38,42,564/- of the said
goods. As per the supply order, two of the destinations were the Additional
DGIGP, GC, CRPF, Mokambehghat-803303 (Bihar) and the Additional
DIGP, GC, CRPF, Rangareddy-500078 (Andhra Pradesh). He has also
placed on necessary bills bearing Invoices No. 526 and 527 dated
12.07.2006 (Annexures A-2 and A-3) respectively in favour of the
Additional DIG, CRPF. The materials were booked in the Transport
Company as these were in small quantities. G.Rs (Annexures A-4 and A-5)
were issued by Satkar Tempo Transport Union dated 12.07.2006 upto Delhi
Railway Station. From Delhi, the goods were to be sent by Train to the
actual consignees. This fact was mentioned in the G.Rs and it was a
Government supply. The inspection notes are Annexure A-6. After loading
the goods, the driver of the vehicle reached at I.C.C. Shambhu where he
furnished all the documents for generation of Form VAT-XXXVI.
Learned counsel for the appellant has further argued that the
person operating the computer failed to generate two bills of the appellant
due to oversight. The driver of the vehicle furnished all the documents
alongwith the computer generated information before the officer- incharge
who detained the goods on the ground that no information was generated in
respect of goods. He has further argued that keeping in view the supply
order (Annexure A-1) and inspection notes (Annexure A-6), the sale was
being made by the appellant to Central Government Department and the
Central Government Department had received sanction from the financial
authority to purchase these things. It was not a case where name of the
purchaser had not been disclosed and all the invoices had been produced
alongwith G.Rs. To support his contention, he has referred to the following
judgments on the proposition that all the necessary documents were in
possession of the driver before the I.C.C. and there was no intention to
Gobindgarh v. State of Punjab (2008) 31 PHT 398 (PVT)
School, Harbanspura, Mandi Gobindgarh vs. State of
3. Krish Pack Industries Vs. State of Punjab and others
4. M/s. Ganpati Foods vs. The State of Punjab and another
5. State of Punjab and another vs. Shree Ram Panels (2011)
6. M/s. Balaji Trading Company, Rewari vs. The State of
Haryana and another 2016 SCC Online P&H 4741
Since the sale was being made to the Government Department,
the invoices and G.Rs could not have been doubted keeping in view
inspection notes (Annexure A-6) which was with the driver and no attempt
was made to evade tax due to the State. Had the driver not produced the
invoices for generation of declaration in Form VAT-XXXVI, it could have
been a reason to initiate penalty proceedings. Since, all the documents
including Invoices No. 648 dated 12.7.06, 225 dated 12.7.06, 8 dated
12.7.06 and GRs No. 431 dated 12.7.06 and 2197 dated 12.7.06 were
produced alongwith Invoices No. 526 and 527 dated 12.7.2006 and GR Nos.
9411 and 9142 were produced by the driver at I.C.C., the findings recorded
by the Assistant Excise and Taxation Commissioner, ICC (Export)
Shambhu that the driver did not give any information with respect to
invoices No. 526 and 527 and subsequently imposing penalty is liable to be
set aside as the driver is not expected to know or give details of these
Learned counsel for the respondent-State has argued that in fact
Form VAT-XXXVI had not been issued to the appellant company for non-
producing invoices No. 526 and 527 before the I.C.C. but the goods were
detained as they seemed to be in excess of the invoices produced before the
I.C.C. He has finally argued that the driver had generated 3 bills whereas
information of two bills were not generated and the Tribunal had rightly
dismissed the appeal of the appellant by referring to judgment in the case of
M/s. Jain Industries Company vs. State of Punjab 2008(31) PHT page No.
Heard learned counsel for the parties and perused the case file.
At the outset, reference can be made to M/s. Jain Industries's
case (supra). This judgment was passed by the Value Added Tax Tribunal,
Punjab, Chandigarh. In that case, the goods had been transferred from
Mandi Gobindgarh to Raipur in Chattisgarh and the driver of the vehicle
furnished information with respect to four bills and GRs and generated
Form No. XXXVI in respect of those bills and when the goods were
detained, invoice No. 26 dated 26.06.2006 of Jain Industrial Company,
Mandi Gobindgarh in favour of Bajrang Metallic and Power Ltd., Raipur
(Chattisgarh) and GR No. 6337 dated 26.06.2006 of M/s. Ashok Akal
Transport Company (Registered) from Mandi Gobindgarh to Raipur
(Chattisgarh) were found. The driver had not given information with
respect to these documents at the I.C.C. and no Form No. XXXVI was
generated with a view to evade tax. He further gave a statement that owner
had asked him that no such forms may be generated at the I.C.C. Hence, the
facts of that case show that apart from four bills, there were two other bills
of other private companies, which were not shown at the time of generation
of Form No. XXXVI at I.C.C. and this would amount to attempt to evade
However, in the facts of the present case, sale was processed to
be made to CRPF as per supply order (Annexure A-1) and all the
information were given at the computer centre and all the documents were
shown but when the goods were detained, other two invoices were also
shown. The supply order was also shown which was given by the
Additional Deputy Inspector General of Police, CRPF, Jalandhar. Hence, it
was a sale which was made to Government Department and the appellant
had also produced GRs and all the invoices at the time of checking. There
was no attempt made by the driver not to show invoices before the detaining
In M/s. Ganpati Foods vs. The State of Punjab and another
(2014) 67 VST 348, a Coordinate Bench of this Court observed that in that
case Dealer was registered under the provision of Haryana Value Added
Tax, Act, 2003. It was having oil solvent plant at Nilokheri in District
Karnal. The appellant sold rice bran oil to one M/s. Bathinda Chemicals
Limited, Bathinda, a registered dealer under the Punjab VAT Act vide bill
dated 28.01.2008 booked with Ahmedgarh Transport Co., Ludhiana for its
transportation from Nilokheri to Bathinda. On its way from Nilokheri to
Bathinda, the driver of the vehicle had to cross the I.C.C. (Import) Shambhu
set up by the Punjab Government under Section 51 of the Punjab VAT Act.
The driver of the vehicle entered the I.C.C. and after getting necessary entry
made by the E.T.O. and clearance from the police personnel, a stamp was
affixed on his documents to this effect. When the documents were returned
to the driver, he was under the impression that necessary entry had been
made. On its way to Bathinda, it was checked by the Excise and Taxation
Officer (Mobile Wing), Bathinda and a case was made out for violation of
Section 51(6)(b) of the Punjab VAT Act on the ground that the information
had not been generated at the I.C.C. section centre while entering Punjab
State. The goods were detained and were subsequently released after
furnishing bank guarantee on 01.02.2008 and, thereafter, penalty amounting
to Rs.7,18,913/- was imposed by the Assistant Excise and Taxation
Commissioner (AETC) vide order dated 06.02.2008. Against the order
dated 06.02.2008, appeal was filed by the assessee before the first appellate
authority which was dismissed vide order dated 29.09.2008 and the second
appeal was dismissed by the Tribunal on 16.04.2009. The VAT appeal was
allowed by the Coordinate Bench and the penalty was set aside on the
ground that the goods in question were duly accompanied by invoice/GR,
statutory form VAT and the insurance policy with stamp of I.C.C. at
Shambhu on the GR. However, the driver being ignored and illiterate,
could not generate declaration at the I.C.C. and this in itself would not
amount an attempt to evade tax as the documents were sufficient to draw a
conclusion that there was no attempt to evade tax unless the documents
were rejected on the ground that they were not genuine.
Reference can now be made to judgment passed in State of
Punjab and another vs. Shree Ram Panels (2011) 46 VST 424, wherein a
coordinate Bench of this Court had dismissed the appeal filed by the State
of Punjab against the order of Tribunal as the Tribunal had accepted the
appeal filed by the assessee and set aside the imposition of penalty on the
ground that there was no violation of Section 51(4) of the Punjab Value
Added Tax Act with a view to make an attempt to evade tax as the driver of
the vehicle was in possession of goods receipts alongwith invoices and
produced the same as well.
Further reference can be made to a recent judgment passed by
the Division Bench of this Court in the case of M/s. Balaji Trading
Company, Rewari vs. The State of Haryana and another 2016 SCC
Online P&H 4741. In that case, the assessee Balaji Trading Company was
dealing with the purchase orders from NAFED, a Government of India
Undertaking. Annexure A-3 was the invoice dated 28.01.2003 and challan
to substantiate that the transaction was with the Government organization
NAFED was held to be bonafide and genuine as the documents were
required to be examined and only on the statement of the driver, penalty
could not be imposed.
In the facts of the present case, the appellant was making sale to
Government Department all over India as the supply order was given by the
Additional Deputy Inspector General of Police, CRPF, Jalandhar and the
driver had produced 5 documents before the computer centre at ICC but
VAT-XXXVI could not generate and at the time of checking, apart from 5
documents two invoices No. 526 and 527 dated 12.7.2006 and GR Nos.
9411 and 9412 were also produced. Since the respondents, in the present
case, were not disputing the fact that the sale was being made to CRPF and
only on account of non-generation of VAT-XXXVI, penalty could not have
been imposed. Further, in the order dated 05.03.2010 (Annexure A-10), it
was further observed that with respect to Invoices No. 526 and 527, the
driver did not furnish any information. The driver is not required to give
any information with respect to details of the invoices. He is to only
produce documents to show that there was a supply order and GRs had been
issued and he was taking the goods to their destination outside the State.
Further, it is not the case of the respondents that the two invoices No. 526
and 527 did not issue to CRPF. Hence, once the Government Department
had accepted the invoices produced at I.C.C., there was no occasion not to
accept Invoices No. 648, 225 and 8 dated 12.07.06. Similarly, invoices No.
526 and 527 were also issued on the same date i.e. 12.07.2006 with respect
to supply order (Annexure A-1). The driver was not expected to know
details of the supply order. It is not the case of the respondents that on
13.07.2006, the appellant did not produce above said invoices. In one of
the cases as referred above, even non-appearance before the I.C.C. cannot
be made a ground to initiate penalty proceedings if no attempt to evade tax
is made out. However, in the present case, the driver had produced the
documents at I.C.C. and subsequently at the time of checking, he showed all
the invoices. There was no attempt to evade tax. Hence, VAT appeal is
allowed and no case for imposition of penalty is made out under Section
51(7)(c) of the Punjab VAT Act, 2005. Order dated 05.03.2010 (Annexure
A-10) passed by the Tribunal is set aside.
Pending application, if any, stands disposed of.
|
The Punjab and Haryana High Court has held that non-appearance before the Information Collection Centre (ICC) cannot be made a ground to initiate penalty proceedings if no attempt to evade tax is made.
The division bench of Justice Ritu Bahari and Justice Manisha Batra has observed that the driver had produced the documents at I.C.C. and subsequently, at the time of checking, he showed all the invoices. There was no attempt to evade tax. Hence, the VAT appeal was allowed, and no case for the imposition of a penalty is made out under Section 51(7)(c) of the Punjab VAT Act, 2005.
The goods were being transferred by vehicle from Ludhiana to Delhi. The driver of the vehicle furnished the documents at the computer counter for the generation of the declaration. After getting the declaration, the driver of the vehicle produced the documents before the detaining officer, who, after examining them, found that the goods seemed excessive and needed physical verification.
The goods were physically verified, and it was found that the driver of the vehicle did not furnish any information with respect to invoices. Therefore, the goods were detained under Section 51(6) of the Punjab VAT Act, 2005, and a show-cause notice was issued to the owner of the goods.
The appellant contended that the person operating the computer failed to generate two bills for the appellant due to an oversight. The driver of the vehicle furnished all the documents along with the computer-generated information before the officer-in-charge, who detained the goods on the ground that no information was generated with respect to the goods.
The department contended that Form VAT-XXXVI had not been issued to the appellant company for not producing invoices before the I.C.C., but the goods were detained as they seemed to be in excess of the invoices produced before the I.C.C. The driver had generated three bills, whereas information for two bills was not generated.
The court held that once the Government Department had accepted the invoices produced at I.C.C., there was no reason not to accept Invoices Nos. 648, 225, and 8 dated July 12, 2006. Similarly, invoices Nos. 526 and 527 were also issued on the same date, i.e., July 12, 2006, with respect to the supply order. The driver was not expected to know details about the supply order.
Case Title: M/s. Punjab Wool Syndicate Versus The State of Punjab and another
Date: 18.01.2023
Counsel For Appellant: Advocates Sandeep Goyal, Nazuk Singhal, Aakriti
Counsel For Respondent: A.A.G. Alankar Narula
|
The appellant-M/s. Punjab Wool Syndicate has come up in
appeal against the order dated 05.03.2010 (Annexure A-10) passed by the
Tribunal dismissing the Appeal (Vat) No. 565 of 2009 of the appellant and
had upheld the penalty of Rs.69,952/- under Section 51(7)(c) of the Punjab
As per the facts culled out from the order dated 24.07.2006
(Annexure A-7) passed by the Assistant Excise and Taxation
Commissioner, Information Collection Centre (Export), Shambhu at
Mehmadpur, the goods were being transferred in Vehicle No. HR-38-9923
from Ludhiana to Delhi. The driver of the vehicle furnished following
documents at the computer counter for the generation of declaration in form
1. Invoice No. 648 dated 12.7.06 of M/S Krishna Paints &
Chemicals, Jalandhar for Rs.67,754/- in favour of M/s Shri
2. Invoice No. 225 dated 12.7.06 of M/S Super Polyme & Co.
Coating Jalandhar for Rs.13,104/- in favour of M/S Shri Balaji
3. GR No. 431 dated 12.7.06 of M/s. H.S.Aujla Transport Service
from Jalandhar to Saharanpur.
4. Invoice No. 8 dated 12.7.06 of M/S R.S. Machi Mart, Ludhiana
for Rs.30,800/- in favour of Nav Nidh Machine Tolls, Delhi.
5. GR No. 2197 dated 12.7.06 of M/S Tempo Transport Union,
Ludhiana from Ludhiana to New Delhi.
After getting the declaration in form VAT-XXXVI, the driver
of the vehicle produced the above documents before the detaining officer,
who after examining the same, found that the goods seemed to be excessive
and needed physical verification. The goods were physically verified and
found that the driver of the vehicle did not furnish the information in respect
of Invoices No. 526 and 527 both dated 12.7.2006 and GR Nos. 9411 and
9412. Therefore, the goods were detained under Section 51(6) of the
Punjab VAT Act, 2005 and a show cause notice was issued to the owner of
the goods i.e. M/S Punjab Wool Syndicate, Ludhiana for 15.7.2006.
After issuing notice, Sunil Nanda, Accounts Manager of the
consignor party appeared before the detaining officer on 15.7.2006 and he
did not furnish information with respect to invoices No. 526 and 527 dated
12.07.2006. He furnished bank guarantee for Rs.50,000/- and Rs.20,000/-
(Total Rs.70,000/-) and the goods were released by the detaining officer.
Thereafter, show cause notice under Section 51(7)(c) of the Punjab VAT
Act, 2005 was issued to the owner of the goods i.e. M/s. Punjab Wool
Syndicate, Ludhiana for 21.07.2006. He was confronted with the report of
the detaining officer that the driver of the vehicle had failed to furnish
information with respect to goods covered by Invoices No. 526 and 527 at
the I.C.C. The dealer failed to produce his books of account before the
detaining officer and also failed to give any explanation for not submitting
the information in respect of above said two invoices. The value of the
goods was Rs.1,39,904.10 and they were meant for trade. Since the dealer
had not furnished information at the I.C.C. and the intention was to
avoid/evade tax due to the State, a penalty of Rs.69,952/- was imposed. On
appeal, the said order was affirmed by the Deputy Excise & Taxation
Commissioner (A), Patiala Division, Patiala vide order dated 15.06.2009
(Annexure A-8). Vide order dated 05.03.2010 (Annexure A-10), the Value
Added Tax Tribunal, Punjab, Chandigarh had dismissed the appeal filed by
the appellant against the order dated 15.06.2009.
Learned counsel for the appellant has referred to the supply
order (Annexure A-1) given by the Additional Deputy Inspector General of
Police, CRPF, Jalandhar wherein nomenclature of the goods was specified
as Beret Wool Knitted with Nylon Tape Binding (Khakhi) (at page No. 15
of the paper-book) and the total amount was Rs.38,42,564/- of the said
goods. As per the supply order, two of the destinations were the Additional
DGIGP, GC, CRPF, Mokambehghat-803303 (Bihar) and the Additional
DIGP, GC, CRPF, Rangareddy-500078 (Andhra Pradesh). He has also
placed on necessary bills bearing Invoices No. 526 and 527 dated
12.07.2006 (Annexures A-2 and A-3) respectively in favour of the
Additional DIG, CRPF. The materials were booked in the Transport
Company as these were in small quantities. G.Rs (Annexures A-4 and A-5)
were issued by Satkar Tempo Transport Union dated 12.07.2006 upto Delhi
Railway Station. From Delhi, the goods were to be sent by Train to the
actual consignees. This fact was mentioned in the G.Rs and it was a
Government supply. The inspection notes are Annexure A-6. After loading
the goods, the driver of the vehicle reached at I.C.C. Shambhu where he
furnished all the documents for generation of Form VAT-XXXVI.
Learned counsel for the appellant has further argued that the
person operating the computer failed to generate two bills of the appellant
due to oversight. The driver of the vehicle furnished all the documents
alongwith the computer generated information before the officer- incharge
who detained the goods on the ground that no information was generated in
respect of goods. He has further argued that keeping in view the supply
order (Annexure A-1) and inspection notes (Annexure A-6), the sale was
being made by the appellant to Central Government Department and the
Central Government Department had received sanction from the financial
authority to purchase these things. It was not a case where name of the
purchaser had not been disclosed and all the invoices had been produced
alongwith G.Rs. To support his contention, he has referred to the following
judgments on the proposition that all the necessary documents were in
possession of the driver before the I.C.C. and there was no intention to
Gobindgarh v. State of Punjab (2008) 31 PHT 398 (PVT)
School, Harbanspura, Mandi Gobindgarh vs. State of
3. Krish Pack Industries Vs. State of Punjab and others
4. M/s. Ganpati Foods vs. The State of Punjab and another
5. State of Punjab and another vs. Shree Ram Panels (2011)
6. M/s. Balaji Trading Company, Rewari vs. The State of
Haryana and another 2016 SCC Online P&H 4741
Since the sale was being made to the Government Department,
the invoices and G.Rs could not have been doubted keeping in view
inspection notes (Annexure A-6) which was with the driver and no attempt
was made to evade tax due to the State. Had the driver not produced the
invoices for generation of declaration in Form VAT-XXXVI, it could have
been a reason to initiate penalty proceedings. Since, all the documents
including Invoices No. 648 dated 12.7.06, 225 dated 12.7.06, 8 dated
12.7.06 and GRs No. 431 dated 12.7.06 and 2197 dated 12.7.06 were
produced alongwith Invoices No. 526 and 527 dated 12.7.2006 and GR Nos.
9411 and 9142 were produced by the driver at I.C.C., the findings recorded
by the Assistant Excise and Taxation Commissioner, ICC (Export)
Shambhu that the driver did not give any information with respect to
invoices No. 526 and 527 and subsequently imposing penalty is liable to be
set aside as the driver is not expected to know or give details of these
Learned counsel for the respondent-State has argued that in fact
Form VAT-XXXVI had not been issued to the appellant company for non-
producing invoices No. 526 and 527 before the I.C.C. but the goods were
detained as they seemed to be in excess of the invoices produced before the
I.C.C. He has finally argued that the driver had generated 3 bills whereas
information of two bills were not generated and the Tribunal had rightly
dismissed the appeal of the appellant by referring to judgment in the case of
M/s. Jain Industries Company vs. State of Punjab 2008(31) PHT page No.
Heard learned counsel for the parties and perused the case file.
At the outset, reference can be made to M/s. Jain Industries's
case (supra). This judgment was passed by the Value Added Tax Tribunal,
Punjab, Chandigarh. In that case, the goods had been transferred from
Mandi Gobindgarh to Raipur in Chattisgarh and the driver of the vehicle
furnished information with respect to four bills and GRs and generated
Form No. XXXVI in respect of those bills and when the goods were
detained, invoice No. 26 dated 26.06.2006 of Jain Industrial Company,
Mandi Gobindgarh in favour of Bajrang Metallic and Power Ltd., Raipur
(Chattisgarh) and GR No. 6337 dated 26.06.2006 of M/s. Ashok Akal
Transport Company (Registered) from Mandi Gobindgarh to Raipur
(Chattisgarh) were found. The driver had not given information with
respect to these documents at the I.C.C. and no Form No. XXXVI was
generated with a view to evade tax. He further gave a statement that owner
had asked him that no such forms may be generated at the I.C.C. Hence, the
facts of that case show that apart from four bills, there were two other bills
of other private companies, which were not shown at the time of generation
of Form No. XXXVI at I.C.C. and this would amount to attempt to evade
However, in the facts of the present case, sale was processed to
be made to CRPF as per supply order (Annexure A-1) and all the
information were given at the computer centre and all the documents were
shown but when the goods were detained, other two invoices were also
shown. The supply order was also shown which was given by the
Additional Deputy Inspector General of Police, CRPF, Jalandhar. Hence, it
was a sale which was made to Government Department and the appellant
had also produced GRs and all the invoices at the time of checking. There
was no attempt made by the driver not to show invoices before the detaining
In M/s. Ganpati Foods vs. The State of Punjab and another
(2014) 67 VST 348, a Coordinate Bench of this Court observed that in that
case Dealer was registered under the provision of Haryana Value Added
Tax, Act, 2003. It was having oil solvent plant at Nilokheri in District
Karnal. The appellant sold rice bran oil to one M/s. Bathinda Chemicals
Limited, Bathinda, a registered dealer under the Punjab VAT Act vide bill
dated 28.01.2008 booked with Ahmedgarh Transport Co., Ludhiana for its
transportation from Nilokheri to Bathinda. On its way from Nilokheri to
Bathinda, the driver of the vehicle had to cross the I.C.C. (Import) Shambhu
set up by the Punjab Government under Section 51 of the Punjab VAT Act.
The driver of the vehicle entered the I.C.C. and after getting necessary entry
made by the E.T.O. and clearance from the police personnel, a stamp was
affixed on his documents to this effect. When the documents were returned
to the driver, he was under the impression that necessary entry had been
made. On its way to Bathinda, it was checked by the Excise and Taxation
Officer (Mobile Wing), Bathinda and a case was made out for violation of
Section 51(6)(b) of the Punjab VAT Act on the ground that the information
had not been generated at the I.C.C. section centre while entering Punjab
State. The goods were detained and were subsequently released after
furnishing bank guarantee on 01.02.2008 and, thereafter, penalty amounting
to Rs.7,18,913/- was imposed by the Assistant Excise and Taxation
Commissioner (AETC) vide order dated 06.02.2008. Against the order
dated 06.02.2008, appeal was filed by the assessee before the first appellate
authority which was dismissed vide order dated 29.09.2008 and the second
appeal was dismissed by the Tribunal on 16.04.2009. The VAT appeal was
allowed by the Coordinate Bench and the penalty was set aside on the
ground that the goods in question were duly accompanied by invoice/GR,
statutory form VAT and the insurance policy with stamp of I.C.C. at
Shambhu on the GR. However, the driver being ignored and illiterate,
could not generate declaration at the I.C.C. and this in itself would not
amount an attempt to evade tax as the documents were sufficient to draw a
conclusion that there was no attempt to evade tax unless the documents
were rejected on the ground that they were not genuine.
Reference can now be made to judgment passed in State of
Punjab and another vs. Shree Ram Panels (2011) 46 VST 424, wherein a
coordinate Bench of this Court had dismissed the appeal filed by the State
of Punjab against the order of Tribunal as the Tribunal had accepted the
appeal filed by the assessee and set aside the imposition of penalty on the
ground that there was no violation of Section 51(4) of the Punjab Value
Added Tax Act with a view to make an attempt to evade tax as the driver of
the vehicle was in possession of goods receipts alongwith invoices and
produced the same as well.
Further reference can be made to a recent judgment passed by
the Division Bench of this Court in the case of M/s. Balaji Trading
Company, Rewari vs. The State of Haryana and another 2016 SCC
Online P&H 4741. In that case, the assessee Balaji Trading Company was
dealing with the purchase orders from NAFED, a Government of India
Undertaking. Annexure A-3 was the invoice dated 28.01.2003 and challan
to substantiate that the transaction was with the Government organization
NAFED was held to be bonafide and genuine as the documents were
required to be examined and only on the statement of the driver, penalty
could not be imposed.
In the facts of the present case, the appellant was making sale to
Government Department all over India as the supply order was given by the
Additional Deputy Inspector General of Police, CRPF, Jalandhar and the
driver had produced 5 documents before the computer centre at ICC but
VAT-XXXVI could not generate and at the time of checking, apart from 5
documents two invoices No. 526 and 527 dated 12.7.2006 and GR Nos.
9411 and 9412 were also produced. Since the respondents, in the present
case, were not disputing the fact that the sale was being made to CRPF and
only on account of non-generation of VAT-XXXVI, penalty could not have
been imposed. Further, in the order dated 05.03.2010 (Annexure A-10), it
was further observed that with respect to Invoices No. 526 and 527, the
driver did not furnish any information. The driver is not required to give
any information with respect to details of the invoices. He is to only
produce documents to show that there was a supply order and GRs had been
issued and he was taking the goods to their destination outside the State.
Further, it is not the case of the respondents that the two invoices No. 526
and 527 did not issue to CRPF. Hence, once the Government Department
had accepted the invoices produced at I.C.C., there was no occasion not to
accept Invoices No. 648, 225 and 8 dated 12.07.06. Similarly, invoices No.
526 and 527 were also issued on the same date i.e. 12.07.2006 with respect
to supply order (Annexure A-1). The driver was not expected to know
details of the supply order. It is not the case of the respondents that on
13.07.2006, the appellant did not produce above said invoices. In one of
the cases as referred above, even non-appearance before the I.C.C. cannot
be made a ground to initiate penalty proceedings if no attempt to evade tax
is made out. However, in the present case, the driver had produced the
documents at I.C.C. and subsequently at the time of checking, he showed all
the invoices. There was no attempt to evade tax. Hence, VAT appeal is
allowed and no case for imposition of penalty is made out under Section
51(7)(c) of the Punjab VAT Act, 2005. Order dated 05.03.2010 (Annexure
A-10) passed by the Tribunal is set aside.
Pending application, if any, stands disposed of.
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The appellant-M/s. Punjab Wool Syndicate has come up in
appeal against the order dated 05.03.2010 (Annexure A-10) passed by the
Tribunal dismissing the Appeal (Vat) No. 565 of 2009 of the appellant and
had upheld the penalty of Rs.69,952/- under Section 51(7)(c) of the Punjab
As per the facts culled out from the order dated 24.07.2006
(Annexure A-7) passed by the Assistant Excise and Taxation
Commissioner, Information Collection Centre (Export), Shambhu at
Mehmadpur, the goods were being transferred in Vehicle No. HR-38-9923
from Ludhiana to Delhi. The driver of the vehicle furnished following
documents at the computer counter for the generation of declaration in form
1. Invoice No. 648 dated 12.7.06 of M/S Krishna Paints &
Chemicals, Jalandhar for Rs.67,754/- in favour of M/s Shri
2. Invoice No. 225 dated 12.7.06 of M/S Super Polyme & Co.
Coating Jalandhar for Rs.13,104/- in favour of M/S Shri Balaji
3. GR No. 431 dated 12.7.06 of M/s. H.S.Aujla Transport Service
from Jalandhar to Saharanpur.
4. Invoice No. 8 dated 12.7.06 of M/S R.S. Machi Mart, Ludhiana
for Rs.30,800/- in favour of Nav Nidh Machine Tolls, Delhi.
5. GR No. 2197 dated 12.7.06 of M/S Tempo Transport Union,
Ludhiana from Ludhiana to New Delhi.
After getting the declaration in form VAT-XXXVI, the driver
of the vehicle produced the above documents before the detaining officer,
who after examining the same, found that the goods seemed to be excessive
and needed physical verification. The goods were physically verified and
found that the driver of the vehicle did not furnish the information in respect
of Invoices No. 526 and 527 both dated 12.7.2006 and GR Nos. 9411 and
9412. Therefore, the goods were detained under Section 51(6) of the
Punjab VAT Act, 2005 and a show cause notice was issued to the owner of
the goods i.e. M/S Punjab Wool Syndicate, Ludhiana for 15.7.2006.
After issuing notice, Sunil Nanda, Accounts Manager of the
consignor party appeared before the detaining officer on 15.7.2006 and he
did not furnish information with respect to invoices No. 526 and 527 dated
12.07.2006. He furnished bank guarantee for Rs.50,000/- and Rs.20,000/-
(Total Rs.70,000/-) and the goods were released by the detaining officer.
Thereafter, show cause notice under Section 51(7)(c) of the Punjab VAT
Act, 2005 was issued to the owner of the goods i.e. M/s. Punjab Wool
Syndicate, Ludhiana for 21.07.2006. He was confronted with the report of
the detaining officer that the driver of the vehicle had failed to furnish
information with respect to goods covered by Invoices No. 526 and 527 at
the I.C.C. The dealer failed to produce his books of account before the
detaining officer and also failed to give any explanation for not submitting
the information in respect of above said two invoices. The value of the
goods was Rs.1,39,904.10 and they were meant for trade. Since the dealer
had not furnished information at the I.C.C. and the intention was to
avoid/evade tax due to the State, a penalty of Rs.69,952/- was imposed. On
appeal, the said order was affirmed by the Deputy Excise & Taxation
Commissioner (A), Patiala Division, Patiala vide order dated 15.06.2009
(Annexure A-8). Vide order dated 05.03.2010 (Annexure A-10), the Value
Added Tax Tribunal, Punjab, Chandigarh had dismissed the appeal filed by
the appellant against the order dated 15.06.2009.
Learned counsel for the appellant has referred to the supply
order (Annexure A-1) given by the Additional Deputy Inspector General of
Police, CRPF, Jalandhar wherein nomenclature of the goods was specified
as Beret Wool Knitted with Nylon Tape Binding (Khakhi) (at page No. 15
of the paper-book) and the total amount was Rs.38,42,564/- of the said
goods. As per the supply order, two of the destinations were the Additional
DGIGP, GC, CRPF, Mokambehghat-803303 (Bihar) and the Additional
DIGP, GC, CRPF, Rangareddy-500078 (Andhra Pradesh). He has also
placed on necessary bills bearing Invoices No. 526 and 527 dated
12.07.2006 (Annexures A-2 and A-3) respectively in favour of the
Additional DIG, CRPF. The materials were booked in the Transport
Company as these were in small quantities. G.Rs (Annexures A-4 and A-5)
were issued by Satkar Tempo Transport Union dated 12.07.2006 upto Delhi
Railway Station. From Delhi, the goods were to be sent by Train to the
actual consignees. This fact was mentioned in the G.Rs and it was a
Government supply. The inspection notes are Annexure A-6. After loading
the goods, the driver of the vehicle reached at I.C.C. Shambhu where he
furnished all the documents for generation of Form VAT-XXXVI.
Learned counsel for the appellant has further argued that the
person operating the computer failed to generate two bills of the appellant
due to oversight. The driver of the vehicle furnished all the documents
alongwith the computer generated information before the officer- incharge
who detained the goods on the ground that no information was generated in
respect of goods. He has further argued that keeping in view the supply
order (Annexure A-1) and inspection notes (Annexure A-6), the sale was
being made by the appellant to Central Government Department and the
Central Government Department had received sanction from the financial
authority to purchase these things. It was not a case where name of the
purchaser had not been disclosed and all the invoices had been produced
alongwith G.Rs. To support his contention, he has referred to the following
judgments on the proposition that all the necessary documents were in
possession of the driver before the I.C.C. and there was no intention to
Gobindgarh v. State of Punjab (2008) 31 PHT 398 (PVT)
School, Harbanspura, Mandi Gobindgarh vs. State of
3. Krish Pack Industries Vs. State of Punjab and others
4. M/s. Ganpati Foods vs. The State of Punjab and another
5. State of Punjab and another vs. Shree Ram Panels (2011)
6. M/s. Balaji Trading Company, Rewari vs. The State of
Haryana and another 2016 SCC Online P&H 4741
Since the sale was being made to the Government Department,
the invoices and G.Rs could not have been doubted keeping in view
inspection notes (Annexure A-6) which was with the driver and no attempt
was made to evade tax due to the State. Had the driver not produced the
invoices for generation of declaration in Form VAT-XXXVI, it could have
been a reason to initiate penalty proceedings. Since, all the documents
including Invoices No. 648 dated 12.7.06, 225 dated 12.7.06, 8 dated
12.7.06 and GRs No. 431 dated 12.7.06 and 2197 dated 12.7.06 were
produced alongwith Invoices No. 526 and 527 dated 12.7.2006 and GR Nos.
9411 and 9142 were produced by the driver at I.C.C., the findings recorded
by the Assistant Excise and Taxation Commissioner, ICC (Export)
Shambhu that the driver did not give any information with respect to
invoices No. 526 and 527 and subsequently imposing penalty is liable to be
set aside as the driver is not expected to know or give details of these
Learned counsel for the respondent-State has argued that in fact
Form VAT-XXXVI had not been issued to the appellant company for non-
producing invoices No. 526 and 527 before the I.C.C. but the goods were
detained as they seemed to be in excess of the invoices produced before the
I.C.C. He has finally argued that the driver had generated 3 bills whereas
information of two bills were not generated and the Tribunal had rightly
dismissed the appeal of the appellant by referring to judgment in the case of
M/s. Jain Industries Company vs. State of Punjab 2008(31) PHT page No.
Heard learned counsel for the parties and perused the case file.
At the outset, reference can be made to M/s. Jain Industries's
case (supra). This judgment was passed by the Value Added Tax Tribunal,
Punjab, Chandigarh. In that case, the goods had been transferred from
Mandi Gobindgarh to Raipur in Chattisgarh and the driver of the vehicle
furnished information with respect to four bills and GRs and generated
Form No. XXXVI in respect of those bills and when the goods were
detained, invoice No. 26 dated 26.06.2006 of Jain Industrial Company,
Mandi Gobindgarh in favour of Bajrang Metallic and Power Ltd., Raipur
(Chattisgarh) and GR No. 6337 dated 26.06.2006 of M/s. Ashok Akal
Transport Company (Registered) from Mandi Gobindgarh to Raipur
(Chattisgarh) were found. The driver had not given information with
respect to these documents at the I.C.C. and no Form No. XXXVI was
generated with a view to evade tax. He further gave a statement that owner
had asked him that no such forms may be generated at the I.C.C. Hence, the
facts of that case show that apart from four bills, there were two other bills
of other private companies, which were not shown at the time of generation
of Form No. XXXVI at I.C.C. and this would amount to attempt to evade
However, in the facts of the present case, sale was processed to
be made to CRPF as per supply order (Annexure A-1) and all the
information were given at the computer centre and all the documents were
shown but when the goods were detained, other two invoices were also
shown. The supply order was also shown which was given by the
Additional Deputy Inspector General of Police, CRPF, Jalandhar. Hence, it
was a sale which was made to Government Department and the appellant
had also produced GRs and all the invoices at the time of checking. There
was no attempt made by the driver not to show invoices before the detaining
In M/s. Ganpati Foods vs. The State of Punjab and another
(2014) 67 VST 348, a Coordinate Bench of this Court observed that in that
case Dealer was registered under the provision of Haryana Value Added
Tax, Act, 2003. It was having oil solvent plant at Nilokheri in District
Karnal. The appellant sold rice bran oil to one M/s. Bathinda Chemicals
Limited, Bathinda, a registered dealer under the Punjab VAT Act vide bill
dated 28.01.2008 booked with Ahmedgarh Transport Co., Ludhiana for its
transportation from Nilokheri to Bathinda. On its way from Nilokheri to
Bathinda, the driver of the vehicle had to cross the I.C.C. (Import) Shambhu
set up by the Punjab Government under Section 51 of the Punjab VAT Act.
The driver of the vehicle entered the I.C.C. and after getting necessary entry
made by the E.T.O. and clearance from the police personnel, a stamp was
affixed on his documents to this effect. When the documents were returned
to the driver, he was under the impression that necessary entry had been
made. On its way to Bathinda, it was checked by the Excise and Taxation
Officer (Mobile Wing), Bathinda and a case was made out for violation of
Section 51(6)(b) of the Punjab VAT Act on the ground that the information
had not been generated at the I.C.C. section centre while entering Punjab
State. The goods were detained and were subsequently released after
furnishing bank guarantee on 01.02.2008 and, thereafter, penalty amounting
to Rs.7,18,913/- was imposed by the Assistant Excise and Taxation
Commissioner (AETC) vide order dated 06.02.2008. Against the order
dated 06.02.2008, appeal was filed by the assessee before the first appellate
authority which was dismissed vide order dated 29.09.2008 and the second
appeal was dismissed by the Tribunal on 16.04.2009. The VAT appeal was
allowed by the Coordinate Bench and the penalty was set aside on the
ground that the goods in question were duly accompanied by invoice/GR,
statutory form VAT and the insurance policy with stamp of I.C.C. at
Shambhu on the GR. However, the driver being ignored and illiterate,
could not generate declaration at the I.C.C. and this in itself would not
amount an attempt to evade tax as the documents were sufficient to draw a
conclusion that there was no attempt to evade tax unless the documents
were rejected on the ground that they were not genuine.
Reference can now be made to judgment passed in State of
Punjab and another vs. Shree Ram Panels (2011) 46 VST 424, wherein a
coordinate Bench of this Court had dismissed the appeal filed by the State
of Punjab against the order of Tribunal as the Tribunal had accepted the
appeal filed by the assessee and set aside the imposition of penalty on the
ground that there was no violation of Section 51(4) of the Punjab Value
Added Tax Act with a view to make an attempt to evade tax as the driver of
the vehicle was in possession of goods receipts alongwith invoices and
produced the same as well.
Further reference can be made to a recent judgment passed by
the Division Bench of this Court in the case of M/s. Balaji Trading
Company, Rewari vs. The State of Haryana and another 2016 SCC
Online P&H 4741. In that case, the assessee Balaji Trading Company was
dealing with the purchase orders from NAFED, a Government of India
Undertaking. Annexure A-3 was the invoice dated 28.01.2003 and challan
to substantiate that the transaction was with the Government organization
NAFED was held to be bonafide and genuine as the documents were
required to be examined and only on the statement of the driver, penalty
could not be imposed.
In the facts of the present case, the appellant was making sale to
Government Department all over India as the supply order was given by the
Additional Deputy Inspector General of Police, CRPF, Jalandhar and the
driver had produced 5 documents before the computer centre at ICC but
VAT-XXXVI could not generate and at the time of checking, apart from 5
documents two invoices No. 526 and 527 dated 12.7.2006 and GR Nos.
9411 and 9412 were also produced. Since the respondents, in the present
case, were not disputing the fact that the sale was being made to CRPF and
only on account of non-generation of VAT-XXXVI, penalty could not have
been imposed. Further, in the order dated 05.03.2010 (Annexure A-10), it
was further observed that with respect to Invoices No. 526 and 527, the
driver did not furnish any information. The driver is not required to give
any information with respect to details of the invoices. He is to only
produce documents to show that there was a supply order and GRs had been
issued and he was taking the goods to their destination outside the State.
Further, it is not the case of the respondents that the two invoices No. 526
and 527 did not issue to CRPF. Hence, once the Government Department
had accepted the invoices produced at I.C.C., there was no occasion not to
accept Invoices No. 648, 225 and 8 dated 12.07.06. Similarly, invoices No.
526 and 527 were also issued on the same date i.e. 12.07.2006 with respect
to supply order (Annexure A-1). The driver was not expected to know
details of the supply order. It is not the case of the respondents that on
13.07.2006, the appellant did not produce above said invoices. In one of
the cases as referred above, even non-appearance before the I.C.C. cannot
be made a ground to initiate penalty proceedings if no attempt to evade tax
is made out. However, in the present case, the driver had produced the
documents at I.C.C. and subsequently at the time of checking, he showed all
the invoices. There was no attempt to evade tax. Hence, VAT appeal is
allowed and no case for imposition of penalty is made out under Section
51(7)(c) of the Punjab VAT Act, 2005. Order dated 05.03.2010 (Annexure
A-10) passed by the Tribunal is set aside.
Pending application, if any, stands disposed of.
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The Punjab and Haryana High Court has held that non-appearance before the Information Collection Centre (ICC) cannot be made a ground to initiate penalty proceedings if no attempt to evade tax is made.
The division bench of Justice Ritu Bahari and Justice Manisha Batra has observed that the driver had produced the documents at I.C.C. and subsequently, at the time of checking, he showed all the invoices. There was no attempt to evade tax. Hence, the VAT appeal was allowed, and no case for the imposition of a penalty is made out under Section 51(7)(c) of the Punjab VAT Act, 2005.
The goods were being transferred by vehicle from Ludhiana to Delhi. The driver of the vehicle furnished the documents at the computer counter for the generation of the declaration. After getting the declaration, the driver of the vehicle produced the documents before the detaining officer, who, after examining them, found that the goods seemed excessive and needed physical verification.
The goods were physically verified, and it was found that the driver of the vehicle did not furnish any information with respect to invoices. Therefore, the goods were detained under Section 51(6) of the Punjab VAT Act, 2005, and a show-cause notice was issued to the owner of the goods.
The appellant contended that the person operating the computer failed to generate two bills for the appellant due to an oversight. The driver of the vehicle furnished all the documents along with the computer-generated information before the officer-in-charge, who detained the goods on the ground that no information was generated with respect to the goods.
The department contended that Form VAT-XXXVI had not been issued to the appellant company for not producing invoices before the I.C.C., but the goods were detained as they seemed to be in excess of the invoices produced before the I.C.C. The driver had generated three bills, whereas information for two bills was not generated.
The court held that once the Government Department had accepted the invoices produced at I.C.C., there was no reason not to accept Invoices Nos. 648, 225, and 8 dated July 12, 2006. Similarly, invoices Nos. 526 and 527 were also issued on the same date, i.e., July 12, 2006, with respect to the supply order. The driver was not expected to know details about the supply order.
Case Title: M/s. Punjab Wool Syndicate Versus The State of Punjab and another
Date: 18.01.2023
Counsel For Appellant: Advocates Sandeep Goyal, Nazuk Singhal, Aakriti
Counsel For Respondent: A.A.G. Alankar Narula
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The Punjab and Haryana High Court has held that non-appearance before the Information Collection Centre (ICC) cannot be made a ground to initiate penalty proceedings if no attempt to evade tax is made.
The division bench of Justice Ritu Bahari and Justice Manisha Batra has observed that the driver had produced the documents at I.C.C. and subsequently, at the time of checking, he showed all the invoices. There was no attempt to evade tax. Hence, the VAT appeal was allowed, and no case for the imposition of a penalty is made out under Section 51(7)(c) of the Punjab VAT Act, 2005.
The goods were being transferred by vehicle from Ludhiana to Delhi. The driver of the vehicle furnished the documents at the computer counter for the generation of the declaration. After getting the declaration, the driver of the vehicle produced the documents before the detaining officer, who, after examining them, found that the goods seemed excessive and needed physical verification.
The goods were physically verified, and it was found that the driver of the vehicle did not furnish any information with respect to invoices. Therefore, the goods were detained under Section 51(6) of the Punjab VAT Act, 2005, and a show-cause notice was issued to the owner of the goods.
The appellant contended that the person operating the computer failed to generate two bills for the appellant due to an oversight. The driver of the vehicle furnished all the documents along with the computer-generated information before the officer-in-charge, who detained the goods on the ground that no information was generated with respect to the goods.
The department contended that Form VAT-XXXVI had not been issued to the appellant company for not producing invoices before the I.C.C., but the goods were detained as they seemed to be in excess of the invoices produced before the I.C.C. The driver had generated three bills, whereas information for two bills was not generated.
The court held that once the Government Department had accepted the invoices produced at I.C.C., there was no reason not to accept Invoices Nos. 648, 225, and 8 dated July 12, 2006. Similarly, invoices Nos. 526 and 527 were also issued on the same date, i.e., July 12, 2006, with respect to the supply order. The driver was not expected to know details about the supply order.
Case Title: M/s. Punjab Wool Syndicate Versus The State of Punjab and another
Date: 18.01.2023
Counsel For Appellant: Advocates Sandeep Goyal, Nazuk Singhal, Aakriti
Counsel For Respondent: A.A.G. Alankar Narula
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The petitioner-accused No.1 is before this Court seeking
grant of bail under Section 439 of Cr.P.C. in Crime No.36 of
2020 of Bagalur Police Station, pending in CC No.3468 of 2020
on the file of the learned V Additional District Judge, Bengaluru
Rural District at Devanahalli, registered for the offences
punishable under Sections 302, 120-B read with Section 149 of
the Indian Penal Code (for short 'IPC'), on the basis of the first
information lodged by the informant K Dhanalakshmi.
2. Heard Sri K Raghavendra Gowda, learned Counsel
for the petitioner and Sri K Rahul Rai, learned High Court
Government Pleader for the respondent -State. Perused the
materials on record.
3. Learned counsel for the petitioner submitted that
the petitioner is arrayed as accused No.1. He is innocent and
has not committed any offences as alleged. He has been falsely
implicated in the matter without any basis. He was
apprehended on 15.03.2020 and since then he is in judicial
custody. The investigation has been completed and the charge
sheet is also filed. The allegations against accused Nos.1 to 3
CRL.P No. 11294 of 2022
are similar with regard to the overt act said to have been
committed by them. However, accused Nos.2 and 3 have
already been enlarged on bail. Therefore, on the ground of
parity, this petitioner is also entitled to be enlarged on bail.
The petitioner is the permanent resident of the address
mentioned in the cause title to the petition and is ready and
willing to abide by any of the conditions that would be imposed
by this Court. Hence, he prays to allow the petition.
4. Per contra, learned High Court Government Pleader
opposing the petition submitted that serious allegations are
made against the petitioner for having committed the offences.
The present petitioner is the main accused. The charge sheet
is already filed which makes out a prima facie case against the
petitioner for having committed the offences. Considering the
nature and seriousness of the offences, the petitioner is not
entitled for grant of bail. Hence, he prays for dismissal of the
5. In view of the rival contentions urged by the
learned counsel for both the parties, the point that would arise
for my consideration is:
“Whether the petitioner is entitled
for grant of bail under Section 439 of
My answer to the above point is in ‘Affirmative’ for the
6. The allegations made against the petitioner and
other accused are of serious nature. The charge sheet filed by
the Investigating Officer makes out a prima facie case against
all the accused including the petitioner. Admittedly, the overt
act alleged against the present petitioner is similar to that of
accused Nos.2 and 3. It is not in dispute that accused Nos.2
and 3 are already enlarged on bail. Under such circumstances,
benefit of parity is to be extended to the present petitioner.
Moreover, the investigation is completed and the charge sheet
is also filed. Therefore, detention of the petitioner in custody
would amount to infringement of his right to life and liberty.
Hence, I am of the opinion that the petitioner is entitled to be
enlarged on bail subject to conditions, which will take care of
the apprehension expressed by the learned High Court
CRL.P No. 11294 of 2022
Government Pleader that the petitioner may abscond or may
tamper or threaten the prosecution witnesses.
7. Accordingly, I answer the above point in the
affirmative and proceed to pass the following:
The petition is allowed.
The petitioner is ordered to be enlarged on bail in Crime
No.36 of 2020 of Bagalur Police Station, pending in CC No.3468
of 2020 on the file of the learned V Additional District Judge,
Bengaluru Rural District at Devanahalli, on obtaining the bond
in a sum of Rs.2,00,000/- (Rupees Two Lakhs only) with two
sureties for the likesum to the satisfaction of the jurisdictional
Court, subject to the following conditions:
a). The petitioner shall not commit similar
offences.
b). The petitioner shall not threaten or tamper
with the prosecution witnesses.
c). The petitioner shall appear before the Court
as and when required.
If in case, the petitioner violates any of the conditions as
stated above, the prosecution will be at liberty to move the
Trial Court seeking cancellation of bail.
On furnishing the sureties by the petitioner, the Trial
Court is at liberty to direct the Investigating Officer to verify
the correctness of the address and authenticity of the
documents furnished by the petitioner and the sureties and a
report may be called for in that regard, which is to be
submitted by the Investigating Officer within 5 days. The Trial
Court on satisfaction, may proceed to accept the sureties for
the purpose of releasing the petitioner on bail.
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The Karnataka High Court has granted bail to a murder accused, observing that though the allegations against him and others are of serious nature but the overt act alleged against him is similar to that of other accused, who have already been granted bail.
"The charge sheet filed by the Investigating Officer makes out a prima facie case against all the accused including the petitioner. Admittedly, the overt act alleged against the present petitioner is similar to that of accused Nos.2 and 3. It is not in dispute that accused Nos. 2 and 3 are already enlarged on bail. Under such circumstances, the benefit of parity is to be extended to the present petitioner," it said.
The court also noted that the investigation has been completed and the charge sheet has also been filed. "Therefore, detention of the petitioner in custody would amount to infringement of his right to life and liberty," it added.
A single judge bench of Justice M G Uma made the observations while granting bail to one Ravi @ Kamaran Ravi. The petitioner is charged for offences punishable under sections Sections 302, 120-B read with Section 149 of the Indian Penal Code, on the basis of the first information lodged by the informant K Dhanalakshmi, in 2020.
He approached the court seeking bail contending that he is innocent and has not committed any offences as alleged. He has been falsely implicated in the matter without any basis, his counsel argued. He was apprehended on 15.03.2020 and since then he has been in judicial custody, the court was told.
“The allegations against accused Nos.1 to 3 are similar with regard to the overt act said to have been committed by them. However, accused Nos.2 and 3 have already been enlarged on bail. Therefore, on the ground of parity, this petitioner is also entitled to be enlarged on bail," the counsel representing the accused submitted.
The prosecution opposed the plea saying serious allegations have been made against the petitioner for having committed the offences. The petitioner is the main accused, it said
"The charge sheet is already filed which makes out a prima facie case against the petitioner for having committed the offences. Considering the nature and seriousness of the offences, the petitioner is not entitled for grant of bail," the government pleader submitted.
Case Title: Ravi @ Kamran Ravi And State of Karnataka
Case No: CRIMINAL PETITION NO. 11294 OF 2022
Date of order: 05-01-2023
Appearance:
Advocate Raghavendra Gowda K, Advocate Mohankumara D for petitioner.
HCGP K. Rahul Rai for respondent.
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The petitioner-accused No.1 is before this Court seeking
grant of bail under Section 439 of Cr.P.C. in Crime No.36 of
2020 of Bagalur Police Station, pending in CC No.3468 of 2020
on the file of the learned V Additional District Judge, Bengaluru
Rural District at Devanahalli, registered for the offences
punishable under Sections 302, 120-B read with Section 149 of
the Indian Penal Code (for short 'IPC'), on the basis of the first
information lodged by the informant K Dhanalakshmi.
2. Heard Sri K Raghavendra Gowda, learned Counsel
for the petitioner and Sri K Rahul Rai, learned High Court
Government Pleader for the respondent -State. Perused the
materials on record.
3. Learned counsel for the petitioner submitted that
the petitioner is arrayed as accused No.1. He is innocent and
has not committed any offences as alleged. He has been falsely
implicated in the matter without any basis. He was
apprehended on 15.03.2020 and since then he is in judicial
custody. The investigation has been completed and the charge
sheet is also filed. The allegations against accused Nos.1 to 3
CRL.P No. 11294 of 2022
are similar with regard to the overt act said to have been
committed by them. However, accused Nos.2 and 3 have
already been enlarged on bail. Therefore, on the ground of
parity, this petitioner is also entitled to be enlarged on bail.
The petitioner is the permanent resident of the address
mentioned in the cause title to the petition and is ready and
willing to abide by any of the conditions that would be imposed
by this Court. Hence, he prays to allow the petition.
4. Per contra, learned High Court Government Pleader
opposing the petition submitted that serious allegations are
made against the petitioner for having committed the offences.
The present petitioner is the main accused. The charge sheet
is already filed which makes out a prima facie case against the
petitioner for having committed the offences. Considering the
nature and seriousness of the offences, the petitioner is not
entitled for grant of bail. Hence, he prays for dismissal of the
5. In view of the rival contentions urged by the
learned counsel for both the parties, the point that would arise
for my consideration is:
“Whether the petitioner is entitled
for grant of bail under Section 439 of
My answer to the above point is in ‘Affirmative’ for the
6. The allegations made against the petitioner and
other accused are of serious nature. The charge sheet filed by
the Investigating Officer makes out a prima facie case against
all the accused including the petitioner. Admittedly, the overt
act alleged against the present petitioner is similar to that of
accused Nos.2 and 3. It is not in dispute that accused Nos.2
and 3 are already enlarged on bail. Under such circumstances,
benefit of parity is to be extended to the present petitioner.
Moreover, the investigation is completed and the charge sheet
is also filed. Therefore, detention of the petitioner in custody
would amount to infringement of his right to life and liberty.
Hence, I am of the opinion that the petitioner is entitled to be
enlarged on bail subject to conditions, which will take care of
the apprehension expressed by the learned High Court
CRL.P No. 11294 of 2022
Government Pleader that the petitioner may abscond or may
tamper or threaten the prosecution witnesses.
7. Accordingly, I answer the above point in the
affirmative and proceed to pass the following:
The petition is allowed.
The petitioner is ordered to be enlarged on bail in Crime
No.36 of 2020 of Bagalur Police Station, pending in CC No.3468
of 2020 on the file of the learned V Additional District Judge,
Bengaluru Rural District at Devanahalli, on obtaining the bond
in a sum of Rs.2,00,000/- (Rupees Two Lakhs only) with two
sureties for the likesum to the satisfaction of the jurisdictional
Court, subject to the following conditions:
a). The petitioner shall not commit similar
offences.
b). The petitioner shall not threaten or tamper
with the prosecution witnesses.
c). The petitioner shall appear before the Court
as and when required.
If in case, the petitioner violates any of the conditions as
stated above, the prosecution will be at liberty to move the
Trial Court seeking cancellation of bail.
On furnishing the sureties by the petitioner, the Trial
Court is at liberty to direct the Investigating Officer to verify
the correctness of the address and authenticity of the
documents furnished by the petitioner and the sureties and a
report may be called for in that regard, which is to be
submitted by the Investigating Officer within 5 days. The Trial
Court on satisfaction, may proceed to accept the sureties for
the purpose of releasing the petitioner on bail.
|
The petitioner-accused No.1 is before this Court seeking
grant of bail under Section 439 of Cr.P.C. in Crime No.36 of
2020 of Bagalur Police Station, pending in CC No.3468 of 2020
on the file of the learned V Additional District Judge, Bengaluru
Rural District at Devanahalli, registered for the offences
punishable under Sections 302, 120-B read with Section 149 of
the Indian Penal Code (for short 'IPC'), on the basis of the first
information lodged by the informant K Dhanalakshmi.
2. Heard Sri K Raghavendra Gowda, learned Counsel
for the petitioner and Sri K Rahul Rai, learned High Court
Government Pleader for the respondent -State. Perused the
materials on record.
3. Learned counsel for the petitioner submitted that
the petitioner is arrayed as accused No.1. He is innocent and
has not committed any offences as alleged. He has been falsely
implicated in the matter without any basis. He was
apprehended on 15.03.2020 and since then he is in judicial
custody. The investigation has been completed and the charge
sheet is also filed. The allegations against accused Nos.1 to 3
CRL.P No. 11294 of 2022
are similar with regard to the overt act said to have been
committed by them. However, accused Nos.2 and 3 have
already been enlarged on bail. Therefore, on the ground of
parity, this petitioner is also entitled to be enlarged on bail.
The petitioner is the permanent resident of the address
mentioned in the cause title to the petition and is ready and
willing to abide by any of the conditions that would be imposed
by this Court. Hence, he prays to allow the petition.
4. Per contra, learned High Court Government Pleader
opposing the petition submitted that serious allegations are
made against the petitioner for having committed the offences.
The present petitioner is the main accused. The charge sheet
is already filed which makes out a prima facie case against the
petitioner for having committed the offences. Considering the
nature and seriousness of the offences, the petitioner is not
entitled for grant of bail. Hence, he prays for dismissal of the
5. In view of the rival contentions urged by the
learned counsel for both the parties, the point that would arise
for my consideration is:
“Whether the petitioner is entitled
for grant of bail under Section 439 of
My answer to the above point is in ‘Affirmative’ for the
6. The allegations made against the petitioner and
other accused are of serious nature. The charge sheet filed by
the Investigating Officer makes out a prima facie case against
all the accused including the petitioner. Admittedly, the overt
act alleged against the present petitioner is similar to that of
accused Nos.2 and 3. It is not in dispute that accused Nos.2
and 3 are already enlarged on bail. Under such circumstances,
benefit of parity is to be extended to the present petitioner.
Moreover, the investigation is completed and the charge sheet
is also filed. Therefore, detention of the petitioner in custody
would amount to infringement of his right to life and liberty.
Hence, I am of the opinion that the petitioner is entitled to be
enlarged on bail subject to conditions, which will take care of
the apprehension expressed by the learned High Court
CRL.P No. 11294 of 2022
Government Pleader that the petitioner may abscond or may
tamper or threaten the prosecution witnesses.
7. Accordingly, I answer the above point in the
affirmative and proceed to pass the following:
The petition is allowed.
The petitioner is ordered to be enlarged on bail in Crime
No.36 of 2020 of Bagalur Police Station, pending in CC No.3468
of 2020 on the file of the learned V Additional District Judge,
Bengaluru Rural District at Devanahalli, on obtaining the bond
in a sum of Rs.2,00,000/- (Rupees Two Lakhs only) with two
sureties for the likesum to the satisfaction of the jurisdictional
Court, subject to the following conditions:
a). The petitioner shall not commit similar
offences.
b). The petitioner shall not threaten or tamper
with the prosecution witnesses.
c). The petitioner shall appear before the Court
as and when required.
If in case, the petitioner violates any of the conditions as
stated above, the prosecution will be at liberty to move the
Trial Court seeking cancellation of bail.
On furnishing the sureties by the petitioner, the Trial
Court is at liberty to direct the Investigating Officer to verify
the correctness of the address and authenticity of the
documents furnished by the petitioner and the sureties and a
report may be called for in that regard, which is to be
submitted by the Investigating Officer within 5 days. The Trial
Court on satisfaction, may proceed to accept the sureties for
the purpose of releasing the petitioner on bail.
|
The Karnataka High Court has granted bail to a murder accused, observing that though the allegations against him and others are of serious nature but the overt act alleged against him is similar to that of other accused, who have already been granted bail.
"The charge sheet filed by the Investigating Officer makes out a prima facie case against all the accused including the petitioner. Admittedly, the overt act alleged against the present petitioner is similar to that of accused Nos.2 and 3. It is not in dispute that accused Nos. 2 and 3 are already enlarged on bail. Under such circumstances, the benefit of parity is to be extended to the present petitioner," it said.
The court also noted that the investigation has been completed and the charge sheet has also been filed. "Therefore, detention of the petitioner in custody would amount to infringement of his right to life and liberty," it added.
A single judge bench of Justice M G Uma made the observations while granting bail to one Ravi @ Kamaran Ravi. The petitioner is charged for offences punishable under sections Sections 302, 120-B read with Section 149 of the Indian Penal Code, on the basis of the first information lodged by the informant K Dhanalakshmi, in 2020.
He approached the court seeking bail contending that he is innocent and has not committed any offences as alleged. He has been falsely implicated in the matter without any basis, his counsel argued. He was apprehended on 15.03.2020 and since then he has been in judicial custody, the court was told.
“The allegations against accused Nos.1 to 3 are similar with regard to the overt act said to have been committed by them. However, accused Nos.2 and 3 have already been enlarged on bail. Therefore, on the ground of parity, this petitioner is also entitled to be enlarged on bail," the counsel representing the accused submitted.
The prosecution opposed the plea saying serious allegations have been made against the petitioner for having committed the offences. The petitioner is the main accused, it said
"The charge sheet is already filed which makes out a prima facie case against the petitioner for having committed the offences. Considering the nature and seriousness of the offences, the petitioner is not entitled for grant of bail," the government pleader submitted.
Case Title: Ravi @ Kamran Ravi And State of Karnataka
Case No: CRIMINAL PETITION NO. 11294 OF 2022
Date of order: 05-01-2023
Appearance:
Advocate Raghavendra Gowda K, Advocate Mohankumara D for petitioner.
HCGP K. Rahul Rai for respondent.
|
The Karnataka High Court has granted bail to a murder accused, observing that though the allegations against him and others are of serious nature but the overt act alleged against him is similar to that of other accused, who have already been granted bail.
"The charge sheet filed by the Investigating Officer makes out a prima facie case against all the accused including the petitioner. Admittedly, the overt act alleged against the present petitioner is similar to that of accused Nos.2 and 3. It is not in dispute that accused Nos. 2 and 3 are already enlarged on bail. Under such circumstances, the benefit of parity is to be extended to the present petitioner," it said.
The court also noted that the investigation has been completed and the charge sheet has also been filed. "Therefore, detention of the petitioner in custody would amount to infringement of his right to life and liberty," it added.
A single judge bench of Justice M G Uma made the observations while granting bail to one Ravi @ Kamaran Ravi. The petitioner is charged for offences punishable under sections Sections 302, 120-B read with Section 149 of the Indian Penal Code, on the basis of the first information lodged by the informant K Dhanalakshmi, in 2020.
He approached the court seeking bail contending that he is innocent and has not committed any offences as alleged. He has been falsely implicated in the matter without any basis, his counsel argued. He was apprehended on 15.03.2020 and since then he has been in judicial custody, the court was told.
“The allegations against accused Nos.1 to 3 are similar with regard to the overt act said to have been committed by them. However, accused Nos.2 and 3 have already been enlarged on bail. Therefore, on the ground of parity, this petitioner is also entitled to be enlarged on bail," the counsel representing the accused submitted.
The prosecution opposed the plea saying serious allegations have been made against the petitioner for having committed the offences. The petitioner is the main accused, it said
"The charge sheet is already filed which makes out a prima facie case against the petitioner for having committed the offences. Considering the nature and seriousness of the offences, the petitioner is not entitled for grant of bail," the government pleader submitted.
Case Title: Ravi @ Kamran Ravi And State of Karnataka
Case No: CRIMINAL PETITION NO. 11294 OF 2022
Date of order: 05-01-2023
Appearance:
Advocate Raghavendra Gowda K, Advocate Mohankumara D for petitioner.
HCGP K. Rahul Rai for respondent.
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Present : Mr. Munfaid Khan, Advocate for the petitioners.
The limited challenge to the order dated 23.09.2021 passed by
the Motor Accident Claims Tribunal, Palwal (hereinafter referred to as the
‘Tribunal’) is to the extent whereby the Tribunal has directed 50% of the
compensation awarded to be deposited in fixed deposits. The further
challenge is to the order dated 12.05.2022 dismissing the application filed by
the petitioners for release of the amount directed to be deposited in the
Learned counsel for the petitioners would contend that the
petitioners lost their son namely, Sakir, in a motor vehicle accident. The
Tribunal awarded a total amount of Rs.11,18,272/- along with interest @
7.5% per annum from the date of filing of the claim petition till its
realization. However, it was further directed that on realization of the
awarded amount together with the interest, the same shall be shared equally
by the claimants and 50% of the amount of the share of the claimants was
directed to be paid in cash to them whereas remaining 50% was directed to
be deposited in a FDR in a nationalized bank in their names for a period of
three years.
authenticity of this order/judgment
CR No.2270 of 2022 -2-
Learned counsel for the petitioners would contend that both the
petitioners are over 40 years of age and have three other children to look
after and hence the money is urgently required by them. In support of his
contention, he relies on judgment of the Hon’ble Supreme Court in H.S.
Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563] to
contend that in the case of an adult it would not be appropriate to direct the
deposit of the amount of compensation in a fixed deposit.
I have heard learned counsel for the petitioners.
In the present case, the claimant-petitioners are the parents of
the deceased who are wanting the release of the amount which has been
awarded to them but 50% of the awarded amount has been directed to be
deposited in FDRs. It is contended by the learned counsel for the petitioners
that the petitioners require the amount for taking care of their three other
minor children and in support of his contention learned counsel for the
petitioners has relied upon a judgment by the Hon’ble Supreme Court in
H.S. Ahammed Hussain’s case (supra) wherein it has been held as under :
“8. Learned counsel for the appellant lastly submitted
that the amount of compensation payable to mothers of
the victims should not have been directed to be kept in
fixed deposit in a nationalised bank. In the facts and
circumstances of the present case, we are of the view
that the amount of compensation awarded in favour of
the mothers should not be kept in fixed deposit in a
nationalised bank. In case the amounts have not been
authenticity of this order/judgment
CR No.2270 of 2022 -3-
already invested, the same shall be paid to the mothers,
but if, however, invested by depositing the same in fixed
deposit in a nationalised bank, there may be its
premature withdrawal in case the parties so intend.”
Keeping in view the law laid down in the above referred case as
well as the fact that the petitioners are over 40 years of age and have also
three other minor children to look after, the present petition is allowed. The
order dated 12.05.2022 passed by the Tribunal is set aside and the award
dated 23.09.2021 is modified to the said extent. The amount of
compensation lying deposited in the shape of FDRs be released to the
petitioners forthwith.
Disposed off in the above terms. Pending applications, if any,
also stand disposed off.
NOTE : Whether speaking/non-speaking : Speaking
Whether reportable : YES/NO
authenticity of this order/judgment
|
The Punjab and Haryana High Court recently allowed the plea of bereaved parents, seeking release of 50% compensation amount that was granted towards loss of their child in a motor accident, to be released from 3 years Fixed Deposit.Justice Alka Sarin referred to the case of H.S. Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563], where the Supreme Court held that the amount...
The Punjab and Haryana High Court recently allowed the plea of bereaved parents, seeking release of 50% compensation amount that was granted towards loss of their child in a motor accident, to be released from 3 years Fixed Deposit.
Justice Alka Sarin referred to the case of H.S. Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563], where the Supreme Court held that the amount of compensation awarded in favor of the mothers should not be kept in a fixed deposit in a nationalized bank.
In the present case, the petitioners had challenged an order passed by the Motor Accident Claims Tribunal whereby it was directed that 50% of the compensation awarded be deposited in fixed deposits in their names for a period of three years. The further challenge was to the order dismissing the application filed by the petitioners for release of the amount directed to be deposited in the FDRs.
The petitioners contended that both the petitioners are over 40 years of age and have three other children to look after and hence the money is urgently required by them.
Keeping in view the law laid down in the above referred case as well as the fact that the petitioners are over 40 years of age and have also three other minor children to look after, the present petition is allowed.
The court further set aside the order and award of the Motor Accident Claims Tribunal and ordered the release of the amount of compensation lying deposited in the shape of FDRs.
The order dated 12.05.2022 passed by the Tribunal is set aside and the award dated 23.09.2021 is modified to the said extent. The amount of compensation lying deposited in the shape of FDRs be released to the petitioners forthwith.
Case Title: Ayyub Khan and Anr VERSUS Pratap Gurjar and Ors.
|
Present : Mr. Munfaid Khan, Advocate for the petitioners.
The limited challenge to the order dated 23.09.2021 passed by
the Motor Accident Claims Tribunal, Palwal (hereinafter referred to as the
‘Tribunal’) is to the extent whereby the Tribunal has directed 50% of the
compensation awarded to be deposited in fixed deposits. The further
challenge is to the order dated 12.05.2022 dismissing the application filed by
the petitioners for release of the amount directed to be deposited in the
Learned counsel for the petitioners would contend that the
petitioners lost their son namely, Sakir, in a motor vehicle accident. The
Tribunal awarded a total amount of Rs.11,18,272/- along with interest @
7.5% per annum from the date of filing of the claim petition till its
realization. However, it was further directed that on realization of the
awarded amount together with the interest, the same shall be shared equally
by the claimants and 50% of the amount of the share of the claimants was
directed to be paid in cash to them whereas remaining 50% was directed to
be deposited in a FDR in a nationalized bank in their names for a period of
three years.
authenticity of this order/judgment
CR No.2270 of 2022 -2-
Learned counsel for the petitioners would contend that both the
petitioners are over 40 years of age and have three other children to look
after and hence the money is urgently required by them. In support of his
contention, he relies on judgment of the Hon’ble Supreme Court in H.S.
Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563] to
contend that in the case of an adult it would not be appropriate to direct the
deposit of the amount of compensation in a fixed deposit.
I have heard learned counsel for the petitioners.
In the present case, the claimant-petitioners are the parents of
the deceased who are wanting the release of the amount which has been
awarded to them but 50% of the awarded amount has been directed to be
deposited in FDRs. It is contended by the learned counsel for the petitioners
that the petitioners require the amount for taking care of their three other
minor children and in support of his contention learned counsel for the
petitioners has relied upon a judgment by the Hon’ble Supreme Court in
H.S. Ahammed Hussain’s case (supra) wherein it has been held as under :
“8. Learned counsel for the appellant lastly submitted
that the amount of compensation payable to mothers of
the victims should not have been directed to be kept in
fixed deposit in a nationalised bank. In the facts and
circumstances of the present case, we are of the view
that the amount of compensation awarded in favour of
the mothers should not be kept in fixed deposit in a
nationalised bank. In case the amounts have not been
authenticity of this order/judgment
CR No.2270 of 2022 -3-
already invested, the same shall be paid to the mothers,
but if, however, invested by depositing the same in fixed
deposit in a nationalised bank, there may be its
premature withdrawal in case the parties so intend.”
Keeping in view the law laid down in the above referred case as
well as the fact that the petitioners are over 40 years of age and have also
three other minor children to look after, the present petition is allowed. The
order dated 12.05.2022 passed by the Tribunal is set aside and the award
dated 23.09.2021 is modified to the said extent. The amount of
compensation lying deposited in the shape of FDRs be released to the
petitioners forthwith.
Disposed off in the above terms. Pending applications, if any,
also stand disposed off.
NOTE : Whether speaking/non-speaking : Speaking
Whether reportable : YES/NO
authenticity of this order/judgment
|
Present : Mr. Munfaid Khan, Advocate for the petitioners.
The limited challenge to the order dated 23.09.2021 passed by
the Motor Accident Claims Tribunal, Palwal (hereinafter referred to as the
‘Tribunal’) is to the extent whereby the Tribunal has directed 50% of the
compensation awarded to be deposited in fixed deposits. The further
challenge is to the order dated 12.05.2022 dismissing the application filed by
the petitioners for release of the amount directed to be deposited in the
Learned counsel for the petitioners would contend that the
petitioners lost their son namely, Sakir, in a motor vehicle accident. The
Tribunal awarded a total amount of Rs.11,18,272/- along with interest @
7.5% per annum from the date of filing of the claim petition till its
realization. However, it was further directed that on realization of the
awarded amount together with the interest, the same shall be shared equally
by the claimants and 50% of the amount of the share of the claimants was
directed to be paid in cash to them whereas remaining 50% was directed to
be deposited in a FDR in a nationalized bank in their names for a period of
three years.
authenticity of this order/judgment
CR No.2270 of 2022 -2-
Learned counsel for the petitioners would contend that both the
petitioners are over 40 years of age and have three other children to look
after and hence the money is urgently required by them. In support of his
contention, he relies on judgment of the Hon’ble Supreme Court in H.S.
Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563] to
contend that in the case of an adult it would not be appropriate to direct the
deposit of the amount of compensation in a fixed deposit.
I have heard learned counsel for the petitioners.
In the present case, the claimant-petitioners are the parents of
the deceased who are wanting the release of the amount which has been
awarded to them but 50% of the awarded amount has been directed to be
deposited in FDRs. It is contended by the learned counsel for the petitioners
that the petitioners require the amount for taking care of their three other
minor children and in support of his contention learned counsel for the
petitioners has relied upon a judgment by the Hon’ble Supreme Court in
H.S. Ahammed Hussain’s case (supra) wherein it has been held as under :
“8. Learned counsel for the appellant lastly submitted
that the amount of compensation payable to mothers of
the victims should not have been directed to be kept in
fixed deposit in a nationalised bank. In the facts and
circumstances of the present case, we are of the view
that the amount of compensation awarded in favour of
the mothers should not be kept in fixed deposit in a
nationalised bank. In case the amounts have not been
authenticity of this order/judgment
CR No.2270 of 2022 -3-
already invested, the same shall be paid to the mothers,
but if, however, invested by depositing the same in fixed
deposit in a nationalised bank, there may be its
premature withdrawal in case the parties so intend.”
Keeping in view the law laid down in the above referred case as
well as the fact that the petitioners are over 40 years of age and have also
three other minor children to look after, the present petition is allowed. The
order dated 12.05.2022 passed by the Tribunal is set aside and the award
dated 23.09.2021 is modified to the said extent. The amount of
compensation lying deposited in the shape of FDRs be released to the
petitioners forthwith.
Disposed off in the above terms. Pending applications, if any,
also stand disposed off.
NOTE : Whether speaking/non-speaking : Speaking
Whether reportable : YES/NO
authenticity of this order/judgment
|
The Punjab and Haryana High Court recently allowed the plea of bereaved parents, seeking release of 50% compensation amount that was granted towards loss of their child in a motor accident, to be released from 3 years Fixed Deposit.Justice Alka Sarin referred to the case of H.S. Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563], where the Supreme Court held that the amount...
The Punjab and Haryana High Court recently allowed the plea of bereaved parents, seeking release of 50% compensation amount that was granted towards loss of their child in a motor accident, to be released from 3 years Fixed Deposit.
Justice Alka Sarin referred to the case of H.S. Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563], where the Supreme Court held that the amount of compensation awarded in favor of the mothers should not be kept in a fixed deposit in a nationalized bank.
In the present case, the petitioners had challenged an order passed by the Motor Accident Claims Tribunal whereby it was directed that 50% of the compensation awarded be deposited in fixed deposits in their names for a period of three years. The further challenge was to the order dismissing the application filed by the petitioners for release of the amount directed to be deposited in the FDRs.
The petitioners contended that both the petitioners are over 40 years of age and have three other children to look after and hence the money is urgently required by them.
Keeping in view the law laid down in the above referred case as well as the fact that the petitioners are over 40 years of age and have also three other minor children to look after, the present petition is allowed.
The court further set aside the order and award of the Motor Accident Claims Tribunal and ordered the release of the amount of compensation lying deposited in the shape of FDRs.
The order dated 12.05.2022 passed by the Tribunal is set aside and the award dated 23.09.2021 is modified to the said extent. The amount of compensation lying deposited in the shape of FDRs be released to the petitioners forthwith.
Case Title: Ayyub Khan and Anr VERSUS Pratap Gurjar and Ors.
|
The Punjab and Haryana High Court recently allowed the plea of bereaved parents, seeking release of 50% compensation amount that was granted towards loss of their child in a motor accident, to be released from 3 years Fixed Deposit.Justice Alka Sarin referred to the case of H.S. Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563], where the Supreme Court held that the amount...
The Punjab and Haryana High Court recently allowed the plea of bereaved parents, seeking release of 50% compensation amount that was granted towards loss of their child in a motor accident, to be released from 3 years Fixed Deposit.
Justice Alka Sarin referred to the case of H.S. Ahammed Hussain vs. Irfan Ahammed, [2002(3) RCR (Civil) 563], where the Supreme Court held that the amount of compensation awarded in favor of the mothers should not be kept in a fixed deposit in a nationalized bank.
In the present case, the petitioners had challenged an order passed by the Motor Accident Claims Tribunal whereby it was directed that 50% of the compensation awarded be deposited in fixed deposits in their names for a period of three years. The further challenge was to the order dismissing the application filed by the petitioners for release of the amount directed to be deposited in the FDRs.
The petitioners contended that both the petitioners are over 40 years of age and have three other children to look after and hence the money is urgently required by them.
Keeping in view the law laid down in the above referred case as well as the fact that the petitioners are over 40 years of age and have also three other minor children to look after, the present petition is allowed.
The court further set aside the order and award of the Motor Accident Claims Tribunal and ordered the release of the amount of compensation lying deposited in the shape of FDRs.
The order dated 12.05.2022 passed by the Tribunal is set aside and the award dated 23.09.2021 is modified to the said extent. The amount of compensation lying deposited in the shape of FDRs be released to the petitioners forthwith.
Case Title: Ayyub Khan and Anr VERSUS Pratap Gurjar and Ors.
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Case :- APPLICATION U/S 482 No. - 434 of 2023
Applicant :- Chandrapal
Opposite Party :- State Of U.P. And 4 Others
Counsel for Applicant :- Hardev Prajapati
Counsel for Opposite Party :- G.A.
Heard Shri Hardev Prajapati, learned counsel for the applicant
and learned A.G.A. Perused the record.
It is contended by learned counsel for the applicant that
respondent nos.3, 4 and 5 are the accused of Special Session
Trial No.183 of 2015 (State vs. Jay Prakash and others) u/s 436,
395, 397 I.P.C., P.S.-Qadar Chowk, District Budaun. It is further
contended by learned counsel for the applicant that respondent
nos.3, 4 and 5 are the police personnel, who are being accused,
but they are not co-operating with the trial.
It is shocking to see that non bailable warrants were issued
against the respondent nos.3, 4 and 5 for the first time way back
on 20.7.2016 and now we are in January, 2023 but after lapse of
even six years, learned Additional District Judge/Special
Court/D.A.A., Badaun was unable to get the non bailable
warrants executed against police personnel. Indeed it is a
shocking state of affairs. The police personnel are not above the
law and the application of law and legal provisions should be
one and same for all and no special treatment shall be given to
any person depending upon his position, power and place in the
society.
Under these circumstances, learned Additional District
Judge/Special Court/D.A.A., Badaun is required to give written
explanation as to why order dated 20.7.2016 issuing non
bailable warrants has not been complied with till date.
Let this matter be come on the board once again on 01.2.2023
as fresh.
By that time this Court expects that if there is no other legal
impediment, the learned Additional District Judge/Special
Court/D.A.A., Badaun shall execute his own non bailable
warrants against the respondent no.3, 4 and 5 and give a report
to this effect by the next date fixed.
Let this order may be handed over to the learned A.G.A. for
communication and compliance.
High Court of Judicature at Allahabad
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The Allahabad High Court recently expressed shock over the non-execution of non-bailable warrants against police personnel accused in a criminal case for 6 years.
The Court also sought a written response from the Additional District Judge/Special Court/D.A.A., Badaun explaining why the order of July 2016 issuing non-bailable warrants has not been complied with to date.
“It is shocking to see that non-bailable warrants were issued against the respondent nos.3, 4 and 5 (police personnel) for the first time way back on 20.7.2016 and now we are in January 2023 but after the lapse of even six years, learned Additional District Judge/Special Court/D.A.A., Badaun was unable to get the non-bailable warrants executed against police personnel,” the bench of Justice Rahul Chaturvedi said.
The bench further added that police personnel are not above the law and the application of law and legal provisions should be one and same for all and no special treatment shall be given to any person depending upon his position, power and place in the society.
The matter came to light while the court dealing with a Section 482 CrPC plea wherein the applicant contended that respondents nos.3, 4 and 5 (police personnel) are the accused in a case u/s 436, 395, 397 IPC, but they are not cooperating with the trial.
Calling it a shocking state of affairs that the NBW was issued against them in the year 2016, however, the same remained unexecuted to date, the Court sought a written explanation from the Court concerned.
The Court also asked the Court concerned to execute non-bailable warrants against respondents no.3, 4 and 5 and give a report to this effect by the next date fixed (February 1, 2023).
Appearances
Counsel for Applicant: Hardev Prajapati
Counsel for Opposite Party: G.A.
Case title - Chandrapal vs. State Of U.P. And 4 Others [APPLICATION U/S 482 No. - 434 of 2023]
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Case :- APPLICATION U/S 482 No. - 434 of 2023
Applicant :- Chandrapal
Opposite Party :- State Of U.P. And 4 Others
Counsel for Applicant :- Hardev Prajapati
Counsel for Opposite Party :- G.A.
Heard Shri Hardev Prajapati, learned counsel for the applicant
and learned A.G.A. Perused the record.
It is contended by learned counsel for the applicant that
respondent nos.3, 4 and 5 are the accused of Special Session
Trial No.183 of 2015 (State vs. Jay Prakash and others) u/s 436,
395, 397 I.P.C., P.S.-Qadar Chowk, District Budaun. It is further
contended by learned counsel for the applicant that respondent
nos.3, 4 and 5 are the police personnel, who are being accused,
but they are not co-operating with the trial.
It is shocking to see that non bailable warrants were issued
against the respondent nos.3, 4 and 5 for the first time way back
on 20.7.2016 and now we are in January, 2023 but after lapse of
even six years, learned Additional District Judge/Special
Court/D.A.A., Badaun was unable to get the non bailable
warrants executed against police personnel. Indeed it is a
shocking state of affairs. The police personnel are not above the
law and the application of law and legal provisions should be
one and same for all and no special treatment shall be given to
any person depending upon his position, power and place in the
society.
Under these circumstances, learned Additional District
Judge/Special Court/D.A.A., Badaun is required to give written
explanation as to why order dated 20.7.2016 issuing non
bailable warrants has not been complied with till date.
Let this matter be come on the board once again on 01.2.2023
as fresh.
By that time this Court expects that if there is no other legal
impediment, the learned Additional District Judge/Special
Court/D.A.A., Badaun shall execute his own non bailable
warrants against the respondent no.3, 4 and 5 and give a report
to this effect by the next date fixed.
Let this order may be handed over to the learned A.G.A. for
communication and compliance.
High Court of Judicature at Allahabad
|
Case :- APPLICATION U/S 482 No. - 434 of 2023
Applicant :- Chandrapal
Opposite Party :- State Of U.P. And 4 Others
Counsel for Applicant :- Hardev Prajapati
Counsel for Opposite Party :- G.A.
Heard Shri Hardev Prajapati, learned counsel for the applicant
and learned A.G.A. Perused the record.
It is contended by learned counsel for the applicant that
respondent nos.3, 4 and 5 are the accused of Special Session
Trial No.183 of 2015 (State vs. Jay Prakash and others) u/s 436,
395, 397 I.P.C., P.S.-Qadar Chowk, District Budaun. It is further
contended by learned counsel for the applicant that respondent
nos.3, 4 and 5 are the police personnel, who are being accused,
but they are not co-operating with the trial.
It is shocking to see that non bailable warrants were issued
against the respondent nos.3, 4 and 5 for the first time way back
on 20.7.2016 and now we are in January, 2023 but after lapse of
even six years, learned Additional District Judge/Special
Court/D.A.A., Badaun was unable to get the non bailable
warrants executed against police personnel. Indeed it is a
shocking state of affairs. The police personnel are not above the
law and the application of law and legal provisions should be
one and same for all and no special treatment shall be given to
any person depending upon his position, power and place in the
society.
Under these circumstances, learned Additional District
Judge/Special Court/D.A.A., Badaun is required to give written
explanation as to why order dated 20.7.2016 issuing non
bailable warrants has not been complied with till date.
Let this matter be come on the board once again on 01.2.2023
as fresh.
By that time this Court expects that if there is no other legal
impediment, the learned Additional District Judge/Special
Court/D.A.A., Badaun shall execute his own non bailable
warrants against the respondent no.3, 4 and 5 and give a report
to this effect by the next date fixed.
Let this order may be handed over to the learned A.G.A. for
communication and compliance.
High Court of Judicature at Allahabad
|
The Allahabad High Court recently expressed shock over the non-execution of non-bailable warrants against police personnel accused in a criminal case for 6 years.
The Court also sought a written response from the Additional District Judge/Special Court/D.A.A., Badaun explaining why the order of July 2016 issuing non-bailable warrants has not been complied with to date.
“It is shocking to see that non-bailable warrants were issued against the respondent nos.3, 4 and 5 (police personnel) for the first time way back on 20.7.2016 and now we are in January 2023 but after the lapse of even six years, learned Additional District Judge/Special Court/D.A.A., Badaun was unable to get the non-bailable warrants executed against police personnel,” the bench of Justice Rahul Chaturvedi said.
The bench further added that police personnel are not above the law and the application of law and legal provisions should be one and same for all and no special treatment shall be given to any person depending upon his position, power and place in the society.
The matter came to light while the court dealing with a Section 482 CrPC plea wherein the applicant contended that respondents nos.3, 4 and 5 (police personnel) are the accused in a case u/s 436, 395, 397 IPC, but they are not cooperating with the trial.
Calling it a shocking state of affairs that the NBW was issued against them in the year 2016, however, the same remained unexecuted to date, the Court sought a written explanation from the Court concerned.
The Court also asked the Court concerned to execute non-bailable warrants against respondents no.3, 4 and 5 and give a report to this effect by the next date fixed (February 1, 2023).
Appearances
Counsel for Applicant: Hardev Prajapati
Counsel for Opposite Party: G.A.
Case title - Chandrapal vs. State Of U.P. And 4 Others [APPLICATION U/S 482 No. - 434 of 2023]
|
The Allahabad High Court recently expressed shock over the non-execution of non-bailable warrants against police personnel accused in a criminal case for 6 years.
The Court also sought a written response from the Additional District Judge/Special Court/D.A.A., Badaun explaining why the order of July 2016 issuing non-bailable warrants has not been complied with to date.
“It is shocking to see that non-bailable warrants were issued against the respondent nos.3, 4 and 5 (police personnel) for the first time way back on 20.7.2016 and now we are in January 2023 but after the lapse of even six years, learned Additional District Judge/Special Court/D.A.A., Badaun was unable to get the non-bailable warrants executed against police personnel,” the bench of Justice Rahul Chaturvedi said.
The bench further added that police personnel are not above the law and the application of law and legal provisions should be one and same for all and no special treatment shall be given to any person depending upon his position, power and place in the society.
The matter came to light while the court dealing with a Section 482 CrPC plea wherein the applicant contended that respondents nos.3, 4 and 5 (police personnel) are the accused in a case u/s 436, 395, 397 IPC, but they are not cooperating with the trial.
Calling it a shocking state of affairs that the NBW was issued against them in the year 2016, however, the same remained unexecuted to date, the Court sought a written explanation from the Court concerned.
The Court also asked the Court concerned to execute non-bailable warrants against respondents no.3, 4 and 5 and give a report to this effect by the next date fixed (February 1, 2023).
Appearances
Counsel for Applicant: Hardev Prajapati
Counsel for Opposite Party: G.A.
Case title - Chandrapal vs. State Of U.P. And 4 Others [APPLICATION U/S 482 No. - 434 of 2023]
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Sri.Sagar., learned counsel., for the petitioner has
appeared in person.
Sri. Gopalkrishna Soodi., learned counsel for respondent
No.1 has appeared through video conferencing.
2. The brief facts are these:
It is stated that the petitioner was working as Circle
Inspector at D.R.B.C Branch, Chikkaballapur at the time of the
alleged incident. Later, he was promoted and he was posted at
It is averred that the second respondent telephoned the
petitioner on 26.09.2010 and informed him that on 19.09.2010
that while having food at the LVT Daba, he had a scuffle with a
person named Mr.Lakshmikanth and 15 others concerning the
payment of commission for purchasing land. The second
respondent requested the petitioner to register a case based on
the complaint given to the Doddaballapur Police Station. Based
WP No. 51993 of 2015
on the request, the petitioner telephoned the PSI Mr.Rajendra
Kumar, and instructed him to take necessary action. Pursuant
to the complaint given by the second respondent on
26.09.2010 the Police Sub-Inspector -Mr.Rajendra Kumar., filed
FIR in Cr.No.107/2010 for the alleged offences punishable
under Sections 143, 147, 148, 342, 323, 324, 506(b), 327 read
with Section 149 of IPC against Mr.Lakshmikanth and fifteen
Thereafter, the PSI being the Investigating Officer,
conducted the investigation and filed a charge sheet with Addl.
Civil Judge and JMFC, Doddaballapur. Based on the charge
sheet, the Court conducted proceedings and passed the
Judgment acquitting the accused Mr.Lakshmikanth on
As things stood thus, Sri.K.A.Appanna - the second
respondent filed a complaint with the Karnataka State Human
Rights Commission against the petitioner and Mr.Rajendra
Kumar, the PSI of Doddaballapur. Based on the complaint, the
Commission sent a copy of the complaint to the Inspector
General of Police, Karnataka Human Rights Commission for
WP No. 51993 of 2015
conducting an inquiry and to submit a report. Accordingly, the
IGP, KHRC after conducting an inquiry, submitted a report.
Based on the report submitted by IGP, KHRC proves the
charges only against Mr.Rajendra Kumar, PSI Doddaballapur.
The Commission issued notice to Mr.Rajendra Kumar on
30.04.2012 to give a written reason for the report submitted by
the Inspector General of Police, Karnataka Human Rights
Commission. Accordingly, Mr.Rajendra Kumar submitted a
written statement of reason justifying his actions.
Subsequently, the Commission based on the complaint, report
of IGP, KHRC, and a written statement of reason by
Mr.Rajendra Kumar, PSI Doddaballapur vide order dated
20.06.2015. imposed a fine of Rs.10,000/- (Rupees Ten
Thousand only) not only on Mr. Rajendra Kumar’s PSI but also
on the petitioner.
Under these circumstances, the petitioner left with no
other alternative and efficacious remedy is filing this Writ
Petition under Articles 226 and 227 of the Constitution of
Learned counsel for the petitioner and respondent No.1
urged several contentions.
4. Heard, the contentions urged on behalf of the
respective parties and perused the Writ papers and also the
Annexures with utmost care.
Sri.Sagar., learned counsel for the petitioner vehemently
contended that the petitioner being the Circle Inspector has
discharged his duties honestly and obediently. He argued that
the moment the petitioner received a telephone call from the
complainant – the second respondent, he properly instructed
the PSI Mr.Rajendra Kumar to act in accordance with the law.
He argued by saying that under his direction, the PSI filed FIR
in Crime No.107/2010. Hence, there is no dereliction of duty
as noticed by the Commission. Counsel, therefore, submits that
the order passed by the Commission imposing a penalty of
Rs.10,000/- (Rupees Ten Thousand only) on the petitioner is
By way of answer, Sri.Gopalkrishna Soodhi., learned
counsel for Commission submits that the Commission has found
that the petitioner being the Circle Inspector has not
discharged his duties properly. Hence, taking note of the
material evidence on record, in particular the statements which
WP No. 51993 of 2015
are recorded before the Commission, the Commission justified
in imposing a penalty. Counsel, therefore, sought to justify the
order passed by the Commission.
The short point which arises for my consideration is:
Is the imposition of a penalty on the
The facts have been sufficiently stated and the same does
not require reiteration.
Suffice it to note that the petitioner being the Circle
Inspector received a telephone call from the second
respondent. A request was made by the second respondent to
register a case based on his complaint. It is seen from the
records that the petitioner being the Circle Inspector instructed
the Police Sub-Inspector - Mr.Rajendra Kumar on the very
same day and directed him to take necessary action.
The second respondent gave the complaint on
26.09.2010. Thereafter, the PSI Mr.Rajendra Kumar filed an
FIR in Cr.No.107/2010. It is pivotal to note that the
Investigating Officer conducted an investigation and filed a
charge sheet with the Addl. Civil Judge and JMFC,
WP No. 51993 of 2015
Doddaballapur. The Court conducted proceedings and the same
was ended in the order of acquittal of the accused
As things stood thus, for the best reasons known to the
second respondent, complained to the Karnataka Human Rights
Commission that there is a dereliction of duty by the petitioner.
It is further relevant to note that based on the complaint, the
Commission proceeded in the matter. In my opinion, the
giving of the complaint and the initiation of the proceedings by
the commission is unsustainable in law. law. The reason is quite
simple. Proceedings before the appropriate forum have been
concluded. It is pivotal to note that the order of acquittal was
passed by the court. If the second respondent had any
grievance or was not satisfied with the order of acquittal of
Mr.Lakshmikanth, the proper course would have been in a
different Forum altogether. Furthermore, even the finding of
the commission that the petitioner has not instructed the PSI in
writing is wholly incorrect and untenable. It is common sense
that the Circle Inspector is higher in ranking than the Police
Sub-Inspector. Based on a telephone call the petitioner has
WP No. 51993 of 2015
directed the official concerned i.e., PSI Mr.Rajendra Kumar to
act in accordance with the law.
It is needless to observe that legal action was set in
motion and the Court has passed the Judgment as per the law.
Therefore, in my opinion, there is no dereliction of duty as
alleged by the complainant. I may venture to say that the
commission has failed to have regard to relevant considerations
and disregarded relevant matters. In my considered opinion,
the imposition of penalty so far as the petitioner is concerned is
unsustainable in law. Hence, the same is liable to be set aside.
The result is that the Writ Petition will be allowed. This
court orders a writ of Certiorari. The order dated:20.06.2015
passed by the Human Rights Commission in
H.R.C.No.4860/2011(SB-1) vide Annexure-A imposing a
penalty of Rs.10,000/- (Rupees Ten Thousand only) in so far as
the petitioner is concerned is set-aside.
Resultantly, the Writ Petition is allowed.
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The Karnataka High Court has said initiation of proceedings by a complainant, post acquittal of the accused before the Karnataka State Human Right Commission, against a police officer who investigated the complaint and filed a chargesheet in the case is unsustainable in law.
A single judge bench of Justice Jyoti Mulimani made the observation while allowing a petition filed by police inspector Siddalingappa S T and quashed the order passed by the Commission dated 20.06.2015, imposing a penalty of Rs.10,000 on the charges of dereliction of duty.
The complainant K.A. Appanna had telephoned the petitioner on 26.09.2010 and informed him that on 19.09.2010 that while having food at the LVT Daba, he had a scuffle with a person named Mr.Lakshmikanth and 15 others concerning the payment of commission for purchasing land. He requested the petitioner to register a complaint.
The petitioner telephoned PSI Rajendra Kumar, and instructed him to take necessary action. Pursuant to which an FIR was filed for the alleged offences punishable under Sections 143, 147, 148, 342, 323, 324, 506(b), 327 read with Section 149 of IPC against Lakshmikanth and fifteen others. Thereafter, the PSI being the Investigating Officer, conducted the investigation and filed a charge sheet. Based on the charge sheet, the Court conducted proceedings and passed the Judgment acquitting the accused on 15.07.2013.
Following which the complainant approached the Commission, which forwarded the complaint to the Inspector General of Police for conducting an inquiry and to submit a report. Based on the report submitted by IGP, KHRC proved the charges only against Mr.Rajendra Kumar, PSI Doddaballapur. The Commission issued notice to him on 30.04.2012 to give a written reason for the report submitted by the Inspector General of Police.
He then submitted a written statement of reason justifying his actions. Subsequently, the Commission based on the complaint, report of IGP, KHRC, and a written statement of reason by Rajendra Kumar, vide order dated 20.06.2015 imposed a fine of Rs.10,000 not only on Rajendra Kumar’s PSI but also on the petitioner.
The petitioner contended that petitioner being the Circle Inspector has discharged his duties honestly and obediently. The moment the petitioner received a telephone call from the complainant – the second respondent, he properly instructed the PSI Mr.Rajendra Kumar to act in accordance with the law.
The bench on going through the records said “Proceedings before the appropriate forum have been concluded. It is pivotal to note that the order of acquittal was passed by the court. If the second respondent had any grievance or was not satisfied with the order of acquittal of Lakshmikanth, the proper course would have been in a different Forum altogether.”
It added “Even the finding of the commission that the petitioner has not instructed the PSI in writing is wholly incorrect and untenable.”
Following which it held “Legal action was set in motion and the court has passed the judgment as per the law. Therefore, in my opinion, there is no dereliction of duty as alleged by the complainant. The commission has failed to have regard to relevant considerations and disregarded relevant matters. In my considered opinion, the imposition of penalty so far as the petitioner is concerned is unsustainable in law. Hence, the same is liable to be set aside.”
Accordingly it allowed the petition.
Case Title: Siddalingappa S T And Karnataka State Human Rights Commission.
Case No: WRIT PETITION NO. 51993 OF 2015
Date of Order: 03-02-2023
Appearance: Advocate Sagar for Advocate Deepak J for petitioner.
Advocate Gopalkrishna Soodi for R1.
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Sri.Sagar., learned counsel., for the petitioner has
appeared in person.
Sri. Gopalkrishna Soodi., learned counsel for respondent
No.1 has appeared through video conferencing.
2. The brief facts are these:
It is stated that the petitioner was working as Circle
Inspector at D.R.B.C Branch, Chikkaballapur at the time of the
alleged incident. Later, he was promoted and he was posted at
It is averred that the second respondent telephoned the
petitioner on 26.09.2010 and informed him that on 19.09.2010
that while having food at the LVT Daba, he had a scuffle with a
person named Mr.Lakshmikanth and 15 others concerning the
payment of commission for purchasing land. The second
respondent requested the petitioner to register a case based on
the complaint given to the Doddaballapur Police Station. Based
WP No. 51993 of 2015
on the request, the petitioner telephoned the PSI Mr.Rajendra
Kumar, and instructed him to take necessary action. Pursuant
to the complaint given by the second respondent on
26.09.2010 the Police Sub-Inspector -Mr.Rajendra Kumar., filed
FIR in Cr.No.107/2010 for the alleged offences punishable
under Sections 143, 147, 148, 342, 323, 324, 506(b), 327 read
with Section 149 of IPC against Mr.Lakshmikanth and fifteen
Thereafter, the PSI being the Investigating Officer,
conducted the investigation and filed a charge sheet with Addl.
Civil Judge and JMFC, Doddaballapur. Based on the charge
sheet, the Court conducted proceedings and passed the
Judgment acquitting the accused Mr.Lakshmikanth on
As things stood thus, Sri.K.A.Appanna - the second
respondent filed a complaint with the Karnataka State Human
Rights Commission against the petitioner and Mr.Rajendra
Kumar, the PSI of Doddaballapur. Based on the complaint, the
Commission sent a copy of the complaint to the Inspector
General of Police, Karnataka Human Rights Commission for
WP No. 51993 of 2015
conducting an inquiry and to submit a report. Accordingly, the
IGP, KHRC after conducting an inquiry, submitted a report.
Based on the report submitted by IGP, KHRC proves the
charges only against Mr.Rajendra Kumar, PSI Doddaballapur.
The Commission issued notice to Mr.Rajendra Kumar on
30.04.2012 to give a written reason for the report submitted by
the Inspector General of Police, Karnataka Human Rights
Commission. Accordingly, Mr.Rajendra Kumar submitted a
written statement of reason justifying his actions.
Subsequently, the Commission based on the complaint, report
of IGP, KHRC, and a written statement of reason by
Mr.Rajendra Kumar, PSI Doddaballapur vide order dated
20.06.2015. imposed a fine of Rs.10,000/- (Rupees Ten
Thousand only) not only on Mr. Rajendra Kumar’s PSI but also
on the petitioner.
Under these circumstances, the petitioner left with no
other alternative and efficacious remedy is filing this Writ
Petition under Articles 226 and 227 of the Constitution of
Learned counsel for the petitioner and respondent No.1
urged several contentions.
4. Heard, the contentions urged on behalf of the
respective parties and perused the Writ papers and also the
Annexures with utmost care.
Sri.Sagar., learned counsel for the petitioner vehemently
contended that the petitioner being the Circle Inspector has
discharged his duties honestly and obediently. He argued that
the moment the petitioner received a telephone call from the
complainant – the second respondent, he properly instructed
the PSI Mr.Rajendra Kumar to act in accordance with the law.
He argued by saying that under his direction, the PSI filed FIR
in Crime No.107/2010. Hence, there is no dereliction of duty
as noticed by the Commission. Counsel, therefore, submits that
the order passed by the Commission imposing a penalty of
Rs.10,000/- (Rupees Ten Thousand only) on the petitioner is
By way of answer, Sri.Gopalkrishna Soodhi., learned
counsel for Commission submits that the Commission has found
that the petitioner being the Circle Inspector has not
discharged his duties properly. Hence, taking note of the
material evidence on record, in particular the statements which
WP No. 51993 of 2015
are recorded before the Commission, the Commission justified
in imposing a penalty. Counsel, therefore, sought to justify the
order passed by the Commission.
The short point which arises for my consideration is:
Is the imposition of a penalty on the
The facts have been sufficiently stated and the same does
not require reiteration.
Suffice it to note that the petitioner being the Circle
Inspector received a telephone call from the second
respondent. A request was made by the second respondent to
register a case based on his complaint. It is seen from the
records that the petitioner being the Circle Inspector instructed
the Police Sub-Inspector - Mr.Rajendra Kumar on the very
same day and directed him to take necessary action.
The second respondent gave the complaint on
26.09.2010. Thereafter, the PSI Mr.Rajendra Kumar filed an
FIR in Cr.No.107/2010. It is pivotal to note that the
Investigating Officer conducted an investigation and filed a
charge sheet with the Addl. Civil Judge and JMFC,
WP No. 51993 of 2015
Doddaballapur. The Court conducted proceedings and the same
was ended in the order of acquittal of the accused
As things stood thus, for the best reasons known to the
second respondent, complained to the Karnataka Human Rights
Commission that there is a dereliction of duty by the petitioner.
It is further relevant to note that based on the complaint, the
Commission proceeded in the matter. In my opinion, the
giving of the complaint and the initiation of the proceedings by
the commission is unsustainable in law. law. The reason is quite
simple. Proceedings before the appropriate forum have been
concluded. It is pivotal to note that the order of acquittal was
passed by the court. If the second respondent had any
grievance or was not satisfied with the order of acquittal of
Mr.Lakshmikanth, the proper course would have been in a
different Forum altogether. Furthermore, even the finding of
the commission that the petitioner has not instructed the PSI in
writing is wholly incorrect and untenable. It is common sense
that the Circle Inspector is higher in ranking than the Police
Sub-Inspector. Based on a telephone call the petitioner has
WP No. 51993 of 2015
directed the official concerned i.e., PSI Mr.Rajendra Kumar to
act in accordance with the law.
It is needless to observe that legal action was set in
motion and the Court has passed the Judgment as per the law.
Therefore, in my opinion, there is no dereliction of duty as
alleged by the complainant. I may venture to say that the
commission has failed to have regard to relevant considerations
and disregarded relevant matters. In my considered opinion,
the imposition of penalty so far as the petitioner is concerned is
unsustainable in law. Hence, the same is liable to be set aside.
The result is that the Writ Petition will be allowed. This
court orders a writ of Certiorari. The order dated:20.06.2015
passed by the Human Rights Commission in
H.R.C.No.4860/2011(SB-1) vide Annexure-A imposing a
penalty of Rs.10,000/- (Rupees Ten Thousand only) in so far as
the petitioner is concerned is set-aside.
Resultantly, the Writ Petition is allowed.
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Sri.Sagar., learned counsel., for the petitioner has
appeared in person.
Sri. Gopalkrishna Soodi., learned counsel for respondent
No.1 has appeared through video conferencing.
2. The brief facts are these:
It is stated that the petitioner was working as Circle
Inspector at D.R.B.C Branch, Chikkaballapur at the time of the
alleged incident. Later, he was promoted and he was posted at
It is averred that the second respondent telephoned the
petitioner on 26.09.2010 and informed him that on 19.09.2010
that while having food at the LVT Daba, he had a scuffle with a
person named Mr.Lakshmikanth and 15 others concerning the
payment of commission for purchasing land. The second
respondent requested the petitioner to register a case based on
the complaint given to the Doddaballapur Police Station. Based
WP No. 51993 of 2015
on the request, the petitioner telephoned the PSI Mr.Rajendra
Kumar, and instructed him to take necessary action. Pursuant
to the complaint given by the second respondent on
26.09.2010 the Police Sub-Inspector -Mr.Rajendra Kumar., filed
FIR in Cr.No.107/2010 for the alleged offences punishable
under Sections 143, 147, 148, 342, 323, 324, 506(b), 327 read
with Section 149 of IPC against Mr.Lakshmikanth and fifteen
Thereafter, the PSI being the Investigating Officer,
conducted the investigation and filed a charge sheet with Addl.
Civil Judge and JMFC, Doddaballapur. Based on the charge
sheet, the Court conducted proceedings and passed the
Judgment acquitting the accused Mr.Lakshmikanth on
As things stood thus, Sri.K.A.Appanna - the second
respondent filed a complaint with the Karnataka State Human
Rights Commission against the petitioner and Mr.Rajendra
Kumar, the PSI of Doddaballapur. Based on the complaint, the
Commission sent a copy of the complaint to the Inspector
General of Police, Karnataka Human Rights Commission for
WP No. 51993 of 2015
conducting an inquiry and to submit a report. Accordingly, the
IGP, KHRC after conducting an inquiry, submitted a report.
Based on the report submitted by IGP, KHRC proves the
charges only against Mr.Rajendra Kumar, PSI Doddaballapur.
The Commission issued notice to Mr.Rajendra Kumar on
30.04.2012 to give a written reason for the report submitted by
the Inspector General of Police, Karnataka Human Rights
Commission. Accordingly, Mr.Rajendra Kumar submitted a
written statement of reason justifying his actions.
Subsequently, the Commission based on the complaint, report
of IGP, KHRC, and a written statement of reason by
Mr.Rajendra Kumar, PSI Doddaballapur vide order dated
20.06.2015. imposed a fine of Rs.10,000/- (Rupees Ten
Thousand only) not only on Mr. Rajendra Kumar’s PSI but also
on the petitioner.
Under these circumstances, the petitioner left with no
other alternative and efficacious remedy is filing this Writ
Petition under Articles 226 and 227 of the Constitution of
Learned counsel for the petitioner and respondent No.1
urged several contentions.
4. Heard, the contentions urged on behalf of the
respective parties and perused the Writ papers and also the
Annexures with utmost care.
Sri.Sagar., learned counsel for the petitioner vehemently
contended that the petitioner being the Circle Inspector has
discharged his duties honestly and obediently. He argued that
the moment the petitioner received a telephone call from the
complainant – the second respondent, he properly instructed
the PSI Mr.Rajendra Kumar to act in accordance with the law.
He argued by saying that under his direction, the PSI filed FIR
in Crime No.107/2010. Hence, there is no dereliction of duty
as noticed by the Commission. Counsel, therefore, submits that
the order passed by the Commission imposing a penalty of
Rs.10,000/- (Rupees Ten Thousand only) on the petitioner is
By way of answer, Sri.Gopalkrishna Soodhi., learned
counsel for Commission submits that the Commission has found
that the petitioner being the Circle Inspector has not
discharged his duties properly. Hence, taking note of the
material evidence on record, in particular the statements which
WP No. 51993 of 2015
are recorded before the Commission, the Commission justified
in imposing a penalty. Counsel, therefore, sought to justify the
order passed by the Commission.
The short point which arises for my consideration is:
Is the imposition of a penalty on the
The facts have been sufficiently stated and the same does
not require reiteration.
Suffice it to note that the petitioner being the Circle
Inspector received a telephone call from the second
respondent. A request was made by the second respondent to
register a case based on his complaint. It is seen from the
records that the petitioner being the Circle Inspector instructed
the Police Sub-Inspector - Mr.Rajendra Kumar on the very
same day and directed him to take necessary action.
The second respondent gave the complaint on
26.09.2010. Thereafter, the PSI Mr.Rajendra Kumar filed an
FIR in Cr.No.107/2010. It is pivotal to note that the
Investigating Officer conducted an investigation and filed a
charge sheet with the Addl. Civil Judge and JMFC,
WP No. 51993 of 2015
Doddaballapur. The Court conducted proceedings and the same
was ended in the order of acquittal of the accused
As things stood thus, for the best reasons known to the
second respondent, complained to the Karnataka Human Rights
Commission that there is a dereliction of duty by the petitioner.
It is further relevant to note that based on the complaint, the
Commission proceeded in the matter. In my opinion, the
giving of the complaint and the initiation of the proceedings by
the commission is unsustainable in law. law. The reason is quite
simple. Proceedings before the appropriate forum have been
concluded. It is pivotal to note that the order of acquittal was
passed by the court. If the second respondent had any
grievance or was not satisfied with the order of acquittal of
Mr.Lakshmikanth, the proper course would have been in a
different Forum altogether. Furthermore, even the finding of
the commission that the petitioner has not instructed the PSI in
writing is wholly incorrect and untenable. It is common sense
that the Circle Inspector is higher in ranking than the Police
Sub-Inspector. Based on a telephone call the petitioner has
WP No. 51993 of 2015
directed the official concerned i.e., PSI Mr.Rajendra Kumar to
act in accordance with the law.
It is needless to observe that legal action was set in
motion and the Court has passed the Judgment as per the law.
Therefore, in my opinion, there is no dereliction of duty as
alleged by the complainant. I may venture to say that the
commission has failed to have regard to relevant considerations
and disregarded relevant matters. In my considered opinion,
the imposition of penalty so far as the petitioner is concerned is
unsustainable in law. Hence, the same is liable to be set aside.
The result is that the Writ Petition will be allowed. This
court orders a writ of Certiorari. The order dated:20.06.2015
passed by the Human Rights Commission in
H.R.C.No.4860/2011(SB-1) vide Annexure-A imposing a
penalty of Rs.10,000/- (Rupees Ten Thousand only) in so far as
the petitioner is concerned is set-aside.
Resultantly, the Writ Petition is allowed.
|
The Karnataka High Court has said initiation of proceedings by a complainant, post acquittal of the accused before the Karnataka State Human Right Commission, against a police officer who investigated the complaint and filed a chargesheet in the case is unsustainable in law.
A single judge bench of Justice Jyoti Mulimani made the observation while allowing a petition filed by police inspector Siddalingappa S T and quashed the order passed by the Commission dated 20.06.2015, imposing a penalty of Rs.10,000 on the charges of dereliction of duty.
The complainant K.A. Appanna had telephoned the petitioner on 26.09.2010 and informed him that on 19.09.2010 that while having food at the LVT Daba, he had a scuffle with a person named Mr.Lakshmikanth and 15 others concerning the payment of commission for purchasing land. He requested the petitioner to register a complaint.
The petitioner telephoned PSI Rajendra Kumar, and instructed him to take necessary action. Pursuant to which an FIR was filed for the alleged offences punishable under Sections 143, 147, 148, 342, 323, 324, 506(b), 327 read with Section 149 of IPC against Lakshmikanth and fifteen others. Thereafter, the PSI being the Investigating Officer, conducted the investigation and filed a charge sheet. Based on the charge sheet, the Court conducted proceedings and passed the Judgment acquitting the accused on 15.07.2013.
Following which the complainant approached the Commission, which forwarded the complaint to the Inspector General of Police for conducting an inquiry and to submit a report. Based on the report submitted by IGP, KHRC proved the charges only against Mr.Rajendra Kumar, PSI Doddaballapur. The Commission issued notice to him on 30.04.2012 to give a written reason for the report submitted by the Inspector General of Police.
He then submitted a written statement of reason justifying his actions. Subsequently, the Commission based on the complaint, report of IGP, KHRC, and a written statement of reason by Rajendra Kumar, vide order dated 20.06.2015 imposed a fine of Rs.10,000 not only on Rajendra Kumar’s PSI but also on the petitioner.
The petitioner contended that petitioner being the Circle Inspector has discharged his duties honestly and obediently. The moment the petitioner received a telephone call from the complainant – the second respondent, he properly instructed the PSI Mr.Rajendra Kumar to act in accordance with the law.
The bench on going through the records said “Proceedings before the appropriate forum have been concluded. It is pivotal to note that the order of acquittal was passed by the court. If the second respondent had any grievance or was not satisfied with the order of acquittal of Lakshmikanth, the proper course would have been in a different Forum altogether.”
It added “Even the finding of the commission that the petitioner has not instructed the PSI in writing is wholly incorrect and untenable.”
Following which it held “Legal action was set in motion and the court has passed the judgment as per the law. Therefore, in my opinion, there is no dereliction of duty as alleged by the complainant. The commission has failed to have regard to relevant considerations and disregarded relevant matters. In my considered opinion, the imposition of penalty so far as the petitioner is concerned is unsustainable in law. Hence, the same is liable to be set aside.”
Accordingly it allowed the petition.
Case Title: Siddalingappa S T And Karnataka State Human Rights Commission.
Case No: WRIT PETITION NO. 51993 OF 2015
Date of Order: 03-02-2023
Appearance: Advocate Sagar for Advocate Deepak J for petitioner.
Advocate Gopalkrishna Soodi for R1.
|
The Karnataka High Court has said initiation of proceedings by a complainant, post acquittal of the accused before the Karnataka State Human Right Commission, against a police officer who investigated the complaint and filed a chargesheet in the case is unsustainable in law.
A single judge bench of Justice Jyoti Mulimani made the observation while allowing a petition filed by police inspector Siddalingappa S T and quashed the order passed by the Commission dated 20.06.2015, imposing a penalty of Rs.10,000 on the charges of dereliction of duty.
The complainant K.A. Appanna had telephoned the petitioner on 26.09.2010 and informed him that on 19.09.2010 that while having food at the LVT Daba, he had a scuffle with a person named Mr.Lakshmikanth and 15 others concerning the payment of commission for purchasing land. He requested the petitioner to register a complaint.
The petitioner telephoned PSI Rajendra Kumar, and instructed him to take necessary action. Pursuant to which an FIR was filed for the alleged offences punishable under Sections 143, 147, 148, 342, 323, 324, 506(b), 327 read with Section 149 of IPC against Lakshmikanth and fifteen others. Thereafter, the PSI being the Investigating Officer, conducted the investigation and filed a charge sheet. Based on the charge sheet, the Court conducted proceedings and passed the Judgment acquitting the accused on 15.07.2013.
Following which the complainant approached the Commission, which forwarded the complaint to the Inspector General of Police for conducting an inquiry and to submit a report. Based on the report submitted by IGP, KHRC proved the charges only against Mr.Rajendra Kumar, PSI Doddaballapur. The Commission issued notice to him on 30.04.2012 to give a written reason for the report submitted by the Inspector General of Police.
He then submitted a written statement of reason justifying his actions. Subsequently, the Commission based on the complaint, report of IGP, KHRC, and a written statement of reason by Rajendra Kumar, vide order dated 20.06.2015 imposed a fine of Rs.10,000 not only on Rajendra Kumar’s PSI but also on the petitioner.
The petitioner contended that petitioner being the Circle Inspector has discharged his duties honestly and obediently. The moment the petitioner received a telephone call from the complainant – the second respondent, he properly instructed the PSI Mr.Rajendra Kumar to act in accordance with the law.
The bench on going through the records said “Proceedings before the appropriate forum have been concluded. It is pivotal to note that the order of acquittal was passed by the court. If the second respondent had any grievance or was not satisfied with the order of acquittal of Lakshmikanth, the proper course would have been in a different Forum altogether.”
It added “Even the finding of the commission that the petitioner has not instructed the PSI in writing is wholly incorrect and untenable.”
Following which it held “Legal action was set in motion and the court has passed the judgment as per the law. Therefore, in my opinion, there is no dereliction of duty as alleged by the complainant. The commission has failed to have regard to relevant considerations and disregarded relevant matters. In my considered opinion, the imposition of penalty so far as the petitioner is concerned is unsustainable in law. Hence, the same is liable to be set aside.”
Accordingly it allowed the petition.
Case Title: Siddalingappa S T And Karnataka State Human Rights Commission.
Case No: WRIT PETITION NO. 51993 OF 2015
Date of Order: 03-02-2023
Appearance: Advocate Sagar for Advocate Deepak J for petitioner.
Advocate Gopalkrishna Soodi for R1.
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